Today, you will get a never ending barrage of referral-laden blog posts about how amazing the new Amex Platinum is, how it pays for itself 3x over, how it killed the CSR, how to use your Lululemon credit, blah, blah, blah. 

The changes released today are a big deal for folks that are primarily juggling annual fee vs card benefits, but there is another Amex benefit change effective today that will have a much wider effect across the churning and MS world. Especially if you are a travel agent that does not specialize in the route referenced in this post.

The market valuation (and I’m not talking about TPG valuations, lol) of certain miles and points can change overnight. While you may think that changes to award charts is what drives this, it’s usually something that seems tangential that moves the markets in this way (with Delta as a noticeable exception). 

Let’s look at some recent examples:

Alaska Airlines Mileage Plan / Atmos

For a long time, Alaska was probably the most valuable mileage currency of the American domestic carriers. They had a unique lineup of partners that wasn’t constrained by alliance (until now, RIP) and an appealing award chart. Additionally, Bank of America issues their cards, and they must not pay as much to affiliates because they aren’t part of the big 3 that are pushed to beginners. 

This year, Alaska miles took a nosedive in terms of market value before soaring through the roof. What changes did Alaska make that drove these changes? It wasn’t anything partner or award pricing related (although losing SQ and LA is a big bummer) 

It was actually their merger with Hawaiian that drove both changes. There was a limited time window where you could convert HA to AS before the merger was complete. Since HA was a transfer partner with Amex, you could convert MR to AS at a direct 1:1. Therefore, AS fell to the market value for a MR transfer, which was much lower than the previous value.

Once that window closed and Amex couldn’t be transferred to AS, the market value rose above even its previous high. Why? They’re back to being difficult to earn at scale unless you know how, and there are still fantastic sweet spots like low cost domestic AA F that gives enough space for both churner and end user to find some margin.

Citi ThankYou Points

Here’s an example of a transferable currency that has fluctuated quite a bit over the last couple of years. Interestingly, while TYPs are more difficult to earn at scale for most people due to Citi’s aggressive KYC shenanigans, they generally have the lowest market value among the big 3.

The major reason for this is that they give zero incentive to book through their portal like Amex and Chase do – all of Citi’s market value is driven by their transfer partners. 

In perusing the list, there aren’t a ton that stand out. Citi obviously had a huge win earlier this year in locking in AA as a permanent transfer partner, but as you may know, booking anyone besides yourself and family with AA miles isn’t exactly the greatest idea unless you don’t want to keep your AA account.

They have a couple of interesting hotel options like Accor and Leaders Club for niche redemptions, but almost all of their airline partners are shared with other transferable currencies and not that exciting outside of transfer bonuses.

Except for one – EVA Air. At face value, it doesn’t seem exciting. EVA is a member of Star Alliance and can be booked with plenty of partners. They are also a transfer partner with Capital One. But there are two caveats. First, EVA is one of the very few carriers offering TPAC premium cabins that consistently releases multiple business class award seats at saver fare, and often only within their own Infinity MileageLands program. Second, only Citi transfers 1:1 – Capital One is 1000:750.

So why does a carrier based in Taiwan offering limited flights to the US drive the market for an American bank’s transferable currency? Well, the same agents mentioned above that will not be affected much by today’s changes have plenty of buyers for EVA award seats. They hit the sweet spot of dependable and affordable availability with a premium product to ensure demand is always high.

That doesn’t mean the Citi TYP market is steady by any means. In fact, it’s pretty much driven by how many hoops EVA makes you jump through to get points from the original earner to the end user. Not every TYP and EVA account is the same in this regard, and the market price moves accordingly. 

And in today’s news…

To come back around to where this post started – today, Amex will remove the 35% MR rebate on all business class flights booked through their portal. Instead, you’ll only get it on the airline you chose for your incidental credit. 

As a churner, this is annoying. Personally, I loved using it for cheap Aeromexico business fares when transferring to AM made no sense. 

As a “travel agent”, this is potentially very disruptive. If you’re only able to provide competitive pricing on 1% of the world’s airlines compared to all of them like you used to, you may be turning away a lot of business. 

I don’t have a crystal ball to tell you what will change today, but my guess would be a small drop in MR value, at least temporarily. But ultimately, unless United pulls out of Shanghai, everything’s not lost.