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I wrote a long article a couple of days ago declaring the Travel/Credit Card Points Bubble had popped. The confluence of factors all aligning to deter travel just seem too overwhelming to justify a bullish sentiment towards a V-shaped travel recovery. Looking at a recent survey from IATA, the results seems to support my conviction, and point towards a substantive reticence amongst recent travelers. Here’s what their survey said:
An IATA-commissioned survey of recent travelers found that:
- 60% anticipate a return to travel within one to two months of containment of the COVID-19 pandemic but 40% indicate that they could wait six months or more
- 69% indicated that they could delay a return to travel until their personal financial situation stabilizes
Here are the parameters of their pool:
IATA commissioned research of people who traveled in the last nine months in Australia, Canada, Chile, France, Germany, Japan, India, Singapore, UAE, UK, and USA. The research was conducted 6-9 April 2020.
I couldn’t find anything that defined “containment,” but I would think that containment would mean more than just a flattened curve, but rather, one that has curtailed the spread and possibly includes a successful treatment/prevention course. Either way…with an imminent recession on the horizon, and 69% of recent travelers intimating they would postpone travel due to financial concerns it begs the question: will that 40% who could wait 6 months or longer to fly go up or down?
As I mentioned in my bubble article, I think now is the time to
- consolidate expenses onto cards that will offer you the best rate of return on stay at home expenses,
- build points in flexible currencies that can be deployed to the programs offering best value,
- and if you’re facing financial uncertainty/increased debt – create a plan that takes advantage of short term interest free cards and pay them off prior to interest kicking in.
While these fall in line with what I’d normally recommend, I’m not an advocate for testing the banks on applications, and would position yourself to weather the storm and strategically take advantage of what will be some insane deals that are sure to come.
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