Assuming a lifetime flying pass purchased for $350 000 in 1981 by a 35-year old and the 1981 US life expectancy of 74.01 years [1], one would have to fly only $15 505 each year to beat the 1981 - 2011 CPI CAGR (inflation) of 3.1% [2]. If we instead use the 2009 US life expectancy of 78.09 that number drops to $14 745.

I fly once or twice a month and don't buy first class tickets very often; it wouldn't take too much for me to cross $15k (and as a 21-year old my threshold would be $13 061 assuming constant life expectancy). Remember, the marginal cost to you of these flights is more or less zero.

AA saw this as a source of financing so one should really see what rate they seem to have financed themselves at. Let's assume we're slicing above travellers who fly 100 000 miles (between Delta's Platinum and Diamond [3]; I wasn't able to find what the average of the top two tiers in 1981 would have been). Airline price per mile for domestic coach ranges from $0.06 to $1.22 [4]. Let's use $0.58/mile as our conservative guess for the cost of a first class flight. Thus we have an airline financing $350 000 for 39 years at $58 000/year at an internal rate of return of about...16.5%.

If American Airlines really believed in a 16.5% floor on US interest rates they should have started by dropping the first part of their name.

Note that we've ignored that $350 000 buys both you and your cuddly friend a ticket.

[1] http://www.google.com/publicdata/explore?ds=d5bncppjof8f9_&#...

[2] http://www.usinflationcalculator.com/inflation/consumer-pric...

[3] http://www.delta.com/skymiles/about_skymiles/benefits_at_gla...

[4] http://online.wsj.com/article/SB1000142405274870454090457545...