Link wheels can be very effective if used as a Tiered linking system. In the past, you could get away with creating Articles pointing to blogs pointing to forum posts pointing to your main site which points to the article.

However, quality links is more important now and Google can easily trace a linkwheel. So it is best to build high quality links from sources likes Squidoo Lens, Poplular blogging platforms, relevant blog comments that all point to your money website but not to each other.

Then you can increase those efforts by social bookmarking or building decent Tier 2 links that point to your high quality Tier 1 links.

Hope this helps!

You can still use link wheels for SERP, but one VERY important thing that you should really pay attention is that you should CHANGE the anchors and be sure that you use DIFFERENT keywords for EACH backlink that points to your MAIN website!!! 6-8 web2.0 websites are perfect btw

So far I have very good results with using Web 2.0 ( with relatively good content) and social media sites as tier 1 links pointing to $$$ site while throwing tons of lower quality links (wiki sites, blog comments, forum link etc) toward each of the tier 1 links.

Linkwheels will always be effective if done right.