True Value of an Exchange

[timeos2]

Open wins. Secrets belong in the old Soviet Union

That we don't know exactly how the points values were arrived at in the various points systems really doesn't matter. What is important is the fact that the values are published for the buyers/sellers/traders to see. They then decide if the values are correct, over or under valued and act based on that informed decision. If the numbers are wrong it is the exchange system that pays the price - the users already know if the product they desire is "in the right price range" or not. That is so much better than being told what your time is worth in hints and, oh, it may change tomomow (nudge nudge wink wink). "Hey, we work for your benefit so it must be kept secret"(I can almost hear the laughter in the phone room as they sucker another top trader into the system only to give them a dog week back in full payment). Monty Python could do a great scene about the backrooms at the major weeks exchanges. Is the dead parrot any different than the worthless winter beach week they offer as a complete exchange?

I don't need to know how those values were set but even if I did the system that reveals the results AND allows the user to decide where to use their credits is so far superior to an all hidden system of place and hope that I would (and have) choose it every time. The fatal flaws of timeshare exchange are harbored in the decades old secrets of weeks valuation and assignment not in any recent attempts to provide more open and defined valuations. If the resorts that relied on secrets to survive fail it isn't RCI or II's fault. They should be happy they had a 20+ year run at the expense of unrelated resorts and only now have to survive on their own merits. As for the so called overbuilt areas we'll take our chances and, hopefully, everyone will come out with open trades, known values and independent, solidly run resorts no longer dependent on backroom deals to survive.

 

[MidlifeTraveler]

Believe it or not, I am still here, although I took a few days off from reading this thread.

I must say, I'm really learning a lot. When I get more time to monitor, I have to start a new thread on what other tuggers see as a good trade value resort so I can keep and enjoy my Orange Lake but still be able to get to England. Apparently, there is no system to determine this and I'm wondering how others have fared.

I'll continue to read here as well.

And as for Walmart, don't get me started. Have you read the business section of the news lately. There are more articles and books about how Walmart sets a business's profit margin so low that when the product can't be produced at that price, the business goes bankrupt and production is sent overseas where some 12 year old can make $5 a day. I believe Huffy was the most recent case. If a company chooses not to play, they're told to take their business elsewhere (which is actually bettter for them but Walmart monopolizes the American shopper) The answer - don't shop at Walmart and they can't become the mega-store they are. Sorry - saw the Walmart post and lost my head.

Let's not turn this into a Walmart thread, okay

 

[Steamboat Bill]

Capitalists (Wal-Mart) will sell you the rope to tie their own noose.

I have been to dollar stores a few times, but I never find anything worth buying...

 

[Carolinian]

Businesses that are competitive are simply not a valid comparision to a quasi-monopoly timeshare exchange company. In a competitive business, competition itself provides the mechanism to keep the system honest, and no further mechanism is necessary. That is not present in a monopolisitic situation.

What about Walmart? We are not told how they set their prices, when they offer sale items, etc. We just see the prices. ("Oh, that would be comparing apples to oranges because Walmart is a retail business.") Oh, I thought that you said any system. Okay, let's move on.

What about car dealerships? ("No, that would again be comparing apples to oranges.")

Housing prices? ("Apples to oranges")

Ipods? - that even meets the criteria of being semi-monopolistic ("Sorry, apples to oranges.") Maybe that should be Apples to non-competitors.

Okay, the only system that I can think of where how supply and demand is established openly is the stock exchanges. What happens there is buyers OPENLY announce the prices that they are bidding, sellers OPENLY announce what they are willing to sell for, and, when a deal is completed the SEC demands that the negotiated price and the size of the trade be OPENLY announced. Has RCI or II ever told someone what the trading power was that would have been actually required to complete a trade? Where are these OPENLY published? (It is not wonder that TUG started doing "trade tests" -- so that someone would at least publish some numbers.)

Maybe its time for Carolinian to announce a bunch of markets that he thinks are comparable to the secret trade systems of RCI and II. (Secret prices, even after deals are consumated.) Or, maybe this system is a one of a kind. Then is it a mere coincidence that this secret system of supply and demand also has had a reputation that has been in the gutter since its very inception? (... And that Hyatt, Disney, Hilton, etc. - yes, they all have "commie" systems that publish established fixed prices - publish their prices and call their systems "vacation ownership" wanting to distance themselves from "timesharing"?)

 

[Carolinian]

For a system to be honest, both sides of the equation have to be fair. Overpointing certain areas, like the overbuilt areas is going to make people there happy (as it obviously does) but it skews the system for everyone else.

And the market clearly shows that the true value of many ''red'' weeks in overbuilt Orlando (and other overbuilt areas) is equaivalent to a January week on Cape Cod. Yes, it is warm, but it also has a huge excess of supply. Bootleg told us not only that Orlando was one of the handful of areas with large oversupply but that two Orlando resorts, including Vacation Village at Parkway, had the largest oversupply in the entire RCI system. I can see why those who own in overbuilt areas do not like to see the true value of their weeks and thus opposed a market-based system, but I cannot see why anyone else would take this position.

The command economy in the old Soviet Union revealed the result in the prices, but that did not make the system fair or honest. Like a big exchange company, it operated essentially as a centrally run monopoly.

Where one central authority is arbitrarily setting values, the most important thing to make public is the mechanism for establishing those values. RCI Points does not do that, so it only has the illusion of openness. When the mechanism is hidden, the problem then goes to whether there is any incentive to cook the books. A published result gives an incentive while a non-published result does not. Of course, if the exchange company puts its own hand in the till, such as renting out exchange deposits to non-members, there is also an incentive to cheat.

The simplest, yet most essential, thing to make a published system fair, honest, and aboveboard is to publish the mechanism for setting values. I can see why those who own in overpointed areas would resist that, as it would ultimately end the overpointing, but I cannot see why anyone else would oppose it.

That we don't know exactly how the points values were arrived at in the various points systems really doesn't matter. What is important is the fact that the values are published for the buyers/sellers/traders to see. They then decide if the values are correct, over or under valued and act based on that informed decision. If the numbers are wrong it is the exchange system that pays the price - the users already know if the product they desire is "in the right price range" or not. That is so much better than being told what your time is worth in hints and, oh, it may change tomomow (nudge nudge wink wink). "Hey, we work for your benefit so it must be kept secret"(I can almost hear the laughter in the phone room as they sucker another top trader into the system only to give them a dog week back in full payment). Monty Python could do a great scene about the backrooms at the major weeks exchanges. Is the dead parrot any different than the worthless winter beach week they offer as a complete exchange?

I don't need to know how those values were set but even if I did the system that reveals the results AND allows the user to decide where to use their credits is so far superior to an all hidden system of place and hope that I would (and have) choose it every time. The fatal flaws of timeshare exchange are harbored in the decades old secrets of weeks valuation and assignment not in any recent attempts to provide more open and defined valuations. If the resorts that relied on secrets to survive fail it isn't RCI or II's fault. They should be happy they had a 20+ year run at the expense of unrelated resorts and only now have to survive on their own merits. As for the so called overbuilt areas we'll take our chances and, hopefully, everyone will come out with open trades, known values and independent, solidly run resorts no longer dependent on backroom deals to survive.

 

["Roger"]

Businesses that are competitive are simply not a valid comparision to a quasi-monopoly timeshare exchange company. In a competitive business, competition itself provides the mechanism to keep the system honest, and no further mechanism is necessary. That is not present in a monopolisitic situation.

So, if you have a monopolistic system (your claim), the best thing that can happen is to let them set the prices in secret. I can't begin to express the depth of my disagreement with that.

 

[matthew98]

Did you not all set out just to buy a weeks holiday?

 

[timeos2]

Too much value = excess inventory

The simplest, yet most essential, thing to make a published system fair, honest, and aboveboard is to publish the mechanism for setting values. I can see why those who own in overpointed areas would resist that, as it would ultimately end the overpointing, but I cannot see why anyone else would oppose it.

Ideally, yes. But some exposure is better than no exposure (how it was set or what it is are both kept secret). Half is far better than none.

And you keep repeating the over pointing argument. When the values are first published it could be true. But after a while the numbers would have to be brought into line or the best, and by your theory under valued, would be grabbed up and the over valued languish unclaimed. That isn't what an exchange company wants.

And interestingly it also explains what is happening in the current weeks systems. The over valued (white, blue times) are able to claim the under valued periods (red, bigger units, better times) and, surprise, the systems are awash in over valued time they have to try to move out. Sound familiar? Last call. 9000 point trades. Anything to try to move the ever growing mountain of unclaimed weeks in the foothills of nowhere in November or January. Expose those values as very low, make them use 2 or 3 weeks to get one better time/location and voila - fair trading restored! But it sure isn't happening under the mysterious cloak of VEP, constantly changing values (if one believes that is actually occurring) color charts and, of course, the real problem. The never ending need for the developers to make owners think those worthless times are golden traders. That is why they have hated the thought of exposing the values. The only real reason.

 

[Carolinian]

The key is not having both the incentive and opportunity to cheat.

A published systems of values creates the incentive. All developers would do most anything for higher numbers in such a system. Non-published numbers create no such incentive because there is no benefit to raising a number that no one will see.

A published mechanism for setting the values would eliminate the opportunity. A hidden mechanism for setting the values creates the opportunity.

A system like RCI Points with a published result but hidden mechanism contains both the incentive and the opportunity to cheat. It is the worst of all possible worlds.

RCI Weeks on the other hand, has the opportunity to cheat but NO incentive, as least as it was devised by Christel deHaan.

What Cendant did that corrupted the deHaan system was to create a totally different incentive to cheat by putting their own hand in the till to rent out exchange deposits to the general public.

The present RCI system is bent all the way around.

The way to fix Weeks is simple - eliminate the incentive by ending the rentals to the general public.

To fix Points, the minimum would be to make the mechanism public.

So, if you have a monopolistic system (your claim), the best thing that can happen is to let them set the prices in secret. I can't begin to express the depth of my disagreement with that.

 

[Carolinian]

1. The combination of hidden mechanism and published values is the worst of all possible worlds because it creates both the incentive and the opportunity to cook the books. No loaf is far preferable to half, because it has no incentive to rig the system (at least without the rentals).

2. You are right about what an EXCHANGE company wants, but RCI, on the other hand is quickly becoming Rental Condominiums International. A rental companies wants to create excuses to move ''excesses'' into rentals.

3. Your theory fails in Weeks, unless you are counting the better weeks that end up in the 45 day window, where their short shelf life diminished their value. The ''red'' weeks those dog weeks are picking up are those from overbuilt areas which should never have been called red in the beginning.

Ideally, yes. But some exposure is better than no exposure (how it was set or what it is are both kept secret). Half is far better than none.

And you keep repeating the over pointing argument. When the values are first published it could be true. But after a while the numbers would have to be brought into line or the best, and by your theory under valued, would be grabbed up and the over valued languish unclaimed. That isn't what an exchange company wants.

And interestingly it also explains what is happening in the current weeks systems. The over valued (white, blue times) are able to claim the under valued periods (red, bigger units, better times) and, surprise, the systems are awash in over valued time they have to try to move out. Sound familiar? Last call. 9000 point trades. Anything to try to move the ever growing mountain of unclaimed weeks in the foothills of nowhere in November or January. Expose those values as very low, make them use 2 or 3 weeks to get one better time/location and voila - fair trading restored! But it sure isn't happening under the mysterious cloak of VEP, constantly changing values (if one believes that is actually occurring) color charts and, of course, the real problem. The never ending need for the developers to make owners think those worthless times are golden traders. That is why they have hated the thought of exposing the values. The only real reason.

 

[Dean]

What you seem to miss is that any system that is not open about the mechanism to set values (revealing the formula and underlying data) but only publishes the results is NOT an open system. It only offers the illusion of openness.

The resorts that are propped up by the system are those with an excess of supply, for whatever reason. One of the biggest groups of excess of supply are resorts in overbuilt areas. These are propped up in Points by overpointing.
Reveal the mechanism to establish values and these resorts can't be propped up anymore. Of course that is one reason why someone connected with such a resort would not want the mechanism revealed.

I would say that weeks is a VERY closed system and points is a more (but not totally) open one.

Supply and demand are real market forces, not a ''whim''.

Calcified numbers primarily help one entity - an exchange company trying to find excess to rent to the general public. Guess why they came up with it? Certainly not to provide any favor to members! Numbers that are frozen and cannot respond to market changes are always going to generate ''excesses''.
It all about their rental operation.

Expecting the value of a week to act like gasoline prices is simply nuts and is inappropriate IMO. This is a situation where past performance does predict future results. Barring a major shift for some reason, there is absolutely no reason to have the values fly up and down. They may need to change if there are major changes over past performance which might occur if a resort deteriorates or long term travel patterns change. So if the demand for the resort and week stay the same and roughly the same number of deposits come in this year as last year, the trade value should remain the same or nearly so.

If an exchange company can predict roughly how many weeks they'll get at X resort and what the demand for those weeks are (and they should be able to do so much better than we can forecast the weather), they have the basis for the trade value of those weeks. Then you simply have to decide what formula you're going to use to compare one deposit to another. There will always be some subjectivity and arbitrary nature to this issue but it is not that difficult.

I don't believe they sit around thinking up ways to take legitimate deposits and turn them into rentals, I know you do. I tend to agree with John on this issue, essentially that it's a case of haves and have nots with those who have being supplemented by the have nots and those that are lazy or uninformed. And the haves are running around with their finger to their mouth shushing everyone.

 

[Dean]

I was thinking about this thread today and the car analogy. Lets equate gas mileage to trade power, put a trip computer on all and reset them at the same time. The higher the gas mileage, the higher the trade value. Define them as luxury, upscale, average and low end. Only allow one to trade for other cars in your classification until 45-60 days out. As you start driving, the gas mileage varies greatly. As you get more miles under your belt, the range starts to narrow until eventually it never changes unless there is some long term change such as how/where you drive or a change in the vehicle itself. To me this is exactly how trade power should work. There is always some guesswork with new choices but you can generally extrapolate from other similar options to get a starting point.

 

[Carolinian]

1) If you follow the travel industry, you should know that there are indeed shifts in patterns. Things do not always follow a script. Changes in fuel prices will impact how close to home people vacation, for example.

2) The problem with your haves / have nots theory is that much of it is backwards. There are too many people in overbuilt areas who think they are ''haves'' when the supply/demand dynamics in fact say they are ''have/nots''. Supply and demand are the key to everything, and even if demand is very strong, developers can certainly go so overboard on supply by overbuilding, leaving trade power low.

3) As to RCI's rentals, I have only to look at the vast availibility on RCI's rental sites and declining availibility for exchange, the comments of RCI employees like Bootleg and Anon, the comments in the newsletter of the Seasons resort chain in Europe when they jumped ship to II, and the RCI rentals I see on the books of my own resort.

4) A partly open system is sort of like being half pregnant.

I would say that weeks is a VERY closed system and points is a more (but not totally) open one.

Expecting the value of a week to act like gasoline prices is simply nuts and is inappropriate IMO. This is a situation where past performance does predict future results. Barring a major shift for some reason, there is absolutely no reason to have the values fly up and down. They may need to change if there are major changes over past performance which might occur if a resort deteriorates or long term travel patterns change. So if the demand for the resort and week stay the same and roughly the same number of deposits come in this year as last year, the trade value should remain the same or nearly so.

If an exchange company can predict roughly how many weeks they'll get at X resort and what the demand for those weeks are (and they should be able to do so much better than we can forecast the weather), they have the basis for the trade value of those weeks. Then you simply have to decide what formula you're going to use to compare one deposit to another. There will always be some subjectivity and arbitrary nature to this issue but it is not that difficult.

I don't believe they sit around thinking up ways to take legitimate deposits and turn them into rentals, I know you do. I tend to agree with John on this issue, essentially that it's a case of haves and have nots with those who have being supplemented by the have nots and those that are lazy or uninformed. And the haves are running around with their finger to their mouth shushing everyone.

 

[Dean]

1) If you follow the travel industry, you should know that there are indeed shifts in patterns. Things do not always follow a script. Changes in fuel prices will impact how close to home people vacation, for example.

Patterns don't change overnight without a reason but they may drift over several years. Any system can re-center itself every few years and that includes points or weeks. Most changes that have to be accounted for can be scripted, like Easter.

2) The problem with your haves / have nots theory is that much of it is backwards. There are too many people in overbuilt areas who think they are ''haves'' when the supply/demand dynamics in fact say they are ''have/nots''. Supply and demand are the key to everything, and even if demand is very strong, developers can certainly go so overboard on supply by overbuilding, leaving trade power low.

No question that there has to be a balance. And I couldn't disagree with the idea that lower rated resorts and lower demand weeks in areas like Williamsburg, Branson, Orlando, even HH could be placed in the have not group if one desired. But I suspect you want to place off season outer banks weeks (and similar) in the haves while those you dis you would place in the have nots. And that degree of homerism (is that even a word) is part of my issue with your position.

3) As to RCI's rentals, I have only to look at the vast availibility on RCI's rental sites and declining availibility for exchange, the comments of RCI employees like Bootleg and Anon, the comments in the newsletter of the Seasons resort chain in Europe when they jumped ship to II, and the RCI rentals I see on the books of my own resort.

Once again, there are legitimate ways for RCI to get weeks to rent out, even high demand weeks. So the numbers themselves don't answer the question and neither does the demand of the week in question. You may be right, I've never said you were or were not, we simply don't know.

4) A partly open system is sort of like being half pregnant.

I'm entertained by the idea that you prefer a totally closed system to a partially open one. I'm not saying that points are perfect, they are not from what I can see and there are many points systems that I know a little about. And what might be perfect for me might not be for you and vice versa.

 

[Carolinian]

1) The fact is that there ARE reasons, and patterns DO change, sometimes very quickly. Fuel costs, SARS, foot and mouth, terrorism are just some examples. Systems based on calcified numbers simply cannot adjust. Katrina initially impacted both supply and demand in NO, and for an extended period has impacted demand.

2) It is not JUST lower rated resorts in the overbuilt areas that have excess inventory. The two resorts in Orlando that Bootleg told us had the highest oversupply in the entire RCI system were BOTH Gold Crowns, for example.

I have never said that an offseason OBX weeks could or should trade for a genuine high demand low supply week like London, New York, summer east coast beach, etc. I have said that the market has said that it, and virtually all other off season weeks as well, is equivalent to the ''phony red'' weeks in the overbuilt areas. I have also observed that there are ''blue'' weeks some places in Europe that have much better supply/demand curves than most ''red'' weeks in Orlando (or the Canary Islands, for that matter).

My observations about the strength of various areas for trading have to do with two things - supply and demand.

3) There is no legitimate way for RCI to take prime exchange deposits in the Weeks system deposited by Weeks members and rent them out. Period. Their taking them to pay for Points Partner reservations by Points members is nothing but a huge fraud on Weeks members.

4) My observation about what is wrong with the illusion of openness of points has absolutely nothing to do with individual preferences. It has to do with what does or does not corrupt the entire system by encouraging backroom dealing between RCI and developers.

5) It is interesting that those who want to vocally defend points, also seem to usually also vocally defend RCI's rentals from exchange deposits to the general public. It must be obvious to all how intertwined these two issues are.

Patterns don't change overnight without a reason but they may drift over several years. Any system can re-center itself every few years and that includes points or weeks. Most changes that have to be accounted for can be scripted, like Easter.

No question that there has to be a balance. And I couldn't disagree with the idea that lower rated resorts and lower demand weeks in areas like Williamsburg, Branson, Orlando, even HH could be placed in the have not group if one desired. But I suspect you want to place off season outer banks weeks (and similar) in the haves while those you dis you would place in the have nots. And that degree of homerism (is that even a word) is part of my issue with your position.

Once again, there are legitimate ways for RCI to get weeks to rent out, even high demand weeks. So the numbers themselves don't answer the question and neither does the demand of the week in question. You may be right, I've never said you were or were not, we simply don't know, but then again there may be black helicopters flying over NC as we speak.

I'm entertained by the idea that you prefer a totally closed system to a partially open one. I'm not saying that points are perfect, they are not from what I can see and there are many points systems that I know a little about. And what might be perfect for me might not be for you and vice versa.

 

["Roger"]

4) A partly open system is sort of like being half pregnant.

Your anger is getting in front of your rhetoric. You can't be half pregnant, so, if I am to take this remark seriously, what you are saying is that there is no such thing as a partially open system.

 

[PerryM]

Let's talk insanity

Supply and demand – how RCI and II use it wrong. (You don't think for a minute that they use it right do you?)

Carolinian keeps using the phrase Supply and Demand as a dynamic key component of the Weeks program and how it’s too frozen with Points – let’s get the record straight.

Setup for example:
You own timeshare X and you paid dearly for it and the MF is eye watering. You decide that you want to exchange into timeshare Y. Both are Gold Crown, 5-star type of resorts and similar in price and you never see them when doing searches – they are snapped up instantly with on-going searches.

I, on the other hand, own timeshare W, I bought it for peanuts, resale, and these are the resorts are mediocre at best – all GC and 5-star however.


Weeks example:
You lock in a super 4th of July week at your resort (X) – it rents for $4,000 from the developer. You want to exchange into timeshare Y for Christmas and it too rents for $4,000 from their developer. You feel like you should get it.

I don’t need to deposit a week, I can make the exchange, if I should qualify and settle up later with the exchange company. I place my on-going search for Y at Christmas time 15 months before check-in. My resort doesn’t rent but the average of the rentals is about $1,500 elsewhere.

3 days later I get an eMail from RCI/II congratulating me on my Christmas week exchange into Y. The owner of X waits and waits and waits and finally at October he is within the 59-day window at II and he knows that his goose is cooked and wonders what awesome exchanger got in front of him and snapped up that Christmas week at X.


Points example:
4th of July week at X is worth 90,000 RCI Points, Christmas week at Y is worth 95,000 points, week W has a generic value of 45,000 Points.

Owner X borrows 5,000 credits from next year and snaps up Christmas week at Y. Owner W can only scrape together 90,000 Points and must make new plans for Christmas.


Debriefing:
Owner X screwed up big time – he didn’t understand the insane rules for Supply and Demand that RCI/II use - they are dynamic and change by the second. His big mistake was to reserve a hot holiday week and minutes later deposit that week into RCI/II. He took an extra couple of sips of coffee and was 5th to deposit that hot holiday week, the Trading Power (TP) assigned to him, with the insane Supply rules, caused his week to be worth less than an off season week in Orlando.

Of course the sad reality is that if owner X waited 1 day to deposit he would have had FULL TP since the other 4 would have been snapped up by on-going searches. His mistake was to use common sense and deposit his hot week ASAP - I hope he learned his lesson.

Owner W snapped up the exchange since he recognized the utter stupidity of the exchange’s definition of Supply and more critically understood the nuances of an even more insane definition of Demand. (I’ll leave this as homework for those who wish to exploit this system)

Owner X should have used a system based upon Supply and Demand being PUBLISHED to all parties. The current Supply and Demand are secret in Weeks and thus do not benefit the owners but the exchange company.


Conclusion:
Now which of the two make’s common sense? Which of the two gives all parties fair warning as to what their unit is worth and what other units are worth? If you can’t figure this out you will be forever depositing your expensive week and owner W will keep going on your vacations.

Supply and Demand work ONLY when the figures are published – when they are secret they work against you. Weeks operates in secrecy and thus Supply and Demand work ONLY for the benefit of the exchange companies.

Want to prove it? I’ve got stock X and I’ll sell it to your for $400 a share. Is this a fair price? What exactly does Supply and Demand tell you? You don’t know do you and that’s what happens in Weeks – you don’t have the foggiest idea and if you think the Exchange companies are on your side you will be doomed to seeing owner W snap up your vacations.

 

["Roger"]

Back and forth isn't working. Everytime I open up this thread, I see about ten different things said that I disagree with. Time for an overall statement and be done with it (and I would welcome others following suit).

When I first bought my timeshare in '96, I could not find a single person who thought I was doing a wise thing. This was well before Points so that was not the issue. (Actually, about two years later I did find one coworker who owned a timeshare and was pleased. When asked why I didn't know this, she said "I don't tell people because I don't want them to think I was dumb and taken advantage of." She, by the way, owned Fairfield points.)

It was easy to identify the cause of dissatisfaction. Everyone had stories about how timesharing overpromises what you can trade for. They (or friends of theirs or relatives of theirs) had bought a timeshare and then couldn't make the trades that made buying seem attractive. (When I wrote about this before, Carolinian's response was maybe I just have dumb friends. Classy.)

My first trade? A Hawiaan GC for a somewhat rundown, converted Florida motel. (Near the bottom of the TUG ratings. Yet, I have had TUGGERs defend the fact that RCI ensures that trades are reasonably even -- the Weeks system works.)

I join TUG and I learn some of the tricks of the trade. I also learn that you need to do this to protect your interests if you own a timeshare. Further, I find a subculture within TUG (I honestly think a minority) who want to keep these tricks secret (loose lips sink ships). They prefer closedness to openness. In fact, when one TUGGER acknowledges what he was able to do to a New York Times reporter, some TUGGERs get so nasty with him that he leaves this board. (I don't blame him.)

Given this climate, it is no wonder that there is a good deal of hostility toward RCI (what Carolinian wants to identify as a monopoly). The sad part is that when some readers discover another person who is angry, they immediately identify with that person as a protector of their interest. I say sad because the single largest factor that has led people to disappointment in timesharing is the secret system of hiding the worth of one's purchase. And, yet that is just what we have some people trying to protect.

I am happy that I can say to the Weeks system "I prefer not"; it has changed timesharing for me from work to protect myself to fun.

 

[timeos2]

Bottom line. I see a better way than weeks can do it

Given this climate, it is no wonder that there is a good deal of hostility toward RCI (what Carolinian wants to identify as a monopoly). The sad part is that when some readers discover another person who is angry, they immediately identify with that person as a protector of their interest. I say sad because the single largest factor that has led people to disappointment in timesharing is the secret system of hiding the worth of one's purchase. And, yet that is just what we have some people trying to protect.

I am happy that I can say to the Weeks system "I prefer not"; it has changed timesharing for me from work to protect myself to fun.

Roger - I will join you in putting a final comment in place to end my participation in this interesting thread.

There does seem to be a culture of timeshare owners who enjoy the secret systems of weeks as it does in fact give value to what otherwise would have little, props up high value weeks with subsidy's from those poor weeks via annual fees and empowers those who take the time to fully exploit the serious flaws of the system to their advantage. It all "works" because most owners aren't aware of the issues and simply take what they can get or become disillusioned (see the hundreds of thousnads of weeks for sale for proof).

I also found the weeks systems to be unsatisfactory despite having found TUG and other places to learn the insider tricks. While I have the ability to use them I simply don't like playing all the games. I also have a basic dislike for a system that depends on taking advantage of the uninformed to the benefit of the informed few.

So my portfolio of timeshares are all deeded and all can be used in points systems for trade if I desire. Of course the key isn't trade at all but the fact that all of our timeshares are in places or systems we wouldn't mind using as long as we own them with never a trade. With that approach trades are what they were meant to be - an occasional way to get something different . They should never have been the reason for ownership. The advent of the minisystems answered the call for those who do want to trade more than return to one site and we have also taken advantage of those. It's no accident that those systems are all points, not weeks, based as thats how to best get the flexibility and value out of travel to areas with various unit sizes, seasonal variances and resort features. The secret society of weeks has never delivered a satisfactory method of value adjustment for the majority of the participants in those systems.

I don't expect that the believers in weeks type exchange will ever happliy switch to a points model anymore than I would want to return to weeks. I do hope that discussions such as this thread have given those who are deciding how to best enjoy timesharing some insight on the various options and a better chance of choosing what will create value for their ownership.

'Nuff said.

 

[Carolinian]

Your made up example is NOT how the Weeks system works at least not in RCI!

Further what someone paid for a timeshare or pays in m/f or whether it has award status may not significantly impact the supply/demand curve, which is driven mostly by location and date.

If you really want to see insanity look at some of the weeks that RCI Points say are equal - like mid-August week 33 on the OBX being ''equal'' (in point values) to a late October week 43. That's the wacky world of RCI Points!

Supply and demand – how RCI and II use it wrong. (You don't think for a minute that they use it right do you?)

Carolinian keeps using the phrase Supply and Demand as a dynamic key component of the Weeks program and how it’s too frozen with Points – let’s get the record straight.

Setup for example:
You own timeshare X and you paid dearly for it and the MF is eye watering. You decide that you want to exchange into timeshare Y. Both are Gold Crown, 5-star type of resorts and similar in price and you never see them when doing searches – they are snapped up instantly with on-going searches.

I, on the other hand, own timeshare W, I bought it for peanuts, resale, and these are the resorts are mediocre at best – all GC and 5-star however.


Weeks example:
You lock in a super 4th of July week at your resort (X) – it rents for $4,000 from the developer. You want to exchange into timeshare Y for Christmas and it too rents for $4,000 from their developer. You feel like you should get it.

I don’t need to deposit a week, I can make the exchange, if I should qualify and settle up later with the exchange company. I place my on-going search for Y at Christmas time 15 months before check-in. My resort doesn’t rent but the average of the rentals is about $1,500 elsewhere.

3 days later I get an eMail from RCI/II congratulating me on my Christmas week exchange into Y. The owner of X waits and waits and waits and finally at October he is within the 59-day window at II and he knows that his goose is cooked and wonders what awesome exchanger got in front of him and snapped up that Christmas week at X.


Points example:
4th of July week at X is worth 90,000 RCI Points, Christmas week at Y is worth 95,000 points, week W has a generic value of 45,000 Points.

Owner X borrows 5,000 credits from next year and snaps up Christmas week at Y. Owner W can only scrape together 90,000 Points and must make new plans for Christmas.


Debriefing:
Owner X screwed up big time – he didn’t understand the insane rules for Supply and Demand that RCI/II use - they are dynamic and change by the second. His big mistake was to reserve a hot holiday week and minutes later deposit that week into RCI/II. He took an extra couple of sips of coffee and was 5th to deposit that hot holiday week, the Trading Power (TP) assigned to him, with the insane Supply rules, caused his week to be worth less than an off season week in Orlando.

Of course the sad reality is that if owner X waited 1 day to deposit he would have had FULL TP since the other 4 would have been snapped up by on-going searches. His mistake was to use common sense and deposit his hot week ASAP - I hope he learned his lesson.

Owner W snapped up the exchange since he recognized the utter stupidity of the exchange’s definition of Supply and more critically understood the nuances of an even more insane definition of Demand. (I’ll leave this as homework for those who wish to exploit this system)

Owner X should have used a system based upon Supply and Demand being PUBLISHED to all parties. The current Supply and Demand are secret in Weeks and thus do not benefit the owners but the exchange company.


Conclusion:
Now which of the two make’s common sense? Which of the two gives all parties fair warning as to what their unit is worth and what other units are worth? If you can’t figure this out you will be forever depositing your expensive week and owner W will keep going on your vacations.

Supply and Demand work ONLY when the figures are published – when they are secret they work against you. Weeks operates in secrecy and thus Supply and Demand work ONLY for the benefit of the exchange companies.

Want to prove it? I’ve got stock X and I’ll sell it to your for $400 a share. Is this a fair price? What exactly does Supply and Demand tell you? You don’t know do you and that’s what happens in Weeks – you don’t have the foggiest idea and if you think the Exchange companies are on your side you will be doomed to seeing owner W snap up your vacations.

 

[PerryM]

Reality insanity

The example I gave is exactly how II works – I exploit it all the time. Granted, I’ve not spent the same amount of time reverse engineering the insanity at RCI, but I’d bet that the two systems are very similar internally.

This is, of course, a moot point, no one outside of a VP and few programmers knows the insane Supply and Demand logic built into RCI – we can only guess and assume that the insanity that inflicts II inflicts RCI.

I used price in my example since it is a quantifiable number that does reflect Supply and Demand of a timeshare in the free market. Granted that even here the price charged by the developer is 4 times it’s real worth but at least it is a number than conclusions can be drawn from.

My statements about Supply and Demand is valid:

Supply and Demand are useful if shown to ALL parties involved with a transaction. Holding them secret benefits one party over the other. RCI and II use these numbers to insure exchanges happen and every time an obviously lopsided exchange occurs you can bet that insane computer logic based on Supply and Demand favor the exchange company and NOT the other 2 parties involved.

In RCI Points, ALL the supply and demand knowledge needed to exchange is built into that published number of Points for a unit and week. Just like the current price of a stock reflects the wisdom of all supply and demand factors, so does that published Points number. If owners believe the Points is too low they will not deposit the week - they have all the knowledge to make the decision in that number. The person exchanging into the unit thinks that the Points charged are too many, they will not exchange into the unit - they have all the knowledge to make that decision.

Stability of a system is key for folks to use it. Changing supply and demand doesn’t take place on the grocery shelves every time a can of corn is stocked or bought – however that’s exactly how it works for timeshare reservations – they change trading power by the second; at least in the Week system.

Since the Points system allows for borrowing from future use and reservations taking place at 10+ months out, Points calendars need to have stability of at least 12 months – anything shorter than this will result in confusion and distrust.

 

[Carolinian]

Your arguments about ''stability'' could be used for rent control, wage/price freezes, currency controls and any manner of other anti-market mechanisms.

So when Katrina strikes New Orleans, points tables are supposed to stay in place for a year, even though supply and demand factors have all changed dramatically? That seems to be repealing reality! That's whats wrong with a points system. They cannot adjust to ever changing supply and demand factors. Heck RCI Points cannot even adjust to changes they know about, like the fact that Thanksgiving sometimes falls on week 46. In those years they still give the holiday bump to week 47, cheating the owners of week 46 and giving an unfair trade up to owners of week 47.

Points is actually a better system for those who want to exploit the loopholes than Weeks. Weeks constantly adjusts for supply and demand, so you have to try to figure out the factors just right, which discourages many from trying.

The screwy numbers in Points, on the other hand, are rigged into the system and always there. Buy a blatantly overpointed resort or the low end of an overbroad grouping that all has the same points number, and you can exploit the fallacies of points. You don't even have to worry that the realities of supply and demand will come back into sync and keep you from doing your massive trade up.

For example, buy a late October week 43 on the OBX (top market $1,000, some HOA's sell for $250) and for the same points get a mid-August week 33 (value more in the $3-6,000 range resale). On the rental market the week 33 will bring 3 to 5 times what the week 43 will.

Or buy a blue week 12 (March) at inland Sand Castle Village II in New Bern, NC, 2BR, and get 44,000 RCI points. For 42,500 points, you can then reserve through RCI Points a summer red week 23 (June) or week 33 (mid-August) 2BR at Ocean Pines, beachfront at Duck on the OBX. If that is not a massive trade up, I don't know what is! If you want to step down in size, you can get a week 27 July 4week 1BR at Ocean Pines for 40,500 points.

Points numbers are rigged and frozen so you can always know where the trades up are.

Instead of hypothetical examples, I am giving real numbers out of the points book.

But you focus just on the member, and their abilities to play the system are bad enough in Points.
You completely ignore the fact that publishing the numbers but not the mechanism opens the door to all sorts of insider deals between developers and RCI to cook the books, which there is simply no incentive to do in Weeks. The key here is MOTIVE. The Weeks model as developed by RCI founder Christel deHaan left no motive for developers to try to get RCI to rig the numbers. The Points model as developed by Cendant positively begs them to do it. That is the biggest single thing wrong with Points.

 

[Carolinian]

The reality is that in most markets, the details of supply and demand are NOT published, at least not widely. When I go to exchange dollars for Hungarian forints, I see the buying and selling rates of various exchange houses, which I know are based on overall supply and demand but nobody posts that the previous day X number of dollars were traded for forints and Y number of forints offered the other way. The next day, I notice the forint is up a bit on the dollar, and I still don't see the specific supply and demand data, but I know that more people were seeking forints than the other way round. Now the markets here are public, so if I dig hard enough, I can probably find that data, but it is not something that would be easily availible.

I really have no problem with timeshare trading power being public in any system, so long as the mechanism and underlying data are also made public to keep the system honest. But it is absolutely essential to discourage rigging of numbers in collusion with developers to keep it non-published if the mechanism and underlying data are non-published.

What some of those owning in overbuilt areas fear is a system that revealed that valuation mechanism and underlying data, because then there would be no way the exchange company could get away with overpointing the overbuilt areas.

The example I gave is exactly how II works – I exploit it all the time. Granted, I’ve not spent the same amount of time reverse engineering the insanity at RCI, but I’d bet that the two systems are very similar internally.

This is, of course, a moot point, no one outside of a VP and few programmers knows the insane Supply and Demand logic built into RCI – we can only guess and assume that the insanity that inflicts II inflicts RCI.

I used price in my example since it is a quantifiable number that does reflect Supply and Demand of a timeshare in the free market. Granted that even here the price charged by the developer is 4 times it’s real worth but at least it is a number than conclusions can be drawn from.

My statements about Supply and Demand is valid:

Supply and Demand are useful if shown to ALL parties involved with a transaction. Holding them secret benefits one party over the other. RCI and II use these numbers to insure exchanges happen and every time an obviously lopsided exchange occurs you can bet that insane computer logic based on Supply and Demand favor the exchange company and NOT the other 2 parties involved.

In RCI Points, ALL the supply and demand knowledge needed to exchange is built into that published number of Points for a unit and week. Just like the current price of a stock reflects the wisdom of all supply and demand factors, so does that published Points number. If owners believe the Points is too low they will not deposit the week - they have all the knowledge to make the decision in that number. The person exchanging into the unit thinks that the Points charged are too many, they will not exchange into the unit - they have all the knowledge to make that decision.

Stability of a system is key for folks to use it. Changing supply and demand doesn’t take place on the grocery shelves every time a can of corn is stocked or bought – however that’s exactly how it works for timeshare reservations – they change trading power by the second; at least in the Week system.

Since the Points system allows for borrowing from future use and reservations taking place at 10+ months out, Points calendars need to have stability of at least 12 months – anything shorter than this will result in confusion and distrust.

 

[MidlifeTraveler]

Businesses that are competitive are simply not a valid comparision to a quasi-monopoly timeshare exchange company. In a competitive business, competition itself provides the mechanism to keep the system honest, and no further mechanism is necessary. That is not present in a monopolisitic situation.

I don't entirely agree. If consumers reward dishonesty in ANY business by continuing to participate, the dishonesty festers. It may be more difficult to change in a monopoly but it can be changed. From what I've read on this website and some other ts websites I've visited to research this issue, there may be some momentum gathering.

 

[JLB]

I have avoided this thread becomes it involved Orange Lake. That is not important to the discussion, but I felt some may misinterpret my comments.

This is a good example of the coming of age, the enlightenment, of a typical timeshare owner. Up until two weeks ago, their understanding of timesharing consisted solely of what they were told when they bought (retail I am going to assume) at Orange Lake.

They were told the same everyone is told--largest TS resort in the world, #1 destination in the world, 3 bedrooms ($25000) max out trading power, buy here and go anywhere you want. Then in the last two weeks, a few folks on an Internet site have explained the truth.

Frankly it took us about a dozen years, because the age of electronic enlightenment had not arrived yet. We also owned a Week 44 in Orlando and we were told the same things 20 years ago that this owner was told whenever. The times have changed but the stories have not.

There is a thread asking Madge something or other that this discussion would fit right into, but I certainly am not going to be the one to link this thread to it. If I'm not mistaken, I did add a note on that thread that there are a few pertinent discussions about it going on.