This article compares the premier benefits obtained by buying at full price from Bluegreen Resorts with the value of buying a resale contract on the secondary market.
It is very important to understand that any premier or VIP benefits can be changed or canceled entirely at any time, as these benefits are not tied in any way to the real estate ownership (which is why the developer can restrict these benefits from being transferred when the ownership is bought or sold on the secondary market!). In fact, shortly before this article was written, Bluegreen had just changed the benefits again- by reducing the privileges given to Bronze level owners (presumably to try and "encourage" more owners to purchase even more points and "upgrade" to higher levels).
Bluegreen pricing is currently about .85 to .25 per annual point.. Resale prices can commonly be found in the $ .25 to $ .40 per annual point range!
The Premier or Elite Levels of Bluegreen are classified as:
Bronze level VIP privileges are received by owning 15,0000 to 19,999 annual points.(Approximate cost of ,000 to ,000 if you buy resale and ,000 to ,000 if you buy from Bluegreen)
Silver level VIP privileges are received by owning 20,000 to 34,999 annual points. (Approximate cost of ,000 to ,000 if you buy resale and ,000 to ,000 if you buy from Bluegreen)
Gold level VIP privileges are received by owning 35,000 to 59,999 annual points. (Approximate cost of ,750 to ,000 if you buy resale and ,000 to 5,000 if you buy from Bluegreen)
Platinum level VIP privileges are received by owning 60,000 annual points or more. (Approximate cost starting at ,000 if you buy resale and 0,000 if you buy from Bluegreen)
Some of the benefits and privileges premier level owners receive are:
Villa upgrades: Premier owners are eligible to get a free one category villa upgrade based on availability. When you can request the upgrade and how many upgrades you can receive differ by level.
Bronze = 1 day prior to the reservation and a maximum of 3 upgrades per year. Silver = 2 days prior and 5 per year Gold = 3 days prior and 7 per year Platinum = 4 days prior and 10 per year
Presidential Villa Upgrades are only available to Gold and Platinum level owners and are subject to the same maximum count per year.
Gold - 4 days prior Platinum - 7 days prior
Question for potential buyers: Is having a chance (based on availability just before check-in) at upgrading to one unit size bigger than what you reserved worth paying more 500% more for ownership?
The Obvious Answer: No! However, chances are you will already have reserved the unit type you need for your stay since nobody reserves a villa too small to accommodate their family. While an upgrade to a larger unit is certainly a nice perk, it is not necessary and certainly not worth thousands of dollars!
Another possible benefit is the waiver of cancellation or modification fees when you change a reservation.
Bronze class owners do not receive this benefit. Silver level owners are allowed up to 3 modifications or cancellations per year. Gold level owners are allowed up to 5 modifications or cancellations per year. Platinum level owners are allowed an unlimited number of modifications or cancellations per year.
Basically, unless you own 20,000 points or more- you still have to pay cancellation fees! This restriction puts this benefit out of reach for most owners. Platinum class owners who routinely rent their points may find this to be very beneficial, but they will have to consider the vast increase in purchase cost as well as the risk that the benefit could potentially be changed at any time. For almost every knowledgeable buyer- the decision is simply that buying resale is the best choice!
Another benefit is that Gold and Platinum level owners can receive extended stays and reservations at no cost based on availability.
Gold members can have one free white and Blue Season reservation per year. Platinum owners can have three free white and blue season reservations per year.
At first glance, this seems like a fantastic benefit! Who wouldn't like to get vacations for free!
But when you really think it over- it's not as fantastic as it sounds. Another great point for resale buyers is that unless you own 35,000 points or more- you don't even get the chance! And when you compare the cost difference- this benefit is at best a bad joke! Owners are often paying between ,000 to 0,000 over resale pricing for the privilege of getting a few free nights? At a rental rate of 0. per night, it will take you more than fourteen years before you break even! If the rack rate is only 0/night- it then takes more than 35 years! Chances are that extra money in your pocket can purchase all the extra nights you will need.
As always, timeshare ownership at resort prices is far more sizzle than steak! Take your time, research the product and the benefits- and I'm confident you'll agree that purchasing a Bluegreen timeshare ownership on the resale market is the only smart decision!
Copyright (c) 2010 Richard Marquette
Showing posts with label Market. Show all posts
Showing posts with label Market. Show all posts
Wednesday, October 17, 2012
Thursday, July 19, 2012
2008 Market Crash Recap
2008 is over at last. It has been an extremely turbulent year and everyone's swept under its currents such that it was hard to see what actually happened, so, here's a recap of what happened in the stock market in 2008.
Summing up, the Dow lost a total of 4488 points this year, down 33.84%. The Nasdaq composite lost a total of 1075 points, down 40.54%. The S&P500 lost a total of 565 points, down 38.49%. The more volatile Nasdaq Composite became the loss leader this year just as it is expected to be the gain leader in a rising market, so, no surprise there. Both the Nasdaq Composite and the S&P500 went lower than the low of the last crisis in 2002. Only the Dow managed to stay above the last crisis level marginally. I had expected it to also make a lower low but it did not.
How did it all begin? Indications of this 2008 market crash actually started showing up as early as July of 2007 when short term bond yields begun yielding higher than long term bond yields in a bond yield curve that is almost perfectly horizontal above the 4% yield line. Such a bond yield curve indicates excessive optimism in the capital market as the 20yr bond hit an all time low price (relative to recent years). Bond prices go down when demand for bonds goes down. Demand for bonds goes down when capital gets reallocated, usually into the equities market (for simplification sake), resulting in high bond yields. At that time, the Dow was trading well above the 13000 points level, just one step from the 14000 level resistance which marked the beginning of the 2008 market crash. At the same time, foreclosure rates had been and continued to rise nation wide, putting pressure on the value of the most complex derivative instrument ever created amongst investment bankers, CDOs or Collateralized debt obligations.
All 3 major indices hit their peak in October of 2007 and begun their long retreat. The retreat didn't look at all menacing for a start as all 3 major indices backed down to their respective short term support levels and even rebounded slightly, making it all look like a classical pullback in a strong primary bull trend. At that time, the Fed's still all confused with what to handle, inflation or growth, and talks of Stagflation begun showing up as real GDP went sideways in Q3 2007 and then retreated in Q4 2007. This was when 2 groups of economists; Recession Talkers and Goldilocks, begun their battle of tongues over the major wires. Of course, now we know who knew better. Sensing danger, investors begun taking positions in bonds once again, bringing bond yields down from their previous highs. The Fed also begun taking Fed Fund Rate down from its high of over 5% in August gradually (too gradually, argued by some economists). At this time, a perfect storm is brewing as the more the Feds cut rates, the lower the dollar goes and the higher commodities prices went (as well as prices at the pump of course), putting further pressure on the real economy.
The first warning sign of a recession surfaced in January 2008 as unemployment rate hit 5% for the month of December 2007. 5% is a psychological level that says that something might be wrong in the economy as full employment rate (normal unemployment with minimal cyclical unemployment) is around the 4.5% level (number arrived at from my own research). That was probably one of the catalysts that caused all 3 major indices to break their respective short term support levels downwards in the first month of 2008, threatening the integrity of the primary bull trend that was in place since 2003. At the same time, inflation continued to be a problem as oil continued it march to the 0 per barrel level while talks of CDOs becoming worthless due to significant doubt about the fixed income ability of mortgage loans built into them begun hitting the wire. In fact, it was around this time when analysts begun finding CDOs being over-rated by rating agencies (well, like one of the high profile analysts said, they belonged to the same club).
By February of 2008, it has become apparent from the charts that the intermediate term bull trend has been compromised as investors rushed for quality, depressing short term bond yields to almost half of what they were just a couple of months ago. On the charts, however, it could still be argued that the Dow merely made its first major intermediate term correction since the primary bull trend started in 2003. Such a technical correction is also an acceptable argument under the Dow theory as some technical chartists expect the major indices to make a rebound from that level, which, did not happen (even though the Dow did rebound just a little bit for a couple of months as technicians took position). At this time, however, the economy's already not looking at rosy as it did just months ago with rising unemployment, lowering durable goods order, rising oil price and a dropping GDP. Signs of trouble also begun emerging in the investment banking sector as major investment bankers started changing CEOs and writing off worthless CDOs and subprime loans. By this time, the Fed is beginning to get it that the economy is in real danger but has yet to take major actions on the fed fund nor to take coordinated action with central banks around the world. The dark cloud also spreaded into stock markets worldwide, making it obvious that this is not only an USA crisis but a world crisis.
By July 2008, investors were convinced that the economy is indeed in a recession (at last) and the credit crisis is deeper than most has expected. All 3 major indices made their first significant downwards breakout, totally disintegrating the previous primary bull trend, and stated without a doubt that the bear has arrived. All hell broke loose after that as Lehman Brothers closed down, unemployment rate soared and real GDP went negative. Investors begun rushing for the door, taking major indices down by a greater magnitude each month. The Dow was down 9% for the month of September and over 17% in October. At the same time, as aggregate demand drops in the economy, so did demand for oil as crude oil price dropped like a rock from its high of 0 per barrel all the way to below , taking CPI along with it. The US dollar also took a surprising turn and surged upwards against major currencies for months, wiping out forex traders trading on the "short-the-dollar-golden-strategy".
Right now, commodities prices are at lows that was not seen for decades, bond prices has formed a bubble waiting to be burst and unemployment rate has reached higher than the previous crisis. Talks of write downs are also disappearing. This is certainly the best time for enterprising companies to take advantage of better prices and start hiring once again. In fact, purchasing by companies are already picking up slightly as indicated by the latest PMI number. All the ingredients needed for economy recovery seems to be in place and I suspect we should see some real signs in 2009. 2008 has done a good job of quickly and mercilessly draining waste from the economy instead of making it a prolonged agony. With stocks this low and bond bubble waiting to be burst, the stock market definitely has a lot more upside potential than downside potential right now. Let's say a nice goodbye to 2008 and welcome 2009! :)
** I am sorry if I did not include many of the other major events that contributed in the 2008 crash as I intend to keep this as short as possible while correlating events in the economy to the stock market.
Summing up, the Dow lost a total of 4488 points this year, down 33.84%. The Nasdaq composite lost a total of 1075 points, down 40.54%. The S&P500 lost a total of 565 points, down 38.49%. The more volatile Nasdaq Composite became the loss leader this year just as it is expected to be the gain leader in a rising market, so, no surprise there. Both the Nasdaq Composite and the S&P500 went lower than the low of the last crisis in 2002. Only the Dow managed to stay above the last crisis level marginally. I had expected it to also make a lower low but it did not.
How did it all begin? Indications of this 2008 market crash actually started showing up as early as July of 2007 when short term bond yields begun yielding higher than long term bond yields in a bond yield curve that is almost perfectly horizontal above the 4% yield line. Such a bond yield curve indicates excessive optimism in the capital market as the 20yr bond hit an all time low price (relative to recent years). Bond prices go down when demand for bonds goes down. Demand for bonds goes down when capital gets reallocated, usually into the equities market (for simplification sake), resulting in high bond yields. At that time, the Dow was trading well above the 13000 points level, just one step from the 14000 level resistance which marked the beginning of the 2008 market crash. At the same time, foreclosure rates had been and continued to rise nation wide, putting pressure on the value of the most complex derivative instrument ever created amongst investment bankers, CDOs or Collateralized debt obligations.
All 3 major indices hit their peak in October of 2007 and begun their long retreat. The retreat didn't look at all menacing for a start as all 3 major indices backed down to their respective short term support levels and even rebounded slightly, making it all look like a classical pullback in a strong primary bull trend. At that time, the Fed's still all confused with what to handle, inflation or growth, and talks of Stagflation begun showing up as real GDP went sideways in Q3 2007 and then retreated in Q4 2007. This was when 2 groups of economists; Recession Talkers and Goldilocks, begun their battle of tongues over the major wires. Of course, now we know who knew better. Sensing danger, investors begun taking positions in bonds once again, bringing bond yields down from their previous highs. The Fed also begun taking Fed Fund Rate down from its high of over 5% in August gradually (too gradually, argued by some economists). At this time, a perfect storm is brewing as the more the Feds cut rates, the lower the dollar goes and the higher commodities prices went (as well as prices at the pump of course), putting further pressure on the real economy.
The first warning sign of a recession surfaced in January 2008 as unemployment rate hit 5% for the month of December 2007. 5% is a psychological level that says that something might be wrong in the economy as full employment rate (normal unemployment with minimal cyclical unemployment) is around the 4.5% level (number arrived at from my own research). That was probably one of the catalysts that caused all 3 major indices to break their respective short term support levels downwards in the first month of 2008, threatening the integrity of the primary bull trend that was in place since 2003. At the same time, inflation continued to be a problem as oil continued it march to the 0 per barrel level while talks of CDOs becoming worthless due to significant doubt about the fixed income ability of mortgage loans built into them begun hitting the wire. In fact, it was around this time when analysts begun finding CDOs being over-rated by rating agencies (well, like one of the high profile analysts said, they belonged to the same club).
By February of 2008, it has become apparent from the charts that the intermediate term bull trend has been compromised as investors rushed for quality, depressing short term bond yields to almost half of what they were just a couple of months ago. On the charts, however, it could still be argued that the Dow merely made its first major intermediate term correction since the primary bull trend started in 2003. Such a technical correction is also an acceptable argument under the Dow theory as some technical chartists expect the major indices to make a rebound from that level, which, did not happen (even though the Dow did rebound just a little bit for a couple of months as technicians took position). At this time, however, the economy's already not looking at rosy as it did just months ago with rising unemployment, lowering durable goods order, rising oil price and a dropping GDP. Signs of trouble also begun emerging in the investment banking sector as major investment bankers started changing CEOs and writing off worthless CDOs and subprime loans. By this time, the Fed is beginning to get it that the economy is in real danger but has yet to take major actions on the fed fund nor to take coordinated action with central banks around the world. The dark cloud also spreaded into stock markets worldwide, making it obvious that this is not only an USA crisis but a world crisis.
By July 2008, investors were convinced that the economy is indeed in a recession (at last) and the credit crisis is deeper than most has expected. All 3 major indices made their first significant downwards breakout, totally disintegrating the previous primary bull trend, and stated without a doubt that the bear has arrived. All hell broke loose after that as Lehman Brothers closed down, unemployment rate soared and real GDP went negative. Investors begun rushing for the door, taking major indices down by a greater magnitude each month. The Dow was down 9% for the month of September and over 17% in October. At the same time, as aggregate demand drops in the economy, so did demand for oil as crude oil price dropped like a rock from its high of 0 per barrel all the way to below , taking CPI along with it. The US dollar also took a surprising turn and surged upwards against major currencies for months, wiping out forex traders trading on the "short-the-dollar-golden-strategy".
Right now, commodities prices are at lows that was not seen for decades, bond prices has formed a bubble waiting to be burst and unemployment rate has reached higher than the previous crisis. Talks of write downs are also disappearing. This is certainly the best time for enterprising companies to take advantage of better prices and start hiring once again. In fact, purchasing by companies are already picking up slightly as indicated by the latest PMI number. All the ingredients needed for economy recovery seems to be in place and I suspect we should see some real signs in 2009. 2008 has done a good job of quickly and mercilessly draining waste from the economy instead of making it a prolonged agony. With stocks this low and bond bubble waiting to be burst, the stock market definitely has a lot more upside potential than downside potential right now. Let's say a nice goodbye to 2008 and welcome 2009! :)
** I am sorry if I did not include many of the other major events that contributed in the 2008 crash as I intend to keep this as short as possible while correlating events in the economy to the stock market.
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