September 2009 Developments - 23

Developments: What does the savings rate increase from 0% to 5.5% say about what consumers are thinking, and what is the larger impact on the ﬁnancial state of our country, in terms of stability? What about the stability factor for particular industries like timeshare? Rossell: The timeshare industry is feeling the brunt of a movement in the overall economy to a new equilibrium. The savings rate is returning to a higher level, probably in the 6-7% range; consumers will spend a smaller portion of their income each month, 93-94 cents on the dollar. Why the shift? People no longer believe their home will fund their retirement, and they are also more afraid of losing a job than before. Thus, they save more. This shift feels painful in the short run but is necessary for the long-term health of our economy. With higher U.S. savings, people (and their spending) will be less vulnerable to downturns in the economy—more U.S. business expansion will be funded by U.S. savers rather than “importing” our savings from Asia. Developments: What about the unemployment numbers and how it may soon exceed 10%, higher than the White House has projected. What does this mean to economic recovery? Rossell: Most economists have expected the unemployment rate to go at least to 10% since the crisis began. Politicians, not surprisingly, have had rosier projections. While jobs (or the lack thereof) grab the headlines, they only tell you about the past. You have to look to leading indicators like new orders and retail sales to see where the economy is headed. Developments: Do you think there will be an effort by the Obama administration to push through a second stimulus package, and if so when, how large and where will monies be targeted? Rossell: I think a new package would be a hard sell. The current one has yet to be fully deployed, and there is considerable Republican resistance to the idea. Developments: What about the impact of major legislation being pushed through the House and Senate (health care) and Senate (energy bill recently passed by the House), which may may impact the recovery or additional recovery legislation—any thoughts? Rossell: Health care, climate change, and social security were all long-term issues that had to be dealt with, one way or another. They will affect the economy for many years. The recovery is probably already underway. Washington can’t move fast enough to derail it. Don’t go it alone — put our expertise to work for you. Meridian Financial Services = Collections At No Cost To You Meridian Financial Services is a sophisticated third-party collection agency able to service whole and partial portfolios. With Meridian, you can: • Lower Bad Debt • Increase Cash Flow • Keep Loans In Good Standing • Reduce Write-Offs • Bring Association Dues Current • Avoid Foreclosures • And More Meridian, a subsidiary of Interval Resort & Financial Services, is a veteran of the vacation ownership industry. We understand the impact of bad debt, as well as the importance of keeping your owners’ accounts current, and preserving their conﬁdence in the purchase decision. To learn, at no cost, how Meridian can work for you, please contact: Greg Sheperd, president, at 866.294.7120, extension 106, or by e-mail at gsheperd@merid.com Marc Coleman, account executive, at 866.294.7120, extension 126, or by e-mail at mcoleman@merid.com September 2009 • Developments 23

September 2009 Developments

Table of Contents for the Digital Edition of September 2009 Developments