Originally Posted by
thbe
Not great, but context matters: U.S. CPI-U is up roughly ~20% since 2021, and U.S. hotel ADR is up roughly ~30% over the same period.
I am glad someone actually spent the time to dig up CPI and hotel ADR to look at this instead of just talking from an emotional point of view.
Originally Posted by
Jed33d
While we can debate whether points rates are up 22% or 37% or higher, I think we can all agree this is a significant bump all at once. And yes compared to CPI the 22% rate is similar to the 20% CPI, one thing missing is the impact of income growth to offset some of that CPI increase (granted it hasn’t been much in the US the past few years depending on income level, but it does narrow the gap a bit.).
Unfortunately, earnings rate for WOH members or credit card holders hasn’t really changed at all in years, so there hasn’t been any income increase to offset the redemption inflation we’ve seen the past few years,
Actually, I have a different take on there "hasn't been any income increase to offset". Based on what you pointed out in the first paragraph I quoted here, there was indeed "income increase to offset".
Here is how I look at this. As you pointed out there is a spending side - which is converting points to room nights, and then an income side - which is earning points.
1. Spending side - I think we all agreed that there is an increase in CPI and ADR to the tune of 20% to 30%, which is kind of coincide with what thbe estimated as the devaluation or increase in points required for redemption.
2. Earning side - you said there is no change in earning rate for WOH all these years, which is true. But if you look at number of points earned, it is actually earning rate x the $ you spend on credit card and ADR$ you spend on the rooms. Then there is definitely increase in number of points you accumulate each year.
- Of course as you pointed out, I am assuming the Chase credit card holders and people who stay at Hyatt are in the group whose income has risen more or less with CPI, and therefore they are spending more each year. So even if the earning rate did not change, the number of points they can accumulate each year will increase more or less in line with increase in CPI or ADR.
Now, we have a situation where people are accumulating more points every year and chasing a redemption chart that has not changed since 2021. And this make it more difficult for everyone to redeem their points at properties they wanted. This is the reality.