The key is the totality of demand from all sources versus the totality of supply in the system. That is a key element of free market capitalism. When there is price fixing, that is NOT a free market approach.
Then there are the subsidies where RCI is constantly ''buying'' for more than it is ''selling'' for, i.e. giving more points lite for deposits than they charge to trade into the same week. Those subsidies are inconsistent with a free market. And those subsidies from RCI are indeed what artificially sustains the overbuilt areas in timesharing.
I agree with others who have pointed out that this is exactly a free market system - under unregulated capitalism. RCI is a corporation, not the government, and there are other companies citizens are free to do business with instead. This isn't a monopoly.
RCI is a corporation whose purpose is to make as much of a profit as possible - by purchasing its product as low as possible, and reselling it as high as the market will bear.
Price-fixing by a government has nothing to do with a corporate entity setting its prices however it wants to, without explanation to anybody.
As far as supply and demand, this analysis is looking to the wrong ratio for supply and demand. Supply is the quantity of "product" the company can buy for how little. Demand is the quantity it can resell, for how much.
So as long as it can obtain deposits from members (or whatever other sources) for low cost (ie TPU's, or cash, or whatever) and as long as it can resell those at current prices (rental $$ or TPU's), supply and demand is in balance.
I'm not saying I love it - I don't - but private companies get to make up their rules of business, and set their prices for what they buy and sell, and have no obligation to obtain my personal approval, nor to conduct their business in a way that I deem "fair." There's certainly no law or precedent that says they have to resell their product for what they buy it for.
I don't have to sell to, aka deposit with RCI if I don't like what they pay me, aka what I get back in exchange. I'm free to shop around - which I've done, and at the moment I feel I get
less back from the other exchange companies. If/when that changes, I can take my business to many other alternatives under in this capitalist system.
(If it were allowed, I could post for a long time about what I think of unregulated capitalism. Perhaps it's ok to say that I don't love that either - I think regulation that promotes and protects fairness is an inherently good thing - but perhaps it's the best alternative for me at the moment, given the alternatives, just like RCI might be the best exchange company for me at the moment, given the alternatives.)