Automatic and reciprocal link exchange, good or bad?

In the last years, many sites and directories started to offer automatic link exchange programs. Some ask for money while others ask for reciprocal linking. It is pretty clear that such programs and the sites involved don't have a shiny future because Google didn't introduced the backlinking system for being abused.

I tested some of these programs: www.linkmachine.net, www.monsterlinkswap.com, www.gotlinks.com, etc. The result? Getting 100 backlinks from these programs is worse than getting 1 single backlink from a PR4+ site "not flagged". By "not flagged" I mean a site which is not involved in automatic/reciprocal link exchange programs. I believe that search engines and I mean specially Google, identify the sites involved in these programs and flag them somehow. They don't get banned(at least not all of them) but their backlinks get ignored and their outgoing links too. Let's take for example gotlinks.com. They claim to have about 10,000 sites in their network. Each of them backlinks to gotlinks.com. By now, they should be about PageRank8, considering they are also promoting their service by many other ways. But they are only PR6 and I have a feeling that they gained this Page Rank only from directories, forums and blogs where people talk about the program. The 10,000+ sites involved are flagged and they don't pass Pagerank.

So if you are looking for a long term result for your site, don't involve in these "easy to gain backlinks" programs. Remember that the most effective way of getting back links is to make a site actually useful, then people will backlink to it without any incentive.