Tuesday, March 8, 2011

Dominican Republic Real Estate As a US Dollar Inflation Hedge ?

Where can you convert your US Dollars without losing your shirt on the exchange rate or otherwise, get fair value for your money? Even in India at the moment, they are now refusing to accept US Dollars in the country's tourist attractions due to the devaluation, but not so in the Dominican Republic. Some Dominican properties are actually priced or sold in Dollars, and if not, the exchange rate is still favorable.

Inflation or devaluation of a currency by the politicians is nothing new. The Roman Emperors starting clipping coins, or better said, slowly but surely reducing the gold content of the Denari until such a point that it was nothing more than base metal. It took them 500 years before the coins became worthless or junk in other words (without the gold or silver content). Paper money used to be backed by gold or exchangeable into gold, until it too was taken off the gold standard altogether, and now it is, quite frankly nothing more than paper with fancy engravings on it. That too is on the path of the Denari. And since we are talking about the US Dollar in this case, one dollar printed in 1913 has almost lost 100 percent of its value in 100 years - progress over the Romans to be sure.
If you hold paper, or money, then you must get an interest rate or return on your funds to at least equal the inflation or devaluation rate. At the moment, as of December 2007, many economists and number crushers put the current inflation rate at about 11 to 15 percent, despite the official line from government bureaucrats. With the US Federal Reserve seemingly bent on keeping interest rates low, keeping pace or treading water in regards to inflation by using traditional bank or savings deposits does not look like the answer.
Regardless, this is not meant to provide a synopsis of how politicians and other leaders defrauded the citizenry over the centuries (although a fascinating study of human history indeed), but rather to discuss some ideas to convert the paper money into something of worth, that will hold onto its value over the long-term. Certainly owning gold fits the bill (and we are fans of gold to be sure). However, aside from gold's use in jewelry and some commercial applications, it does have a fairly limited utility value to us in our everyday lives. Real Estate, on the other hand, is another matter. Which is to say, you can live on it, you can grow tomatoes on it, you can rent it out to someone else to grow tomatoes on it, and so on. In other words, a utility or use, while you wait or while you hold onto it as a store of value.
Property or land has historically appreciated anywhere from about 2 to 5 percent annually, with some periods of slow growth or a stagnant market setting in from time to time, and some periods of double digit growth as well - sometimes to the point of bubbles being created. But, the main point to be noted is that real estate usually holds it value and acts as a hedge against inflation (along with gold, of course). We say usually, as there are exceptions to everything, such as the current sub-prime nonsense in the US at the moment, which is wrecking havoc with the US real estate market and probably will skew the traditional calculations because of all that debt and leverage that is out there (the market was driven up by debt and leverage, so it is no surprise that these same two factors will make a correction that is much more dramatic and painful as well).
So, the question becomes - if you are going to swap your paper money for something else, and presumably real estate for some portion of it - then where? Good question. The answer has to do with if whether or not the market where you are looking to buy is over-valued, under-valued or fairly valued at the moment. In addition, if there has been increases lately, what has caused it. Is cheap money or debt to blame, or are properties being purchased for cash? Is it a case of supply and demand or something else?
Real estate in some parts of the Dominican Republic, such as on the North Coast, Semana and Punta Cana has seen price increases of 20 percent or more annually recently. Will that continue to be the case? If history is any guide, probably not or not indefinitely, at least not at that rate of appreciation indefinitely, but then again, much of that real estate has been purchased for cash, so no debt bubble as the cause either. However, there still are bargains and fairly valued real estate or properties out there - you just need to know where to look. Often enough, that means not following the crowds and staying away from where the current boom is. The idea is to be the investor with some common sense and long-term vision, buying for fair value and holding it. For example, if your grand-father bought twenty-five acres on the beach in Punta Cana 30 years ago, when there was nothing but noisy seagulls and weeds, he probably would have gotten the land dirt cheap. He also proably would have never stopped hearing his wife, your grand-mother, tell him what an imbecile he was for buying a property in some banana republic. Of course you, one of his grandchilren would most likely be laughing all the way to the Mercedes dealership, telling everyone along the way what a genious your grand-father was. And so it goes.
The key point in all of this is of course to make your real estate purchases in such a way that you are not over paying, or at least getting current value. In this regard, once again, the Dominican Republic on average is still about 25 to 30 percent less expensive when you compare similar properties in the rest of the Caribbean. As just one example, The Global Property Guide (a real estate guide from the UK) says that prime beachside property in the Dominican Republic sells at an average of US$2,000 a square meter, compared with US$10,400 in Barbados. There is nothing wrong with Barbados, but it is worth 5 times the cost of similar, beautiful beach front property in the Dominican Republic? We think not.
Looking even further, the Dominican Republic has a large number of luxury condo's, single family homes, rural or farm land and undeveloped beach lots at prices that most middle class Americans and Europeans can afford. One area we have highlighted is the Barahona region, whereby you can still get beachfront or ocean view property for about US$35 per square meter, compared to about US$100 per square meter in more built up or otherwise, better known areas of the country. In terms of luxury ocean front condos, while you can pay US$800,000 for a sea view apartment in some projects in Punta Cana, the point is you do not have to. As an example, we found a very well done project of brand new 1100 square foot condos right on the beach in Juan Dolio, complete with swimming pool for US$195,000. Looking for a single family home? Some of our clients have recently purchased homes in middle and upper middle class sections of Santo Domingo for prices ranging from about US$120,000 to US$180,000. And these are what you would call homes, not garaged sized shacks that some real estate brokers in California are trying to convince you are worth US$500,000 or more.
In summary, is there value for money when it comes to real estate in the Dominican Republic? The answer is YES. In addition, adding some fairly priced Caribbean real estate to your investment portfolio could also help protect your assets from the eroding nature of inflation as well.

Real Estate In Another Country As a Hedge To The US Market

When you discuss the idea of owning real estate in another country with Americans, many will claim that this is a risky idea, that legal protections for titles do not exist, that living in foreign lands may be dangerous, along with a whole slew of other comments - which are not entirely accurate or true. In fact, in many countries, such as the Dominican Republic, title insurance is certainly available (from well known firms such as Stewart Title) and legal guarantees under the law for foreign investors as well. In many countries also, you need not be a resident or citizen at the time you make a real estate purchase either.

Europeans of course have no problem investing in real estate overseas and generally make the leap to ownership abroad much quicker and easier. Regardless, both Europeans and Americans do have a current problem at home they need to consider in the decision making process - namely a housing boom or bubble that resulted in a outright bust in some cases (the US and the UK) or otherwise a market slowdown in their respective countries.

What has been the culprit and why do these problems not appear in other countries, such as the Dominican Republic, Ecuador, etc.? Well, for starters it has been noted that artificially cheap interest rates have been partly to blame. Even more so in the US, where housing prices have not gone up as dramatically as in some other countries, YET the debt incurred to purchase the properties had indeed lead to a serious problem going forward. In fact, in some areas of the US, it is estimated that over 50 percent of new home financing is interest only and or hybrid adjustable rate mortgages, whereby buyers are not even paying off the debt principal as part of the payment plan (in the case of interest only and so-called 1 percent ARM option loans). In addition, some newer statistics would indicate that about 70 percent of all residential real estate is mortgaged, in one form or another. In other words, about 30 percent or so of US homeowners actually own their own home outright with no debt or mortgage against the property, while 70 percent of US residential property has a debt liability. But aside from that, home prices as a percentage of average income is at one of its highest levels or ratios historically, making housing even more expensive or less affordable for many middle class people. European housing prices are even worse or have gone up even more shockingly over the past five years, yet there may be a major difference in terms of the consumer debt supporting it (in comparison to the US market). However outrageous home prices are still outrageous regardless, and a boom is also a bust waiting to happen, which of course we already know has happended. However, one thing is certain - real estate in many other countries is still less expensive and not over leveraged with debt. Why is this so?

Financing is available in most other countries, but it often doesn't make any sense, said Elizabeth Makatura, vice president for international service and operations for Coldwell Banker. Interest rates can be as high as 30 to 50 percent in some parts of Latin America or the Caribbean. Down payment requirements are also more stringent. While it's not uncommon to put down as little as 0 percent to 5 percent in the United States, in many other countries buyers need a hefty amount of cash to qualify for a loan. According to Fannie Mae, buyers in Italy may need to put down 50 percent of the cost of the house. In Germany, a 40 percent down payment may be needed, and in Mexico a 30 percent down payment is the standard.


Sounds terrible, does it not? But it is true in many countries that local banks require a 50 percent down payment or will only offer a mortgage for 15 or 10 years only. But is this really such a bad idea? We know that according to some US statistics, roughly 70 percent do NOT own their own home. Which is to say, people that have purchased homes think that they own it, but they really do not. The bank does, and in effect these people are tenants making monthly payments to the bank. Where as in the past, this was a fairly sound idea - many people today are making interest only payments. In effect, remaining on the hook for the full debt amount while making monthly payments to the bank for interest only. In any event, from a socio-economic point of view, certainly a case of citizens living on credit (in terms of their own home) and certainly very much so exposed financially should things become difficult economically going forward. Contrast this now to a country where most of the citizens own homes outright (paid in full with no mortgage) or whereby the requirements are steep in that a loan applicant must be very solvent in order to qualify. What are possible differences in financial outcomes for people living in the easy credit environment (no money down, etc.) versus the later more difficult one? One thing that comes to my mind, in terms of the easy credit environment, is that many people are going to loose their homes and face severe problems (which often enough translate into social problems). In the country where most people pay cash for their homes, they may loose their job, the economy may turn negative - but they still have their own home (free and clear). Ergo, even with a poor economy, certainly the probability of LESS social strife and not more, in the country with the high down payment or cash only real estate purchase environment. Where have we seen real case studies of this? Where have we seen a country where the people actual do own their own property, and often have more real personal wealth that have allowed them to weather economic torments? Argentina is one and the Dominican Republic yet another.

This is in contrast to accepted wisdom in North America, whereby everyone can borrow money and buy a home - but without the savings to do it with. No money at risk often means no personal responsibility, or at least the probability of walking away if things go wrong (and certainly not a pretty site for the banks that have loaned the money either). In any event, let us put our long-term rational thinking caps on for a moment. If you do believe that there is a debt and leverage problem affiliated with the housing market in the US and the UK, then where will this lead socially and economically? The final question is, depending of course how you answered the first two questions - Where do you go?

The surprising answer for some might be - those very countries where credit is strict and housing equity in the hands of the owners and not the bankers. For many people, the equity in their current home is the bulk of their wealth or savings. So, it stands to reason, the opportunity exists to tap into that wealth and buy a home, apartment or small farm in Argentina, Brazil, Dominican Republic, Ecuador and a host of other places where the climate is good year round, and real estate prices are not overblown.


Wednesday, February 23, 2011

Meanwhile, in Police State, America

by Mr. Ogre

I read a definition of a “police state” yesterday that really bothered me. Someone said that a police state is a place where the police have the power to arrest anyone for anything at any time. My very first thought was, “Welcome to America.” In case you didn’t know, you can be arrested by any policeman at any time, and the policemen will not ever be held accountable. The charge? Resisting arrest/disorderly conduct. This is also known as “contempt of cop.”

71-year old Ray McGovern found out about this when he committed a serious crime and was wrestled, manhandled, bruised, and arrested. What was this serious crime, for which he was physically attacked and punished? He dared to turn his back on Her Royal Majesty, Hillary Clinton. No, seriously, that’s it. He didn’t say a word, he didn’t bother anyone, he didn’t threaten anyone, he didn’t harm anyone. But if you annoy a government official in America, you are forced to jail. And the charge? Of course — disorderly conduct.
Actually you are on the right track but you have not fully realized what the definition of a Police State, Here let me help you out! A better defintion albeit a more scary one but one we have to live with everytime we go outside the door to say Costco as Erik Scott's family found out when he was executed in cold blood outside a Costco Store , his crime having a Concealed Weapons Permit, well it is legal to have a weapon for self defense, well in theory, yes in real life police officers do not like for anyone to be armed but them and by having a weapons puts your life in mortal danger even if it is a crossbow ..... Make sure you see this Video=>>here

Read more about how Erik was judged, juried and executed on
http://www.erikbscott.com/ and check out his facebook page=>> here

or how about
pregnant woman shot by Washington State Detectives or if you want to watch a taped execution of a man in his own home watch here=>>
Dad to be killed by Vegas Cops want to watch a real life execution on real time here=>>Blair Shooting his crime, his roomate who wasn't home smoked pot or want to watch a disabled man in a wheelchair shot

Illegal Search - Police Respond to Man With Crossbow & Seize House

Man in Wheelchair shot

That is the definition of a police state is when you can not only be arrested at any time but you your life can be terminated at any time and this is why I don't feel safe living in America...

Friday, January 14, 2011

Santiago De Chile

Founded in 1541, Santiago de Chile is one of the more attractive capital cities of South America. With a population of nearly six million, it is a modern metropolis and you can find almost everything you need. Whether you are here on business or pleasure travel, Santiago is of interest to many visitors.

Dear Readers:

Please accept my apologies when I get off track, but I believe we are a community and are all tied together by common experiences and share a common goal, mainly to raise awareness to the problems facing our generation as we age and learn to grow old together....

AS I prepare for another day the sounds of diverse languages drifts in through my window, like Santiago, a breath of fresh air and freedom, no mailman delivering threatning communications demanding things, no real estate tax bill to pay or court hearing to go to, a place where the mantra "The best government is the one that governs the least" is music to my ears, my only question as I read Simon Black's letter is what took me so long? a letter I 'd like to share with you....


Date: January 13, 2011
Reporting From: Santiago, Chile

Yesterday evening I was walking around the beautiful tree lined streets of Providencia, one of Santiago's central upscale districts.

I might as well have been walking around Berlin or Strasbourg-- Providencia is a clean, highly civilized area with plenty of parks, cafes, and boutique shops that adjoin the neighborhoods of manicured homes and quiet mid-rise condominium buildings.

On the streets its common to see a host of walkers, runners and bikers-- Santiago is a very 'outdoors' city, much like Austin or Vancouver, and with such beautiful mountain vistas and great weather, it's easy to understand why.

What's interesting is the number of languages that you can hear being spoken while walking around town-- the varied nationalities that have made Santiago their home is staggering for a country of this size (17 million).

It's common to see the token French, German, British, and American expats... but in addition you come across people from all over the world-- Africans, Taiwanese, Thai, Russians, and even Iraqis.

Chile has become one of the countries in a growing list that welcomes foreigners with open arms-- people who are willing to work hard, add value, or bring in capital are respected and treated well.

This is the same approach that has worked in places like Hong Kong and Singapore; these are two countries where just about every nationality on the planet can enter without a visa.

Propping the door wide open for foreigners provides significant economic benefits; people are more likely to visit (and spend their money) in a place where they are treated well, and they're more likely to do business in a place where they feel comfortable.

The exact opposite end of the spectrum is the United States... and to a growing degree, the UK. Foreigners who arrive to the US are subjected to discourteous, disrespectful measures and made to feel like lowlife criminal terrorists.

For many, it's an absolutely horrific experience. Maria C., the Chilean lady who owns the apartment I'm renting in Providencia told me yesterday about her most recent-- and last-- trip to the United States.

The Department of Homeland Security decided that, instead of being a well-respected Chilean national attending her Harvard reunion, she was a suspected Colombian drug trafficker. DHS detained her for over 12-hours, confiscating her purse, her passport... even her shoes.

She was continually interrogated by DHS officials who played good cop/bad cop mind games, and when she was given 'permission' to use the bathroom, it was under close-up video surveillance. They finally released her without so much as an explanation, let alone an apology.

Maria's story is unfortunately common; Homeland Security's Customs and Border Patrol division takes itself way too seriously, and its uniformed chimpanzees are convinced of their own righteousness... that their actions are actually defending the homeland.

One recent story makes this attitude abundantly clear. It involves a Canadian woman, Lind Bird, who was stopped, searched, and relieved of her $2 Kinder Surprise egg by US border patrol agents.

Kinder Surprise eggs are a type of European chocolate candy, and they're considered illegal in the United States because the FDA has deemed them a choking hazard for children.

The eggs are perfectly legal in Canada, and Bird had one in her vehicle as she was crossing the border. After a stern talking-to by agents, Bird's egg was confiscated by the United States government, who subsequently sent her a 7-page letter demanding that she authorize the 'destruction' of the egg.

Stories like this are so ridiculous that they border on satire... and yet they're entirely true.

Rather than wasting taxpayer dollars such nonsense, the US government should be rolling out the red carpet for all nationalities with welcome signs saying "Thank you for spending your hard earned savings in our economy... and while you're at it, please consider mopping up our excess housing inventory!"

I mention housing because it's such a massive problem; the latest census data shows that there are 19 million vacant homes in the US... and climbing. There are only a handful of ways to clear out this surplus.

First, the country can wait it out until a new generation of Americans comes of age, moves away from mom, and establishes a new household. Given the country's anemic growth rate over the last decade, this option will take years. And years.

Second, the excess inventory could be consumed by a sudden surge in Americans' wealth that sends them on a shopping spree for second and third homes.

Considering that the government has spent a few trillion dollars to create a few hundred thousand temporary and low-paying jobs, however, this seems unlikely.

Third, foreigners could provide the much-needed influx of people and capital that are required to purchase and fill the surplus of homes. Given the way that the government has so distastefully mistreated foreigners over the last several years, however, those cries would likely fall on deaf ears.

Just ten to fifteen years ago, if the US housing market had been in a similar situation, foreigners from all over the world would have been lining up to buy cheap property in the states; there was no greater status symbol than having a home in New York, San Francisco, or Florida.

Today, foreigners understand that the world is a big place, and that there are dozens of other countries that will treat them like human beings, and offer attractive incentives to boot.

Latvia is one country already taking this step, offering EU residence to anyone that purchases real estate subject to minimum criteria (I'll have a lot more actionable information about this in our upcoming edition of Sovereign Man: Confidential, due out this weekend).

Meanwhile, the US government will continue to treat visitors like criminals, scare citizens about terrorist threats, and wrap itself up in a blanket of righteousness... all while failing to realize that instead of protecting the homeland, these policies take an active role in the destruction of the economy.

Simon Black
Senior Editor, SovereignMan.com

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Friday, December 24, 2010

Chilean VUL Life Insurance

The following post is from American-expat correspondent in Chile, Dr. John Cobin:

Chile is arguably the overall best place in the world for most people to live. But that fact does not mean that Chile is the best place to keep the majority of their assets. Indeed, many other places are better-suited for that task: Singapore, Guernsey, Jersey, Labuan, Liechtenstein, Abu Dhabi and Andorra, just to name a few.

The most widely-known financial instrument that Chile has going for it is the Chilean peso, which is about as solid as it gets for a fiat currency. Further, peso accounts can be denominated in Unidades de Fomento (UFs) which, in short, is an inflation-proof quasi-currency based on the peso.

Chilean stocks have also doubled in the last two years and a mutual fund or brokerage account has been a good friend to those who have had one. The biggest problem with UF and fund accounts for foreigners is that one must have a visa (and national ID card/number) to open them. When one can qualify for these accounts, he can realize some significant financial benefits.

However, there is also another Chilean product that should be in the limelight: life insurance. On account of very favorable legislation in Chile, a person with a visa can profit handsomely in Chilean or global stocks through a variable universal life contract. Why should one consider such a product?

1. No death tax (which is otherwise as much as 25% in Chile);

2. No capital gains or income taxes on your profits;

3. Lawsuit and judgment proof (including divorce decrees for alimony or child support);

4. Face amount and death or disability benefit is stated in inflation-proof UFs;

5. Face amount is payable to the insured prior to death for total disability;

6. Face amount and death or disability benefit increase with the amount of investment and are always significantly greater than the policy’s cash value;

7. Policies can be overfunded with unlimited amounts of cash, without fear of “modified endowment contract” conversion like in the USA (meaning that, for example, one can buy a UF2,000 policy–US$90,000 face amount equivalent–with a annual premium equivalent of US$4,000, and dump in an extra US$100,000 equivalent every year without losing the legal protections and tax advantages of life insurance;

8. Overfunded policies have surrender penalties but illustrations at assumed growth rates of around 10% show that the full investment (and more) can be recouped by the second year of the policy, making the investment medium rather than long term in nature, with larger additional contributions making the surrender penalty problem much less significant.

Imagine writing a check representing nearly all the value of your estate to the life insurer upon news of a terminal illness, immediately transforming your estate into a tax free benefit. All your money would be protected in your VUL contract. With a little more creative thought, you can probably think of other valuable uses for this product.

I have worked in the financial services industry for over 15 years and this product is unparalleled in the USA. The eight benefits listed above are simply tremendous. And property rights are secure in Chile. For that reason, as part of my services to expatriates, along with buying Chilean gold coins and real estate, I help them set up overfunded life insurance accounts. In January, we will be announcing a special visa program for wealthier clients which includes quick access to life insurance, UF, mutual fund and brokerage accounts as part of the service.

Dr. Cobin’s book, Life in Chile: A Former American’s Guide for Newcomers, is the most comprehensive treatise on Chilean life ever written, designed to help newcomers get settled in Chile. He covers almost ever topic imaginable for immigrants. This knowledge is applied in his valet consulting service, where he guides expatriates through the process of finding a place to live and settle in Chile, helping them glide over the speed bumps that they would otherwise face in getting their visas, setting up businesses, buying real estate, investing in Chilean stocks or gold coins, etc.

Source=>>Sovereign Man

Thursday, October 14, 2010

Leave Me Alone!

by Mr. Ogre

So, I’m watching the US and world economy going down the drain. I’m seeing the globalization of America, and seeing real hard times coming. So, I’d like to prepare myself and at the same time, do what the enviro-lefties want, and reduce, reuse, and recycle. Here’s my plan:

I want to obtain some land, maybe in Montana. I’d like to build a home (think log-cabin), and then farm the land to feed myself. I might also do some work as a carpenter, and perhaps trade with some other folk in the area, maybe some vegetables for meat or furniture for animals. I won’t require anything of anyone. I won’t use force to make people do anything for me or provide me with anything. I will help people when I can, but not if they don’t want my help.

Only one problem with my plan — it will not be possible, because it would break dozens, if not hundreds of laws. I’d have to pay taxes on the purchase of the land. I’d be required to pay annual taxes simply for living on the land. I may run afoul of various federal laws if I happened to plant vegetables in “federally protected” lands. I would get in trouble if I defended my life against a wolf that was intent on killing me. I would be required to pay taxes on voluntary transactions between myself and other willing people. I would be evicted from my home by force if I didn’t receive the correct government permits before building, and would jailed or killed if I attempted to live in a house that did not meet arbitrary government standards. I would have my family taken from me, should I attempt to allow my children to help me labor on the land, or if I were to allow others to employ them to learn a useful skill. If I were to go to the bathroom without getting permits and following government regulations for connections to various government systems, I would also be jailed or killed.

In other words, in this country, once the land of the free, it is now a large number of serious crimes to simply attempt to live free. Oh, how I yearn for freedom.

Monday, September 6, 2010

Ecuador emerges as world's most affordable retirement haven

According to a story recently published in U.S. News and World Report, Ecuador is emerging as the world's most affordable "retirement haven." For as little as $850 a month (see below), you can live in Ecuador and cover rent, food, utilities, transportation, health insurance and entertainment needs.

The three most popular cities in Ecuador for retirement are now Quito (the capitol), Cuenca (a high-elevation city in the Andes), and Vilcabamba (in the spring-like "Valley of Longevity" to the South).

More than 100 people a day are now moving to Ecuador to experience its amazing year-round weather, abundant food production, culture and comfortable cost of living.

According to US News and World Report (http://finance.yahoo.com/news/The-W...), here's how costs of living add up for typical single-person living in Ecuador:

Rent: $200 (see below for more details)
Utilities and Internet: $120
Groceries: $240
Transportation: $40
Health Insurance: $50
Entertainment: $200

Of course, this is just a basic living package. In some areas, you'll spend considerably more on rent, but food is affordable just about everywhere!

I lived in Ecuador on and off for two years (and plan to go back!), and came to love what it has to offer. Here are my thoughts on the three most popular retirement destinations in Ecuador:

Ecuador's top three retirement destinations for homes and land


Pros: Easy access to international airport, easy to find and buy things you want or need.

Cons: Crowded. Air quality isn't as good as other cities. High-density city living.


Pros: Very "European" feel in architecture and culture. Top destination for Europeans to buy homes. Lots of shops for food and household goods.

Cons: Considerably colder weather due to high altitude. More rain than other areas.


Pros: Amazing year-round weather, ridiculously easy food production in rich soils, with abundant water from nearby mountains. More "country" living than city living.

Cons: Higher rent due to shortage of affordable housing. Must drive to Loja for shopping.

Real-world costs of living in Ecuador

It's true that Ecuador offers very affordable living, but only after you acquire land and a house there. That can cost you anywhere from $100k and up depending on where and how nice your land is. Home construction is accomplished with high quality materials but takes more time than home construction in the USA or Canada.

Once you have your home and land squared away, living in Ecuador is extremely affordable. That's why it has become one of the most popular retirement destinations in the world.

If you want some domestic help, budget in another $250 per month (or so) for a cook or groundskeeper. If you decide to own a vehicle there, you'll need to budget for that, too (don't expect to buy a car on a loan, you'll need to pay it in full up front).

Realistically, I would recommending budgeting more like $1200 per month to live more comfortably, and that's after you've acquired your house and land. A couple can live comfortable for only slightly more, and a family of four can live well on $1500 per month.

Vilcabamba resources

Vilcabamba Real Estate Company (VREC)

One of several available ranches with a home and orchard:

Amazing photos from Hacienda San Joaquin:

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Thursday, September 2, 2010

Chicxulub Diary

September 2, 2010

By Janet Phelan

I first came to Mexico in the early seventies. Straining at the confines of the small midwestern liberal arts college where I was in my second year, I responded decisively to a small ad in a progressive magazine, advertising a free university in Cuernavaca, Morelos. The founder of this project, Ivan Illych, had been gaining some notoriety for his concept of “De-schooling America,” and his institute, CIDOC, featured an array of radical thinksters of the post-flower power era.--most notably, Paul Goodman and John Holt.

I finished up my semester, bade farewell to Iowa, and took off for Mexico. I was nineteen.

CIDOC was perched on a hill overlooking one of the most beautiful cities in Mexico. I quickly found a room in a house –no, a mansion, whose ten bedrooms were rented out to a mish-mosh of Americans and Canadians, in Cuernavaca for varying periods of time to attend CIDOC or CALE, an intensive Spanish language training institute. A self professed Weatherman, on the lam from the law, also lived in the mansion, which had a smaller two story house (for the maid and gardener) as well as a large swimming pool in the overgrown and labyrinthine backyard. It was the height of radical chic.

Every day, I would walk to the busstop to take the ride up the hill, usually accompanied by my housemate Debbie, a drop out from Reed College, in Portland. Every day, we would walk by a construction zone, where the workers were busy erecting a new office building. Every day, we would be subjected to catcalls and hoots. Gringas in Mexico, I learned, were reputed to be “putas” and were fair game for the most outrageous propositions and insults.

CIDOC was predominantly occasioned by gringos. Up on the hill, the culture that I was accustomed to reasserted itself and women were treated according to the general standards of America in the seventies.

Every evening, I would ride back down the hill into a world which treated Norteamericanas as exquisitely scorned whores.

When I left Cuernavaca a few months later and took off on the road, the questionable status of a gringa travelling alone became even more salient. On more than one occasion, I would check into a small hotel, to find the concierge following me up the stairs and propositioning me as I slammed the door on him, locking myself in.

Why was this, I wondered. I began to examine my appearance. I wore jeans, t-shirts and sometimes short skirts. Mexican women, on the other hand, appeared far more demure. Were the clothes then a flag, an invitation?

American movies were beginning to be widely distributed in Mexico. The sexual revolution was in full swing in the States, and the big screen showed women picking up and enjoying men, at will. Did the Mexicans then get their perception of American women through the media?

After several months travelling through Mexico, I returned to college. My horizons had expanded and I chose to transfer to U.C. Berkeley.

While I returned to Mexico on a number of short excursions, it was not until I returned in 2010 that I began to appreciate the degree to which American culture had continued to impact Mexico. Gone are the days of the catcalls and the loudly hooted invitations. Mexican women now adopt the same streetwear persona as American women—tight tank tops with black bra straps clearly visible, skin tight jeans with rips riding high on the thighs, pierced nostrils and tattoos. Other cultural indicators also support the perception that morality, ala Americana, has deeply infiltrated the Mexican psyche. The local paper here, PESO, features a centerfold of scantily clad young women, while the personal ads clearly advertise those offering sex for money. Some are underage.

At the local hangout for gringos in this Yucatan beachtown, “Jellyfish Bill”

( so known for the tattoo he sports on his forearm) is now known to have two young Mayan mistresses living with him. Bill, a former high roller in the time- share industry, is in his early seventies and is reputed to have lost millions in the peso crash. He now lives off his social security check and regularly runs a tab waiting for that monthly check to be deposited in the bank. The two beautiful young girls now hanging on his arm, I am told (by those attempting to mitigate my concern that he may be preying on their innocence), are having a far better life than they would if they were only dependent on their incomes as shop clerks. “They are the smart ones,” I am told. “They know how to get the butter for their bread.”

Other economic issues appear to have subtly altered, as well. I remember well the friendly bartering that accompanied purchases where a fixed price was not clearly marked. Now, I have to guard constantly against waiters returning the wrong change as the bill is negotiated. On one occasion, as I was paying for groceries in the check-out line, the young clerk grabbed significantly more out of my palm than the bill called for, and glared angrily and defiantly at me as I tried to explain to her that she needed to return some of the coins. I reflected ruefully on the behavior of stateside “professionals”--attorneys and trustees—padding their expenses and using their clients' monies as their own. The scale may be different but the mind set -is the same--”You got it, but if I can get a hold of it --it's mine!”

The globalization of the economy has resulted in the spread of the values which piggyback on an ethic of financial gain, at all costs. The secrets of the Mayans have all but disappeared. The Mayan prophecies, focussing on the apocalyptic date of 2012, are nearly all that have survived. Written in the Mayan book Chilam Bilam is the warning from the fifth prophecy: “There will be general loss of prestige of politics, politicians, political parties, and religious leaders; ineffectiveness and inefficiency in the administration of public and private resources of the State and of the companies, institutions, and national and world governments; as well as at the family and community level; product of the greed and ambition, generating corruption.” Side by side with this warning of overriding corruption and self-interest resides the undeniable reality that the world-as-they-knew-it has disappeared. In the place of the mysteries of time and dimensional travel, is the face of Mexico today-- sexy, money-driven –and a host for the American meme.