BajaNomad - I Smell a devaluation coming.

I Smell a devaluation coming.

surebought - 5-21-2010 at 08:04 AM

16 to 1 should not lead to immediate inflation and it will briefly cut expences in the public sector and will give a great kick start to exports. And all the retires will benefit from less living expences for a while. But it won't bring the tourists back. Anyone in retail will have to take a 30% hit on their inventory until it turns over.

bajabass - 5-21-2010 at 08:11 AM

What is your basis for the "smell". I am ready to buy a house or lot in Baja soon. Timing could save thousands, if not tens of thousands of dollars!!

DianaT - 5-21-2010 at 08:18 AM

Yes, it also could mean a lot to us right now, so really curious on why you are thinking this??

durrelllrobert - 5-21-2010 at 08:36 AM

This was in Bloomburg report last month:
By Andres R. Martinez

April 21 (Bloomberg) -- Rogelio Ramirez de la O, the Mexican economist who predicted the 1994 peso devaluation, said the currency will rally through the end of 2010, the second time in as many years that he has abandoned a forecast for a decline.

The peso will strengthen to as much as 11 per U.S. dollar, an 11 percent gain from today’s level, before finishing the year between 12 pesos and 12.2 pesos, Ramirez, the sole partner at research firm Ecanal, said in an interview in Mexico City today.

Investors are buying the Mexican peso to take advantage of the carry trade, borrowing in nations with low interest rates to purchase higher-yielding assets, Ramirez, 61, said. Mexico’s 4.5 percent benchmark interest rate is higher than near zero rates in the U.S., 1 percent in the euro-zone and 0.1 percent in Japan. The peso has risen 7.5 percent this year, the best performance among the 16 major currencies tracked by Bloomberg.

“Financial markets are being inundated with liquidity right now, and investors are buying any instrument they can get their hands on,” Ramirez said. “Mexico has become a target for the carry trade.”

Ramirez said in January that the currency would weaken to 15 pesos per dollar by the end of the year as the recovery in the U.S., the biggest buyer of Mexico’s exports, falters and central banks remove stimulus.

In March 2009, Ramirez predicted the peso would strengthen to beyond 13 per dollar by year-end from 14.1722 after President Felipe Calderon said he was seeking a credit line with the International Monetary Fund. Earlier that month he had predicted it would weaken to 18.2. The currency ended the year at 13.0914 per dollar.

The currency rose 0.3 percent to 12.1790 per U.S. dollar at 5 p.m. New York time today from 12.2212 yesterday.

Ramirez, who earned his PhD in economics at Cambridge University, was the chief economic advisor for 2006 presidential candidate Andres Manuel Lopez Obrador

surebought - 5-21-2010 at 08:56 AM

Public Sector expences are way out of control. The Private sector is rapidly shrinking, especially in the Tourist Sector which has gone to zero. Rather than deficit spend like they do in the states, Mexico can simply cut public sector employment expences by devaluing the Peso. The Oil money rolls in in dollars and this will save the day once more. Buying Real Estate in Mexico is almost always in dollars, but the news won't increase Real Estate prices. Trust fees and Notory estimates, I hope were quoted to you in Pesos and not dollars. I wouldn't be in a hurry to buy property in Baja. Not a good time to have a Peso savings account in a Bank or to be in the Mexican Stock Market. Exports are the place to be in my opinion. I have survived the devaluations of 1976, 82, 87, 94, and 08. I could be wrong, but it won't cost anyone on this board a penny to take my advice and be prepared.

BajaBruno - 5-21-2010 at 09:02 AM

Everyone's entitled to their own opinion, of course, but looking at a peso/dollar graph going back to 1996 would lead one to believe that the peso tends to correct about every 4 years, sometimes slightly and sometimes dramatically.
Using that trend, the peso isn't due to move significantly for another couple of years, and it has held fairly tightly in the 13 - 13.25 range for the last year.
The Euro is in trouble right now, but the USD - MXN doesn't correlate well with the USD - EUR. They are on seperate tracks. My vote (for what it's worth) is no significant correction absent a major global financial meltdown, which doesn't seem likely.

gnukid - 5-21-2010 at 10:31 AM

Anyone who is in denial of the severe financial issues looming can not likely be helped, for many even knowing the facts, there is nothing they can do.

Currencies around the world are being devalued in unison, this is largely due to the excess printing of money causing inflation since fiat currencies (dollar) are not backed by gold or anything. The dollar has been devalued from 1917 values to now to a degree that it is worth pennies in comparison and certainly most old timers can attest to that. It's obvious.

Currencies are primarily managed by central banks who are private and have no oversight or reporting, stock markets are now mostly traded by institutional traders, computers etc... and the individual traders make up a small percentage who have no inside information and are in no position to compete.

The recent 1000 point drop was a message, a threat, it was an manufactured drop which serves as both a warning and a serious threat that the market is controlled by puppeteers and you better not mess with them or further regulate derivatives-today's regulation reform is joke, a shell of what is needed to end credit default swaps, derivatives, naked shorts etc... that are all tools of profit on your backs.

So, you won't see a peso-dollar radical change necessarily though you might-the if and when is hard to predict but you will see that your dollar buys less basic commodities, housing is in a free fall in many markets but in affluent areas it remains stable-oddly enough.

So, what can you do? Most of you will do nothing until after a serious collapse, which makes some sense. Certainly the with massive debt across nations and more than 19 on the verge of total bankruptcy, the USA is playing games with currencies and markets to attempt to profit and stay on top of a sinking boat. The manipulations across markets are prevalent.

You can not look for financial info on main stream media because they are feeding you hype and misleading messages, forget Yahoo finance or even bloomberg, NY Times or Washington Post or even the Financial times. Look to data points and trust your own opinion and conclusions.

Basic advice is reduce debt, reduce consumerism, do not buy crap, do not waste money and get out of corporate investments and banking.

Here are some data points:

FDIC is in debt-short many millions.

Banks use fractional banking-meaning they loan out on a percentage of deposits.

Bankruptcies and foreclosures are up-this month fixed rate foreclosures are way up-more than 3 million Americans lost their homes in the last year and the numbers are rising as are the tools and mechanisms to take homes away from those who owe tax or are in default.

The USA under Obama has spent (borrowed) more in one year than in all the previous 200 years. The wars rage on without purpose and cost escalate.

So, in conclusion, money is becoming less valuable, banks are insolvent and going bankrupt in order to consolidate central banking, people are insolvent and losing their homes, employment opportunities are fewer and pay less, actual oversight is less and less while printing of money to false fuel economies is increasing, all the while interest rates are artificially low.

Now even if you are on vacation in Baja and in complete denial-cant you see there is a devaluation happening and a massive devaluation looming. You will not profit from this-institutional traders will profit from the downturn and they will consolidate-as they have done in banking, insurance, automobiles, and healthcare.

If you can't figure this out, its because your brain is being programmed by constant false messaging-turn off your tv and try to talk to your neighbors and see your community as having your common interests. Join together and support each other and develop local industries and business.

[Edited on 5-21-2010 by gnukid]

mtgoat666 - 5-21-2010 at 10:37 AM

:!:

the sky is falling :!:

newkid:
you should buy gold and bury it in your back yard, then tell me where you live :lol:

Woooosh - 5-21-2010 at 10:39 AM

Baja real estate is most always priced in dollars- the peso devaluation will have little impact on the sales price. Even the real estate crash of two years ago had little effect on sales price. They just wait it out down here. If you have cash- sit on it and be thankful to have a safety net. This is not a good time to be joining the Baja real estate circus with an all cash position. Given the casino atmosphere in all world financial markets right now- it's going to be a very challenging few years coming our way and who can go that long without sleep? JMHO

gnukid - 5-21-2010 at 11:02 AM

What is strange is that while many home markets across the USA have been massively devalued and therefore people are upside down with their mortgages, leaving them with loans well in excess of the value of their homes, in Baja, Mexico published home prices haven't changed even though those sales are flat.

I still see occasional sales closed at similar market prices to recent years, yet many thousands of homes are on the market and many many condos and timeshares exist for rent, sale or trade well in excess of demand. In La Paz, there are thousands of cement box units for sale and Cabo as well. Yet the prices remain the same as before? 400-800k There are few employment opportunities in Baja, few industries and few business opportunities except basic consumer goods, retail and food yet homes/condos are still priced out in the hundreds of thousands of dollars? While comparatively in the USA they are far lower?

My non-expert opinion is that the housing market in Baja is complex but not so different from any other. The top end has fallen, jumbo loans do not exist nor even simple loans. So anything above 100k is slow to move if at all. Vacation homes are the first to go down, 3 of 5 are for sale in vacation regions. Low end homes are of value to everyone-Baja is a nice place to live and the cost of living is reasonable. So low end homes 5-50k are selling but largely to Mx nationals who are moving to Baja from MX and the USA.

This complex market creates a confusing message, BCS has an increasing population, it is moving up and up in affluence while the poor population also increases and the perception is things are good-but beneath the surface BCS is suffering from the same weakness as the USA, there is weakness in Government-of course we can not actually talk about that here nor report the daily going ons that are revealed in many papers, infrastructure is wholly inadequate without proper sewage treatment, adequate water and roads. But it still appears to be a value and better place to live and buy than any other North American Markets which is why the market prices remain high.

If you want a place in Baja certainly you should make an offer on the place of your dreams, just be aware that most listed prices of high end homes are much higher than the going rate for homes sold-if that makes any sense-and be aware that large complexes suffer from the weakness of the minority, so if your thinking of buying into a condo complex you will bear the burden of the minority who can not pay home owners fees or who simply default and walk away and at some point early on, this burden is overwhelming. Better to find a single family home under 100k in a stable neighborhood and buy what you can afford to pay for in cash.

[Edited on 5-21-2010 by gnukid]

surebought - 5-21-2010 at 11:08 AM

The Casas de Cambio in Ensenada are 12.25 today. I exchanged at Santander at 12.60 today. At Soriana they're giving 13.20 if you pay in dollars today. Soriana must want dollars to pay their suppliers and employees forward with cheaper Pesos. Is there another reason that they would do that, other than anticipation of a different exchange rate?

gnukid - 5-21-2010 at 11:10 AM

Quote:

Originally posted by mtgoat666
:!:

the sky is falling :!:

newkid:
you should buy gold and bury it in your back yard, then tell me where you live :lol:

I am not a gold investor, though I understand that it might be a good investment. I live in the most wealthy regions of California and Baja among the crooks and liars, they are my neighbors and quite often friends (who got sucked into the game). Although I am a poor slob, I get stuck at parties next to the biggest venture capitalists, bankers and CEOS and worse foreign nation presidents and even worse than that I have to sit next CFR losers over dinner-they start out with the false messaging how its going great but after a few stiffy c-cktails even they admit it's a complete scam that is falling and will fall completely apart sometime soon in the next 1-2 years. Even multi millionaires worry they will be bankrupt, yesterday a billionaire told me he couldn't get a loan on his real estate holdings that are paid for in cash and turn a profit! Many of my wealthiest friends have only a few thousand in the bank-seems odd?

Really its a game over attrition, many if not most will fall and be consolidated, many gain on the weakness of others-it's sad what has been orchestrated-though I am not a doomsday predictor, to me things are getting better the more clarity that is present.

I do worry about the seniors though, that's why I posted this message. We must come together and see our common interests and stop the divisive mean spirited attacks which only weaken our community. We must share techniques to survive and patronize each others businesses and stop feeding the machine that is eating us. Its common sense survival.

There are some simple solutions if even a small percentage could educate themselves, we can end this game in heartbeat if we understand it.

Again, I urge you to turn off TV and try to read or use other real data points that are not manufactured by corporate interest who profit off of your back.

I am often surprised how when I meet a simple rancher in Baja with TV or Radio or News, they are far more prescient and aware than most Americans.

[Edited on 5-21-2010 by gnukid]

oldlady - 5-21-2010 at 11:14 AM

Quote:

Originally posted by mtgoat666
:!:

the sky is falling :!:

newkid:
you should buy gold and bury it in your back yard, then tell me where you live :lol:

yada,yada,yada.

Actually, with all the financial chaos these past couple of weeks, the pricipitous drop in precious metals is a data point that strengthens gnukid's case.

oldlady - 5-21-2010 at 11:26 AM

Quote:

Originally posted by surebought
The Casas de Cambio in Ensenada are 12.25 today. I exchanged at Santander at 12.60 today. At Soriana they're giving 13.20 if you pay in dollars today. Soriana must want dollars to pay their suppliers and employees forward with cheaper Pesos. Is there another reason that they would do that, other than anticipation of a different exchange rate?

oldlady - 5-21-2010 at 11:31 AM

The FOREX is very volatile these days. The peso was at 13.20 at 7 this morning, it's about 13.02 right now. It also hit 13.20 for a few minutes yesterday, depends on when they set their rate.
They could be motivated by what you suggest...anything's possible.

[Edited on 5-21-2010 by oldlady]

tiotomasbcs - 5-21-2010 at 12:54 PM

ATM's give the best/highest rates of exchange at the time of transaction, verdad?? That's what I have always understood. If I have cash--effectivo where is the best place to make a dollar to peso exchange?? Baja Norte and Baja Sur? I understand banks charge commisions which by the way just increased! Thanks Tio

toneart - 5-21-2010 at 01:22 PM

Gnukid is a visionary. He also see the big picture and is not afraid to gaze into the future instead of being stuck in an old paradigm. The old paradigm is NOT working and all indications are for a total economic collapse. We are there now. It is only the corporate media that is keeping it propped up, and thus prolonging the fall.

Most of you will get caught by complacency. Make your defensive plans now, if you can.

If you can't buy into gnukid's seemingly radical prognoses (this spelling is plural), at least go out there in your mind and contemplate what he is saying.

Here is what how you can use what he is saying: Get out there with him in your mind. Surely everything he sees will probably not materialize, so then pull back to a stretch of your own imagination, based on support from your own reading and extensive research that is more comfortable and tolerable for you. Just don't remain with the status quo and get caught by surprise. If you do you will be misplacing your trust in institutions and governments that have no regard for you.
:smug:

Dave - 5-21-2010 at 01:23 PM

I don't see any devaluation coming near term. Mexico actually lowered its external debt by almost 12% over last year.

Bajahowodd - 5-21-2010 at 01:27 PM

Quote:

Originally posted by surebought
Public Sector expences are way out of control. The Private sector is rapidly shrinking, especially in the Tourist Sector which has gone to zero. Rather than deficit spend like they do in the states, Mexico can simply cut public sector employment expences by devaluing the Peso. The Oil money rolls in in dollars and this will save the day once more. Buying Real Estate in Mexico is almost always in dollars, but the news won't increase Real Estate prices. Trust fees and Notory estimates, I hope were quoted to you in Pesos and not dollars. I wouldn't be in a hurry to buy property in Baja. Not a good time to have a Peso savings account in a Bank or to be in the Mexican Stock Market. Exports are the place to be in my opinion. I have survived the devaluations of 1976, 82, 87, 94, and 08. I could be wrong, but it won't cost anyone on this board a penny to take my advice and be prepared.

Methinks that your observation that the tourist sector has gone to zero is a mistaken observation influenced by your location in Ensenada. No doubt that some areas have really seen tourism dry up, especially close to the border. However, I have friends who have recently been to Cabo, and others who were in Cancun. They both told me that each location appeared to be business as usual.

That said, Mexico's economy experienced a 4.3% growth in the first quarter versus prior year. Just can't see currency devaluation under those circumstances. That is, unless gnu is correct that somehow conspiratorially being devalued in unison.

Total?

Dave - 5-21-2010 at 01:31 PM

Quote:

Originally posted by toneart
The old paradigm is NOT working and all indications are for a total economic collapse. We are there now. It is only the corporate media that is keeping it propped up, and thus prolonging the fall.

What indicators?

Bob and Susan - 5-21-2010 at 01:57 PM

11.9...12.2...12.5...13.1..."go dog go"

mtgoat666 - 5-21-2010 at 02:14 PM

Quote:

Originally posted by toneart
Gnukid is a visionary. He also see the big picture and is not afraid to gaze into the future instead of being stuck in an old paradigm. The old paradigm is NOT working and all indications are for a total economic collapse. We are there now. It is only the corporate media that is keeping it propped up, and thus prolonging the fall.

Most of you will get caught by complacency. Make your defensive plans now, if you can.

i assume you are telling us that stock market wealth will evaporate, real estate holdings will devalue to zilch, and the only security net is to buy guns/ammo, learn a trade that has value after armageddon, and live on a self-sufficient farm or commune.

perhaps i got to get some of what you two are smoking!

[Edited on 5-21-2010 by mtgoat666]

knuckles - 5-21-2010 at 02:15 PM

I think gnukid is spot on......

I have a not so crazy uncle living in a bunker in Utah. He has been telling me the same things for 20 years. I always wondered what he was smoking...but knew he was a smart guy and have been taking his advice more seriously in recent years.

gnukid has put it in perspective, listen now folks before its too late.

tripledigitken - 5-21-2010 at 02:24 PM

Based on these posts...........................

I'm buying Alcoa stock!!!

Ken

toneart - 5-21-2010 at 02:40 PM

Quote:

Originally posted by mtgoat666

Quote:

Take out the guns/ammo and you may have it. Self-sufficient farm could translate down to growing whatever food you can. Communes are not for most including myself. But Community help, support and mutual trade is very realistic. That is happening now, more and more.

...and go get or grow your own stash. Stop coveting others'.

mtgoat666 - 5-21-2010 at 02:40 PM

Quote:

Originally posted by gnukid
I live in the most wealthy regions of California and Baja
I get stuck at parties next to the biggest venture capitalists, bankers and CEOS and worse foreign nation presidents and even worse than that I have to sit next CFR losers

Please don't choke on your silver spoon!

toneart - 5-21-2010 at 02:53 PM

Quote:

Originally posted by Dave

Quote:

What indicators?

Dave,

The indicators are most of the ones that have already been mentioned by others in this string.

You probably won't like my answer because it is only opinion. My opinion is based on projections of my constant monitoring, reading and immersion in watching this thing go down. It is also based on intuition, which has no value to anyone else, but it serves me well.

I too am a futurist with a pretty good self-confirming track record. However, I can be wrong and sometimes am. What I have to say about being occasionally wrong is that time has not borne me out yet. It's coming!

On my Toneart business/pleasure card I try to be modest. I printed the slightly self-deprecating line: "A Visionary In Over His Head". :tumble:

What I want on my tombstone is: "A Visionary Really In Over His Head This Time!"

tripledigitken - 5-21-2010 at 03:06 PM

"Even multi millionaires worry they will be bankrupt, yesterday a billionaire told me he couldn't get a loan on his real estate holdings that are paid for in cash and turn a profit! Many of my wealthiest friends have only a few thousand in the bank-seems odd? " Gnukid

These people you describe must have inherited their wealth and take mass quantities of illegal drugs.

They are idiots if they are what they claim, and still fear they will go bankrupt and/or have no money in the bank. So YES, it does seem odd!!!

to the billionaire with vast holding of RE paid for, with a cash flow and can't get a loan.......wha wha wha wha

What also seems odd, if you're as poor as you claim how is it you are hanging with these high rollers, are you a waiter?

Ken

mtgoat666 - 5-21-2010 at 03:26 PM

Quote:

Originally posted by tripledigitken
What also seems odd, if you're as poor as you claim how is it you are hanging with these high rollers, are you a waiter?

or gigolo or drug dealer?

i still think newkid is silver spoon boy from san fran, coasting in loafer mode until daddy warbucks passes on inheritance.

Bajahowodd - 5-21-2010 at 03:36 PM

:lol:

Right on, Ken.

Without launching in to a diatribe about what has gone wrong in this country both socially and financially, I do want to go on record about the supposed economic collapse. In my opinion, had it not been first for Bush and then Obama injecting tons of dollars, many of you probably hate because they propped up ungrateful institutions, we would have sen a worldwide financial collapse that would have dwarfed the great depression. What I don't understand is that now, after Armageddon was averted then, there are way too many folks who cry about socialism, loss of freedom, and the need to maintain free markets. If you don't want to face the abyss again, and soon, you need to get your elected representatives from coddling the financial people. Just yesterday, the payday loan lobby was apparently able to expunge language in the pending financial legislation that would have limited the number of usurious loans they could make to a customer. We are living in very unusual times. However, the onslaught of deregulation that started in Reagan's time is the very thing that caused the recent meltdown. Being able to limit and control greed and ignorance is not socialist. It's pragmatist.

Cypress - 5-21-2010 at 03:39 PM

What am I gonna do with all my money? :lol:

gnukid - 5-21-2010 at 03:52 PM

Quote:

Originally posted by mtgoat666

Quote:

Originally posted by tripledigitken
What also seems odd, if you're as poor as you claim how is it you are hanging with these high rollers, are you a waiter?

or gigolo or drug dealer?

i still think newkid is silver spoon boy from san fran, coasting in loafer mode until daddy warbucks passes on inheritance.

Funny that in this crisis you attack the poor person instead of the rich? I have no idea-well maybe I do, no I don't have any one giving me money, neither suga momma or sugar daddy. I simply have a simple life.

In California and everywhere we brush shoulders, and you might find that most private parties have no entry fee so they certainly do not cost anything, in fact I bet few even carry a wallet or cash.

Look don't try to make me feel bad because I am poor and happy, nor because my friends are rich, apparently they find me interesting and they envy my efficient lifestyle. So yes I am poor. I garden and grow my own foods and fix my old cars and we even make our clothes and sandals and whatever we need. My income is almost zero.

I was sitting at the bar of private club a while ago and found myself next to an attractive and pleasant woman and a few guys in suits. Suddenly someone said hey there are people in suits breaking into your camper out front-I ran outside and so did the woman to see-there were secret service breaking into my car, I stood back and let them do their business. Finally when they stopped and the woman waved them over, I said why did you illegally enter that vehicle you broke the law, they said no, we have a constitution free zone 100 miles in from any border and besides we are protecting the president of Argentina who you are drinking with?

I laid into them pretty hard about the slippery slope of thinking they are beyond laws and the constitution even if they think they have President Obamas approval, its still against the law. Then they made some hot young female secret service buy me drinks-but I balled her out the whole time for being part of the destruction of the USA. It sucks, these guys really believe they are above the law. An ACLU lawyer was there too but he wouldn't take the case because he said I didn't really suffer serious consequence. Damn.

My point to you seniors is, don't follow main stream media, trust yourself, stop buying crap and get out of corporate investments. Even the Obama administration has said they will likely need to take your 401k and mutual funds to pay the debt but they are going to pay you back later on...

Is anyone even a little bit cautious about trusting the media as a guide to finance? Anyone? And yes, good question what will I do with my money? Very good question?

[Edited on 5-21-2010 by gnukid]

tripledigitken - 5-21-2010 at 04:02 PM

Gnukid,

Let's be clear. I did not attack you. I asked how is it you are hanging with wealthy people when you say you are poor. Unless you are in the service industry that is unusual. I questioned the honesty/intellect of the wealthy people you are having conversations with.

Multimillionaires, the smart ones, have investments in Corporations and or LLC's to insulate those assets from their personal assets. So when a "wealthy" person says he/she has no money in the bank, well.... it just doesn't ring true.

Your theories of the world, etc. I just take exception to, with a few exceptions.

Ken

Woooosh - 5-21-2010 at 04:27 PM

Quote:

Originally posted by mtgoat666

Quote:

and you only have until December 21, 2012 to do it all... :saint:

[Edited on 5-21-2010 by Woooosh]

surebought - 5-21-2010 at 04:41 PM

Wow, I didn't really want to cause any panic. I am just saying that the exchange rate could go to 16 to 1 quickly. That's is not exactly economic meltdown. It's actually a good thing, unless you get paid in pesos or the Government owes you money. Actually I think that Mexico overall has weathered the last two years pretty good, economy wise. Its pretty hard to have a credit crisis if no one works with credit anyway. Most people who own property, own it free and clear here. That's why you don't see the prices going down. "If someone wants to give me a redicules price for my property, I'll take it. Otherwise, I'll just pass it on to my kids." I have heard that a lot from Mexican Property owners over the years.

chippy - 5-21-2010 at 04:45 PM

I´m sorry gnu but your posts are really lame. You are poor but hang with billionaires? You drink at private clubs but you are poor? WTF? Am I missing something here? Plus your doom and gloom hopes are the same B.S. I´ve been hearing all my life from religous zealots. You act like you hang with Mexicanos yet I have never met a Mexican with your twisted negative point of view. I think my life plan will be to do the opposite of what ever you spew. Saludos

PS Bring on 16 to 1!!!!!!!!!!!!!!!!!!!!

[Edited on 5-21-2010 by chippy]

Cypress - 5-21-2010 at 04:46 PM

surebought!! :yes:

Bajahowodd - 5-21-2010 at 04:49 PM

Point is that with the Mexican economy growing faster than almost any other, if the Peso falls, it really only means that Mexico's exports will be cheaper for the rest of the world, allowing them to export more goods.

That said, Noting that I'm nothing close to an economist, as the trouble in Europe causes the Euro to weaken and the Dollar to strengthen, Mexico is just going to have to hold on for the ride, inasmuch as what you are quoting is Dollar v. Peso.

mtgoat666 - 5-21-2010 at 05:09 PM

Quote:

Originally posted by gnukid
I was sitting at the bar of private club a while ago and found myself next to an attractive and pleasant woman and a few guys in suits. Suddenly someone said hey there are people in suits breaking into your camper out front-I ran outside and so did the woman to see-there were secret service breaking into my car, I stood back and let them do their business. Finally when they stopped and the woman waved them over, I said why did you illegally enter that vehicle you broke the law, they said no, we have a constitution free zone 100 miles in from any border and besides we are protecting the president of Argentina who you are drinking with?

I laid into them pretty hard about the slippery slope of thinking they are beyond laws and the constitution even if they think they have President Obamas approval, its still against the law. Then they made some hot young female secret service buy me drinks-but I balled her out the whole time for being part of the destruction of the USA. It sucks, these guys really believe they are above the law. An ACLU lawyer was there too but he wouldn't take the case because he said I didn't really suffer serious consequence.

hard to follow along with this story :?:

am i to understand that you were hitting on the prez of argentina when the US secret service roughed you up, and then you tried hitting on a hot secret service agentina, and you almost got into her pants using a tirade about civil rights, but then the ACLU dissed you :?:

so which chick did you go home with? :lol:

Cypress - 5-21-2010 at 05:15 PM

Bajahowodd, You're not an economist? Who would have guessed? The Mexican economy is an example of a powerhouse? Good God in heaven! The average income is well below poverty. The Dollar vrs. Peso is like a pit bull vrs. a chihauhau. :lol:

oldlady - 5-21-2010 at 05:28 PM

I sure find it interesting that anyone who cares/enjoys/loves Mexico, even as a part-timer or visitor, relishes a devaluation of its currency. Maybe greed was redefined and I missed the memo.

I don't know what economic collapse means. I do know that devaluation, globally, at some degree or another is a concern by some economists.

The currencies of commodity based countries fell hard this past week. Mexico, Canada, the Aussie hit lows not seen in a long time, moving more than the peso. Metals and oil prices were down. That may be nice when you fill your gas tank, but not real good for Mexico. When a company or country has to sell its product for less it's not a good thing. That's devaluation and it hurts.

"Why" is debateable, take it as a signal or not. But I sure don't support ridiculing gnukid for sharing an observation, however it was derived, with well meaning intent.

Hook - 5-21-2010 at 06:01 PM

If the central banks really do control everything (as the New World Order worrywarts postulate), for the life of me, why would they want to see the world thrown into utter economic chaos? These people are rich beyond belief already; why create a whole host of problems on a global scale that will simply reduce the flow of money between countries and foster anarchy? They are well invested; it would hurt their investments, too.

Call me an inveterate optimist, but I think the NWO is all about simply controlling people for the GOOD of humanity, not to gloat over the anguish they can produce. By controlling economies on a worldwide scale, they reduce the possibilities of Hitlerian type dictators re-emerging and also make it much harder for religious zealots to finance their schemes.

Yeah, it is social engineering on a global scale and will mean less freedom going forward. But it is a Brave New World out there, where truly evil ideas can move faster than ever.

My prediction is that, with the control the central banks now possess, currencies will continue to slowly drift towards stasis as the NWO folks create large groupings that reduce nationalistic differences. North America, Asia, Europe, etc. Currencies worth more will be reduced towards currencies worth less within these geographic regions.

The differences we enjoy between the cultures and the laws (or lack, thereof) of different countries will probably be a bittersweet memory in 20-30 years.

I have often looked back at descriptions of the incredible freedom at the beginning of the 20th Century with longing. Unfortunately, the evils of the middle part of that century took care of most of that. We cant let that happen again.

However, I cant argue with Gnukid's counsel to reduce debt and reduce consumerism on a personal scale. Many of us were already taught these lessons by our parents and grandparents who lived through the Great Depression.

Some of us just seemed to have forgotten those lessons in the pursuit of the shiny objects.

Donjulio - 5-22-2010 at 06:44 AM

Quote:

Originally posted by bajabass
What is your basis for the "smell". I am ready to buy a house or lot in Baja soon. Timing could save thousands, if not tens of thousands of dollars!!

I would recommend waiting at least another year or two. Prices have not hit bottom and have a ways to go. Just my opinion.

toneart - 5-22-2010 at 09:57 AM

Quote:

Originally posted by Woooosh

Quote:

Originally posted by mtgoat666

Quote:

and you only have until December 21, 2012 to do it all... :saint:

[Edited on 5-21-2010 by Woooosh]

I have a date for that particular day. It will be a lurid adventure. Let's just say we are going to leave this planet with a bang! :!:

Bob and Susan - 5-22-2010 at 11:00 AM

for us simpletons...

December 21, 2012: Judgment Day

Science can neither confirm nor discredit the validity of many religiously or prophetically deemed judgment days of the future

the soonest will be arriving December 21, 2012, the final day of the Mayan Calendar

oldlady - 5-22-2010 at 12:38 PM

Guess I won't be needing my stock pile of incandescent bulbs.

Bajahowodd - 5-22-2010 at 01:16 PM

Quote:

Originally posted by Cypress
Bajahowodd, You're not an economist? Who would have guessed? The Mexican economy is an example of a powerhouse? Good God in heaven! The average income is well below poverty. The Dollar vrs. Peso is like a pit bull vrs. a chihauhau. :lol:

Maybe you ought to read what I wrote. I never called Mexico an economic powerhouse. I merely stated that a falling peso could stimulate their exports. That said, Mexico is really not an economic wimp. They rank 13th in the world. Any measure of poverty is a domestic issue. They have plenty of money. It's just not distributed in a fashion that would eliminate or decrease poverty. Good thing there's no poverty in the US.

comitan - 5-22-2010 at 01:29 PM

History tells us that devaluations follow with the changing of the president.

MitchMan - 5-22-2010 at 01:30 PM

The amount of regulation necessary in a society is directly proportional to the quantity and diversity of people within a given sovereinty and the average amount of space per person in a given group location.

Also, the distinction between religion and superstition is often blurry.

What the human race really needs is a system of necessary incentives and just (fair and equitable) compensation in an educated democratic society of ever vigilant voters.

Naah, never gonna happen in my lifetime.

[Edited on 5-22-2010 by MitchMan]

Devaluation

lookingandbuying - 5-22-2010 at 01:50 PM

This thread has devalued!!

Cypress - 5-22-2010 at 02:03 PM

MitchMan, You're a skilled verbalist! Appreciate your contribution and looking forward to more.

irenemm - 5-22-2010 at 05:27 PM

A devaluation would be very bad for Mexico and the Business here. For the people who have there money from the States that is fine. But for us who work and earn our money in Mexico for it to devalue by almost 50%. The food in the baja goes up by that amount and more. Much of the food products come from the United States and Canada. I know because that is what Our distributor's bring us. All that food products will be so costly and we can not pass that cost on to just the gringos, just because you have dollars and you can buys more pesos. The Mexican does not have dollars to by the devalued peso. His pay will stay the same for a very long time. Yes people will adjust but it will take a very long time for that to happen.
For you that think it is not a big deal or it is a great deal for you, your wrong. It will hurt the people that you know and have befriended.
It will not be good for anyone.
Irene

woody with a view - 5-22-2010 at 05:42 PM

Hook said.....

Quote:

However, I cant argue with Gnukid's counsel to reduce debt and reduce consumerism on a personal scale. Many of us were already taught these lessons by our parents and grandparents who lived through the Great Depression. Some of us just seemed to have forgotten those lessons in the pursuit of the shiny objects.

and here i am buying our first home NOB. i got a little bit of a later start growing up, but then so did Peter Pan!!! no one knows the future but i sure as hell hope the euro keeps crashing before i lock in my rates.

as for those who have already retired, your situation is VASTLY different than us youngsters so there is not much sense in prognosticating on things. you are only guessing.

i am still hoping! :saint:

k-rico - 5-22-2010 at 05:47 PM

Congrats on the new home, that's exciting. Glad to hear about people buying. That's good for all, even the old folks.

But don't hope for any currency to crash, hope for stability.

[Edited on 5-23-2010 by k-rico]

Nan&D - 5-22-2010 at 05:57 PM

thanks for the reality check irenenm

irenemm - 5-22-2010 at 06:46 PM

Nan
Your welcome
Went to your web page. Very nice. Hope you will stop by sometime and see the Muriel painted in our banquet room. They are so beautiful you as an artist will truly love them.
We will tell you all about them if you stop by. you can see some of it on our wed page.
enjoy

wornout - 5-22-2010 at 07:37 PM

Quote:

Originally posted by woody in ob
Hook said.....

Quote:

and here i am buying our first home NOB. i got a little bit of a later start growing up, but then so did Peter Pan!!! n

Congratulations on your home. I took my money out of the stock market in 1998 and invested in Mexican Housing. Yep, built a strawbale home in San Felipe and have been here ever since. The interest? Well, let me tell you about the interest. No house payments for 12 years, now that is some interest. Oh yea, I still have my original investment and I can't say that about the money I had in Enron :-(

Mexicorn - 5-22-2010 at 08:04 PM

It will be 14 to one by weeks end.

Woooosh - 5-22-2010 at 08:34 PM

The peso has been down more than 20% for a long while (12:1 or more) and not only is the sky not falling- no one but us has noticed. More will take notice at 30% and 40% and China won't be happy with tech-export price competition. Oh well- for the rest of us it'll be a good time to change those coffee cans of US coins into pesos to keep the bar stocked.

woody with a view - 5-23-2010 at 07:21 AM

Quote:

Originally posted by k-rico
Congrats on the new home, that's exciting. Glad to hear about people buying. That's good for all, even the old folks.

But don't hope for any currency to crash, hope for stability.

[Edited on 5-23-2010 by k-rico]

my greedy plans include (if the world doesn't end in 2012 :light:

) in 10 years taking out $40k in equity. buying two more homes to rent out. 10 more years later selling one (or both) to pay off my primary home and retiring down south with a fistful o' dollars.

it's good to have a plan!

as for the euro, they all despise the dollar (and the u.s.) so it is refreshing to hear them b-tch about how it is america's fault that greece needs a bailout. F'em!!! their pain means my interest rates are falling. nobody cared when the dollar was falling like a rock.....

pepino - 5-23-2010 at 08:20 AM

I smell a lot of opinions. :lol:

bajalou - 5-23-2010 at 11:55 AM

Just looked back a little over a year - Peso was at 14+ to the dollar for the month of march 2009.

woody with a view - 5-23-2010 at 12:58 PM

Quote:

Originally posted by pepino
I smell a lot of opinions. :lol:

si, Pepino. opinions are like culos. everyone has one and they all stink.

Peso falls six straight days

BajaNews - 5-25-2010 at 03:52 PM

http://www.signonsandiego.com/news/2010/may/23/peso-falls-si...

May 23, 2010

Mexico’s peso fell against the dollar for six consecutive days until rising to 12.9491 to the dollar Friday. That broke the peso’s longest losing streak since September. The six-day fall, attributed in part to the European debt crisis, erased a year-to-date gain for the peso.

-----------------------------------------

http://www.businessweek.com/news/2010-05-25/mexico-s-peso-we...

Mexico’s Peso Weakens for Second Day on European Debt Crisis

May 25, 2010, 6:03 PM EDT
By Andres R. Martinez

May 25 (Bloomberg) -- Mexico’s peso dropped for a second day on concern the European debt crisis may be spreading, threatening to slow the global economic recovery.

The currency dropped 0.1 percent to 13.0443 per dollar at 5 p.m. New York time, from 13.0300 yesterday. The peso earlier touched 13.3848, the weakest level since Nov. 9. The decline pared the peso’s gain this year against the U.S. dollar to 0.4 percent.

“The risk is that the European economy and the global economy will begin to slow in the second half of the year,” said Bertrand Delgado, a senior Latin America economist at RGE Monitor, a research company in New York. “Markets are way too fragile right now and any little thing is affecting them.”

The MSCI World Index of 23 developed nations’ stocks fell as much as 3.4 percent today. The Standard & Poor’s 500 Index dropped as much as 3.1 percent before closing higher.

The drop in crude oil, Mexico’s largest export, is also driving the peso lower, Delgado said. Oil revenue funds about a third of the government’s budget. Crude fell as much as 4.4 percent before settling at $68.75 a barrel in New York today.

Mexico’s unemployment rate rose to 5.4 percent in April from 4.8 percent in March, the national statistics agency said. Economists had forecast the rate would fall to 4.7 percent, according to the median of 14 estimates compiled by Bloomberg.

Deposit Restrictions

The yield on Mexico’s 10 percent peso bond due in 2024 fell one basis point, or 0.01 percentage point, to 7.679 percent, according to Banco Santander SA. The price of the security rose 0.11 centavo to 120.26 centavos per peso.

Traders didn’t exercise any of the $600 million in options available today, the central bank said on its website. The central bank has been auctioning the options monthly, allowing it raise its foreign reserves after the peso fell to a record low last year.

Mexico will put new restrictions on cash deposits made in U.S. dollars in an effort to curb money laundering, Mexican Finance Minister Ernesto Cordero said.

The rule changes will be announced in detail next week, Cordero told reporters today during an event in Mexico City. He emphasized that Mexico isn’t implementing exchange controls.

The measures aim to crack down on the finances of drug traffickers and organized crime in Mexico. The U.S. Justice Department estimates $17.2 billion of cocaine, marijuana and other drugs cross the border from Mexico into the U.S. annually. More than 22,000 people have been killed in related violence since President Felipe Calderon took office in 2006.

DavidE - 5-27-2010 at 07:58 PM

There are just too many variables for this poor humble MBA to see a clear path through the fog. One issue is USA institutional investors who can dump a billion or three into Mexican instruments with the touch of a key. They are looking for yield and Mexico has it and the USA doesn't. Mexican finance ministers learned after the christmas surprise that feeding the wolves just a few dozens of millions of dollars a day can have a rather dramatic strengthing effect -if there is no external pressure on the peso-

Guillermo Ortiz was the first to discover this and the practice is now instiutionalized to the point of automation. If pressure is heavy trading stops and then resumes when things calm down. To wit, the peso can devalue by a half point in a day under heavy trading then revalue over the next several days with injection of US Dollars.

wessongroup - 5-28-2010 at 06:57 AM

Wow, too cool... just like the United States House and Senate... great thread... thanks to all