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surebought
Junior Nomad
Posts: 84
Registered: 11-30-2009
Location: Ensenada
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I Smell a devaluation coming.
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.
In a while the smile on my face turned to plaster.
Stick around while the clown who is sick, does the trick of disaster. Neil Young from Mr Soul.
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bajabass
Super Nomad
Posts: 2016
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Location: La Paz,BCS
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Mood: Want to fish!!!
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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!!
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DianaT
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Yes, it also could mean a lot to us right now, so really curious on why you are thinking this??
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durrelllrobert
Elite Nomad
Posts: 7393
Registered: 11-22-2007
Location: Punta Banda BC
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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
Bob Durrell
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surebought
Junior Nomad
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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.
In a while the smile on my face turned to plaster.
Stick around while the clown who is sick, does the trick of disaster. Neil Young from Mr Soul.
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BajaBruno
Super Nomad
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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.
Christopher Bruno, Elk Grove, CA.
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gnukid
Ultra Nomad
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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]
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mtgoat666
Select Nomad
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 the sky is falling
newkid:
you should buy gold and bury it in your back yard, then tell me where you live 
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Woooosh
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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
\"The only thing necessary for the triumph of evil is for good men to do nothing\"
1961- JFK to Canadian parliament (Edmund Burke)
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gnukid
Ultra Nomad
Posts: 4411
Registered: 7-2-2006
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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]
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surebought
Junior Nomad
Posts: 84
Registered: 11-30-2009
Location: Ensenada
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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?
In a while the smile on my face turned to plaster.
Stick around while the clown who is sick, does the trick of disaster. Neil Young from Mr Soul.
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gnukid
Ultra Nomad
Posts: 4411
Registered: 7-2-2006
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| 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
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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]
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oldlady
Banned
Posts: 1714
Registered: 10-31-2005
Location: BCS
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| 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
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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.
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oldlady
Banned
Posts: 1714
Registered: 10-31-2005
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| 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? |
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oldlady
Banned
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Registered: 10-31-2005
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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]
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tiotomasbcs
Super Nomad
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Location: El Pescadero
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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
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toneart
Ultra Nomad
Posts: 4901
Registered: 7-23-2006
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Mood: Skeptical
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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.
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Dave
Elite Nomad
Posts: 6005
Registered: 11-5-2002
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I don't see any devaluation coming near term. Mexico actually lowered its external debt by almost 12% over last year.
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Bajahowodd
Elite Nomad
Posts: 9274
Registered: 12-15-2008
Location: Disneyland Adjacent and anywhere in Baja
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| 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.
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Dave
Elite Nomad
Posts: 6005
Registered: 11-5-2002
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Total?
| 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.
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What indicators?
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