Episode Summary
In this episode of The Expat Files, Johnny Mueller dives into the complexities of living on the gringo tourist trail in Latin America. He explores both the advantages and the risks, from the ease of dealing with bribes in English to the dangers of scams in real estate and business ventures. Johnny also touches on the cultural impact of expats and the economic challenges facing countries like Colombia.
Johnny begins by responding to criticism about his negative portrayal of gringos and expats on the tourist trail. He defends the experience by highlighting both the challenges and the benefits. He shares personal experiences from living in Costa Rica, where he found that locals often prioritized English over Spanish and were more interested in tips and dollars. He also warns about the risks of scams, particularly in real estate, and notes that many expats and gringos are targeted by these schemes. However, he acknowledges that living on the tourist trail can offer a 'soft landing' for newcomers, as these destinations are often more first-world in appearance and experience compared to the more chaotic parts of Latin America. He recommends short-term trips and all-inclusive packages to avoid the pitfalls of permanent residency.
He then discusses the advantages of living on the 'gringo tourist trail,' highlighting several benefits. These include the ease of dealing with bribes due to English-speaking police, the ability to avoid social interactions with locals, and the availability of clubs and organizations that cater to expats. He also touches on the cultural impact of gringos on local communities and the tendency of expats to create their own cultural enclaves, often at the expense of local culture.
In a humorous tone, Johnny lists the advantages of living on the 'gringo tourist trail' in Latin America. He highlights the availability of American-style services, products, and cultural experiences, such as American-style bars, fast food, and schools, while also making light-hearted jokes about the local populations and the potential for 'revenge' from historical figures like Montezuma. He also mentions the acceptance of U.S. currency in tourist areas and the availability of pharmaceutical products. Johnny uses a news article about Costa Rica's vaccination program to support his argument about the influence of first-world countries on Latin American healthcare policies.
He then discusses the challenges of living on the gringo tourist trail, emphasizing that starting a brick-and-mortar business is unlikely to be profitable for most expats. He warns that while it's possible to have a successful internet business, expats should be cautious of scams and overzealous business partners. He highlights the common pitfalls of investing in real estate or business ventures with local partners, often involving a lack of personal investment from the partner and a high risk of being scammed. He also touches on the economic situation in Colombia, noting that while it's being touted as the next Costa Rica, it's facing significant economic challenges, including a devalued currency and a struggling oil industry.
Finally, Johnny discusses the economic challenges facing Colombia, focusing on the oil industry's struggles due to high transportation costs, political instability, and high taxation. He highlights the impact of these factors on foreign investment and the broader economic outlook for the country.
Topics
Gringo tourist trail, Expats in Latin America, Scams and real estate, Language barriers, Soft landing for newcomers, Media portrayal of Latin America, Bribery and language barriers, Social isolation from locals, Cultural enclaves and expat communities, Advantages of living on the gringo tourist trail, Availability of American-style services and products, Cultural and educational experiences for gringo children
Chapters
00:00:00 Opening 00:00:39 Defense of Living on the Gringo Tourist Trail 00:03:49 Soft Landing for Newcomers 00:05:47 Language and Communication on the Tourist Trail 00:06:07 Signs of Being on the Gringo Tourist Trail 00:11:58 Reason Number Five: Clubs and Organizations for Expats 00:12:15 Nice to be on the tourist trail 00:12:17 Joining American-style organizations 00:12:36 Favorite organization: Republic Rats Abroad 00:13:03 No need to change to local currency 00:13:15 Acceptance of damaged U.S. currency 00:13:41 Access to American products and franchises 00:14:41 Americanized schools for gringo children 00:15:50 Costa Rica's vaccination program and U.S. influence 00:18:18 The Reality of Starting a Business on the Tourist Trail 00:19:01 Making Friends and Facing Scams 00:21:57 Colombia's Economic Situation and Its Implications 00:24:23 Introduction to Colombia's Economic Struggles 00:24:33 High Costs of Oil Extraction in Colombia 00:25:27 Colombia's High Taxation Rates 00:26:00 Proposed Tax Increases and Their Implications 00:26:31 Minimum Wage and Its Impact on Competitiveness 00:26:58 Central Bank's Inflation Mismanagement
Transcript
Automatically transcribed from the original recording; names and wording may contain errors.
[00:00] South of the border down Mexico way That's where I fell in love when the stars above came up to play and now I wonder Hello there all you expat wannabes. I'm Johnny Mueller and you're listening to the expat files living in Latin America The show that tells you just what it's like to live work play and or retire down here in Latin America It's a mix of the good the bad the ugly and the great and it's all right here. So let's get started Okay, so people send me emails saying Johnny You're so negative about gringos and expats living on the gringo tourist trail So today in defense of living on the gringo tourist trail, I'm gonna give you some of the positive benefits
[00:46] There are some you know, I mean, come on I lived on the gringo tourist trail for two and a half years in Costa Rica Of course, I couldn't learn my Spanish there because all the Costa Ricans wanted to speak English with me because they want to learn their English I found out in a hurry. They much prefer tips and dollars than over the local funny money Colonies not to mention I watched every single one of my gringo friends get ripped off there, too Not just by the locals though There was a lot of that but by savvy long-term gringos and expats even Canadians and Europeans Most of whom who had also been ripped off when they first came down to some More than once so they know the game and they're on the lookout for starry-eyed mostly fresh green gringos Looking for their little piece of paradise on the cheap, of course
[01:34] Let's just say green gringos even seasoned gringos are prime targets for a scam Especially a real estate scam and it's true many clever frugal gringo investors Check their brains at the boarding gate when they travel to a so-called tropical paradise like Panama or Costa Rica Even though the investment opportunity hey days of these so-called tropical paradise have been over for years sometimes decades But still you've got rags promoting them like Conde Nast the overseas retirement letter Aarp and of course international living you named the retirement ragger blog and they never quit talking about Costa Rica Panama Nicaragua Ecuador and now Columbia and I'm forever seeing articles with the scary title
[02:21] Which country will be the next Costa Rica at least it's scary to me and believe me Whatever the flavor of the month happens to be be it Nicaragua, Columbia, Chile, Uruguay I'll be staying far far away from those places That is except when airlines and hotels put together packages and offer great deals on short-term beach vacations Though I don't much recommend gringos live in those countries permanently or part-time even unless you have tons of dough And you just have to be around gringos all the time However, I do recommend short weekend and week-long trips as Sun in fun destinations And if you do so, here's a big tip try to buy it one of those all-inclusive hotel destination packages in the end It could save you thousands at least then you'll have a good idea what your budget's gonna be
[03:11] If not be prepared to be whipsawed by extreme gringo pricing and be prepared to be treated Indifferently at best by the locals if you don't tip first-world style But wait a minute. This was supposed to be about the advantages of living on the gringo tourist trail, right? Sorry about that Okay number one in defense of living on the gringo tourist trail It's a very soft landing If you're really worried about all the things you hear and see up in the first world media about the third world Because you see if your destination is on the gringo tourist trail as soon as you land You'll be absolutely astounded as to how first world the place really is No truckloads of snarling military guys with ak-47s on every corner No broken down scruffy airport facilities that make you long for that budget tell back in Cleveland
[04:00] No stray bullets flying or bombs bursting or narcos shooting it out with federales in front of the airport Meaning if you land that one of those airports on the gringo tourist trail It is a good prescription for the timid and over cautious traveler Just coming down to test the waters to see if they can handle what they believe will be extreme third-world chaos In fact, I always do recommend that fresh green gringos who've never been to Latin America before Check out some of the tourist spots like Cancun Playa del Carmen Costa Rica Panama Ecuador even the big cities in Colombia Just so that you can firmly get it into your mind in your system with boots on the ground Once and for all that not all of Latin America consists of that scruffy chaotic crisis-ridden dangerous third world
[04:48] Yeah, see in Hollywood movies 60 minutes and nightly TV news reports Of course, there are places just like that down here in Latin America, Venezuela to name one for sure But that's why you listen to this program next pet files living in Latin America So you can avoid those places and keep far far away Just like sane people up in the states avoid Harlem East LA Detroit most of st. Louis three-quarters of Washington DC half of Atlanta a Quarter of Cleveland half of the Chicagoland area too and on and on too bad There isn't a companion show called the illegal alien files living in Big Brother land. Now. There's an idea Who knows could go viral certainly with the millions and millions of illegal alien wannabes in Latin America
[05:34] But then we'd have to do it in Spanish, right? Isn't that just the way life goes so many great ideas and never enough time to act on one-tenth of them Anyway, here's another point in defense of living on the gringo tourist trail You won't ever have to struggle with learning another language Since there'll be so many gringos around and all the locals will be boning up on their English by trying it out on you By the way, that's a very good clue that you are definitely on the tourist trail That's especially true when the porters and the taxi drivers at the airport can all speak English Another sure sign you're definitely on the gringo tourist trail is when you're driving from the airport through town to your hotel If you see a lot of signs in English Well, you're there now for reason number three in defense of living on the gringo tourist trail when not if you get pulled over
[06:25] By the cops for any reason at all You'll find out exactly how much the bribes gonna be because they'll tell you in English Nope, there's no getting away with the clueless gringo act that works so well when you're off the trail when on the trail The cops will know enough English to hitch up for a bribe and it will be in dollars So you won't have to carry any funny money around with you In fact to make that transaction easier on you because you might not have a good mental grasp of funny money to dollar conversion rates They may just insist on dollars So do have fifty hundred or even two hundred bucks in cash stashed somewhere on you or in your wallet because unlike paying Coppa more Dito or bribe in a place like San Pedro Sula Honduras Well off the gringo tourist trail where ten or twenty bucks in the local funny money will suffice
[07:15] Note when on the gringo tourist trail cops will insist on Franklin's not Jackson's Okay now reason number four in defense of living on the gringo tourist trail You won't have to mingle socially or hang with any of the locals. You can avoid that prospect completely It's easy why because there'll be so many gringos and expats around and so many common first-world activities Involving gringos that you'll almost never meet any local Latin people socially only your maids and your gardeners retail clerks Bank tellers shoeshine boys and such you'll most certainly be living in a subdivision or gated community with a ton of other Gringos and as for Latin people even those in your own socioeconomic bracket
[08:01] You'll generally find when on the gringo tourist trail that they live in Subdivisions and gated communities with other Latin families of their class and caliber sure You'll run into them here and there when you're shopping and when you have to deal with your lawyer account Doctors and other professionals and such but note that though they drive a large percentage of their income from gringos Who've been flooding in in most cases they prefer to live in their own neighborhoods And though as said before in highly gringo iced areas the local Latin is put on a happy face They recognize their own local culture and their way of life has been permanently distorted by just too many damn gringos Not to mention every time a place gets popular with gringos The cost of living rises dramatically and who does that affect the most the Latin's of course
[08:51] So when on the gringo tourist trail don't tell me that behind all those happy Latin faces There isn't a touch of resentment The fact is when you're on the gringo tourist trail And you sit down with long-term expats living there when you get down to brass tacks and opinions You'll hear things like this They'll tell you the locals want what we have but no they can't get it unless by luck or if a scam or a con Is involved which is why there seems to be little concern and zero sympathy within the local Latin community when gringos get ripped off and scam I understand Spanish I know what they're saying crazy gringo gringo loco stupid gringo gringo is stupido But they never say it with sympathy. They don't say poor gringo gringo Bobre
[09:38] They say gringo is stupido or gringo idiota However, when you're off the gringo tourist trail there is concern and sympathy in their voices You don't hear gringo is stupido or gringo idiota Though you will hear gringo loco crazy gringo because well, we're considered crazy in all Latin countries But off the tourist trail work crazy in a nice way You get the picture by the line don't expect to be invited to a Christmas dinner or quince a annual party anytime soon Off the tourist trail. Yes on the tourist trail not likely unless you're trying really hard to make Latin friends It's like this when it comes to upscale Latins on the gringo tourist trail think of that 1970s era song by the OJ's the backstabbers
[10:26] I know I'm dating myself, but you might know the lyrics they smile in your face all the time They want to take your place Now I'm not saying that doesn't occur off the gringo tourist trail too But there are just so few of us gringos around that were kind of a novelty Like for example when I went to an all-white grade school back in Chicago The very first Mexican kid that went to our school Well, he was a novelty and everyone warmed up to him wanted to be his friend invited him everywhere But then after a few years and a couple of dozen more Mexican families the initial excitement and novelty Simmered down man did it simmer down? That's human nature I guess so again when on the gringo tourist trail you'll probably never have to interact socially with local Latins
[11:12] But then again, that's perfectly fine with most gringos on the tourist trail because that's the way they like it now I don't get not wanting to understand and blend in with the culture But that's just me the fact is the vast majority of gringos you meet on the tourist trail Want to create their own little version of Cleveland in a latin country Which come to think of is exactly what illegal latin immigrants do in the states don't they they create their own little version of back home Honduras Nicaragua Mexico or San Salvador in some gringo city even more ironic They don't want to learn the language They don't want to mingle with the locals and they don't want to know or absorb the local culture Hmm isn't that strange? That's just like most all gringos living on the tourist trail
[11:58] Okay, here's reason number five in defense of living on the gringo tourist trail there'll be dozens and dozens if not hundreds of Transplanted clubs and organizations that you can join to make you feel like you're right back at home in Seattle or Cucamonga or Cleveland Isn't that nice? You'll find the Rotary Club the Sierra Club the Humane Society the Society for disabled veterans The Red Cross a a even neurotic synonymous thinking about joining that one myself They've got aarp and amnesty international even get this that disgusting thieving organization The united way and last but not least of course my personal favorite republic rats abroad And how do I feel about that?
[12:44] Well, I can only hope that montazuma takes out his revenge on those lunatic members frequently Oh, and by the way, if you're on the gringo tourist trail You're never hurting for gringo bars and us style sports bars and therefore no shortage of drinking buddies And reason number six in defense of living on the gringo tourist trail You'll never have to change to the local funny money. They'll take gringo dollars practically everywhere And by the way, here's an important tip when you're on the gringo tourist trail locals will accept Mutilated torn and disfigured us money even the occasional artistically modified Lincoln with a penis for a nose Whereas off the gringo tourist trail gringo funny money will rarely be accepted in any condition With the exception of Ecuador and El Salvador two countries off the tourist trail that use US dollars as their currency
[13:36] Okay now for number seven in defense of living on the gringo tourist trail You'll certainly be able to find almost every known gringo product and franchise. Yep. It's true You'll be able to get any pre-digested high fructose corn syrup saturated Antibiotically laced chemically enhanced gmo fortified synthetic food product your liver can tolerate Whoa, don't ask me to say that again However, that would not be true when you're off the gringo tourist trail case in point I've been asked by more than one of my previous seminar attendees Where can I get some diet Mountain Dew? In fact one attendee who'd lost a hundred pounds in six months on a very very naturalistic diet Said his only vice was diet Mountain Dew and after a few days at the seminar
[14:23] He was having the Mountain Dew DT's and you know what I couldn't help him I'd never seen it on the shelves off the tourist trail and I've never seen regular Mountain Dew either Yahoo Mountain Dew. Okay now recent number eight in defense of living on the gringo tourist trail And that would be if you bring your kids down They'll be able to go to schools that are completely 100 percent americanized with practically no latin students at all Just other snotty ass little gringo kids And of course most all of the teachers will be gringos too So your child can enjoy all the first world double speak benefits of a us public school common core education As endorsed by hillary with almost no local latin cultural influence at all
[15:09] Okay, then reason number five in defense of living on the gringo tourist trail You'll be able to get all the latest and greatest first world pharmaceutical products Just like if you were living back up in cleveland or atlanta Are you on the latest and greatest calcium channel blocking blood pressure medication? Do you need a specific handful of psychotropic anti-depressant medications just to be able to log on to facebook or press a button on your tv remote? If you're on the gringo tourist trail, you're in luck latin doctors are all clued in They know just what drugs and medicines a gringo needs to get them through the day including every first world gringo vaccine known to man too now for some proof Here's an article from the biggest costa rican newspaper from january 11th of this year
[15:56] It says and i'll translate the costa rican social security department has announced It will buy an additional 1 million influenza vaccines for 2016 aimed at minor children the elderly health care professionals and to supply demand and get this the tourism segment and The expat population in a statement just issued by the president of the republic It says the national commission on vaccination and epidemiology. That's cnve Coordinated by the costa rican ministry of health reports that the amount of vaccines purchased have been ever increasing since the seasonal influenza vaccination program started in 2003 and how's this for the kicker? It says following the lead of first world countries like the united states
[16:46] The government announced that in 2016 Construction will start on a production facility to produce millions of doses of vaccines Including the seasonal flu vaccine now. Here's the real strange part get this The vaccination production plant will be financed with 14 million dollars provided by guess who? Russia. Yes, russia. Will somebody please tell me what that's all about? I can think of a lot of scenarios there and none of them are good. Okay. Now we have number nine I think it's number nine anyway in defense of living on the gringo tourist trail If you do rest assured that you won't have to waste any time thinking about how you're going to start a business down there because it'll Be almost impossible to do so successfully
[17:32] Why because anything you can think of has already landed down there That means if you have a so-called great idea your competition will be gringos Meaning you'll be up against people who've been there a while and who know the system Rest assured you'll be no farther ahead trying to start a business on the tourist trail Then you would be trying to make a go of a business up in the states Meaning if you want to live on the gringo tourist trail, you're best to just look at it as a pleasant tropical retirement plan Nope, nothing wrong with that. It's the perfect life for someone who's got a nice outside retirement income stream Who might be into water sports or crazy about golfing? Tennis gardening painting maybe writing or just sitting around in a hammock by the pool Sucking down tropical drinks with little umbrellas in them
[18:18] But again, if you're going to live on the gringo tourist trail don't get the big idea You're going to come down and start a kick-ass business. You might give it a try a lot of people have But the reality is the majority just chug along giving the gringo something to do and a tiny bit of extra income Meaning you'll most likely need a supplemental income from the outside Or a hefty nest egg to tide you over so don't get your hopes up. Don't clutter your mind up about it Now that previous info is in regards to starting up a brick and mortar business However, that's not to say you couldn't have a very fulfilling and profitable internet business. You can do that anywhere Okay. Now for reason number 10 in defense of gringos living on the tourist trail Note that it won't take long to make a lot of friends gringo friends
[19:06] And note if you're a born risk taker which you probably are to some degree if you come down here to live Either on or off the gringo tourist trail You will be spotted as a fresh green gringo right away That's obvious and you will be approached by quote businessmen and real estate people Of course and people with so-called sure fire Investments and business ideas chances are your own new gringo friends and neighbors and even your new latin lawyer Will try to get you involved in quote sure fire investments with the promise of fantastic returns. Yep I've seen it happen a hundred times a starry eyed fresh gringo swimming with the sharks on the gringo tourist trail So you have to look out for both gringos and fast talking english speaking latins And especially look out for those too good to be true real estate deals
[19:54] Oh and do look out for those latins who want to partner up with you and it usually works like this All you have to do gringo is put up the dough and your new latin partner He'll do the groundwork the legal work the contracts the permits and stuff And he'll always have some inside information or a relative that's connected in the government And he might even introduce you to the guy in a bar over a couple of drinks And of course by now you're pretty excited about the deal So you'll pick up the tab for that too. And yes, it's true. The dough will flow from your hands into his Need some examples. I got a million of them. Like I said every single gringo expat I know that ended up on the gringo tourist trail eventually got ripped off
[20:40] Most often in this order by number one your brand new friend and gringo partner number two Your new slick english speaking latin partner often in conjunction with number three Either your new lawyer or your new business partner's lawyer So again, if you're a gambler and a risk taker and you like very long odds You really could be right at home on the gringo tourist trail. And again, here's another tip I'm sure I gave you a long time ago, but it's worth repeating If some latin person or a gringo approaches you and all you have to do in the business venture is to put some money up A red flag should go up and the question should be he's such a great businessman and it's such a great opportunity How come he's begging other people for money?
[21:27] And why isn't he putting up any of his own money or Some kind of collateral like a car a house or have some skin in the game again If it's such a great idea, why are you that supremely lucky guy? He's approaching with that once in a lifetime deal a guy. He barely knows you just met him remember Chances are he's probably hit up a dozen other gringos before you and they just didn't bite or didn't have the money to get in Okay, there you have it in defense of gringos living on the tourist trail Okay Now let's talk about columbia a place that many expat rags and blogs are saying is poised to become the next costa rica But then again, that's what they've been saying for the past five years about Nicaragua panama and Ecuador So then who's full of bs and who's not?
[22:14] Well, let me read you some excerpts from a recent article explaining what's happening in columbia right now For all you listeners up there who think it might be the investment opportunity or living opportunity of a lifetime Okay, here goes and this article came out on december 17th. It starts out by saying Columbians are reacting joyfully to the news of the fall of Chavismo in neighboring, Venezuela Almost everyone in columbia is well aware that the socialists in venezuela have done the impossible They've wrecked the economy of one of the top five oil producers in the world Then the article goes on to say however columbians themselves are not scrutinizing their own monumental economic failures
[23:01] In fact their economy is on the road to becoming a basket case. Just like venezuela Fact number one the columbian peso has become the world's most devalued currency over the last 18 months Losing at least 70 of its value against the dollar in that time So people are asking why did that happen? What people don't know is that columbia itself has an oil industry and before the big oil bust this year columbians invested heavily in their own oil businesses So when oil prices recently fell the dollar became strong and the peso began to dive What outsiders don't realize is that echo patrol the majority state-owned oil company makes up
[23:51] Roughly half of the entire columbian stock market So when oil fell so tumbled the columbian stock market dragging down the peso along with it Then to further complicate matters columbia being a newcomer to the world of large-scale oil exports As it turns out because it's owned and operated by the government. It's a model of waste and inefficiency surprise surprise, huh? Then it goes on to say just over a year ago when oil was over a hundred dollars a barrel columbian state oil producers Were making money hand over fist, but now that oil is well under 50 dollars a barrel The oil industry has some staggering problems on its hands Due to the country's geological conditions extracting oil in columbia is far more expensive than in adjacent countries like venezuela
[24:40] What's worse? Companies are forced to pay bribes to guerilla and paramilitary groups in order to transport petroleum across the country by road It says in columbia anyone who transports products over large distances within the country Must pay highwaymen who set up roadblocks? Which adds up to the world's highest transportation costs within a single nation and why imported products like electronics are so Expensive in columbia anything that has to be shipped by truck over the road incurs heavy transportation costs Then it goes on to say nonetheless investment in any business in columbia is bound to remain low As long as the government continues to maintain some of the highest taxes in the world
[25:27] Currently columbian companies must hand over 70 percent of their commercial profits in taxes to the columbian government According to the world bank only five countries in the world Tajistan komoros itria, bolivia and argentina Charge higher rates than columbia each of those five countries by the way are now experiencing terrible economic conditions Worse yet, it's expected that president Juan Manuel Santos's government will raise Vat taxes even more next year Saying that these new tax increases are meant to cover the government's fiscal and current account deficits And to finance the hefty price of a looming peace agreement with the farc guerilla movement
[26:15] In other words, he's proposing to pay off the guerrillas with taxpayer money, of course But it gets worse the article says columbia's statist rituals darken the economy's prospects even further Since trade unions and the government annually Negotiate the next year's raise in minimum wage, which is now considered by many experts to be non-competitive Because it's the highest in south america As a result of these problems and proposed new taxes foreign investors are being scared off in every sector except get this real estate Then finally it says economic analysts are saying the columbian central bank is nothing more than a joke, too After underestimating the national inflation figures for 2015 by 100 percent
[27:05] Doesn't that sound familiar? Oops, we're getting near the end Just want to remind you to go to my youtube channel Just put in expat files or the expat files and check out the slideshow that goes along with the audio and do subscribe It's free. Oh and don't forget john gault's famous web and blog site Www the new expat.com where you'll find me in some of my stuff too along with other blogs and articles of great interest south of the border You've been listening to the expat files living in latin america coming to you twice a week from somewhere south of the border Email me the expat files at gmail.com And if you want me to help you sort out your own latin american plans, schedule a one-on-one consult with me
[27:52] Just send an email and let me know at the expat files at gmail.com. Nos vemos