#608 – The Expat Files: Lessons from Latin America and Beyond

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 as I wander 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, let's start by tying up a few loose ends today Now if you remember a couple of shows ago I spoke about how an Airbnb I went to invited by a friend on the Pacific side of Central America was a complete disaster I was invited so I was a guest I didn't have to pay that being the case. I shouldn't be complaining, right?

[00:51] It was free but at best it was a terrible case of false advertising and my friends Well, they were totally and thoroughly embarrassed about it because they were the ones that paid if you remember I mentioned the owners put up beautiful pictures on the web look fantastic So that's what you think you're gonna get right in a way You do because those pictures were at a distance nothing up close so you couldn't see the defects all over the place In fact, if you're watching this on YouTube right now, you'll see exactly what I mean And after that I got some emails from people saying Johnny Does that mean you don't approve of Airbnbs and are they all ripoffs like that? Does that mean there's no oversight government or otherwise? Well, the truth is it's buyer beware and that's the way it should be So the only thing you've got to go by before you make the deal is to check the consumer comments on the website

[01:40] And as far as Airbnbs being self-standard here in Latin America in the vast majority of cases That's not true. There are some really nice ones, but you have to keep your eyes open It's all about due diligence and the fact is a lot of these Airbnbs sites are in Spanish So you'll find out those are almost always less expensive than the ones that advertise in English You know a self-selected sample of gringos being their target They're for gringo prices again to recap closer you get to gringo areas. You're gonna pay gringo prices So don't expect to get great deals, but off the gringo tourist trail. You can get fantastic deals Especially when the ads are in Spanish Remember it's location location location So you really have to do your homework to make sure you don't get stuck in a real bad neighborhood

[02:29] Unless you're just using it as a kind of a base camp to sleep and you never go out hanging in that area That said again, if you're watching YouTube, you're gonna see what this Airbnb look like and how disgusting it really was So if you're watching do note mixed in with some very great shots of the pool in the ocean and the outside premises Beautiful gardening and stuff. You'll see moldy furniture and wooden surfaces Delaminating along with hand railings that are non-existent or broken and do check out the jacuzzi on the veranda That's just loaded with green mold and fungus It's just unbelievable that someone would put a unit like that in the rental pool You'll see just have a look and I'm doing this that is posting the pictures right now because A lot of people send me emails thinking I must be exaggerating. They say Johnny can't be that bad

[03:16] Well see for yourself and I even skip the role of rusted out kitchen appliances And of course a picture is worth a thousand words, but no matter how cool your picture is It doesn't have smell-o-vision. So thankfully you'll never get to know what it was like to walk in and practically gag By the way, have a look at two pictures. I took of under the sink you'll see that the drain pipe and the p-trap for that particular sink is Get this one inch in diameter. You know what the standard is. So maybe you don't it's two inches for the main PVC Drain pipe that goes into the wall into the main sewage system And the pipe coming directly from the drain in your sink is generally one and three quarters inch diameter And at minimum in a cheaply done US subdivision Maybe one and a half inch diameter and when you see that you definitely know there's been a lot of skimping along the way

[04:08] Yes, that's still up to code but not great So you can only imagine what kind of pipe diameters they used within the walls and floors of that building were no one can check Them no one can see oh and I did forget to tell you that my friend and his wife who rented the place had to Call the plumber slash maintenance man as soon as they walked into the bathroom for the very first time It was plugged with well, you know, it was plugged with which again tells you they certainly don't have standard diameter Plumbing and the floors and walls and when the guy came about a half a day later I don't have to tell you it was a real mess So for those of you sending me emails saying Johnny you have to be exaggerating Hyperbole for effect. Well, have a look on the YouTube and see for yourself. All right moving on Here's another point I wanted to mention about health and natural health care herbal and natural remedy products you see down here all over the place

[04:59] But you just don't see them up in the States now, you know up in the first world They're all over you if you make claims you can substantiate and even if you make claims for things that actually work Whereas down here in Latin America, there's none of that You can say what you want about any product and it'll never get checked or investigated unless someone gets sick or dies and actually reports it Of course if you die, it'll have to be someone else that reports it, right? By the way, every Latin American country state department city Whatever does have a health department that comes out and inspects if someone or many people get food poisoning and end up in the hospital Or someone dies and it's linked back to some food or restaurant Not that whoever shows up from the health department actually knows what he's doing After all they get that kind of sack job You have to know somebody or be related to someone in office what they call quayo down here

[05:47] Which means favoritism cronyism nepotism, whatever by the way the word quayo Which like I said means nepotism also means neck and ECK You know the thing that connects most people's head to their torso Though I know that some people for example professional athletes on steroids. That's redundant, right athletes on steroids Don't have necks at all. I know I know I digress as usual, but sometimes Digressing is fun, isn't it? So often when you're talking to a Latin person and he's trying to explain to you about someone he knows who has a good job in government He won't say it's nepotism favoritism or cronyism. He'll just tap the back of his neck Why because that word quayo also means neck A lot of hand signals and body language here in Latin America. They don't have up in the States

[06:33] For example, if someone's a cheapskate Whereas there are a lot of words for that condition in the English language like tight cheap skin flint Scrooge miser a lot of words right well down here There may be fewer descriptive words for things because you know The Spanish language has only around two-thirds the number of words that the English dictionary has But Spanish speakers like Italian speakers at times more than make up for it in body language and hand gestures Which is why one of my gringo expat friends whose hobby is gambling He goes down to the casinos in Panama and Columbia a lot He loves to play with Latins because he says he can read them like a book Whereas Europeans and Americans are much better at bluffing and harder to read

[07:19] But as for us and day-to-day Latin gestures and such like for example If someone's cheap a Latin person might call him a takanyo or he just might touch the tip of his elbow That means cheap. It's just about the same sign language Italians use when they tell you to f1 Though Italians do it with firm conviction and Latins make that motion rather subtly So the same motion in Italian that means go f yourself in Latin America means you or someone else is a cheapskate But where were we? Oh, yeah talking about Latin American Medicinal products stuff to eat drink rub on yourself That's supposed to affect some kind of cure or improve your health or your well-being somehow That's the claim. Anyway

[08:05] Now do note that in most of Latin America There are large indigenous populations and they do not like going to the doctor because number one They're always taller lighter and more European Spanish looking So there's that class difference which is often intimidating to the indigenous person when at the doctor's office So then why so very few indigenous doctors when indigenous numbers can be 40% or more of a country's population Well, unfortunately, it's the upscale children of the wealthy that generally make it through professional schools here in Latin America Not the poor indigenous types who could never afford the tuition even though tuition for a year at a very good private medical school in Latin America is Usually less than five thousand bucks that said most indigenous people don't trust doctors all that much

[08:55] And you know indigenous people have been using herbs and spices and various natural treatments for millennia before any Western doctors or medicine Landed here. In fact, they still use many of the treatments that are pre-columbian in origin you'll see this for yourself, especially if you're off the gringo tourist trail passing through various small indigenous towns if You poke around you'll find out that in almost every indigenous neighborhood There's what you might call a medicine lady and her house or corner kiosk will be loaded with bags and jars full of stuff with crude Tags and labels sometimes handwritten and wouldn't you know it? I was just recently in one of those shops and I have a couple of photos. I'd like to show you So if you're watching this on YouTube now, have a look at this one It's just one of those typical indigenous treatments that could never be sold up in the States because it just promises

[09:46] Way too much and there's no proof that it does any of it though Maybe it does who knows that said many of these products make fantastic claims nevertheless If they're all natural and don't kill you or harm you and you feel better or better about yourself after you use it Even if it's the placebo effect who cares though Like I said if you have bought this stuff and brought it on the plane back to the States TSA would surely confiscate it and probably throw you in a room for questioning by the way that little natural medicine shop I went into must had a hundred or two different salves and remedies and potions and most of them I'd never seen before and had no idea what they were supposed to do that said Let me read what's on the label of one of the products I picked up now It's in Spanish and English and believe me you gotta know I'm way off the gringo tourist trail because it's obvious. No one even bothered to shove this through Google Translate

[10:37] So you've got a crude label here in Spanish and an English translation. This is not my translation. It's theirs It's called in English rue soap r-u-e soap. Okay soaps soap Technically, you can only do a few things one cleanse moisturize possibly maybe exfoliate Well, let me tell you if that's all you think a soap can do You're not thinking outside the box because here's what it says on the label printed in English a kind of English anyway It says rue soap. That's the way P eliminates Menstruation pain which begs the question if that's the case and it's a soap where you're supposed to rub it or maybe you're supposed to eat It hmm, then it says eliminates pain from insect bites, which of course is possible this I like it says

[11:26] Protects you from bad energy Then it says this which is rather confusing a dangling participle or something's dangling anyway It says even sores for babies It says yep, even sores for babies and here's how they spell that Ey en must be an even McGregor fan who wrote that, huh? sores s or yes for babies B A B Y S Then it says Gives good luck to man. If that's true, I'll go back and buy a case and here's the best part It says it's also for trauma or scares scares SCa res Hey, I can live but who might have put this down. Maybe it works

[12:12] You know what they say you believe in something and you're halfway there So by all means when you come on down head to one of these local indigenous pharmacies and by all means pick up some of This stuff especially if you need good luck and or need protection from bad energy trauma and scares Now if you went to a dock up in the states with those symptoms, that would be a job for Prozac, right? Alright, so this just highlights how little less first-world gringos know about day-to-day life in Latin communities especially low-income indigenous communities and Health-wise the question you really have to ask is why do indigenous people who count on natural herbal medicines quite a bit? Who rarely utilize doctors and pharmacies? How is it? They have the same longevity or even more so than their local Latin counterparts that have much better access to modern health care

[13:04] And you know, you talk to some of these old-timers here and they'll tell you they never once been to a doctor's office Or maybe they did see one once 20 years ago, by the way And I'm sure you know this since down here you do not need a prescription for drugs Although of course doctors write prescriptions and you bring it to the pharmacy etc And they fill it out. You don't really need a doctor to do that Which is why pharmacists down here play a much more serious dual role And I'd say a good 80% of Latin Americans will first go to their pharmacist with their symptoms He'll make sort of a diagnosis and prescribe something. They'll buy it try it and most times they'll improve I have to admit when I first got down here. I had to see it to believe it I had a very bad sore throat and I told them my symptoms and walked out with 25 500 milligram ampicillin pills

[13:53] Charged me, I think it was three bucks and told me to take one three times a day And the same thing goes for pain pills and everything else No prescription necessary Which makes you wonder according to conventional wisdom up in the States Why the entire Latin American population isn't addicted to one pill or another But they're not you don't see that at all Even though for example, you can walk right into a pharmacy and say I'd like to have a hundred tile in all threes Please or some other first world so-called scheduled narcotic now I understand not all pharmacies carry that stuff Why because doctors just don't prescribe it the people don't ask for it. There's no demand so they don't carry it It seems so counterintuitive and flies in the face of first world conventional logic

[14:39] Why isn't Latin society overwhelmed with prescription drug addicts? They should be right on top of that Why isn't everyone smoking dope and taking coke? I mean they make it down here It's a tenth the cost of what you get it for in the states Probably less though. It might not surprise you down here when you read articles in a paper about people who have drug addictions, etc It's the children of the rich and the college kids that are doing the usual experimentation with coke and ecstasy and other designer drugs Whatever they are these days. You'll find them at the rave and disco parties and on college campuses and such and most of the time It's just peer pressure and kind of a phase a lot of people go through right? So what about addicts? Every culture has addicts Now I know in every large and medium-sized Latin City almost always in an older crummier part of town

[15:29] You'll see the occasional scruffy young adult Scragly looking greasy hair Toting around a paper or plastic bag because they're sniffing glue So there is some of that down here and why not there are always some people in every town in the world In fact every culture that are broke depressed manic depressive or otherwise Psychologically damaged and for whatever reason became alcoholics drug addicts or glue sniffers. Yeah But the point is there's no greater percentage of it down here because it's easier and cheaper to get Than anywhere else in the world. In fact much less compared to first world countries Even though from our first world viewpoint to have those vices. It's Fantastically inexpensive not to mention down here is the perfect climate to grow the best marijuana in the world

[16:15] Just throw some seeds in a backyard and you're up to the races if that's your thing Oh, and by the way, wherever you find gringos, you'll find drug dealers hawk in their stuff Isn't that funny gringos do have a reputation as dopers? I mean, that's where all the drugs get shipped up to the states In fact, if it wasn't for gringo demand, there would be no drug industry in Latin America, right? Which is why sooner or later someone's gonna walk up to you wherever you are and say gringo Ganja, or what do you need? But you know that almost never happens to me off the gringo tourist trail only went on or Slightly off the gringo tourist trail have people approached me In fact once I was in a barber shop a guy walked in sat in the chair next to me opened up a little tin Box full of drugs and said hey gringo, what do you need? And I said right now I need a little privacy

[17:01] So how about let me have my haircut in peace? And you know where that was? Margarita Island, Venezuela. Have you heard of it? I may have mentioned it a long long time ago It's the Sun and fun island where all the wealthy Venezuelans have their beach houses and boats and such and it had been such a nice beautiful little quiet cheap getaway Over the last 10 or 15 years many Europeans came and bought property on that island, too It's pretty much like any nice small Caribbean island white sand beaches Beautiful clear water except near the little towns and villages where the locals live because they always pollute the crap out of everything You know raw sewage gets dumped into the ocean and all that when you're in the third world You see it all the time. Anyway, like I said, Margarita Island for years was Venezuela's Sun and fun getaway

[17:49] So believe me, it really is or was kind of exclusive because it being an island it takes some effort to get there So basically the poor and the riffraff on the main continent had no easy access Except by a modern hydrofoil boat, which was generally way out of their price range By the way That hydrofoil boat is pretty much exactly the same size as the one you use to go to the island of Roatan in Honduras from the mainland port of La Saba You're there in less than an hour and a round trip costs about 40 bucks pretty expensive for the locals So it does keep out the mainland riffraff So why bring up Margarita Island besides the fact the guy tried to sell me drugs in a barbershop there as it turns out The shining star of Sun and fun beach life in Venezuela has crashed and burned just like in mainland, Venezuela

[18:36] Turns out Europeans who own beach houses there can't transfer US dollars or euros at anything but the official rate And when they do they get an automatic 80% haircut So even the Europeans have got no dough to pay their bills and there's food shortages on the island too Because the ferry systems down believe it or not. The main ferry was recently sunk It's like this you see the company that owns it called Khan ferry was doing just fine hit great business was a private monopoly Servicing Venezuela's biggest tourist destination Margarita Island then in 2009 Hugo Chavez Nationalized that private ferry line. So what happens then? Well, you know the story large-ass government puss bags take over and it goes to crap

[19:23] So then the question is why did their flagship ferry boat sink? Carlos Mata Figueroa Governor of the region says it happens. It's sunk because of changes in the pressure in the sea now There's a guy with at least two brain cells firing in his head, huh? Other technical experts say the ship was way past its service time and should have been pulled at the end of its lifetime years earlier Meanwhile tourism experts are saying the Carmen Ernestina. That's the name of the ship should not have gone down It certainly seemed like a modern ferry They said especially for sailing in calm waters such as those between Porto La Cruz and Margarita Island The agency said he was purely

[20:09] mismanagement and corruption Noting on that tourist route. They have lost a total of 40 million US dollars since 2009 due to an irresponsible government running what should have been a private shipping line Now get this these ferries have been a source of long-standing government corruption says Herbert Garcia Plaza former senior official to president Nicolas Maduro who is currently in exile for buying used ferries and register him with the government as if they were new and According to the Venezuela Federation of Tourism the contrary transport business to Margarita Island from the mainland has shrunk by 90% since 2009 with this announcement also came the admission from the government that

[20:55] 80% of all the gasoline used by Venezuelans in their vehicles is now being Imported from other countries this in a country that has the third biggest oil reserves in the world along with the world's biggest refinery complex called Amoe which by the way exploded in 2012 under circumstances that still remain unclear resulting in 55 fatalities and today in 2016 From the four giant refinery plants the country had an operation in 2012 Only one is operational and is working at half its capacity Now if you want to talk about how a dictatorship works think about this in Caracas for the first time the National Assembly or Parliament that would be their Congress had to close its session last Tuesday

[21:44] Because most of its assembly members who lived in the interior of the country had no way to travel to the parliament in Caracas Because president Maduro cut off the salaries and fuel Allowances of congressmen who were not members of his political party remember right now There's a big push in Congress to remove Maduro from office a recall and as you've probably seen from the news every day tens of thousands Of Venezuelans are marching in the streets because there's no food on the shelves They too are demanding a recall which is why he's cutting off the congressional salaries of his dissenters So that's what's happening in Venezuela And I'm bringing up the margarita thing because I've gotten quite a few emails over the years from gringos and expats who've been to that island

[22:31] bragging about how nice and cheap and wonderful the place is many who had bought land and were building beach houses these gringos and expats seemed unconcerned about Chavez and Maduro Saying that whatever was happening on the mainland never really affected margarita Island It was totally isolated from all that even back then in the Chavez days when the island was quite spectacular I said it was a very bad move to stake your future on the place and now look what's happened Even the cruise ships have quit stopping there. I never thought it was a good place to live But it's not even a nice place to visit anymore All right changing gears again Now you remember a few shows ago We were talking about gold silver and precious metals which naturally spawned a few emails And I also have been saying over and over again that I do not recommend Argentina for your plan B exit strategy

[23:21] That said how about this email dear Johnny? Here's my Argentine inflation and gold experience I received a real-world education on inflation and the benefits of owning physical gold while living in Argentina For nine months a few years back This disheartening inflation experience came as a result of my habit of frequently dining out at a particularly small Steakhouse once a week I'd drag someone with me because my favorite order was a dish for two now along with that dish for two I had order a bottle of good Malbec wine The bill was a hundred ten pesos back then which officially was around twenty four bucks That's roughly four point six pesos to the dollar now during my stage on e Inflation as it has so many times in the past in Argentina reared its ugly head in a vain attempt to prevent its

[24:12] Citizens from abandoning the peso and draining the central bank's dollar reserves in the process the president of Argentina Christina Kirchner Suspended the trade of pesos for dollars now this affected many Argentines I know personally because their wages were paid in dollars coincidentally soon after the dollar trade suspension the price for my favorite meal For two increased 20 pesos and continued to rise steadily During my stay the last price I paid was a hundred and sixty-five pesos 37 bucks an increase in price of fifty percent over nine months now being interested in the monetary history of Argentina I knew the loss of wealth was heading our way I educated my friends about the benefits of gold and urged them to buy some to protect their purchasing power while there I

[25:01] Found there was just one place I could buy gold behind a closed door in the owner's back office of an Argentinian currency exchange There was a gold window The reason for such secrecy was because Argentinos were not allowed to change pesos for US dollars And of course you need dollars to buy gold now get this for an Argentine to buy gold They first have to exchange pesos for dollars at the black market rate at that time It was six pesos to the dollar then one still had to pay the premium to buy gold Which is an extra hundred bucks per ounce at the time. My friend decided to buy some gold the price was 1700 bucks in black market terms this fiasco cost him 10,800 pesos per ounce if he had been allowed to purchase gold legally it would have cost only

[25:50] 8100 pesos and that's a premium of 25% So in the end he got hit for an extra six hundred bucks in the process of buying just one ounce Thus though I am sympathetic to what I hear the Vietnamese are paying for gold these days. I understand it's a $217 premium over spot price I really do feel for my Argentine friends who face nothing but worsening currency controls Price inflation and expensive options just to protect themselves in a losing battle against falling purchasing power Which is why as a result I urge everyone to buy some gold and don't tell anyone you have it. That was from Jerry Thanks for that. So there you have it. Once again a nasty story about Argentina. I don't know what Doug Casey is thinking

[26:39] All right. That said we're getting towards the end of the show now Still have a few places left for my January 2017 expat insider seminar Just go to www.thenewexpat.com click on Johnny's 2017 seminar link at the top of the page and check it out Everyone with a brain needs a plan B and everyone Definitely needs to get boots on the ground and this is one of the best and easiest ways to do it Plus you'll meet a new group of friends and connections that can help you on your move to give you that little boost of confidence We all need when we move to a foreign country and don't know anyone it's always good to know there are some people you can call on and count on when you need some assistance and my Seminars provide all that and more and finally, don't forget to check out my youtube channel See the slides and the pictures that go along with the show you'll like it and you just might get a laugh or two as

[27:28] Well, don't forget to subscribe. It's free South of the border This is the expat files living in Latin America If you want me to help you out with your own plan B Just schedule a one-on-one consult send me an email the expat files at gmail.com And if you want to learn how to move forward with your own plan B from right up there in the States go to www.xpatplanb.com and check out my three videos. See ya nos vemos