A chink in the economy or the start of something bigger

bueno_pues says on Jul 23, 2007, 19:03:

Es el fin de una epoca. Gracias a Dios.

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panthdave says on Jul 23, 2007, 19:04:

Right on the Dime.. The devil has landed in Colombia CREDIT CREDIT CREDIT CREDIT...
Spigrimace..still see many people grocery shopping carts full and in shopping stores..People do look for the sales though..Ate lunch Sunday in Parque Llares many people having lunch...Many colombian families were in the restaurant eating..I guess for a Sunday brunch..
Personally I think Colombians I see even in some lower estradas are doing very well.. They have a house or apartment, have insurance, eat and drink good,
Starting to really think how bad are the Colombians off....All I hear is poor salaries, struggling to make it well I see otherwise..I think I see more famalies in Miami struggling and more stressed than ones in Colombia..to make ends meet..

panthdave Miami

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juanalejo says on Jul 23, 2007, 20:34:

GIB, don´t tell me you are going to start all over again, you have been for several years announcing a melt down, I thought the numbers had finally proven you wrong. Maybe one day you will be right, but in the mean while a few of us will keep making money. Have you ever seen the movie "the secret"? Something tells me that you are following their advice to the limit, and since your biggest dream is to see Colombia´s economy in the sink, you can simply not see anything beyond that idea.

Sorry but I don´t think the time is yet to come, while you are forcasting doom and gloom (as usual) HSBC (the second largest bank in the world for if you did not know) opened its doors in Colombia today. So my bet is they know better than others.

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miamimike says on Jul 23, 2007, 20:34:

Esto me Huela a Tumbe

"Wait a minute. What did you just say? You're predicting $4-a-gallon gas? That's interesting. I hadn't heard that." -- Feb. 28, 2008 --George W. Bush, Washington, D.C.

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miamimike says on Jul 23, 2007, 20:38:

Seems to be more then the normal amount of Businesses for sale on MercadoLibre.com in Colombia, especially Internet Cafes,,,,

http://listado.mercadolibre.com.co/negocio_OrderId_MAS*OFERTADOS_Categ...

"Wait a minute. What did you just say? You're predicting $4-a-gallon gas? That's interesting. I hadn't heard that." -- Feb. 28, 2008 --George W. Bush, Washington, D.C.

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miamimike says on Jul 23, 2007, 20:40:

Excuse me "should read "Huele a Tumbe" ,,,

"Wait a minute. What did you just say? You're predicting $4-a-gallon gas? That's interesting. I hadn't heard that." -- Feb. 28, 2008 --George W. Bush, Washington, D.C.

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juanalejo says on Jul 23, 2007, 20:46:

If you have lots of internet cafe´s for sale, it is evidence people can afford computers and internet at home. So it is far from an indicator of a slowing economy. Internet prices have halved in the last year, so I guess it is not good business anymore.

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miamimike says on Jul 23, 2007, 21:02:

If you have tourist and visitors using them, they don't have this Service or a computer at their convenience. The Internet Cafes in Colombia I used mostly had visitors and out of towners as customers so what does that say?

"Wait a minute. What did you just say? You're predicting $4-a-gallon gas? That's interesting. I hadn't heard that." -- Feb. 28, 2008 --George W. Bush, Washington, D.C.

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panthdave says on Jul 24, 2007, 05:13:

Juanalejo Yes just noticed HSBC and actually they opened a branch right down the street from apartment in Castropol Calle 14...I am giving them a call today because supposedly HSBC Cards have no fees from HSBC ATM's....like Citibank..but don't like Citibank because there card no fees for ATM but on POS Transactions they charge currency exchange fee..Going to look into this and also HSBC is suppose to have a International Premier Program..which is real good..but I think there debit card will have currency exchange fees for POS Transactions if its a US Dollar Account but if you have two accounts one Pesos and one Dollars maybe not but I would have to say no Cedula no Peso account lets see..

panthdave Miami

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podborski says on Jul 24, 2007, 05:51:

I called the NASDAQ crash of 2000/2001....in 1998. I also called the current US real estate bust.....about 3 years ago.

Timing is hard.

But my gut tells me Colombia has gone too far too fast, and with the strong peso to boot, MAYBE it's the beginning of a correction.

Maybe the US really is slowing too, that would hurt Colombia don't you think?

No point to put time frames on predictions, unless it's for fun to place a bet. Or if you earn your living by doing that, jaja.

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Waterdawg says on Jul 24, 2007, 06:05:

... Well I am on your side of the coin on this one ! .. Credit , Peso , Inflation are all in play here . I live in the North End and I see more for Rent and sale Signs all over .. The difference between now and say Jan. is well , " In your face ".. All my friends ( in export biz ) are hurtin also !

... I remember the first time I used a credit card here and they ask me how many payments ; Oh my this ain't good !!

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juanalejo says on Jul 24, 2007, 06:24:

GIB, you have been calling for this melt down since I have been in this site, and that is a few years back, so don´t come up with a hero telling story and try to act like you know when and where to invest, because you have been scaring people away from Colombia since time inmemorial. And yes the peso may be too strong, inflation higher than expected, but so are exports at record high, so are mortgages at record high, so is direct international investment at record high. And you have been noticing a faster slowdown since December, just when the economy has grown the fastest in decades? 8.8% makes it the highest growth in the world after China and India.

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Tinto (Moderator) says on Jul 24, 2007, 06:33:

6% inflation and a couple of quarters of 6% to 8% GDP growth do not spell the end of the world. Colombia, and the region, have lived with far higher inflation in the past. Yes, it hurts the poor the most and the government needs to do what's in their power to reduce it, but inflation alone isn't going to bring an end to the good times.

Now, if there is in fact an unsustainable credit orgy, and houses are well about what the average person can afford, and the trickle down effect of a strong GDP doesn't work very well in Colombia, then I'd agree things might be a lot more unstable. But I don't know these things.

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Tinto (Moderator) says on Jul 24, 2007, 06:54:

Yes, Colombia's inflation index has faults or limits just like they all do. If I was trying to forecast the market I'd pay a lot closer attention to the bad debt reserves that the big banks must report each month. That's a valuable indicator.

Re housing, I don't know of a reliable source of statistics that aggregate city wide and country wide data. Everything I see is anecdotal and even then I hear about people fudging the numbers so they can cheat the tax man. But the laws of gravity haven't been suspended in Colombia, just like they weren't suspended in Australia, the UK, Spain, the US, etc. You cannot have sustained increases in housing values that far exceed the growth in income. The ratios get so screwed up and eventually the general housing market has to go soft for a while.

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Tinto (Moderator) says on Jul 24, 2007, 07:25:

Have no fear: In the news this a.m. is a story about Maxwell House removing Robusta beans from their signature blend and returning to 100% Arabica for the first time in more than two decades. That's good news for Colombia.

;-)

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panthdave says on Jul 24, 2007, 07:26:

Really how can they get accurate numbers in Colombia with all the undeclared funds roaming the country...and many tax returns not filed.. Now the Bad Debt Reserve that is filed is probably accurate....There has to many people paid under the table and not reported..Really where does Colombia get there numbers on average salary from jobs which report the income..

panthdave Miami

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podborski says on Jul 24, 2007, 07:28:

is a lot of the economy in colombia underground? Are most workers paid cash under the table or just a small portion? Anyone have any idea?

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Lowell says on Jul 24, 2007, 07:42:

Many sales and a whole lot of stores have flat out closed. Carefour opened about a year ago and it's never crowded. Exito and Olympica have had some good sales. Things are becoming more competitive. Perhaps now service will improve. People seem to be doing a lot of remodeling instead of buying bigger or better.

Alfred E. Newman. "What. Me Worry?"

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juanalejo says on Jul 24, 2007, 07:46:

GIB, somebody got upset, please stop screaming that it is bad manners in Colombia. And by the way it is not easy to keep a peso from getting strong, if it were that easy then the Euro, and the Pound, and the Mexican Peso, and the Brazilian Real, and the Indian Rupee, etc, etc, etc would not be having record highs against the very weak US dollar. It is a world problem that will correct itself one day. We have barely appreciated against the dollar and we barely appreciated against the Euro. So please go complain about something real.

And rent up 20%? Where did you get that? If there is something that has come down in price is rent, because many more people are affording their own homes and there is an excess of homes for rent in the market and the price has gone down. Will this generate an effect on house prices when these renters see it is not good business any more? Probably and that will correct the really high prices of the real estate, and is only better news.

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juanalejo says on Jul 24, 2007, 07:50:

Sorry, I meant we have barely appreciated against the pound not the dollar.

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Tinto (Moderator) says on Jul 24, 2007, 08:00:

I wouldn't disagree if someone said that parts of Colombia have added too many higher-end retail outlets. And I wouldn't disagree if someone said those living at the margin have been hit hard by rising food and gasoline prices. But those are common themes in poor, middle income and even rich countries. Doesn't mean things are going to spiral down...just that a mild shakeout might be in the cards.

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snake says on Jul 24, 2007, 08:06:

this reminds me of my favorite economist joke.......lol

A civil engineer, a chemist and an economist are traveling in the countryside. Weary, they stop at a small country inn. "I only have two rooms, so one of you will have to sleep in the barn," the innkeeper says. The civil engineer volunteers to sleep in the barn, goes outside, and the others go to bed. In a short time they're awakened by a knock. It's the engineer, who says, "There's a cow in that barn. I'm a Hindu, and it would offend my beliefs to sleep next to a sacred animal." The chemist says that, OK, he'll sleep in the barn. The others go back to bed, but soon are awakened by another knock. It's the chemist who says, "There's a pig in that barn. I'm Jewish, and cannot sleep next to an unclean animal." So the economist is sent to the barn. It's getting late, the others are very tired and soon fall asleep. But they're awakened by an even louder knocking. They open the door and are surprised by what they see: It's the cow and the pig!

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miamimike says on Jul 24, 2007, 08:19:

We are having more then a mild shakeout in our Hosuing Market in Miami--way way overbuilt in the High End Apartment range, one has to wonder what possessed these developers to build all these luxury units in the Poorest Large City(miami-per capita) in the US,,,Now midle class buyers(investors-flippers) are trying to bail like rats off a sinking ship from their overpriced $500K-$700K units that in reality are worth $300K at best,,,

"Wait a minute. What did you just say? You're predicting $4-a-gallon gas? That's interesting. I hadn't heard that." -- Feb. 28, 2008 --George W. Bush, Washington, D.C.

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robi666 says on Jul 24, 2007, 09:03:

Rent up 20%? Noway. If you rent an apartment after one year the rent goes up at the rate imposed by the central bank. It is no way 20%, but it is related to inflation. Like salario minimo, which, for the first times with Uribe was always gaining above inflation (so the poor saw a better gain these years).
What happened is that two years ago you could get 8% of the value of an apartment in rent. Now we are at 6%. And it will come down to a more natural 3,5% - 4% in a few years, because the increase of price will go faster than inflation (which is the speed of rent).

"I am a citizen of the most beautiful nation on earth. A nation whose laws are harsh yet simple, a nation that never cheats, which is immense and without borders, where life is lived in the present."

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panthdave says on Jul 24, 2007, 09:10:

My renewal contract for my rent in Medellin stayed at the same price which now I have one year and has not increased in over a year at 780,000 Pesos per month... Carrefour was there Friday last week at the Las Vegas store in Medellin and was packed I waited 30 minutes to checkout at the Cash Register..but non secured credit has taken over Colombia and many vehicle debts which is secured but I feel that is a bad debt..Mortgages is a secured debt but secured by a good asset..As long as the property your in is based on your income and you can afford per month to the bank and you had nice deposit for the property..20% or Higher.
Again I stress I really think Colombians are not that bad off.. I see more homeless in Miami than I do in Centro Medellin...I see many with nice homes/apartments,cars,motos,eating good, going to the movies, restaurants, enjoying there lives..

Some points I agree with Gringo but some I don't Colombia my personally opinion will be fine..As long as the FARC is controlled and no big disasters happen..Hey one huge attack on the United States could literally shut down the United States and unemployment lines will be full and the funny thing is I really don't think the State Governments will have the money to fund umemployment if we have huge disaster..

panthdave Miami

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panthdave says on Jul 24, 2007, 09:29:

So at what point Gringo will foreign investment stop...or has it already which I don't see example HSBC sees a market here..They would not open up if they did not see a market for loans and credit..to sell there money here in Colombia..

panthdave Miami

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Robert Jorge says on Jul 24, 2007, 10:26:

Panthdave, what kind of huge disaster? Like the World Trade Ctr? 8 hurricanes in 15 months, including an Ivan, Charlie, and a Katrina? Now, if you are talking about Denver or Atlanta getting nuked ... yep, that would halt the economy for a while. But the US has had HUGE disasters recently, and the the economy burped.

I will try to find out for sure, but I do not think any of my inlaws rent went up recently (within the last year even). If it did, it has never been mentioned, which means it isn't something they are greatly impacted by. They are all estrato 2 households, with a few ones and a three thrown in.

--"I believe in making the world safe for our children. But not for our children's children, because I don't think that children should be having sex." - Jack Handy

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Robert Jorge says on Jul 24, 2007, 10:37:

Good post GIB. And, like you said earlier, I also hope you are wrong.

--"I believe in making the world safe for our children. But not for our children's children, because I don't think that children should be having sex." - Jack Handy

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panthdave says on Jul 24, 2007, 11:09:

Robert J. just saying it could happen a disaster..I really think Colombia is fine..and Colombians are doing fine too but maybe there using there credit lines to live that could lead to a disaster..I just observe Colombians living good lately..Foreign Investment to my eyes has not stopped like the example HSBC moving in..I really think they did there research before coming into Colombia with experts so they must see a long term future in selling there money to the Colombian public...and selling there money to businesses...lines of credit..
The real estate bubble could burst quickly

Hope your wrong to Gringo..

panthdave Miami

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juanalejo says on Jul 24, 2007, 12:13:

GIB, you can be right or you can be wrong. What you are saying applies to any economy and you are simply assuming things, putting in variables right out of an economics textbook.

But my complaint was not about what you have said, but that it is that the same long subject is argued by you every six months, for the last few years, at least since I have been in this site.

So if a well known economist came and said something on the lines, I may begin to think. But all forecasters are actually saying the opposite, both national and international economists. Sorry but if I did not know your stories from years back I may even listen to you.

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jarhead says on Jul 24, 2007, 12:53:

"They are a very efficient society, believe it or not"..................Rubito, you actually said this?????you actually believe this?????fuck you should come to my factory and tell me what we are doing wrong....these people (my people) are the most un efficient people I have seen in the world, and I have been all over the world.......:):):):)

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Coffeeman says on Jul 24, 2007, 13:13:

GIB, I have been following this discussion with interest and I concur with you. I have been traveling to Colombia for over 20 years, and I too have noticed changes. I plan on retiring in Medellin or Bogota so I have concerns with regard to the long term stability of the Colombian economy. Also, I have family and friends in Colombia, so naturally I am concerned for their welfare. To me the economic analysis is more simplistic: Colombia's major trading partner is the USA, a strong peso / weak dollar hurts the export side of their economy. If Colombia's economy was totally self sufficient (energy, food, etc), then economic growth could be independent of foreign investment. Internal credit would be from national banks, loans would come from national banks, etc.. Colombia is making the same mistakes America is with regards to the over extension of consumer credit. Banks are like any other business, they expect / demand profit. They (banks) open branch banks to make profit from local people. Profit is always made at someone elses expense! The question is; how long can the Colombians continue to pay the note and where will the money come from? I too have seen lots of commercial development in Colombia; the price of imports are down (relative thing), consumerism is up. How about industrial investments? factories? development of mineral resources? agriculture development advancement? As I said earlier, I care alot and would like to see real long-term gains for the Colombians. I have no motive to what I have said, because wheather I am wrong or right; it will only affect me in determining where and when I will acquire property in Colombia.

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Nucknfuts says on Jul 24, 2007, 17:09:

Just a thought,
Every single "fiat" currency in the history of mankind has failed and gone to be worth $ 0
Economies cannot survive without more and more debt. Every bubble pops.
Invest in something real " silver and gold" I like silver better.
DYODD....
The Nuck

You are never lost, unless you don't want to be where your at.

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panthdave says on Jul 24, 2007, 17:31:

Getting to complicated..Gettng a headache...

panthdave Miami

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tomtom33 says on Jul 24, 2007, 17:56:

It's not too complicated. It's hilarious. Economies cycle. Are we near the top of this cycle? I, for one, don't give a fuck. I buy and hold.

I'd much rather spend my time with Colombianas than trying to guess about this shit. Things will get worse. Then things will get better. Repeat.

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goin_south says on Jul 24, 2007, 23:29:

ditto, tomtom33.

muchas gracias, senor, por mira a realidad

Sounds like the best motto to me: "HORD: COLOMBIANABONITAS."

Ciao! Gustav. Bienvenitos, Ike.

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podborski says on Jul 25, 2007, 08:49:

Complicated? GIBs signature is complicated. I think it took me a week to get it.

Steven Wright is the best.

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podborski says on Jul 25, 2007, 08:58:

My experience employing people in Arg is that some of them work incredibly hard, but many of them are great at looking busy but in reality they do as little as possible.

From what I saw of colombians working in bars, shops and restaurants, they run circles around the 'average' argy. Plus their attitude seems so much better, happier.

But I am sure there are many who are slackers, as jarhead has experienced.

Can't you find ANY decent workers jarhead? I just think there have to be some.

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juanalejo says on Jul 25, 2007, 17:12:

Just a quote from a thread from today:

"Colombia's industrial production rose 11.91 percent in May from a year earlier, while the output for the January-through-May period increased 14.13 percent, the National Statistics Department said on Wednesday.

April industrial production was up 13.25 percent from the same month last year.

Retail sales in Colombia rose 10.24 percent in May from 12 months ago and grew 13.13 percent in the first five months of the year versus the year-ago period, the government said in a separate statement."

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Tinto (Moderator) says on Jul 25, 2007, 17:20:

Good news except for the retail sales piece. There was another statistic released yesterday that showed consumer credit up 43% (I don't remember if it was May 2007 vs. April 2007 or May 2007 vs. May 2006, regardless it's HIGH). And the imports exceeding exports can be troubling if it exists for an extended period of time.

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juanalejo says on Jul 25, 2007, 17:29:

Semana Magazine June 25 - July 2

Foreign investment in Colombia grew to 3.7 billion dollars in the first 4 months of 2007, that triple the same period in 2006.

90% of Industrials say their production is at an all time high, industrial capacity is at over 80%. Bavaria (beer) is working at 95% of installed capacity, Cemex (cement) at 90%, car factories are working at 100% 24-7, Industrial investment in machinery, etc grew 26% vs, 2006.

Construction in 1st quarter grew 28%, mortages grew at 81%, civil construction at 40%, social housing at 30% and bad loans came down to 4%.

The biggest complaints are: not enough raw material, not enough trained professionals for specific skills in new technology, ports that are saturated, airports which are deficient and the highway system which is planned will take long to be built.

The biggest risk is too much government investment through credit which can drive up interest rates and a sudden collapse in the Venezuelan economy which can really hit industrial production here.

Where there are looking into is the free trade agreements with Mercosur (Brazil, Argentina, etc), Chile and the Central American countries and hopefully the free trade agreement with the USA and Europe for next year.

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juanalejo says on Jul 25, 2007, 17:32:

Tinto: Imports exceeding exports can be worrying if it is only based on consumer products, up to know (depending on the data I have read) it varies from 30-50% being industrial goods that are imported as most companies in Colombia have taken advantage of the cheaper dollar to reconvert, not knowing where the peso will head in the long run. So if that data is correct once the industrial reconversion has taken place the trend should revert.

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Tinto (Moderator) says on Jul 25, 2007, 17:33:

I was half right (the 43% part). Here's the blurb:
----------------------
"Exito shares will keep advancing because the retailer will continue growing, boosted by the strong growth of retail sales in the country," he said.

Retail sales in the first quarter of this year expanded 16% from the same period a year earlier, though growth slowed down in April, when it only expanded 7%.

At the same time, the country's consumer loan portfolio grew 43% in the first half of the year to COP30 trillion.

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Tinto (Moderator) says on Jul 25, 2007, 17:40:

JuanAlejo - Yes, the increase in imports isn't necessarily a bad thing if productive assets are the main reason for the increase. I agree 100% with that. It's just that the numbers are unusual right now -- most Latin American countries that also benefit from raw materials exports have a strongly positive trade balance, in contrast to Colombia. Who knows...it might be a relatively brief surge because of the "make hay while the sun shines" thing with the peso.

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robi666 says on Jul 25, 2007, 17:46:

And, as I always stated, rising interest rate in a third world country with a high growth rate will just attract more foreign capital and cause more inflation... It is happening, let's see the inflation...

"I am a citizen of the most beautiful nation on earth. A nation whose laws are harsh yet simple, a nation that never cheats, which is immense and without borders, where life is lived in the present."

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juanalejo says on Jul 25, 2007, 18:00:

Tinto, everything you said is correct, anything can happen and hopefully it will go for the best, but none of the variables seem to be showing the doom and gloom others love to forecast. That is all I wanted to show. If the economy is kept under control, if exports keep on growing on the same rate and imports slow down some then most variables will be on the positive side.

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robi666 says on Jul 25, 2007, 18:03:

I agree, Juan, the main problem of Colombia is not its economy. The economy is running well. The problem is politic.

"I am a citizen of the most beautiful nation on earth. A nation whose laws are harsh yet simple, a nation that never cheats, which is immense and without borders, where life is lived in the present."

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Tinto (Moderator) says on Jul 25, 2007, 18:09:

Two things to keep in mind regarding inflation:

- The govt predicts food price inflation should be tempered in the 2nd half of 2007. Apparently, the early 2007 drought really hurt some staple crops.

- Looking wayyyyyyyyy back, Colombia has never experienced hyper inflation. For all its challenges, it has managed to outperform many countries in the region with respect to inflation and debt repayment.

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juanalejo says on Jul 25, 2007, 18:10:

For all I know is that I employ 150% more than before (I have a small office, nothing big although sounds impresive) and everybody in my office seems to be having a better life. Most people even have a car now, something I would not have imagined just a couple years back and my biggest problem is providing them with a parking space at work. I just hope it continues for years to come. I hate when those who carry a black cloud on their heads on a permanent basis want to underestimate all the progress that the country is experiencing. Before they would only call for kidnappings where they weren´t any, now they see the economy crashing tomorrow morning and then still they say they love Colombia. It is my country and I will live here in goods and in the bads, and I will continue as I have done until now to try and make this a place as good to work as it is to live in. .

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RAAAY says on Jul 25, 2007, 19:02:

BOGOTA, July 25 (Reuters) - Colombia's industrial production rose 11.91 percent in May from a year earlier, while the output for the January-through-May period increased 14.13 percent, the National Statistics Department said on Wednesday.

April industrial production was up 13.25 percent from the same month last year.

Retail sales in Colombia rose 10.24 percent in May from 12 months ago and grew 13.13 percent in the first five months of the year versus the year-ago period, the government said in a separate statement.

The economy of the Andean country has gained strength under President Alvaro Uribe, who has reduced crime and attracted foreign investment with his U.S.-backed crackdown on Marxist rebels.

.........Its useless to argue with ignorance

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robi666 says on Jul 25, 2007, 20:51:

Anyway, something big will probably happen... interesante o no?
About polishing brass on the Titanic... there's a big wreck outside Los Cocos, 4 km from Parque Tayrona. From 15 to 20 meters. Some friends use to go there and get copper and sell it... It's a huge ship, 60 meters long.
We also get big barracudas, snappers an really big lobsters. Got two 1 meter and half barracudas just yesterday.
For some years to come i will be ok!

"I am a citizen of the most beautiful nation on earth. A nation whose laws are harsh yet simple, a nation that never cheats, which is immense and without borders, where life is lived in the present."

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juanalejo says on Jul 25, 2007, 22:27:

I agree with you robi, lets enjoy life. I for one shall ignore the silly doom and gloom, it has been far too many years of trying to prove them wrong, but the numbers have done the job for me. If I ever see it coming I shall react properly and not worry years in advance. I simply do not like such a negative and sad life around me. I have a positive attitude on life and tend to concentrate on half full glasses not the half empty ones.

Will look for the sunken ship when I am in Tayrona over the weekend and eat some fresh lobsters, hopefully my plane won't overshoot the runway on landing.

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robi666 says on Jul 26, 2007, 03:02:

Juan, I hope we can meet one day. I'll PM you. If your plane will land that way, no problem, you can just get a early swim!
But, I really do not think GIB has got sad life... he's surely doing well and he's happy of his life. Of course he has got his view about economy and he has his expertise. He may be right and, more important, he always try to contribute positively to this forum.
What I think, it is that if something catastrophic happens, it will be on the political side. You see... poverty... AUC... FARC... narco-everything... para-everything, a long way to go!
About enjoying life... don't forget we are foreigner: that's what living in Colombia is about. GIB, Miguel_Clavo, Vic, Rubito, BAQ, Panthdave, Spigrimace, Brians, me, we all choose to live here (or to get living here) for a reason. (uff... no Elmo... it is not just for chucha!)

"I am a citizen of the most beautiful nation on earth. A nation whose laws are harsh yet simple, a nation that never cheats, which is immense and without borders, where life is lived in the present."

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Tinto (Moderator) says on Jul 26, 2007, 05:32:

GringoinBogota, You're a smart guy and I like reading your economy related posts, but you're almost baiting JuanAlejo. Let's turn the tables for a moment. Consumer debt for YEARS has been the elephant in the room when discussing the outlook for the American economy. Yet here we are, the U.S. is chugging along nicely through war, natural disasters, terrorist acts, the financial drag of all these non-value added security measures, etc, etc. I know there are problems, you know there are problems, most Americans that bother to pick up a newspaper know there are problems. But what can an individual do to change the bad credit habits of our fellow Americans? Nada, right? So we enjoy life, we plan and save as best we can because we know eventually there are going to be some tough spots. What makes you think financially savvy Colombian act any differently?

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Tinto (Moderator) says on Jul 26, 2007, 05:41:

P.S. As I noted several posts above, the growth of consumer credit *on the surface* appears troubling. But I haven't investigated the base numbers, either. If Colombia has historically been a cash-driven society, and now they are starting to use more credit for mortgages and cars and durable goods (stoves, washing machines, etc), then one would expect a rapid percentage increase from a small base and the "type" of debt isn't all that terrible. On the other hand, if the base was relatively large to begin with and people are using debt to buy loads of consumer disposable junk, then the rapid percentage increase should be a warning sign.

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Tinto (Moderator) says on Jul 26, 2007, 06:41:

I don't know the precise figures, but I *thought* I saw some car dealer ads in "El Tiempo" and the interest rate on a new car purchase was in the neighborhood of 15%. That would stretch a whole lot of family budgets. It's just crazy to pay that kind of interest on a depreciating asset.

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robi666 says on Jul 26, 2007, 07:09:

GIB, are you going to buy a car? Wow!
No, it's NOT right! Why pay cash in Bogotà?
Listen,
load a bag full of pesos, hire 4 bodyguards, drive to Cucuta or Maicao, change the Pesos into Bolivars (2 for 1), drive to Maracaibo, buy a new F150 or Silverado at half the price, "talk" to the DIAN to get taxes cheaper, and that's it! Your car will be legal and 30% less expensive.

"I am a citizen of the most beautiful nation on earth. A nation whose laws are harsh yet simple, a nation that never cheats, which is immense and without borders, where life is lived in the present."

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jinksmiester says on Jul 26, 2007, 08:07:

It seems credit has become big part of life in colombia as gringoinbogota states...you sure seem to see it everywhere and there does,nt seem to be a lot of cash purchases when the family goes shoping.Sooner or or later the bill comes in along with finance charges.With the peso on the rise and costs going up whats happening to wages?My guess is nada.

A man is not old until regret takes the place of dreams

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goin_south says on Jul 26, 2007, 22:09:

***in my experience 50% of people in Bogota are totally on the money, reliable, on point. The other 50% are the most incredibly incompetent assholes you ever met****

...which might indicate that you're ABOUT AVERAGE... like the rest of us.

Ciao! Gustav. Bienvenitos, Ike.

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panthdave says on Jul 27, 2007, 15:34:

Are you serious Gringo about what is the price for the car??? Danm I would not want to buy like that....

Well going to buy used anyways so will not effect anyways..

panthdave Miami

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