Planet-Love.com Searchable Archives

The official rate for the peso as of yesterday was 2365 to a dollar.That means you will get about 2340 at most ATM's.The last time I got pesos at an ATM,about 5 days ago it was 2262,so the dollar dropped a little more.
Cheching with http:// yahoo.finance.currency?  think I got that right ,you will see then down about 5 if you search google currency rates,the dollar got you about 2950 pesos in April 2003.for the same period the Euro went up from 1.05 to 1.31.The dollar decline was about the same in each case.
As an american with a pension in US dollars I don't like it.But We have been spoiled for along time with a cheap peso.Where will it go from here?What I here isthe long term thinking isthat the Euro will go on up,but when it hits around 1.40 governmentswill be jumping in to try and  prop  up the dollar or get their currency lower.It screwsup exportsfor a country when their currency goes up.Uribe is not happy with the higher value of the peso recently.
I think its a slow late reaction to the US buget and deficit situiation.Nowwhen interest ratesare going up you wouldcthink the dollar would too,but too many other concerns about the US budget problem.I for one wish GWB would have forgot that little tax cut he threw out mostly to the big $$$ guys.Bad timing I think.The Republicans used to be for fiscal responsibility.Seems no one is now.I think the Democrats would do as bad,probably spend more money.
As interest rates go up that alone will make the deficit worse,if we didn't have enough problem already.
I hope we don't get as bad as Argentina or Brazil where nobody is willing to face the political heat for cutting spending or raising taxes and the currency really goes to hell.The Argentine currency was supposed to be tied to the Dollar.The let it float about 2 years ago,it went to $.40
I just renegotiated my new one year lease on my apartment.The rent went from 1,400,000 to 1,600,000.The administration went from 434,000 to 458,000.The total from 1,834,000 to 2,058,000.Worse yet,with the exchangecrate the price from last May untill now went up from $675 to $879.More from the exhange rate than the rent increase. But still a good deal for a furnished 2500 sq ft apartment,4 bedrooms,5 baths,4000 sq ft patio with jacuzzi.Quiet and in the best neighborhood,close to everything in the north. I get some income renting rooms.One permanent guy now.In December I actually made money.Last June and September I basically had the whole place to myself.
So I really can't  complain.Consider it observing the situation.I have recently cut my eating out budget from about 500,000 pesos a week to maybe 250,000.I was actually getting a little tired of eating all those late dinners.I cook or we do domicillio or something simple about half the time now.I can still get a great steak at Lenos and Carbones for 8500 pesos,about $3.60.Its as good as the fancier places,just a different atmosphere.And I can make a better hamburger or taco than you can buy here.
Actually I should have lots of money left over.I guess if I look back it was some unusual expenses that caused me not to be saving any money.A person could live here for $500 a month,pretty well for $1000 a month.But if you spend money on Restaurants,Taxis and intertainment plus travel  I was able to spend my $3300 net a month I get.There was an ex girlfriend I was supporting also.No more.My current girls get only the food intertainment and Taxis.

Pete

... in response to Peso to Dollar exchange, posted by Pete E on Jan 15, 2005

Basically, Bush has spent money at a faster rate than Clinton. That's the main problem, not the tax-cuts.

Here's one strategy, invest in quality foreign stocks.

... in response to Peso to Dollar exchange, posted by Pete E on Jan 15, 2005

Pete, if one week ago you could buy fewer pesos to the dollar, that means the dollar gained against the peso, it didn't drop.

... in response to Re: Peso to Dollar exchange, posted by Karl on Jan 15, 2005

Thts right,but last week you could get more pesos.The ATM rate was 2362 meaning the official rate was around 2385.As of Friday the official rate was 2365 so the ATM rate will be around 2340.If I get down to the ATM today I will know,I can pull up the dollar cost from my credit Union on the web right after taking the pesos out.

Pete

... in response to Peso to Dollar exchange, posted by Pete E on Jan 15, 2005

I forgot to mention utilities,a major expense.My internet cable alone is 460,000.Thatsunlimited use,we have4 computer cable connectionshere,3 going alot.PlusI needit for my vonage phone.My energy-water bill can be 300,000- 400,000.The phones are about 120,000.My vonage phone is $25 plus about about $20 in extra charges calling back in to Colombia mostly.My maid is 3 days a week now,about 300,000 amonth.Oh,Tv.I paid a year up front.That will start costing me about 100,000 pesosamonth soon.
Lets see,total from above,about 1,500,000,% of the basic priceof the apartment,so about 3,560,000 pesos,$1521.
Taxis cost me about 20,000 a day mostly paying for round trips for girlfriends.Thats $8.50,$250 a month.
So we are up to $1771 a month before food and intertainment.But I have a large place so I have the ability to rent rooms,I usually get half or more of that back.

Pete

... in response to Utilities,ect, posted by Pete E on Jan 15, 2005


Pete,

I just got cable with EPM and it's nowhere near the cost of what you are paying.  I opted for their triple play service (internet, tv, internet telephone) and pretty sure I'm paying 120,000 pesos a month.  I chose the 128kbs service which is supposed to work with the Vonage system.  A faster speed is available for 150,000/mo.

My maid service is 20,000 per day and get by with her coming once a week.

Why so much more in Cali?

... in response to Utilities,ect, posted by Pete E on Jan 15, 2005

The exchange rate isn't in our favor right now for travelling internationally. I disagree with the majority of Bush's economic policies, but I do think a weaker dollar is a good thing for the time being. It's supposed to stay down for the majority of 2005.

The tax cuts with big spending suck. I think the Democrates would have done a better job. Rolling back the tax cuts, monitoring spending, and strengthing alliances with allies. Health care was a big issue on the democratic platform, which Bush isn't even considering, it seems.  

Social security probably does need overhauling, so I wont throw Bush's plan in the trash. But, his plan should be bipartisan, input from both Republicans and Democrates.  

For me personally, I'm sitting ok. And, there is one benefit for times like these...I'm learning to cut expenses and save money. The current situation is placing the latina quest for me in better perspective...in other words "baby, we need to watch our spending, and you need to work".

In the end, I think the US will pull through, because other countries have so much invested in us that if our economy would collaspe, it would eventually send the economies of other nations into a tail spin as well. Other economies will do what they can to prop up the US economy.

Pete, I'm sincerely sorry for the negative outburst we had a year ago. I hope you're taking care of yourself.

Aaron

... in response to I hear ya.., posted by Dr Aaron on Jan 15, 2005

Aaron,
The weaker dollar helps exports and reduces imports and helps the balence of payments.However everything we purchase from outside the country becomes more expensive.
I think economic cycles have to run their course and government intervention doesn't really change the big picture that much.
Even though I voted for Bush I don't like his tax cut plan,his weak dollar idea or even his social security ideas.Social security should not be gambled with.People can do that with the rest of their money.
As far as spending,military spending is either necessary or not,I think it is,and we have to pay for it.The cost is not the primary concern,but what is the right thing to do.We can afford it,we just have to pay for it and not disguise it by borrowing more.
And I agree,we are very resiliant.We will do fine in the future,we have too much going for us not to. Change,the inevitable will occur however.And we arestill damned lucky to have been born in America,the place most of the world would like to come to.
Aaron I'm glad your back.Lets forget all that stuff that happened a year or so ago.

Pete

... in response to Re: I hear ya.., posted by Pete E on Jan 16, 2005

[This message has been edited by Cali James]

Pete,

I'm normally in agreement with you on economic issues but on social security, I'm not.  The system is headed for disaster, congress knows this but they don't have the political will to do anything about it.  

Right now the system is in so called surplus as we are taking in more money than what is being spent.  The Social Security trust fund lends the excess back to the general fund in exchange for what is essentially an IOU, i.e. government bond.  In less than 10 years, there will no longer be a surplus and the trust fund will begin to call in it's IOUs to fund the difference.  That might be OK if the IOUs represented some real assets but they don't.  The federal government will have to pay off the bonds and their only source for income is taxation.  At this point social security will be funded through two sources, the social security tax as in current law and secondly the federal income tax to pay off the bonds.    

We are also going to see a major shift in demographics as families have less children, boomers reach retirement and people live longer.  The government as is typically the case, puts these demographic numbers in the best possible light instead of being conservative in their estimates.  The combination of all these factors, spells doom IMO.

President Bush's proposal is undoubtedly too little, too late but it's at least better than doing nothing.  The system would be more stable if the trust fund were invested in real assets rather than IOU's that can only be paid through additional taxes.

James

P.S. Here's some good articles on how the so called "trust fund" really works:
http://www.heritage.org/Research/SocialSecurity/em940.cfm
http://www.cato.org/dailys/10-16-99.html
http://www.heritage.org/Research/SocialSecurity/bg1802.cfm

... in response to Re: Re: I hear ya.., posted by Cali James on Jan 16, 2005

Right out of the park.  Bam!

... in response to Re: Re: I hear ya.., posted by Cali James on Jan 16, 2005

James,
I was reffering to his private investment idea for part of social security.Since its something the  government is going to have to come up with I don't think people should be given the opportunity to lose part of it.Plus I guess it really messes up the way they fund it,missing that portion of the contributions would really make things difficult to fund current payments.
Basically the government played SANTA CLAUS by giving people who retired back in the 50's 60's and 70's  alot of money that they ever started to pay in for.Then they had to start raising the rates on current wage earners to fund those already retired.Up untill 1965,the first year I paid the full amount in,the whole contibution for the year was like 3% of $4800 $144.Some folks retiring then got more than that every month.My grandmother,who never worked was getting the minimum in the late 60's.Like $80 a month.My grandfather worked but I bet he never put in over $500 for his whole life.And he drew it for 11 years before he died.It started out being $36 a year.So we payed up big time for our parents and grandparents and  our kids are really going to get screwed.
It will be there in the future in some form,it would be politically unaceptable for it not to be.But rates will be raised and retirements deffered.And people will be living longer thanks to medical proceedures and drugs that will increasingly burden medicare.
Interesting little discussion with one of my roomates.He had some littleskin cancer spotsremoved in Florida.The doctor would do one every 3 weeks,because if did them more often he would not get paid his $700 for a 5 miniute proceedure.Maybe insurance should be structured for the patientsto shop for a good price or not allow doctors to get away with something like that.
Another little aside,my girlfriend in Cali is an RN,a surgical nurse.She went to college for 5 years.She has 18 years experience.She makes 600,000 pesos a month,about $250
a month.She works 48 hours,including some 12 hour all night shifts.I think some US doctorsneed a system that will make them get real.Our health system is really screwed up.I spent my only night in a hospital in July in the US,not because I needed to be there but because I was playing the emergency room game to get around 3 week waitsfor appointments.They told me it cost $2500.my insurance paid.I was thinking what kind of hotel I could be in for that price.

Pete

... in response to Re: Re: Re: I hear ya.., posted by Pete E on Jan 16, 2005

[This message has been edited by Cali James]

Hey Pete,

Of the 12,000 plus I contributed this year and all the prior and future years, I wonder how much of my investment will I see when I retire 20 years from now? What will my return on investment be? Is my investment safe? Are even a dime of my contributions guaranteed to me?

I don't think they're safe at all.  Congress will reduce benefits and increase taxes to fund a system that is not fundamentally sound.  I would imagine by the time I reach retirement age, I will receive a fraction of what I would have received had my contributions been invested in real assets.

We need to stop pretending this is a trust fund and call it what it really is, a transfer program from the younger working generation to an older unproductive one.  That would be OK if it was equitable but as you point out it's not.  Each suceeding generation gets burdened with a larger and larger tax bill.

We should face the music now, while we still can.  

James

... in response to I hear ya.., posted by Cali James on Jan 16, 2005

James,
To face the music,basically cut off the people who didn't put in enough money is politically unacceptable.Besides most of those overpaid are  already dead and the money is gone.The system will survive.You will get something.It will not be a good investment.It is not an investment but a government program that has turned from a very good deal for the earlier participants to a very bad deal for the later ones.Maybe you should think of it as pay back to grandpa and mom.
Gee,I just remembered,I need to apply now probably,I could get my first check in a little over 2 months.I'm kind of a tweener,I need to live along time to get my money back but thats where life expectancy is headed.I expect to make out on it.

Pete

... in response to Re: Re: I hear ya.., posted by Cali James on Jan 16, 2005

I'm not excited about Bush's soc sec plan. Markets go up, markets go down. Soc sec should be maintained as a least common denominator retirement plan. A lot of people recognize they need to invest privately for their retirement in addition to soc sec.

There's a few things they can do.
Raise the retirement age, freeze the cola for a year, increase the payroll tax. Just try to muddle through for now. Circumstances can change. Who would have predicted in 92 that the federal budget would be in surplus by the end of the decade.

... in response to Re: Re: Re: I hear ya.., posted by Avispa on Jan 16, 2005

[This message has been edited by Cali James]

"Muddling through" or tinkering with the system here or there doesn't fundamentally change what will some day happen.  The reality is, is that by pushing things out, we just transfer the burden of paying all these promises on to our children.  I paid more than 12,000 this year (including employer contributions) to fund social security.  It's an amount higher than I paid in Federal taxes.  But this is a pittance compared to what we will begin paying as the demographics play out over the next several decades.  I can guarantee you, there will come a day when the working folks of America will no longer believe the promise of social security and see it for what it is.  On that day things will change and those that put into the system believing it was "safe" will begin to see the real value of their contributions.

... in response to Re: Re: Re: Re: I hear ya.., posted by Cali James on Jan 16, 2005

Howdy James...very good points.

Aaron