Post: #26

(09-22-2015 05:52 PM)RioNomad Wrote:  I planned to go the end of 2011 but it was roughly 1.6 to the dollar, so I went to Thailand instead.

Now that it's 4 to the dollar, have those of you who are there seen a dramatic difference in the cost of living?

I'm noticing that Latin America as a whole is collapsing economically wise.

Brazil at 4 for the dollar.

Argentina now at 12 for the dollar when it used to be about 3 or 4 to the dollar.

Mexico now I saw just yesterday is at 18 for the dollar when it used to be around 10 for the dollar.

What's going on Latin America man.

Post: #27

I have been following this closely aswell.
Getting from Scandinavia to Brazil used to be one of the more expensive destinations to fly to.

Now I noticed I could get there and back for about 600€
That's way less than SEA.

I might catch this wave..

Post: #28

Not just Latin America just the whole emerging segment is down currency wise, including the Indonesian rupiah, the Malaysian ringgit, South African rand, Russian ruble etc...

Brazil has always been a top rated destination ( beautiful beaches, pleasant and welcoming culture, sexy women) and more expensive than others in the emerging world, but with the current times it could be had at reasonable prices.

Cheaper times to travel if you earn usd pound or euro.

Post: #29

The feeling in the air is that Dilma won't survive until the end of her mandate - remember, she still has 3 years ahead of her.

The people that like her aren't very adamant about her, while the people that don't like her really hate her guts with passion. Check out this report by Datafolha for august: 71% rate her mandate as bad/very bad. Only 8% rate it as good. Pro-impeachment: 66%; against it: 28%. And that's before shit escalated to the degree we're at now.

Although Dilma has such a high disapproval rate, most don't realize that the chain of people who should take over her place is corrupt as fuck and as bad or worse than her: VP Michel Temer, President of the Chamber of Deputies Eduardo Cunha, etc.

As for the people who are asking for military intervention...

Post: #30

(09-23-2015 11:15 PM)EL CHAPO Wrote:  What's going on Latin America man.

The populists party is coming to its end, and now they dont know how to pay the bills, that is what is happening.

Post: #31

Post: #32

This forum should have some sharks who are looking for big currency changes in developing countries to see how to make money of of that no? I would love to see some datasheets on that, seems like a lifestyle that could fit me.

Post: #33

Thanks for the thread. I was there at the end of 2015 and somewhat benefitted from a ~2.65 exchange rate.

If you're planning on a week trip to Rio as a result of this devaluation, I don't think you would derive too much benefit. Your online-booked lodging (whether AirBnB or a hotel) will still be priced in terms of USD, you will eat and purchase goods in tourist-oriented establishments that will quickly adjust their prices or quote you in USD, and as a poster mentioned above, goods merchants and service providers will otherwise treat you as a walking sack of cash.

I see real value (no pun intended) in long-term apt leases or even home purchases, paid in cash. I see value, financial and psychological, in skipping Rio and SP in favor of Belo Horizonte, Fortaleza, etc -- cities that will be more dependent on your dollars.

In terms of policy, I will be glad to see Brasilia finally come to terms with the necessity of tourism and its role in shaping Brazil's future. Travel visa requirement for US, Canadian, Australian, and Chinese passport holders? That garbage, tourism-stifling "reciprocity" policy has to go. So does this notion of a self-sufficient Brazil that answers to nobody but local business and domestic civil society. We're talking about one of the world's most complex and burdensome bureaucracies for foreign investors and foreign nationals seeking citizenship.

As far as reports on the ground, it would be nice to get some qualification as to your location and target demographic prior to talking about a "Brazilian" attitude to foreigners. The daughter of a Joao Pessoa fisherman will not be impacted in the same way as the daughter of a Sao Paulo property developer who will see the value of her trust fund decrease by 65%.

Post: #34

(09-24-2015 03:04 PM)Papi Rico Wrote:  Thanks for the thread. I was there at the end of 2015 and somewhat benefitted from a ~2.65 exchange rate.

You mean end of 2014? Makes sense.

(09-24-2015 03:04 PM)Papi Rico Wrote:  If you're planning on a week trip to Rio as a result of this devaluation, I don't think you would derive too much benefit. Your online-booked lodging (whether AirBnB or a hotel) will still be priced in terms of USD, you will eat and purchase goods in tourist-oriented establishments that will quickly adjust their prices or quote you in USD, and as a poster mentioned above, goods merchants and service providers will otherwise treat you as a walking sack of cash.

Had some obligations in São Paulo several weeks back. Though I benefited from restaurant/nightlife prices, etc...lodging via Airbnb was quickly adjusted to meet inflation rates.

(09-24-2015 03:04 PM)Papi Rico Wrote:  I see real value (no pun intended) in long-term apt leases or even home purchases, paid in cash. I see value, financial and psychological, in skipping Rio and SP in favor of Belo Horizonte, Fortaleza, etc -- cities that will be more dependent on your dollars.

With regards to strife & frustration in São Paulo (infrastructure crumbling) and Rio (continued tension between Zona Sul residents & the rest of Rio not to mention increased crime rates), the possibility of those people flocking to tier two cities has already happened & might happen more often.

Women from Rio de Janeiro have a history of hating on Southern Brazil & especially the women down there...though recently in a city I'm staying in, I've met three females move due to crime/ridiculous prices & met another one who wants to do the same. That shift means property in certain competent tier 2 cities like a Curitiba, Campinas, or Belo Horizonte could increase in value as well.

Relatively speaking...look at what's happening in major Texas cities (property vale increase) like a Dallas/Ft. Worth or Houston with all those Californians shifting there for work.

(09-24-2015 03:04 PM)Papi Rico Wrote:  In terms of policy, I will be glad to see Brasilia finally come to terms with the necessity of tourism and its role in shaping Brazil's future. Travel visa requirement for US, Canadian, Australian, and Chinese passport holders? That garbage, tourism-stifling "reciprocity" policy has to go. So does this notion of a self-sufficient Brazil that answers to nobody but local business and domestic civil society. We're talking about one of the world's most complex and burdensome bureaucracies for foreign investors and foreign nationals seeking citizenship.

Wait...answering to nobody while begging the world for foreign investments only to place ridiculous sanctions on them only to piss it all away as they please? You took the words right out of my mouth...if not saying it better.

Then there is the issue of myself paying a ridiculous $7.00 USD for a bottle of Sriracha. If the real did not drop, it would likely be $15.00 USD. It's ridiculous how the government is trying to play up their whole good samaritan card by bringing in refugees that can increase the number of votes for the Partido de Trabalho while making it harder on immigrants that can stimulate the local economy....but that would be a bigger threat to the political party in power right? There is also the issue of helping out those same immigrants instead of providing a better foundation of success for people living in the favela communities in order to garner more votes again.

(09-24-2015 03:04 PM)Papi Rico Wrote:  As far as reports on the ground, it would be nice to get some qualification as to your location and target demographic prior to talking about a "Brazilian" attitude to foreigners. The daughter of a Joao Pessoa fisherman will not be impacted in the same way as the daughter of a Sao Paulo property developer who will see the value of her trust fund decrease by 65%.

Wait...did you just call me out?

You're absolutely right.

Let's just say I'm here long-term for certain obligations outside of game that entail me being in between a top/lower tier Southern Brazilian city with time spent in the Southeast zone as well (São Paulo, Rio, Belo).

The whole "eu tou aqui fazendo alguns projetos para trabalho" line (I'm here doing work projects line) worked terrifically in Brazil 2014 during a brief visit. That whole "work projects" line however in those same economically relevant cities 2015 right now has locals baffled giving me shit tests wanting to know more....

I know some rich top dogs in São Paulo that took 4-6 international trips (OUTSIDE of Latin America) annually amongst some pretty well off people in Tier 2 places that have NO plans to leave South America anytime soon. These are the same people who likely increase their domestic tourism ventures in 2015-2016.

There are some who will continue to proceed with their plans to study abroad (intercâmbio), but a great deal of this group have delayed if not cancelled theirs altogether.

Post: #35

My take (apologizing in advance for stream of consciousness tone but I've been working too fucking much lately to form a coherent thought):

- Brazil's stifiling corruption and bureuacracy held the country back from reaching its potential in boom times but a hot commodity market kept everyone satiated enough to not demand structural change.
- The above mentioned corruption and bureacracy will protract this recession but is finally forcing the goverment to make some changes (though minimal and at a snail's pace).
- Like all economies Brazil's is cyclical, and it will come back
- I have no idea how long this thing will play out, but our board estimated 3-4 years and recommended scenario planning for a pro-tracted recession
- The combo of devaluing currency -> high inflation -> higher interest rates (and they were already fucking high) can be a vicous cycle
- I was talking with a banker the other day and he said there is foriegn money on the sidelines waiting for the BRL:USD fx rate to hit 5 (really fucking me... it's like 1/2 a months salary just for the flight for me to visit my family in the US, I haven't been in nearly 2 years)
- Signs of the recession everywhere in SP:
*both office vacancies and homeless population sky rocketing on Av Paulista
*retail vacancies on Oscar Friere
*I had a meeting scheduled at a Starbucks in Vila Olimpia only to show up and it was shut down (I thought they only multiplied, not retracted)
*Random conversation with a Bolivian the other day and he said all the Bolivians were going back home because there is no work here. Unfortunately for them they have to change their BRL to USD in order to change it back home.
- Lots of popular support for an impeachment, though I have no idea legally if it can happen
- Like Ringo said, what is plan B?
- The mood in general is a bit dour by Brazilian standards (which still makes it 10x whatever the opposite of dour is compared to anglo countries)

To put a happy ending on my rambling negativity here are some potential positive outcomes:
- Cheap travel for the Rooshers
- Brazilians are finally awake and doing a little more than just bitch about their government
- At least some structural change
- Good time to invest in assets (RE and Private Equity in particular, less confident on Brazilian stocks) if your wealth is not BRL based
- Good time to start a business (low rents, cheap labor, if you can get something to float now it will take off in the future)

Post: #36

It's actually very simple. Commodities have gotten crushed over the last few years in case you were living in a cave. Brazil like many emerging markets are resource exporting economies. Commodities tank, resource based economies tank. That's the main driver. Now throw in the facts that money is shifting back to the US as interest rate hike is on the horizon and that the long risk carry trade is over for now. Also, because the US is the strongest economy in the world now, Germany 2nd so institutions are not looking for return ON capital, rather return OF capital. Corruption in Brazil doesn't help either. That's looking back.

Looking forward, real devaluation makes Brazilian imports more competitive so good business ideas could involve exporting of services and goods from Brazil. For public/private equities, unless you think Brazil is gonna go the way of Syria, IMO not a fucking chance, it's a great time to buy for the long haul. 10+ years will yield amazing results, especially if you weight to non commodity businesses. I suspect Brazilian real estate would be an interesting play here.

Post: #37

Problem with re is that your rent income would be in reals which is pretty low at the moment and you gotta convert that to yourUSD or euro.

Post: #38

(09-24-2015 06:21 PM)champ Wrote:  My take (apologizing in advance for stream of consciousness tone but I've been working too fucking much lately to form a coherent thought):

- Brazil's stifiling corruption and bureuacracy held the country back from reaching its potential in boom times but a hot commodity market kept everyone satiated enough to not demand structural change.
- The above mentioned corruption and bureacracy will protract this recession but is finally forcing the goverment to make some changes (though minimal and at a snail's pace).
- Like all economies Brazil's is cyclical, and it will come back


- I have no idea how long this thing will play out, but our board estimated 3-4 years and recommended scenario planning for a pro-tracted recession
- The combo of devaluing currency -> high inflation -> higher interest rates (and they were already fucking high) can be a vicous cycle
- I was talking with a banker the other day and he said there is foriegn money on the sidelines waiting for the BRL:USD fx rate to hit 5 (really fucking me... it's like 1/2 a months salary just for the flight for me to visit my family in the US, I haven't been in nearly 2 years)

- Lots of popular support for an impeachment, though I have no idea legally if it can happen

There are two kinds of corruption in Brazil, you have ambitious and power hungry guys who take public hospitals money to make a weekend barbecue on a mansion in Brasilia (where i live) and then you have Bolivarianism which is the workers party MO. Deeply imbued in the Marxist mentality, for them stealing taxpayers money is just a revolutionary tool against capitalism

As declared socialists they controlled everything for 12 years, since the economy is non controllable the workers party are now finally running out of money and are even cutting the social policies they always used to win elections.

The country may start to grow again in maybe 5 years but there is a giant political vacuum since there is no right wing party in Brazil, social democrats and Marxist keep playing a game of calling each other neoliberals while they all share the same ideas, the trick to fool the public for decades is to never have any political discussion on ideological levels, only who was worst with handling the economy

There are some right wing politicians coming out of closet in the last 5 years and are growing huge in popularity like Jair Bolsonaro, but Brazil will still remain for years a assembly line of retarded leftists who keep voting for being fucked in the ass, this is the main point of our universities,schools,media

The impeachment is very possible because its written on the Brazillian Constitution

Quote:Art. 2º Os crimes definidos nesta lei, ainda quando simplesmente tentados, são passíveis da pena de perda do cargo, com inabilitação, até cinco anos, para o exercício de qualquer função pública,

Crimes defined by this law are liable to forfeiture of the office

Quote:VI - A lei orçamentária;

Crime against the budget law

Right at the end of 2014 dilma juggled the congress to change the budget law to turn her deficit of 17 Billion R$(the worst since 1997), thats 0,6 of our GDP, into a superavit (budget surplus)

http://www.bloomberg.com/news/articles/2...e-solution

http://www.bloomberg.com/news/articles/2...et-defense

The cunt managed to manipulate Federal Court of Accounts to delay the audit and only now in October they will start to review the 2014 govt spending.
This moment will be the tipping point were well finally see if she falls

Edit: If anyone is interessted, i wrote more stuff in a dupe thread : /thread-50639.html

Post: #39

worldtraveler3 Wrote:Problem with re is that your rent income would be in reals which is pretty low at the moment and you gotta convert that to yourUSD or euro.

Is this really the case? Decree-Law 857/69 generally bans "contracts, titles, or other instruments...that stipulate payment in gold, foreign currency".

But there's a clear exception below:

"Os contratos de locação de bens móveis que estipulem pagamento em moeda estrangeira ficam sujeitos, para sua validade a registro prévio no Banco Central do Brasil."

EN: The validity of real property lease agreements that stipulate payment in foreign currency shall be subject to prior registration with the Central Bank of Brazil. In other words, file a document with the Central Bank and you can begin collecting USD or BRL indexed to USD rent payments from your tenants.

Have any of you Brazil vets come across lease agreements indexed to or priced in USD?

In any event, there's Airbnb. When you receive a payout for any listing, it is made in the currency of your financial institution. Nothing to my knowledge would preclude an American from renting out a pad in Rio and having reservations payments deposited directly into his US account in USD.

I concur with the above. Brazilian RE is looking very good at the moment.

Post: #40

Sure you might be able to index it to dollar or whatever currency u want...

but remember its the market u are competing against so while u index it other domestic investor are not hence they will be offering a more competitive rate= getting the deal. You will then be forced to be more competitive. So in the end doesn't really matter.

Most investors in the market outside rio are not foreign.Brazil is a long term game.

Not sure about Airbnb, in the case od short term rentals you would have to have someone on the ground running it if you are not based there. Even then there is gonna be alot more hassle than a long term rental with unpredictable tenants.

Post: #41

Yield on residential RE (in Rio) is below 4% and the current interest rate is 14,25%. Hence investing in residential RE (in Rio) now is not a yield play but should be seen as a LT play on the increase of property value, and the potential increase of the real if you are a foreign investor. Next questions then is whether residential RE is over- or undervalued.

Post: #42

(09-25-2015 01:14 AM)worldtraveler3 Wrote:  Most investors in the market outside rio are not foreign.Brazil is a long term game.

Not sure about Airbnb, in the case od short term rentals you would have to have someone on the ground running it if you are not based there. Even then there is gonna be alot more hassle than a long term rental with unpredictable tenants.

With regards to numbers, long term game indeed. I think we can agree most of the posters in this thread however are somehow vested into Brazil for the culture, vibe, feeling of being there, game, & other possible ventures. They would therefore be more patient with that aforementioned long-term investment.

Post: #43

I believe Colombia is a better long term investment, at the moment, specially in real estate. The economic situation is more stable and, overall, it is less of a gamble. Inflation is nowhere near Brazilian levels, and they are about to sign a peace deal with the rebels.
Barranquilla, for example, stands out as having excellent growth potential.
Though, if the dollar goes anywhere near 5 reals, and I enjoy my next trip to Brazil this October.... I am in.

Post: #44

I'm in the south, Santa Catarina.. I've got front row seats to the South American economic-collapse, and good balcony seats to the US shit show that will be going down in the near future.

Post: #45

Now the current government in Brazil is proposing a capital gains tax and bringing back the financial transactions tax. Yeah, I'm sure that will help the economy. It certainly gives those of us in financial services a fucking headache.

Post: #46

(09-26-2015 05:00 PM)TheNookieMonster Wrote:  Now the current government in Brazil is proposing a capital gains tax and bringing back the financial transactions tax. Yeah, I'm sure that will help the economy. It certainly gives those of us in financial services a fucking headache.

The more the headache, in an economic sense, in Brazil, the better. At least that is my theory when it comes to garotas.

Post: #47

(09-24-2015 10:58 AM)Ringo Wrote:  The feeling in the air is that Dilma won't survive until the end of her mandate - remember, she still has 3 years ahead of her.

[...]

Although Dilma has such a high disapproval rate, most don't realize that the chain of people who should take over her place is corrupt as fuck and as bad or worse than her: VP Michel Temer, President of the Chamber of Deputies Eduardo Cunha, etc.

Oh shit. Big news:

Quote:Brazil opens impeachment proceedings against president Dilma Rousseff

Rousseff expresses outrage in national televised address after Speaker of lower house of congress accepted opposition’s impeachment request

Source: The Guardian

Post: #48

edwardo cuhna himself is being accused of corrption. i dont see him lasting either. so they might get rid of him before he get rid of her.

Post: #49

(09-23-2015 02:00 PM)gmoneysauce Wrote:  The question here is if this change in exchange rates is real or merely nominal, an adjustment to the local inflation. If you get twice as many Reals for your Dollar/Pound/Euro but the prices have all doubled then the 'real' exchange rate remains unchanged...

This is the real question. I'm in Play del Carmen, Mexico now and the strong dollar has made little difference in overall cost of living since most businesses have raised their prices. Is this true for Brazil as well?

Post: #50

My tip : buy Banco Santander (LON:BNC) shares or Black Rock Latin American Investment Trust as soon as Brazil shows the first blossoms of economic improvement. You will make a killing in the long run.