Economy Wham here comes the tsunami

[Toronga]

And it is gonna get worse and then give it a few years.

https://www.reuters.com/article/us-argentina-election/argentina-opposition-on-way-to-defeating-macri-in-primary-after-major-upset-idUSKCN1V209J

 

[Frisel]

I always wanted to know what's it like to live in Venezuela. Will soon find out!!!

 

[earlyretirement]

I always wanted to know what's it like to live in Venezuela. Will soon find out!!!

Nah, Buenos Aires will never be like living in Venezuela. Never. 2001 if anything should have taught you that when things crash that hard and blood in the streets, you pounce on it and buy. The most successful people in Argentina are the ones that understand the cycles.

 

[CarlosDEr]

Nah, Buenos Aires will never be like living in Venezuela. Never. 2001 if anything should have taught you that when things crash that hard and blood in the streets, you pounce on it and buy. The most successful people in Argentina are the ones that understand the cycles.

Exactly, collapses here are the perfect opportunity to make real money, you just have to be cold minded and buy opportunities all my family made money by buying when people panic and people do panic an exaggerate here, but after the storm there is plenty of material to push the economy to it feets again and again it has become somehow resilient to this cycles. People get nervous when is to long since the last one and they start to be wary. Venezuela is not going to happen here because the production matrix is just different same as the people and what people is used to. If Argentina will be an oil exporter economy then this might happens given the quality of politicians (populist that will grab any sort of money cow and dry it out), but luckily is not the case. But is a sad sad day, that for sure, and is even sadder to know that there will be at least 4 years like this in front of us, with good luck alberto fernandez will not be like kristina (after all he was a critic of Kristina Kischner) but only future will tell

 

[PhelipCer]

Exactly, collapses here are the perfect opportunity to make real money, you just have to be cold minded and buy opportunities all my family made money by buying when people panic and people do panic an exaggerate here, but after the storm there is plenty of material to push the economy to it feets again and again it has become somehow resilient to this cycles. People get nervous when is to long since the last one and they start to be wary. Venezuela is not going to happen here because the production matrix is just different same as the people and what people is used to. If Argentina will be an oil exporter economy then this might happens given the quality of politicians (populist that will grab any sort of money cow and dry it out), but luckily is not the case. But is a sad sad day, that for sure, and is even sadder to know that there will be at least 4 years like this in front of us, with good luck alberto fernandez will not be like kristina (after all he was a critic of Kristina Kischner) but only future will tell

Economies should not be manipulated as to benefit a small percentage of the population . How many people in Argentina can benefit in a crash maybe 10 % at most who have a lot of money that can be used to buy up big when there is blood of the streets . This is financial terrorism of the worse kind as 90% of Argentinians live month by month and have to buy the food and pay the rent . With terrible inflation and low wages in a devalued currency life has been a liiving hell for them the last year .

Macri had a excellent chance to create and stimulate the economy internally when he was elected but he did not implement one policy to help real economic growth that come from the argentinian people . The economy in the last years has been a casino economy of the worst kind based on speculation that has only benefited those that are very wealthy . There has been very little investment in a business culture that would have created a lot of employment for local people . The last years has seen many busineses close down and argentina made is non existent .

Having a open economy where everything is china made does not benefit argentina . This is a country that can produce everything it needs . We need a president that cares about his people and creates real economic growth that comes from the talent of the argentinian people and the incredible natural resources that argentina has .

 

[earlyretirement]

Economies should not be manipulated as to benefit a small percentage of the population . How many people in Argentina can benefit in a crash maybe 10 % at most who have a lot of money that can be used to buy up big when there is blood of the streets . This is financial terrorism of the worse kind as 90% of Argentinians live month by month and have to buy the food and pay the rent . With terrible inflation and low wages in a devalued currency life has been a liiving hell for them the last year .

Macri had a excellent chance to create and stimulate the economy internally when he was elected but he did not implement one policy to help real economic growth that come from the argentinian people . The economy in the last years has been a casino economy of the worst kind based on speculation that has only benefited those that are very wealthy . There has been very little investment in a business culture that would have created a lot of employment for local people . The last years has seen many busineses close down and argentina made is non existent .

Having a open economy where everything is china made does not benefit argentina . This is a country that can produce everything it needs . We need a president that cares about his people and creates real economic growth that comes from the talent of the argentinian people and the incredible natural resources that argentina has .

Whether only 10% of the population can benefit is just a fact but it's subjective as to the morality of is it right or wrong. The wealthy will always be able to benefit on opportunities when there is blood in the street. I will still argue with anyone that says Argentina will become a "Venezuela". It just won't happen. I will argue with anyone that says that real estate prices will go back to the levels of the last crash. It just won't happen. Not in US dollar terms. Never.

I hope I'm wrong and if so, I'll be one of those 10% you refer to taking advantage and loading up on my investments. That isn't a question or morality or taking advantage of anyone. It's just prudent and sound investing.

Look at Buenos Aires a city with a metropolitan area of about 13 million people and look at La Capital of only around 3 million people. Much of that is concentrated wealth and always will be for the end of time.

Wise economists and experts have said if you took ALL the wealth in the world and divided it equally with every single person in the world. Within 10-15 years all the people that were wealthy before would be again and the people that were poor before probably would be again. I agree with much of that thought. There is no right or wrong about it. Just fact.

As far as Macri failing. Yes, absolutely. But as I mentioned before, I don't think any politician could have successfully navigated Argentina after the mess CFK made. That was unrecoverable. Argentina will always be a mess because it's a broken country. So the best thing you can do is take advantage of the really really bloodbaths and recessions and crashes when they happen. And between relative periods of stability when they have recovered to dump your investments and rinse, repeat over and over.

It's certainly not a matter of morality or taking advantage of anyone. It's about taking advantage of a smart investment opportunity.

 

[PhelipCer]

Whether only 10% of the population can benefit is just a fact but it's subjective as to the morality of is it right or wrong. The wealthy will always be able to benefit on opportunities when there is blood in the street. I will still argue with anyone that says Argentina will become a "Venezuela". It just won't happen. I will argue with anyone that says that real estate prices will go back to the levels of the last crash. It just won't happen. Not in US dollar terms. Never.

I hope I'm wrong and if so, I'll be one of those 10% you refer to taking advantage and loading up on my investments. That isn't a question or morality or taking advantage of anyone. It's just prudent and sound investing.

Look at Buenos Aires a city with a metropolitan area of about 13 million people and look at La Capital of only around 3 million people. Much of that is concentrated wealth and always will be for the end of time.

Wise economists and experts have said if you took ALL the wealth in the world and divided it equally with every single person in the world. Within 10-15 years all the people that were wealthy before would be again and the people that were poor before probably would be again. I agree with much of that thought. There is no right or wrong about it. Just fact.

As far as Macri failing. Yes, absolutely. But as I mentioned before, I don't think any politician could have successfully navigated Argentina after the mess CFK made. That was unrecoverable. Argentina will always be a mess because it's a broken country. So the best thing you can do is take advantage of the really really bloodbaths and recessions and crashes when they happen. And between relative periods of stability when they have recovered to dump your investments and rinse, repeat over and over.

It's certainly not a matter of morality or taking advantage of anyone. It's about taking advantage of a smart investment opportunity.

I like to make it clear once and for all I am not a peronist nor want a return to the past . I also voted for Macri hoping for a positive change and like everyone in Argentina we were left with egg on our faces. In regards to the 10 % loading up on investments when there is blood on the streets why not invest in Venezuela where property prices are now the cheapest in the world?

Buying a property depends on stability and a fair system of law . I worked in real estate in Argentina for many years and believe that it is very risky to buy property now and for the next years . Prices have come down substantially since 2017 and now with the new scenario they will go doiwn much further . I believe that the future is 2001 revisted but Imho it seems that the next time the crash will be much more profound and longer . The 2001 crash only lasted for 2 years a very short time before recovery . The world situation is very unstable now and it seems that in the next year there could be a world wide economic correction

The last 3 years under Macri have been the worst years for most small businesses in Argentina since records began . Retailers have been absolutely hammered with outrageous rental prices in dollars , huge service costs . and very low consumption due to people not having any disposable income . Palermo Soho and Hollywood once vibrant dynamic neighbourhoods have been the most affected in the city of Buenos Aires and some strrets have a 50% occupation rate Fitzroy Street is a example . The inflation under Macri has been close to double than under Kristina but without wages being adjusted to keep up with inflation peoples real earning potential have been halved in just 3 years . Im currently in Sydney Australia and it is cheaper and much higher quality food to eat out here than in Buenos Aires now . Food is a necessity and should not be so marked up as it is in Argentina . Supermarket prices in Buenos Aires are dearer than most cities of the world including London

With the imf record loan more adjustments were going to be implemented on the battered Argentinian public . How much can people suffer and for how long before they say basta . I do not believe that people are voting for Christina but they are voting against Macri this is the reality . He won the elections with most of our votes but he did not deliver on any of his promises . I am not saying it will get better next year as the damage has been done . Argentina has a huge foreign debt created in the main by the current government . ( Early retirement do you know where this money went ?)

I do not want to be one of those bitter expats who spend their days whinging about their new country and for this reason I am already half way out of Argentina . As early retirement has stated Buenos Aires is great for holiday but to live there and do business it is not desirable .

 

[RichardOne]

I like to make it clear once and for all I am not a peronist nor want a return to the past . I also voted for Macri hoping for a positive change and like everyone in Argentina we were left with egg on our faces. In regards to the 10 % loading up on investments when there is blood on the streets why not invest in Venezuela where property prices are now the cheapest in the world?

Buying a property depends on stability and a fair system of law . I worked in real estate in Argentina for many years and believe that it is very risky to buy property now and for the next years . Prices have come down substantially since 2017 and now with the new scenario they will go doiwn much further . I believe that the future is 2001 revisted but Imho it seems that the next time the crash will be much more profound and longer . The 2001 crash only lasted for 2 years a very short time before recovery . The world situation is very unstable now and it seems that in the next year there could be a world wide economic correction

The last 3 years under Macri have been the worst years for most small businesses in Argentina since records began . Retailers have been absolutely hammered with outrageous rental prices in dollars , huge service costs . and very low consumption due to people not having any disposable income . Palermo Soho and Hollywood once vibrant dynamic neighbourhoods have been the most affected in the city of Buenos Aires and some strrets have a 50% occupation rate Fitzroy Street is a example . The inflation under Macri has been close to double than under Kristina but without wages being adjusted to keep up with inflation peoples real earning potential have been halved in just 3 years . Im currently in Sydney Australia and it is cheaper and much higher quality food to eat out here than in Buenos Aires now . Food is a necessity and should not be so marked up as it is in Argentina . Supermarket prices in Buenos Aires are dearer than most cities of the world including London

With the imf record loan more adjustments were going to be implemented on the battered Argentinian public . How much can people suffer and for how long before they say basta . I do not believe that people are voting for Christina but they are voting against Macri this is the reality . He won the elections with most of our votes but he did not deliver on any of his promises . I am not saying it will get better next year as the damage has been done . Argentina has a huge foreign debt created in the main by the current government . ( Early retirement do you know where this money went ?)

I do not want to be one of those bitter expats who spend their days whinging about their new country and for this reason I am already half way out of Argentina . As early retirement has stated Buenos Aires is great for holiday but to live there and do business it is not desirable .

ery true , excellent comments.! yesterday on TV the Head of the BA Realtors Assoc. mentioned that one of his clients that lives in the US, asked him to put on the market his 10 units in Palermo , and suggested lower the prices 15 % and if necessary go down to 20 %....

 

[Frisel]

ery true , excellent comments.! yesterday on TV the Head of the BA Realtors Assoc. mentioned that one of his clients that lives in the US, asked him to put on the market his 10 units in Palermo , and suggested lower the prices 15 % and if necessary go down to 20 %....

Most of my friends who are realtors are lucky to sell a property every few months . Now with the new scenario it will be much more difficult . Prices in Buenos Aires in US dollars for being a cash market have been high now for a long time . There is no justification for these prices as there is a tremendous amount of offer for sale and low demand . Rental returns are at historic lows and in many cases people are losing money holding a property in Buenos Aires as costs to maintain are very high . Also now with the new capital gains tax of 15% it makes little sense to buy a property as the risk factor is high . For example if I brought a property in January 2018 for 100 thousand dollars or at that time 1 ,700.000 pesos and now resell it for the same amount US$ 100,000 this is currently 5,700,000 pesos Banco de la Nacio venta .

This means that a 15% tax must be paid on the false earning ( ganancia ) of 4 million pesos or 600 thousand pesos US$ 11,000 approximate . This is a most unfair law as it does not contemplate the sale and purchase of property in us dollars and takes the peso as its base . This means that the seller is paying for the devaluation of the peso even though he did his transaction in us dollars.

Imagine if the peso reaches 100 or more the tax will be brutal .

Please note this only applies for those who brought from 2018 .

 

[earlyretirement]

Most of my friends who are realtors are lucky to sell a property every few months . Now with the new scenario it will be much more difficult . Prices in Buenos Aires in US dollars for being a cash market have been high now for a long time . There is no justification for these prices as there is a tremendous amount of offer for sale and low demand . Rental returns are at historic lows and in many cases people are losing money holding a property in Buenos Aires as costs to maintain are very high . Also now with the new capital gains tax of 15% it makes little sense to buy a property as the risk factor is high . For example if I brought a property in January 2018 for 100 thousand dollars or at that time 1 ,700.000 pesos and now resell it for the same amount US$ 100,000 this is currently 5,700,000 pesos Banco de la Nacio venta .

This means that a 15% tax must be paid on the false earning ( ganancia ) of 4 million pesos or 600 thousand pesos US$ 11,000 approximate . This is a most unfair law as it does not contemplate the sale and purchase of property in us dollars and takes the peso as its base . This means that the seller is paying for the devaluation of the peso even though he did his transaction in us dollars.

Imagine if the peso reaches 100 or more the tax will be brutal .

Please note this only applies for those who brought from 2018 .

Yes, this is one thing I agree with you totally on. This is NOT time to buy. The old adage is true. Never try to catch a falling knife. Fortunately I sold many of my properties earlier this year and also last year and got really premium prices for them. I bought them mostly after the last crash so I didn't have any capital gains tax on them. I wouldn't buy now unless prices crashed like in 2002-2004. (And I don't believe they will). I still own a few properties in Buenos Aires I will just use for when I visit/retire and also renting out.

Buenos Aires is a really amazing city. And it always will be. No matter the economy. Venezuela...um is NOT.

 

[Mart]

Real estate is not for the faint of heart in Argentina. When we sold our farm at the end of 2016, part of the payment was another piece of real estate which was rented out to a commercial enterprise. Phenomenal location, great rental history, etc. The buyer of our farm said it was worth X. We talked to several real estate agents who told us it was worth less than X but still a worthwhile asset. Once it became ours, all the headaches began. Tenant issues. Slow to pay their monthly rent. The building had issues and monthly expenses skyrocketed, taxes, etc, etc, etc. We sold it in 2018 at a great deal less than what the "experts" assured us it was worth 18 months prior but we were just happy to be rid of it.

 

[earlyretirement]

Real estate is not for the faint of heart in Argentina. When we sold our farm at the end of 2016, part of the payment was another piece of real estate which was rented out to a commercial enterprise. Phenomenal location, great rental history, etc. The buyer of our farm said it was worth X. We talked to several real estate agents who told us it was worth less than X but still a worthwhile asset. Once it became ours, all the headaches began. Tenant issues. Slow to pay their monthly rent. The building had issues and monthly expenses skyrocketed, taxes, etc, etc, etc. We sold it in 2018 at a great deal less than what the "experts" assured us it was worth 18 months prior but we were just happy to be rid of it.

Never, never, never take a property as partial payment for one that you sell. I'd had that offered to me several times and I never accept. Just cold hard cash. I can't tell you how many headache stories I hear like Citygirl of people that take other properties as partial payment.