Chile's Place in Latin America

Chile Investment, how to invest in Chile, what to watch out for when investing, economic issues, currency exchange in Chile, and more.
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Re: Chile's Place in Latin America

Post by admin » Thu Jun 14, 2018 3:49 pm

Like a quote i seen recently, "the only ones selling dollars is the argentinean central bank".

And that is not working.
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41southchile
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Re: Chile's Place in Latin America

Post by 41southchile » Thu Jun 14, 2018 5:10 pm

admin wrote:
Thu Jun 14, 2018 3:49 pm
Like a quote i seen recently, "the only ones selling dollars is the argentinean central bank".

And that is not working.
Going from bad to worse, it seems it was only 25 I think when I looked last week, now it's 28 . And hung around 17 when we were there last November. Does that mean it's better value for foreigners or have they just put all their prices up to compensate ?
In the Lakes Region Chile for 6 years. It looks like New Zealand in some ways, and is nearly at the bottom of the world too, but there the similarities end.

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Re: Chile's Place in Latin America

Post by admin » Thu Jun 14, 2018 7:52 pm

41southchile wrote:
Thu Jun 14, 2018 5:10 pm
admin wrote:
Thu Jun 14, 2018 3:49 pm
Like a quote i seen recently, "the only ones selling dollars is the argentinean central bank".

And that is not working.
Going from bad to worse, it seems it was only 25 I think when I looked last week, now it's 28 . And hung around 17 when we were there last November. Does that mean it's better value for foreigners or have they just put all their prices up to compensate ?
They are claiming 25% inflation, but every time I have seen these inflation spikes in Argentina they are normally much, much higher on the ground. The government stats can not be trusted. As a friend that spends a lot of time in Argentina described it, everyone jacks their prices a month in advance, in anticipation of more inflation, which just causes more inflation. No one wants to put their money in the banks or in to pesos, because they have all seen this show before where the government just seizes or devalues everything as they implode. So, a stack of dollars under the rose bush becomes the bank.

Another trip over, in the middle of that first collapse (again this century), people were literally printing fake dollars on their home computers. No one one would touch a dollar that was even remotely old, crinkly, etc. We bought something small at a store. They gave me back $3 U.S. dollars change. We get in to a taxi, and I realize the ink was coming off the dollars they had given me. I turned to my wife and said lets try something. I took out the last real, 100% U.S. dollar bill I had. I know it was real, because i had taken directly from a U.S. bank counter, years before and for some reason had been hauling around the world with me for years. It was pretty beaten up, but a good one. The taxi ride was $1. So I held the three fake dollars, and the one good dollar to the driver. He grabbed the fake ones, because they were pretty, other than the ink smudges on the obvious regular printer paper. You could spot they were fake from the other side of the street they were so bad. I use to joke, Argentina was printing more fake U.S. dollar bills than the U.S. federal reserve because at that time, they really were printing fake U.S. dollar bills with their dollar peg, that did not have a dollar in any government reserve backing it up.

Any transaction longer than a day away simply gets priced in dollars, and typically way over priced.

That said, I might still go try to find a nice ski package on the other side of the speed bump (andies) this year if they get some respectable snow.
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Re: Chile's Place in Latin America

Post by admin » Thu Jun 14, 2018 8:00 pm

Christina really buggered them this time. By cutting off the ability to import foreign goods for so many years, when they took the leash off the demand skyrocked. So, imports flowed in with imports, dollars flowed out, all far faster than exports flowing out.

They also are doing a bunch of bonehead things like raising taxes on foreigner investors, right when they need the foreign investment money. This whole crisis started almost exactly when they implemented that tax on foreign investment just a month or two ago. They tried to screw over their foreign investors too early in the cycle. Typically Argentina has been better at waiting until late in the cycle to burn their foreign investors.

They still have a bunch other things like the tax system on argentinans buying dollars, restrictions on this and that. There is just a pile of distortions in the economy, that are all self-inflicted by the goverment, but the corruption is so entrenched around something like that they will never be able to get rid of it now.
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41southchile
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Re: Chile's Place in Latin America

Post by 41southchile » Fri Jun 15, 2018 9:46 am

Argentina to start gas exports to Chile (again) last time they tried to do this, didnt they switch off the tap, when they needed it themselves, after Chile had invested in the infrastructure to get it to Chile, back in the early 2000s. Recently Chile has been using the pipeline to send gas they import over to Argentina. This is a good deal for Chile, .......if they can trust the Argentinians that is to provide a reliable supply
https://uk.reuters.com/article/argentin ... KL1N1TG1OD
In the Lakes Region Chile for 6 years. It looks like New Zealand in some ways, and is nearly at the bottom of the world too, but there the similarities end.

41southchile
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Re: Chile's Place in Latin America

Post by 41southchile » Fri Jun 15, 2018 10:03 am

admin wrote:
Thu Jun 14, 2018 8:00 pm
Christina really buggered them this time. By cutting off the ability to import foreign goods for so many years, when they took the leash off the demand skyrocked. So, imports flowed in with imports, dollars flowed out, all far faster than exports flowing out.

They also are doing a bunch of bonehead things like raising taxes on foreigner investors, right when they need the foreign investment money. This whole crisis started almost exactly when they implemented that tax on foreign investment just a month or two ago. They tried to screw over their foreign investors too early in the cycle. Typically Argentina has been better at waiting until late in the cycle to burn their foreign investors.

They still have a bunch other things like the tax system on argentinans buying dollars, restrictions on this and that. There is just a pile of distortions in the economy, that are all self-inflicted by the goverment, but the corruption is so entrenched around something like that they will never be able to get rid of it now.
Yeah that is really dumb, taxing the foreign investors is one sure fire way to bring any transormation plans and growing the economy to a screaming stop. I have claimed before the time Chile has done most well economically in recent decades is under Lagos (I believe it was Lagos, piñera to a certain extent)when huge ammounts of foreign capital flowed into the country. On a smaller scale as an example of no fresh money entering an economy, its like the folks selling second hand clothes and dodgy presciption medicines or smuggled cigarettes to each other in the streets (the ferias). They are only at best, ever going to maintain their situation, its not going to lift all their standards of living thats for sure. Thats fine, if they dont want growth and are happy with their lot, but dont turn around then and complain and moan about everything (some can see opportunities, those are the ones that need encouraging), but most havent got a clue and all they do is seeth with resentment and jelously.
Its a shame about Argentina, I held out hopes that Macri could have sorted out Argentina a bit, but i guess he is only one man and is up against so many other things.
In the Lakes Region Chile for 6 years. It looks like New Zealand in some ways, and is nearly at the bottom of the world too, but there the similarities end.

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Re: Chile's Place in Latin America

Post by admin » Fri Jun 15, 2018 1:59 pm

This is interesting. This report on the increase in financial wealth (stocks and bonds) in chile (excluding biz and real estate holdings) increased 10% last year.

http://www.latercera.com/pulso/noticia/ ... os/206571/
Half the wealth is via the pension afp system.

What is interesting more than just another list of wealth in chile, is who owns what and where they invest it.

Chileans, both rich and poor, unlike the rest of the neighbors tend to invest in chile. So love or hate the super rich in chile, at least they are reinvesting in chile or keeping their assets in chile.

Chile has 5.6% off shore investment vs a 23% for south america. Global average is around 4.3%
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Re: Chile's Place in Latin America

Post by nwdiver » Fri Jun 15, 2018 4:36 pm

41southchile wrote:
Fri Jun 15, 2018 9:46 am
Argentina to start gas exports to Chile (again) last time they tried to do this, didnt they switch off the tap, when they needed it themselves, after Chile had invested in the infrastructure to get it to Chile, back in the early 2000s. Recently Chile has been using the pipeline to send gas they import over to Argentina. This is a good deal for Chile, .......if they can trust the Argentinians that is to provide a reliable supply
https://uk.reuters.com/article/argentin ... KL1N1TG1OD
Argies buy allot of cheap gas from Bolivia, last time they stopped exporting to Chile was when Bolivia said 1 molecule of our gas goes to Chile, we cut you off......so no Argie gas to Chile, and you are right the lines to Argentina were built to supply 2 large gas fired power plants that then needed to setup structure to run on marine supplies of LNG, which they then sold into Argentina cutting off some of the need for Bolivian gas.......those smart Canadians, Opps I mean Chileans ;)
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Re: Chile's Place in Latin America

Post by admin » Fri Jun 15, 2018 8:38 pm

Well i see peru came in with a 7+% growth last month. Good for them. Nice to have a few neighbors around that are not complete socio-economic basket cases. Granted peru has a lot of catching up to do, but at least they seem to be mostly moving in the right direction in recent years.
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Re: Chile's Place in Latin America

Post by HybridAmbassador » Sat Jun 16, 2018 5:15 pm

admin wrote:
Fri Jun 15, 2018 8:38 pm
Well i see peru came in with a 7+% growth last month. Good for them. Nice to have a few neighbors around that are not complete socio-economic basket cases. Granted peru has a lot of catching up to do, but at least they seem to be mostly moving in the right direction in recent years.
Yeah but that 7%+ growth went to politicians pockets. A la same in Brazil, all progress and still doesn't have anything to show.
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41southchile
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Re: Chile's Place in Latin America

Post by 41southchile » Mon Jun 18, 2018 11:14 am

Got to appease those students I guess
https://money.usnews.com/investing/news ... ars-report
In the Lakes Region Chile for 6 years. It looks like New Zealand in some ways, and is nearly at the bottom of the world too, but there the similarities end.

41southchile
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Re: Chile's Place in Latin America

Post by 41southchile » Mon Jun 18, 2018 11:22 am

HybridAmbassador wrote:
Sat Jun 16, 2018 5:15 pm
admin wrote:
Fri Jun 15, 2018 8:38 pm
Well i see peru came in with a 7+% growth last month. Good for them. Nice to have a few neighbors around that are not complete socio-economic basket cases. Granted peru has a lot of catching up to do, but at least they seem to be mostly moving in the right direction in recent years.
Yeah but that 7%+ growth went to politicians pockets. A la same in Brazil, all progress and still doesn't have anything to show.
Give this new guy a chance he has only been in there a couple of months, maybe thats why the economy had such strong growth, got rid of the other corrupt pedro pablo. This new guy sounds ok from what I have read but he has an uphill battle. As for Brazil, blame the socialists for that and the unsustainable social welfare benefits and subsidies for the poor and working class the country, they are finding difficult to wind back and get rid of them now that they cant afford them, again another uphill battle, they have elections this year and the fron runner is a right wing bad ass by the sounds of, its going to be interesting.
Heres what they say of the Brazil guy
"Bolsonaro, a former army captain, is running on a tough law and order platform advocating looser gun controls, which has won him widespread support among Brazil’s agriculture sector. His voting on economic issues has been mixed and he has little legislative track record to show he can pass major reforms."
In the Lakes Region Chile for 6 years. It looks like New Zealand in some ways, and is nearly at the bottom of the world too, but there the similarities end.

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