Monthly Archives: October 2013

Living to 100!

What is your Longevity Factor?

What if you were to live until 100?

Impossible you might say? Not really and in fact living to 100 is becoming an increasingly likely outcome for many people. Check out the number of centenarians (persons over 100) in Okinawa Japan or the USA for that matter.

There exists an exceptionally well researched web site namely www.livingto100.com that you would be well advised to sign up for as soon as possible. Better yet it is completely FREE. Do it today and learn something very important about your life.

www.livingto100.com

I had highlighted this excellent web site in my original eBook on Panama written 7 years ago. It is still going strong and the questions seem to have been simplified. By answering a bunch of personal questions about everything you might imagine it will make a prediction concerning  your probable longevity …. short of getting hit by a truck.

I just did mine and it predicted 101 years. Seven years ago my score was only 97 years but then I weighed considerably more and lived in New Jersey (polluted air, extra stress etc.). Now the trick is to complete the test twice. The first time you should be completely and absolutely honest. The second time around make some small adjustments to your answers that you know would not be very difficult to achieve. Exercise a bit more, drink a bit less, eat less red meat, lose a bit of weight to get your body mass index down, try to be a bit more sociable etc. You may be very surprised to see that these minimum improvements may add 6 or 7 years to your longevity.

You Should Live So Long!

You might be of the camp that says it is not worth it. You expect that by your mid 80’s, if you should live so long, you will be suffering from one or other form of dementia making life a hell for your partner and children, spending excess money on medical care and generally living much like a vegetable. Wrong! Dementia is actually a rapidly declining threat for old age even well into your 90s. If you maintain a positive attitude and a healthy body there is no reason that you will not be painting masterpieces like Picasso at age 94 when he enjoyed an untimely death.

Three Months Every Year

Longevity is a critical factor in retirement planning and just about every other aspect of life and death. Many people are still planning to die at age 72 or 75 at the latest just like perhaps one of their parents. Their retirement financial planning horizon is also, not surprisingly, 75 giving them a very false feeling of confidence.

As you may have heard, 95 is today the new 75. Believe it! Every year for the past decade, the average longevity of the average North American has increased by about 3 months. 30 extra months in just 10 short years. Amazing! Actually, if you do the numbers for the past 160 years you will find that longevity increased by about 40 years in this period or about 3 months per year (same same as they say in Thailand) at least for some nations such as Sweden.

Beware of Boredom

A greatly extended longevity, however, is not only about having an adequate cash flow. More importantly, for many reasons, it is about “what am I going to do with all of this extra time”? There is only so much time you can spend watching football games and soap operas. It is a well-known fact that one of the biggest killers in retirement is “boredom” plain and simple. That is a condition reached when you believe you can finally turn off your mind. Because you are doing very little or perhaps nothing you first become rather bored by yourself and then, for stage two, you become boring with everyone else and in stage three you fade off quietly into the night.

However, now that you realize that you have a reasonable chance to become a super-centenarian (110 or over) plan on it. Develop a daily routine with goals and activities that have a very, very long time horizon. Your life will be much the richer for it.

Cheers

The World is Collapsing?


The World is Collapsing

I’m continuously surprised by the number of people I meet in Coronado, often American expats, who are convinced that the USA and the world is going to hell in a hand basket. To be fair, there are some Europeans and Canadians in this mix. This is often the reason these same people decided to move to Panama in the first place …. where the economy is based squarely on the American dollar.

When I question these people a bit further, the typical explanation is that the massive spending/stimulation programs of the past five years will soon result in runaway inflation causing the American dollar to plummet. The current wisdom is that “you can’t just print money”; the United States is living far beyond its means and ObamaCare is clearly the last straw that will break the camel’s back.

My first response is typically the following question. With high and persistent unemployment in the USA and Europe and huge amounts of global overcapacity in virtually every industry sector what exactly will drive this runaway inflation? To date, after 5 years of considerable stimulation, inflation and interest rates remain extremely low. Some countries in Europe which applied much less “stimulation” than the USA actually remain mired in recession with excessive rates of unemployment sometimes in the 20 to 30% range especially for some of the peripheral countries. Even Japan, a basket case of deflation for 20 years, recently decided to stimulate its way out of its problem and so far this strategy seems to be working.

The next point commonly made is that foreigners holding American dollar Bonds and Treasuries will start cashing in their chips. Oh My God, China will start selling! This argument has been around for longer than I can remember but China continues to add to its reserve of US Treasuries. Why? Because China sells most of its production to the USA. The last thing China wants is for the American dollar to plummet. Where else can China store its reserves? Gold?

How about gold? Is this not the ultimate “safe haven” when the world is crumbling. Gold has had a great run until recently precisely because everyone was certain that massive inflation was imminent. The number of “serious articles” in the past 5 years predicting gold at $5000 was mind boggling. In contrast, today some of the largest American investment houses are predicting that gold will drop to $1000. I happen to side with them.

Then there is always the point that the American dollar will lose its privileged status as the “world currency”. Of course this is the reason why the USA can “print money” to a much greater extent than would be permitted by the domestic economy alone. This is why every nation in the world wants to and must hold ample reserves of American dollars and why most global commodities (such as oil and gold) are priced in American dollars. Try to buy a house in Uruguay (a very strong economy) and you will see it priced in American dollars and not in Uruguayan pesos . What are the options to using the American dollar as a global currency? Gold? The Euro? Bartering? The Chinese currency? A basket of global currencies controlled by some international body? Probably not in my life time.

Then of course there is ObamaCare. With the present standoff in Congress this is clearly the major stumbling block. Whereas every other developed country in the world (and many developing countries) has a health program covering every citizen, many Americans believe that such a program dramatically curtails personal freedoms and will be the ruin of the country. The richest country in the world cannot afford such a program! Just look at how badly the insurance exchanges operated in their first week. Clearly a stupid program! Politically speaking, if the Republicans are so convinced that ObamaCare will be such a huge failure then the smart thing to do would be to let it roll out and fail miserably. They can always repeal it in 2016 when they control the House, the Senate and the White House because of this ObamaCare fiasco.

An Optimistic Global Outlook

So what does the other side, the bright side look like?

Is there an optimistic global outlook? In fact, yes I think there is ….. as follows:

  • The American economy has actually come “back from the brink” of the worst financial crisis since 1929.
  • The housing market in some American cities is attracting multiple bids on properties well in excess of the asking price and in excess of 2008 prices.
  • The USA is today on the brink of self-sufficiency in energy. Amazing … remember the OPEC embargo on oil in the 1970’s.
  • The European economy has “adjusted” significantly with large numbers of important structural changes and considerable austerity. It is finally bottoming out of 4 years of recession.
  • Japan is on the rise with the major stock exchange up about 65% in the past 12 months.
  • The UK has a very hot property market among other signs of renewed overall growth. It also has a great new Governor of the Bank of England …. a Canadian!
  • Canada and Australia remain in pretty good shape and never really suffered a housing bust and a major recession as did the USA and Europe.
  • China has also adjusted significantly and is returning slowly to a higher growth rate.
  • Gold is today in a serious “bear market” and the belief that gold is the perfect “safe haven” has been tarnished. A bit of diversification OK but as a major investment objective I doubt it.
  • The internet has continued to expand at blinding speed through smart phones, tablets and iPads. Billions of people exchanging information has been a transformational global phenomenon. Today anyone can earn a Harvard or MIT degree for “free” using the internet and live anywhere in the world. What a concept!  In the end it’s what you know.
  • The new Panama Canal opens in about 18 months (early 2015) and the prices of many commodities will drop dramatically as world trade takes on a new meaning.
  • Longevity for the average human on the planet is changing at the blinding speed of almost 3 months every year. Now that is truly incredible. What will this mean for productivity?
  • The global “middle class” is also growing at blinding speed meaning a rapidly increasing market for high end goods and services. Check out the number of millionaires in China.
  • The world is much less “at war” today than it was 10 years ago. Most countries have lost their appetite for new engagements. The Arab Spring was a very good thing globally albeit many adjustments remain.

It is not all gloom and doom as some scaremongers would have you believe. Cheers ….

 

Crazy Season in Coronado


Crazy Season in Coronado

It is always the same!

Starting in August/September and rapidly gaining speed thereafter, new projects and businesses rush to complete construction before the “big tourist rush” in December.

This year, with the new Rio Hato International Airport expected to be functioning by December, there is an even greater urgency and sense of expectation than average.  As a result there are many more and much larger projects/businesses currently in the final countdown stages.

In the relatively small town of Coronado, more than 1000 employees (most of whom are construction workers) pass through the security gates every day. Many of them work a six day week which is rather par for the course in Panama. The “Boulevard” in Coronado has become the latest area for new residential projects. Meanwhile new businesses keep popping up at a furious rate at the Coronado entrance and along the InterAmerican highway nearby.

Punta Paraiso

One significant residential project inside Coronado on the Boulevard that has fascinated me (because of size and speed of development) is Punta Paraiso. Phase One of this relatively large project (for Coronado) has just been completed with about 100 townhouses all pre-sold. There are no “for sale” signs at the entrance.

Phase Two (a slightly larger phase than Phase One) has just completed a very significant leveling, drainage and roadway infrastructure phase. As of last week, house building started in earnest with rough plumbing sprouting up from perhaps 20 adjacent sites.

DSCN0983

Interestingly, this project has decided to use a “poured wall” construction approach which is not yet very common in the Coronado area. This approach is optimal when a developer is constructing a large number of relatively similar or even identical units. It would appear that once everything is running smoothly (and the weather is cooperating which has not been the case recently) the complete walls for one house can be poured every single day.  The following day the steel forms are stripped off and erected at the next site. The poured walls contain a heavy gauge steel mesh making these walls extremely sturdy. Of course all window openings and doorways are preset for perfect sizing and “squareness”. The poured wall approach solves most of the smoothing or parging problems associated with standard cement block construction (inside and outside).  This is a production line approach of the first order ensuring increased quality control in my opinion although it required very good coordination. At this rate of production the last house should be poured sometime in early january with the roofing only a few days behind. (I will post additional information as this project develops.

DSCN0986

There are many other new projects on the Boulevard including “Coronado Escapes”, Palmaras, and about 5 or 6 smaller projects including many new private residences.  An interesting recent development is that several new “Coronado” projects (including Punta Paraiso) are actually building on Gorgona land outside the original Coronado boundaries. Access is still controlled through the Coronado security gates.