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Editorial Note: Looking at Alajuela closely is interesting, making me realize how many little things I can still learn about the country. I think it is important as foreigners living here that we try and learn more to help us understand the culture, and become closer to the country. I also wish to thank all our contributors, like Ana Hernandez who is sharing her knowledge of the country. Also ARCR member Jorge Hoepker, who has provided us with some fabulous photographs of the province for this issue. Alajuela is a diverse province, and looking at the secrets it alone has to offer, I am really looking forward to seeing what surprises the other provinces hold as well. I hope you are as well. So, on we go... - Ryan Piercy
The end of the year is approaching, don’t forget to renew your insurance!
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This magazine has been published every two months for 10 years as the ofďŹ cial communications media of the Association of Residents of Costa Rica. Our organization provides service to thousands of foreigners who have chosen Costa Rica to reside for short periods or for permanent residence. Since 1984 the Association of Residents of Costa Rica has been offering reliable SERVICES, INFORMATION and ADVOCACY to Costa Rica’s foreign residents. We have the experience and ability to help you with your residency application, immigration, business and ďŹ nancial management, real estate purchases and rentals, property management, insurance, pet importation and much more. If you wish to place an ad in El Residente, please contact the ARCR main ofďŹ ce.
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Presidents Repor t by Earl Tomlinson Well, as mentioned in my letter, inserted in the last El Residente, the Annual Board meeting was held on October 12Th. The first call for a quorum, all members of ARCR, was called at 9:30AM, because we didn’t have a quorum the second call was at 10:30AM, and since the by-laws read who ever is in attendance at that call the meeting shall commence. We have a membership in excess of 2500 people, and I realize many do not live within the central valley, but to have only 10 people represent the membership is a little under whelming. Just my two cents! The nominating committee recommended Earl Tomlinson for President, Terry Renfer for Vice President. Rebecca Wilkinson for Secretary, Jose Carter for Fiscal and Chris Howard, Charles Zeller and Kim Corey as Vocals. The vote was unanimous in favor of the committee’s recommendations. The only position that was not open was Treasurer and Bill Read remains in that position. Luis Urrutia will chair the special events committee. Attilio Gilberti, our omniscient envoy, for all events and fund raising will continue with chairing the Foundation and Charity committees as well as represent us with our affiliation with the Hospital dos Niños and other charitable organizations. Attilio, aside from all the above, is also very instrumental in acquiring gifts for our quarterly charity raffle. The next raffle will be held on October
27, there are many prizes. The grand prize is a gold ring provided by Rubens Jewelers. Again thanks to Attilio, Rubens made this donation, which is worth more than $200.00. It’s not too late to buy tickets from any staff member at ARCR. The tickets are only 1,000 colones each and you do not have to be present to win. There are many other prizes already for the next draw in January. Don’t forget that early December will once again feature the Annual Christmas Dinner & Dance, announced in this magazine. Come out and join us to kick off the holiday season. Our goal this year is to find more way to involve our members in ARCR activities, provide them with more assistance, develop some social events or trips and be the ombudsman to assist with their problems, complaints or constructive and positive criticisms. I realize ARCR is not always perfect or correct, but we try hard and we welcome your comments so that we can improve or adjust our procedures to compliment your needs. A man once said: “you can please some of the people some of the time, most of the people most of the time, but you cannot please all the people all of time.” Living here is much different than living in the United States, Canada or other foreign Continued on page 4...
Cover Collage Province 2-Alajuela: The diverse province of Alajuela has much to offer, and many foreigners have moved to different locales within its borders. La Garita, Atenas, Grecia, San Ramon, Arenal, and so on, each offering a flavour of their own. Alajuela grew out of the small town La Lajuela, which formed in 1782. It is now the scend most populous province, which over 700,000 inhabitants, over 2/3 of these living in rural communities. Alajuela has a lot to offer, from its favorable climate, beautiful landscape, culture, and of course great coffee for those of us who love it so much.
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countries. I don’t think this is news to anyone, but sometimes we forget about the cultural differences, that this is a process not a result orientated country and that patience is the most important attitude we can learn. So please if you have problems call, write or come in and talk to us. There will always be a Board member at ARCR, maybe not all day, but generally in the mornings and afternoon. Of course Ryan is always available. Just remember to call ahead for an appointment if at all possible.
WISH SOMEONE A MERRY CHRISTMAS! CHRISTMAS is just around the corner, a time for friends and family, turkey dinners, beautifully decorated trees, and lots of presents. Well, for most of us, but imagine how sad to have no family? No gifts? No HOPE for Christmas. That is why this year we have decided to collect gifts for the children at the Hospicio de Huerfanos in San Jose. Nearly 100 children beetween the ages of two and thirteen that deserve to have a little happiness for their Christmas, and a little hope.
Speaking of Ryan and his afďŹ liation with ARCR and our parent Casa Canada, Casa Canada bought, remodeled and moved into the building next door to ARCR. The staff at ARCR remains the same so come in an say hello, e-mail us your questions, talk about residency, ask for help in renewing your cedula or anything else. We can’t always oblige, but remember our job is to be a problem solver and we will certainly try to accommodate you.
If you are able to buy for one of these children, be it clothes or shoes, and maybe a small toy to accompany, the ofďŹ ce has details of the ages and sizes of the children for you to select a particular child, or simply drop off a toy to the ARCR ofďŹ ce for donation.
One last thought for your consideration. People don’t buy quarter inch drills they buy quarter inch holes. Why are you in Costa Rica?
We will be buying them a tree and some decorations, and lets help them have a HAPPY Christmas this year.
CALL TODAY! (506)
672-1181 www.FirstRealtyCR.com El Residente
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Association of Residents of Costa Rica in conjunction with the Canadian Club (ACCR) will be holding their combined Christmas Dinner/Dance on December 2nd. Watch in this issue for further details on page 10. Great event for dancing, celebrating, and meeting other expats in the country. website: www.arcr.net Alcoholics Anonymous Groups meet daily throughout the country; times and places change frequently. Call for up-to-date information. San José 222-1880 (Anchor club, also serves Narcotics Anonymous) Av 6 Calle 1, 2nd floor Maryland Building. Heredia (Laura) 267-7466, Puerto Viejo Limon 750-0080, Zancudo 776-0012, Tamarindo 653-0897, Flamingo (Don) 654-4902, Manuel Antonio (Jennifer) 777-1548, Jacó (Nancy) 637-8824, Zoo Group Escazu 293-4322. Al-Anon Meetings Al-Anon Family Group is for all family and friends of Alcoholics. For information in English, please call Martha 483-1275 or Sandy 288-4836; For Spanish please call Christine 840-4658 American Legion Post 16 All veterans are welcome. Meetings are the second Tuesday of the month at Hotel America in Heredia. Contact Post Commander Jim Young or Post Adjutant Ken Johnson at 591-1695. Bird Watching Club The Birding Club of Costa Rica sponsors monthly trips to observe local and migrant birds in various areas of the country. For more information contact us at 282-5365 or at costaricabirding@hotmail.com Canadian Club (ACCR) For the Annual ACCR/ARCR Christmas Gala this December 2nd at the Cariari Hotel, or other upcoming Calendar events call Lucie 289-98312 or visit the website: www.canadianclubcr.com Democrats Abroad The Democrats Abroad of Costa Rica meet the last Saturday of each month at the Aurola Holiday Inn, 9:30 a.m. to noon, coffee break menu. Visit cr.democratsabroad.org or contact Ruth Dixon for information and reservations. 494-6260, dixonmueller@yahoo.com Little Theatre Group LTG is the oldest continuously running English-language theatre in Central or South America. The group currently puts on a minimum of four productions a year offering a choice of modern, classic, serious, and farcical plays. Continuing in the tradition of its founders, LTG regularly donates to charity, sponsors school drama festivals, trains new directors, and takes productions on the road to the more remote areas of the country. The group’s monthly social meetings are held in the theatre on the first Monday of the month from 7p.m. to 9 p.m. and everyone is welcome. Membership costs C 4,000 per person or C7, 000 per family. Also, earn your Wings, become an LTG Angel. For more information Call the LTG Box Office 355-1623 or www.littletheatregroup.org
November-December, 2006
Send us your club news or activities for free publication in this column
Newcomer’s Club A women’s social organization that meets the 1st Tuesday of each month. We welcome English speaking women who reside in Costa Rica. New and long term residents-contact Nancy 416-6165 or newcomerscr@yahoo.com PC Club of Costa Rica This computer Club meets on the third Saturday of each month at Pan American school, in Belen, 830 to 11:30 am 2 months Free Trial for newcomers. For information call Chuck Jennings. Phone 266-0123 www.pcclub.net Republican’s Abroad The Republicans Abroad of Costa Rica meets the second Tuesday of each month. Contact Francis 203-6131, or or fax 282-2150. Radio control Sailing Club Meets at Sabana Park Lake. For information contact Walter Bibb. Wwbbsurf40@yahoo.com Wine Club of Costa Rica Please mark your calendars The wine club usually meets at 1 P.M. on the last Sunday of each month. Join us to tantalize your taste buds and expand your education. For more information on upcoming events please contact us Phone 279-8927, 257-2223 Women’s Club of Costa Rica Founded in 1940. The Women’s Club of Costa Rica is one of the oldest, continuously operating service clubs in the country. The name has changed in 63 years, but our motto “friendship and service” has remained the same,. An English-speaking organization, our club has approximately 350 members, originating from over 30 countries. Please join and help us to continue to grow. Remember that you can contact us or keep in touch through our website www.wccr.org Women’s International League for Peace and Freedom (open to men too) Bilingual group meets in Heredia on the first Wednesday of the month at 10 a.m. in the clinic of Mireya Gonzalez. We work on peace and human rights issues. Call Mitzi 433-7078 or write peacewomen@gmail.com Young Expats of Costa Rica Some Expatriates under the age of 40, and currently living in Costa Rica, have formed a new social club to be coordinated through their website This club will help younger expatriates living in, or moving to, Costa Rica meet other expats in their age group for; friendship, romance, travel and activity partners, and professional networking. www.YoungExpatsOfCostaRica.org
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Wild Side XXXIV by Ryan Piercy
Ring-a-Ling Alajuela is a province of parks, reserves, and an abundance of wildlife. Her hills and Mountains include felines, over a hundred mammals, insects, and hundreds of bird species. Some of the most important parks and reserves in the country are found here, including Caño Negro, Arenal, Poas, Tenorio, half of both Rincon de la Vieja and Miravalles, and of course the biologically diverse Monteverde. Within the latter lies sanctuary for the very special Three-wattled Bellbird. Procnias tricarunculata, commonly known as the Threewattled Bellbird, is a member of the Cotinga family, and is a migratory bird of Central America. Locally called the Campanero Tricarunculado (or Pajaro Campano) this endangered species is famous for having one of the most unique and distinct calls of any bird in its range. The males include loud far-carrying notes that often can sound somewhat bell-like. In fact its call can carry up to ½ kilometer.
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The vast Cordillera de Tilaran is an important breeding area for this species, mainly at 40007500 ft. It is a large bird up, to 12” with a heavy body and broad flattened bill. Colouring is chestnutrufous, with its head, neck and chest in immaculate white. Its name comes from the three worm-like wattles of skin that hang from the base of the bill. These are a darker colour like the bill and around the eyes. This bird feeds primarily by plucking fruits of the Lauraceae and other trees, and its nest is undescribed, probably being only attended by the female as reports indicate. Apart from its distinct call and features, it is quite a beautiful bird to see. It remains somewhat endangered, but hopefully the continued efforts at conservation in Costa Rica will help these birds to flourish. One of the best times to spot them is during their mating season from March to June.
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Learning The Language e by Christopher Howard
How To Tell Time And More! One of the most important Spanish survival skills you need to learn is telling time. The first step is to learn to count up to sixty in Spanish, since there are sixty seconds in a minute and sixty minutes in an hour. You should also learn the question “¿Que hora es?” which means, “What time is it?” To say the hour right on the dot, use this simple formula: “Son las…” (Followed by the hour). For example, “Son las dos” – “Its two o’clock”, etc. There is one exception to this formula. When saying that it is one o’clock, you have to use “es” instead of “son” before the hour and say “Es la una” – “Its one o’clock”. This formula can then be taken one step further by adding “de la mañana” – “in the morning”; “de la tarde” – “in the afternoon”; or “de la noche” – “in the evening”; to be more specific. For example you can say “Son las tres de la mañana” – “It is three o’clock in the morning” or “Son las tres de la tarde” – “It is three o’clock in the afternoon”. Normally “noche” is used from 6 pm onwards. The next step is learning to add the minutes when saying the time. To do this you simply add the letter ‘y’ (pronounced like saying the letter ‘e’ in English) to the first formula given above, followed by the number of minutes. For example to state that it is one-twenty, in Spanish you would say “Es la una y veinte”. If you wish to express that it is two-fifty, you simply say “Son las dos y cincuenta”. Now practice saying different times using the formulas above. There are two other, more traditional methods of expressing the last 30 minutes of each hour. However the formula at the end of the last paragraph is completely acceptable, and much easier and akin to English. To express the time by the quarter or half-hour just add “y cuarto” or “y media”. For example to say that a quarter past two you would say “Son las dos y cuarto” and so on. There is another Spanish structure that is often confused with telling time. When you hear the question “¿A qué hora?” followed by a verb or a phrase, you are being asked at what particular time you will be doing something. For example “¿A qué hora vamos a comer?” - “What time are we going to eat?” Don’t confuse this question with the previous one in the article. Also, when you ask the question “¿A qué hora...?” you don’t use ‘es’ or ‘son’ like you do when telling the time. You use ‘a’ followed by the time. For example “Voy a comer a las dos” – “I am going to eat at two.”; or “El tren sale a las cinco y media” – “The train leaves at five-thirty.” I have tried to simplify the above concepts of expressing time, however for more help consult a basic Spanish text for more graphic examples. Here is your Costa Rican expression or tiquismo for this week: “Chorizo” literally means a type of smoked pork sausage, but in Costa Rica it is used to refer to an illegal way of making money, like a bribe, scam or pay-off. Anybody who engages in this activity is known as a “Choricero” or sausage maker.
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Alajuela by Ana Hernandez
A Province Filled with Verdant Parks and Poetry Even without knowing it, the first taste of the Alajuela Province that most people get on their first trip to Costa Rica is through landing at our International Airport Juan Santamaría. That first view might not look too different from their country of origin though. As most visitors get rushed into a cab, hotel shuttle or rental car, the next thing they see is a vibrant city and a busy freeway with huge signs advertising hotels, airlines and all sort of amenities in English.
Not long after his failed attempt to invade the Costa Rican territory, Walker made one more attempt to come back and conquer, but he was killed by execution instead. In addition to the modern, vibrant downtown Alajuela and the residential growth that is taken place near suburbia, there is also a rural side to the province, with towns and houses filled with countryside charm and long distance highways adorned with spectacular views leading to wellknown tourist destinations. A lot of these towns are favorite places for foreign residents to live because of the lush vegetation -prodigious everywhere- the abundance of delicious fresh fruit and also because of the weather. Atenas, a city about 30 kilometers west of the airport is said to have the best weather in the world. Orotina, the next good size city after Atenas on the highway to Jacó Beach, is one of the largest fresh fruit producers in the province. Northwest of San José, the nice semi-rural towns of Grecia and Sarchí with rich, verdant scenery, are must places for travelers to see. Traditionally, people from these towns were able to make their living through cattle and agricultural farming, but more recently, their economy is mostly sustained by tourism.
The distance that separates our airport and downtown San José is only about 12 kilometers. Perhaps, not quite as large or glamorous as other well-known international airports, ours was named after national hero Juan Santamaría, whose birthplace was, Alajuela, of course. Alajuelans are mighty proud of this hero who gave his life defending the country in 1856. Back then, our country had to face American filibuster William Walker who invaded Costa Rica with the purpose of conquering it and setting up a slave state in Central America. Unluckily for Walker, the small barefoot army sent to defend the country was able to repel the invasion thanks to the courage shown by Santamaría. Armed only with his drum and a torch, the humble soldier burned down the shed where the invaders were hiding.
Grecia offers tourists a beautiful park with an interesting red metal church in Gothic style built in 1890 with metal brought from Belgium. It is a prosperous land with abundant sugar cane and coffee production. Not far from Grecia is Sarchí, Costa Rica’s main souvenir town where all types of wood furniture and carved wooden souvenirs –made by local artisans- can be found. A myriad of miniature and exquisitely painted oxcarts are a favorite of tourists and locals alike. The real size oxcarts were used in the 1800s to haul coffee to the Port of Puntarenas before being sent to European markets and became part of our tradition and a symbol most Costa Ricans are very proud of. The towns of Palmares, and San Ramón, west of Sarchí Continued on page 9...
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are places visited by hundreds of travelers and also favorite locations for people to live and enjoy. Palmares is known for its cowboy style home-fest complete with rodeo shows and bulls corrals where any valiant Tico can be chased by a fast bull while trying to prove which of the two is faster. The festivities draw thousands of people annually.
Volcán and Lake Arenal and the town of La Fortuna, are the next major attractions on the way north. La Fortuna, a tourist Mecca, is a welcoming stop for any traveler thinking on booking tours to see majestic Arenal Volcano with its nightly firework showers or for fishing and water sports at the fresh water man-made lake of Arenal.
Travelers on the way to the Pacific coast passing through San Ramón get enveloped by misty clouds and cold temperatures, forcing them to grab a cozy sweater or a jacket before coming down to sea level and humid-hot weather. Because of its altitude and cool weather and perhaps due to this bucolic weather, San Ramón is also known as the home of many national poets.
The whole San Carlos region is blessed with abundant vegetation and no one is turned away without sighting a toucan bird, a monkey, or if really lucky a two-toe sloth high up on a trip and even sometimes crossing the road.
Northeast of San Ramón and about 47 kilometers from the city of Alajuela, the majestic Poás Volcano sits atop like a turquoise on the continental divide of the central mountain range. It towers 2,708 meters above sea level with slopes facing both the Caribbean and the Pacific. The Poás is a volcano with two craters. Its main crater measures 1.5 kilometers in diameter and 300 meters deep, and it is one of the larger volcanic craters in the world producing geyser eruptions of steam and sulfuric gases. The second crater is a cold- water lagoon, peacefully resting near his colossal twin. The Poás volcano is part of the Poás National Park, a beautiful, well-designed park, with four different types of vegetation, from scarce to cloud forest eerily covered in moss. Safe trails accessible to the handicapped, lead toward awesome views of the craters. The best views can be seen before noon because fog and misty clouds usually envelope the volcano in the afternoon.
For anyone getting this far, a trip to the indigenous reservation of the Malekus in the Guatuso Valley, gives visitors a glimpse of what life is like for native people in the 21st Century. The Malekus live in three indigenous reservations called El Sol, Margarita and Tonjibe. They still speak their native tongue and are closely in touch with the earth. They earn their living as artisans creating colorful musical instruments from the Balsa tree, a very light porous wood, and carving gourds from the Jicara tree, which they sell to tourists. Closer to the northern border with Nicaragua, the towns of Upala, Los Chiles and Boca San Carlos, a little hamlet on the San Juan River, are not only distant, but also among the most rural and wild, ideal for a once in a life time adventure.
Continuing to the north, toward the bountiful region of San Carlos, with rolling hills and verdant views, there is Ciudad Quesada, a large city and the center of commercial activity in the San Carlos region.
Just before reaching Ciudad Quesada visitors can make a stop in Zarcero to admire the topiaries found in the park with zany shapes of animals and funny characters in motorcycles or to visit the picturesque church in the back of the park.
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New At ARC CR
to participate in our Yahoo mailing group, it is probably because we do not have your updated e-mail address. Feel free to access the following link: http://groups.yahoo.com/ group/arcr/ and you can join us from there.
by Eduardo Tamayo
See you on line!
ARCR ‘Group’ Email ARCR has created a online mailing group in Yahoo to keep all of our members informed and updated as new activities and other important notices arise. This service was created as an alternative to the regular “snail mail” system which sometimes turns out to be slow. Members will receive global notices of upcoming events, charity updates, and information regarding residency procedures in Costa Rica as well as any changes in our services. ARCR will be sending invitations to all members via email, where they will have the chance to join our group immediately with just one click. Get informed and have fun. Join us now!!!
FEDEX Discount Available only at the ARCR mail room, members can now receive a 25% discount on courier services from Federal Express to any destination. Do you need to send important documents in a hurry? Or rush that present off in time for Christmas? Then why not save a little by sending out with FEDEX and ARCR.
Note: If you did not get an email from ARCR inviting you
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should be taken - it is just a friendly nickname. (A lady from the US is a Gringa.)
Letters to the e Editor For Newcomers: I have enjoyed reading the articles by Allen Dickinson about his first days in Costa Rica. The sense of adventure and newness of everything reminds me of when we first moved here! New arrivals receive both information and misinformation passed on to us by others. Allen’s new friends gave him very good advice in some respects, but there are a couple of points that I would like to clear up in case other new arrivals take them as fact.
The other misunderstanding is the quote, “A cultural issue is that it’s not ‘dishonourable’ for a Tico to steal from a Gringo”. That statement is not true. I don’t know any long-term resident of Costa Rica, foreigners or Ticos alike, who have not been robbed. Even friends I have on the police force have had their homes or cars broken into. Most Ticos detest thieves, and they do not detest those who specialize in robbing foreigners any less than they do the thieves who prey on the local citizenry. Another common misconception not mentioned is that the court system discriminates against foreigners. It doesn’t. It is bureaucratic, cumbersome, inefficient, corrupt and slow to the point of ridiculous, but it discriminates against Ticos and foreigners equally. Daniel Walker
Costa Ricans love nicknames, both individually and for groups. Nicaraguans are Nicas, Chinese are Chinos, Costa Ricans are Ticos and people from the US are Gringos - but only those from the US. It is often misapplied to English speakers from other countries that are assumed to be Americans. As the article says, no offence is intended by it, and none
November-December, 2006
I think most readers enjoy hearing of others’ experiences, and it would be great to have more articles such as Allens’ from other members. If you are willing to share with us your experiences or thoughts, we always do our best to publish them, Ryan Piercy
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turn the town’s former soccer field into a topiary garden.
Provincial Par ks by Ana Hernandez
Zarcero’s Park: A Place of Unusual Characters Shaped Right Out of the Shrubbery
Zarcero is a semi-rural but progressive little town located almost in the heart of the San Carlos region, about 67 kilometers northwest of San Jose, with nice cold weather and an elevation of 1700 meters. Just like it is in the greater San Carlos region, Zarcero is known for its cattle farms and fine dairy products but the delicious homemade stringy white cheese, formed into a ball, is a hallmark of Zarcero. The park and its topiaries, prettily enhances the church in the back of the park and draws thousand of visitors who stop to admire the green sculptures. The church is a charming edifice with twin towers topped by domes and is as pretty outside as it is inside, where its tall pillars have been painted to resemble fine marble. The topiaries are the work of gardener Evangelista Blanco, 64, a man who since the early 60s planted the trees and as they grew, he began shaping them in the form of animals to the delight of tourists and kids who can discover among the shrubbery, a giant bunny, a funny monkey in a motorcycle, a helicopter, a large elephant, a rabbit, an oxcart, and even walk through small tunnels of shaped trees.
Commonly known in our country as Ciprés, a conifer tree, this species is far from being native to our tropical climate. Brought to Costa Rica centuries ago and planted on high elevations, are nowadays beautiful green landscapes of tall, pointed conifers, surrounding dairy farms and hugging the cliffy side of our mountain highways.
According to Blanco, kids’ favorite topiary is the helicopter but the dinosaur he created 3 years ago is gaining on popularity.
Once transplanted to our highlands, this evergreen tree loved its new home and very successfully propagated its species, taking over high altitude meadows, farms and the sides of highways. Not seeing with good eyes by local environmentalists who claim that the ciprés takes away nutrients from the soil, making it very difficult for crops or gardens to grow there afterwards, it has mostly being ignored or cut down to be used as lumber. In the little town of Zarcero, northwest of San Jose, however, a man took advantage of the prolific nature of the ciprés to
Blanco himself has kept the topiaries in shape, trimming the trees for over 40 years. At any given time he can be found at the park busy at work but willing to tell people about his creations. Even though he has gotten very famous outside of his hometown, he says he is not comfortable with his celebrity status. But folks in the community of Zarcero are grateful and proud of Mr. Blanco. They recognize that their town is now widely known for their little park with trees sculptures, which have become an important part of the local identity.
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Calles’ have the same arrangement.
What I Did On n My Winter Vacattio on by Allen Dickinson
Day Three Day three broke with a bit of a jolt! It seems the ‘closed’ restaurant outside my room wasn’t as closed as I thought - at least it sure wasn’t closed for breakfast! The hotel was serving a continental breakfast and people were sitting right outside my room talking, laughing, etc. Oh well, a free breakfast couldn’t be passed up so rather than fight it, I got up. The breakfast was coffee, fresh fruit and fruit juice, and toasted bread with butter and jam. The fact the bread was some Costa Rica equivalent of Wonder Bread was offset by the wonderful butter, the fresh fruit, and the coffee. I ate, packed my bag, and left the hotel. First stop: my original hotel, a natural since it was down hill from where I was. Thankfully, they had a room and I moved back in. I would stay there for the rest of my visit. I unpacked and then headed up the hill to downtown. I had really enjoyed meeting the Gringos at McDonalds the day before, and they had given me good information, but there was an air about them I found was a little negative. During our conversation there had been a lot of reminiscing about “the good old days” and bitching about how things are now, focusing on how Gringos had screwed things up – prices were higher, there was more street crime, etc -- all of which they attributed to the increased discovery of the county by Gringos. I wondered how much credibility I should give to people who, besides being negative about a situation they helped to create, chose McDonalds for meeting place? So, since I had information of another location where Gringos also gather, a hotel restaurant on another side of the plaza from McDonalds, I headed there. Getting around San Jose is easy. The downtown is very well laid out - numbered Avenidas run east and west and numbered Calles go north/south. They are arranged around a central Avenida and a central Calle which form a N/S by E/W cross at the main plaza. That results in the main city being divided into four quadrants, all populated with generally straight and parallel streets. (The streets are not always straight, but enough so that finding one’s way around is pretty simple.) Add to that the Avenidas’ on one side of Avenida Central are odd numbered, and on the other side even numbered, makes it really easy.
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I easily found the hotel I was looking for and the outside restaurant was lovely. Umbrella shades over the tables, plants dividing it from the plaza proper, and formally attired waiters. The Gringos, there were seven of them at one table, were at the far end. I took a table next to them and ordered café con lecche. It took less than 10 minutes and some polite questions and I was invited to join them. It was soon apparent that I was right -- this was a different kind of group. They were even warmer and forthcoming than the McDonalds group and without any loss of experience or helpfulness. And there was definitely a difference in their attitude. Their average age, I am guessing, was about 60 and all had been living in Costa Rica a fairly long time. The most ‘junior’ member, a fellow of about 40, had been there “only” 10 years. All (as well as I could determine) were married to, or in long term relationships with, Tico women. A couple had some sort of commercial venture going, but for the most part these guys were truly and totally retired. All were drinking coffee and a few had breakfast, and the only complaining they did was about the service. Now, that’s more like it! The group broke up, between 10 and 11 AM and in the end I had spent roughly two hours with them. During that time there were new members coming and existing ones going randomly, and in total I met at least a dozen people. All my questions were answered politely and as completely as they could. Upon departing, one gentleman invited me to come see his bed and breakfast, a couple blocks away. We walked down the street about two and one half blocks and there we were. He has a very nice arrangement with (I think) five or six rooms, two of which might be termed efficiency apartments. Rent: $15/night or $300/month. It was very neat, clean and hospitable. I met his wife and daughter and found that he has three networked computers, on a high-speed Internet connection, for himself and tenants to use. When I left he invited me to come back that evening and he and his wife would take me out to dinner and show me some local sights. I have his email address and, if a space is available when I return, that is where I will be staying, at least initially. I walked back to the main plaza and decided it was time to see a little more of the country. The map I had shows main bus stops and I headed for one. Before I go into describing my first out of town trip I want to mention the computer/internet situation in Costa Rica. First, I was pleased to find that the hotel I was Continued on page 15...
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at had two public computers for the residents to use, for which they charge by the half hour. I had not had the foresight to bring my email address book with me, so I wouldn’t be writing friends, but at least I could check my incoming email. Second, I was surprised to find that nearly every business I went in to, even small stores and restaurants, are computerized and, if they have more than one terminal, are networked. One business, a pharmacy, whose shop size was about 25 X 25 feet, had four terminals sitting out. They were used for checking inventory for customers, locating items in stock, determining prices, and completing sales. Any purchase generates a small, clear, receipt. Very modern and efficient. Back to travel. I already knew from my reading that Costa Rica has a highly evolved and efficient bus system that can take one most anywhere in the country. Terminals are located all over the city, depending on destinations, and local busses are a constant sight. And, if there isn’t an appropriate local bus handy, there are taxies.
At first I thought the young man who was standing in the aisle was some sort of attendant - he had ushered me on the bus as soon as I got near the door -- but it turned out I was wrong. He was apparently going to be the Costa Rican equivalent of satellite radio! About two minutes into the ride he pulled out a wooden, double row pan flute and began to play. He played quite well, with heart and soul, his eyes closed as he worked his way up and down the aisle. And, at some particularly dramatic points in the music he would bend down to a passenger as if the notes he was playing were particularly for them. OK, I figured, he’s looking for tips. Wrong again! About ten minutes into the ride, and after playing three selections, he made an announcement and held something up - he was selling CDs of his music. It wasn’t Costa Rican satellite radio- it was a commercial! He sold three copies and was off the bus at the next stop.
Taxies comprise at least one-quarter of all traffic - they are everywhere. They are uniformly red and all have their license prominently displayed -- a large, yellow (roughly 12-inches to aside) triangle shaped decal with a permit number -- on the doors, plus an illuminated roof sign, just like taxies in the US. (There are a few “independent” or “freelance” operators available too.) All licensed taxies have meters and, although some of the drivers will try to get you to agree to a flat price, it is best to have them run the meters. However, the bus terminal I wanted was only eight blocks away – down hill - so I walked to it. I had chosen to go to Cartago, a city located to the south east of San Jose, which is generally the second largest city in Costa Rica. No particular reason for choosing it, other than the bus station was close. When I arrived at the terminal the bus was already loading. There was an interesting looking outdoor market next door but there was no time to go look at it as I went directly on to the bus. Cost: 85 cents, one way, collected at the door. The bus was not new, but it was clean and well maintained, and there were empty seats so I was able to get one next to a window. The seats, however, aren’t designed for tall Americans. If my thighs were a half-inch longer, I couldn’t have sat down - there was just enough room for my legs if my butt was jammed against my seat back and my knees were pressed tightly against the seat in front. It was tight enough that if we had rolled over, I don’t think I would have fallen out of my seat. Cartago is approximately 50 KM (31 miles) away and the trip took about an hour to make. But it wasn’t just a bus ride in a tight seat and no more. Oh no.
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The remainder of the trip was less eventful. The road to Cartago is a four lane, divided highway all the way. Traffic was heavy and sometimes, because the bus was full, it would have to slow in the right lane as it climbed a steep hill. 75% of the ride was in the suburbs of either San Jose or Cartago but I did get to see some rural countryside. Once again…beautiful. Rolling hills, some very steep sided, covered in low, green vegetation, and there were occasional houses, farm animals, etc. When we arrived at Cartago, somewhere short of downtown, the bus stopped and the 20 or so remaining passengers unloaded. I thought I would ride on into central downtown but the driver wouldn’t allow it and made me get off too. A hurried plea in (my not-yet-goodenough-to-call-pigeon) Spanish got me the information that the main terminal was six blocks that way, and then three block left (I think.) I was now afoot and on my own with not even a map. Continued on page 16...
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Not to worry. The driver was right. A few blocks later I found the main street of the center of town. I even took a detour on the way to look at a spectacular church, which I later found out is a major tourist attraction.
Downtown Cartago isn’t quite as modern as San Jose - the streets and sidewalks are narrower but it was just as clean and has the same deep gutters. With a little wandering around I found, in order, the main plaza, the bus station, and a large central market. In the process I also encountered a couple of street beggars, one an obvious Indian woman with a two to three year-old girl asleep in her lap, sitting on the sidewalk with her hand out. In the market I spotted a fabric store and got an odd look when I purchased a meter of two-inch wide red ribbon (for my luggage handle.) Farther on I stopped at a Boca and had a delicious sandwich, after which I wandered the streets some more. I was surprised to find that there were an inordinate number of shops oriented to baby and children’s items present. Cartago is a center for breeding, training, and raising racehorses and I’m not sure what the connection is, but there it was! After a couple of hours I got on the return bus and headed back to San Jose. The bus went through downtown and I got off four blocks from my hotel. It was an easy walk and I went and had a nap. (I’m not sure if the Costa Ricans honor the Spanish traditions of siestas, but I did.) About 5:30 I left the hotel to go meet my new friend and his wife for dinner. Along the way I planned to stop by a bank and change some more travelers checks. Easy, I thought. I went by several banks, there are a lot of them in San Jose, and discovered the fabled long lines really existed. I had forgotten that it was Friday and didn’t realize that many Costa Ricans get paid via automatic deposit on Fridays (I learned that later) and were there to withdraw money. I quickly realized that if I got in one of those lines I would be late meeting my friends, so I went on to the B&B. It was then I learned another thing about life in Costa Rica. When I told my friends of my cash situation I was assured it was no problem. (BTW, banks stay open to 7 PM there - what a concept!) The three of us went to a nearby bank, and the line there was still approximately 50 persons long.
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Even though there were about 15 tellers it was obvious that there would be a wait. As I went to get in line my friends wife (a Tica) informed me that I should go have a seat - she would stand in line for me. It was then I learned that it was one of the duties Tico women assume as their province -- that if there is a line to be endured, it is the woman’s job to do that for her man (or her man’s guest.) It’s not sexist or demeaning, it’s just the way things are done there. About 15 minutes later she reached the head of the line and motioned me forward to take my place at the tellers’ window. Out of the bank and on to the premier Gringo bar where we had some wonderful fresh fish for dinner, along with chips and some decent beer, and talked. I was told later the fish was probably Marlin. Prostitution is legal (and controlled) in Costa Rica and I couldn’t help noticing there were several attractive ladies lining the walls. I was informed, however, that these girls, were the “B” team - the “A” team was down the street. One thing different about Costa Rican prostitutes is that they rarely approach a man unless they are invited. One, that flirted outrageously with me, never left her seat to come bother me, much to my relief. Later my friends took me to where the “A” team hangs out. It was amazing! It’s a hotel and there were 200 - 300 beautiful, young women in the bar, the casino, the lobby, the dance pavilion ... everywhere. Short, tall, light, dark, it was a kind of an ‘available female’ paradise. In Costa Rica one has to be 18-years old in order to be a prostitute, but I am guessing that none of the girls there were over 22. And, once again, there were flirting looks, casual touches as I passed by, but no aggressive “sailor, buy me a drink” advances. Amazing!!! I’m not one to take advantage of such a situation (pay-forsex just doesn’t press my buttons) so we three had a few more drinks, played a few slot machines, and went on our separate ways. I was tired from my adventures, despite my siesta, and I went directly back to my hotel room. As I drifted off to sleep I considered how the Costa Rican catch phrase, “es pura vida” (the good life) is appropriate. I lamented that I hadn’t discovered this place years ago. ---------Allen Dickinson is a member of ARCR. After serving 23 years in the US Navy he settled in Pensacola, Florida, and owns his own licensed mortgage broker business there. He holds a Bachelors Degree from the University of the State of New York and a Masters Degree from the University of West Florida. He will soon be retiring and moving to Costa Rica. He can be reached at humphree@bellsouth.net.
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Business Brie efs Luxury Development at Coyol Beach US hotel chain Starwood Hotels & Resorts Worldwide will develop a multi-million dollar luxury resort at Coyol Beach, in the Costa Rican Central Pacific, in the same area as Marriott’s Los Sueños Marina and Resort. Although the actual cost has not been officially disclosed, sources close to the project estimate the first stage at $US 100 million. The St. Regis Resort Costa Rica will include 133 rooms, 49 condominiums, 42 villas, several swimming pools, restaurants, a large-size spa, and a convention centre. This is Starwood’s third investment in Latin America, after two resorts located in Mexico. It has properties in 95 countries.
The Happiest in Latin America The World Map of Happiness of the University of Leicester, England, ranks the degree of happiness in 178 nations. Data is from a global survey that includes interviewing over 80,000 people on topics related to happiness and satisfaction, as well as reports from several international agencies, including UNICEF, the CIA and the World Health Organization. The answers to the interviews were supplemented with data pertaining to the quality of life, education and the health system. Denmark ranked number one, followed by Switzerland and Austria. Costa Rica is first in Latin America and 13th worldwide. Canada ranked 10th and the USA was 23rd.
Arias Harsh with US Even though his remarks were not aimed directly at Washington, Costa Rican President Oscar Arias’ speech at the UN Assembly general was critical of US foreign policy. The Tico head of state regretted that following the terrorist attacks on September 11, 2001, world military spending increased by $200 billion, and that this, far from improving international security, has boosted vulnerability. According to Arias, the US spends 25 times more on its armed forces than is designated for development. “What is this but an evident misplacement of priorities and deep irrationality?,” Arias said. He even quoted President Dwight D. Eisenhower (1953-1961), “a soldier”, who said that every naval vessel is ultimately a theft from those who are hungry, who have nothing to eat. Regarding arms, President Arias said that other developed countries are following the trend and that even Latin America has embarked upon a new arms race.
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Relations with Arab Countries Costa Rica renewed diplomatic ties with Egypt and Jordan, and is about to do the same with Kuwait, Oman, Bahrain, and the United Arab Emirates. This follows a Costa Rican decision to move the embassy from Jerusalem to Tel Aviv. It is hoped that these countries will eventually back the Arias Administration’s initiatives for world disarmament and the Consensus of Costa Rica, aimed at getting wealthy countries to modify their economic aid criteria, so that they would help not only poor nations, but also those who have strong commitments to social investment, such as Costa Rica. According to President Arias, he aims at reviving the World Moral Power status that Costa Rica had in the 1980s. “When a developing country buys a tank, it is likely not building many schools,” said Dr. Arias.
Airport Conflict Worries Business Business owners have expressed concern about the years-long conflict between the Costa Rican Government and Alterra Partners, the British consortium contracted to modernize and run Costa Rica’s main airport near San José. The Union of Private Sector Chambers and Associations issued a statement saying, “These problems will soon affect exports and tourism, reduce the number of flights and discourage investors.” Alterra took over management of the airport in 2001, but stopped construction in 2003 because of an $18 million disagreement with the government. Alterra and the Civil Aviation Department apparently had a memorandum of agreement, but it was overturned by the Controlaria, or finance department, who have the right to overrule financial agreements. Some work began again recently after a new agreement was struck with the government, but then it too was over ruled by the Controlaria. Renovation costs are to total $160 million, of which banks put up $90 million and Alterra $40 million.
Starwood Comes to Costa Rica Starwood Hotels & Resorts Worldwide and Costa Rican development firm Grupo Genesis announced plans to build the 133 room St. Regis Resort, to feature a dramatic cliff top presidential suite, a spa and residences. Starwood operates Sheraton, Westin, W, St. Regis and Le Meridien hotels. They have not had a hotel in Costa Rica since the Heredura Hotel dropped its affiliation with Sheraton many years ago.
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Top Ten Driiviing Tips for CR R by Rick Chalmers
8-10. Safe & Smart The following article is a primer, or introduction to safe and competent driving in Costa Rica. In this issue we will carry on with respect to local needs. 8. Taller vehicles with better ground clearance improve visibility and safety In Costa Rica, any advantage you can add to your visibility is worth considering. Being able to see further down the road allows you to judge the depth of potential potholes and the presence of other obstacles. This added visibility also gives the driver more time to assess and maneuver around those obstacles. In addition, most vehicles that are taller and have better ground clearance will likely have 4WD. If you are driving off-road, we highly recommend having and knowing how to use 4WD. 9. Newer, sophisticated vehicles aren’t necessarily better vehicles for Costa Rica In our experience of having our vehicles repaired, we have found there are fewer breakdowns with older and less sophisticated machines. Also there is a greater number of mechanics able to assist you and a higher possibility of effective repairs if you have an older or simpler vehicle. Mechanics are more likely to be familiar with an older vehicle and its less sophisticated mechanical parts. With an older vehicle, there are fewer parts that can fail, the parts are cheaper, and you are more likely to find multiple sources for the parts you need. Diesel powered vehicles tend to be simpler and are therefore easier to maintain and repair. Diesels have the additional qualities of burning less fuel and have better more mileage. We recommend diesel vehicles for their economy and for driving in Costa Rica. Electrical and electronic components raise the performance, comfort and reliability of vehicles in general. However, the opposite applies in Costa Rica! Due to the climate and road conditions here, these enhancements are prone to failure. The dust of the dry season, humidity of the wet season, and jarring quality to the roads in general, take a toll. Small, delicate parts are at greater risk. The downside
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of relying upon sophisticated electronics and electrical parts is not just the greater possibility of failure, but the time and energy it takes to repair or replace the part. In Costa Rica, small, specialized & expensive parts are often not in stock. These parts need to be paid for in advance, and are usually ordered from the country which produced the vehicle. We experienced an electrical failure when we had the motor on one of our power windows break. Ordering the part from Japan took a month on the fast plane. Meanwhile, we were not able to raise or lower a window. We could not secure the vehicle or protect it from rain or dust. 10. Driving Smart We recommend obeying all of the traffic laws of Costa Rica. First, remember that it’s kilometers not miles! The posted speed limits are lower here than in North America or Europe for good reason. The speed limit is not always posted on a road sign. Frequently painted numbers on the road itself indicates speed limit changes. It is not uncommon while driving in Costa Rica to be stopped by police. Be prepared by having your papers in order and obeying all of the laws. If you were not following the laws, or do not have the proper documents, expect a ticket. Unattended vehicles should be locked. And never, ever, leave belongings unattended in a vehicle, locked or otherwise - this is an invitation to thieves! One last thing, people routinely get around the backcountry of Costa Rica by hitchhiking. We are not recommending you pick up hitchhikers, although we frequently do. We are letting you know it is common practice in a country where not everyone owns a vehicle. We have never had, nor heard of, any problems encountered with hitchhikers. You will need to use your own judgment on this one.
Rick Chalmers, President of Adventure Motors: “Bigger Than Yours!” S.A., has over 30 years experience in automotive repair. He is a licensed mechanic and emissions technician. Rick owned and operated an automotive repair business in San Diego, CA for 13 years. He currently lives in Costa Rica and specializes in the importation and modification of specialty off-road vehicles. Questions or comments? Email: advenmotor@yahoo.com For the full version of this article: go to www.advmo.com and go to our Blog!
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Health Care e by Susana Guzmán
Digital Medicine Radiology, ultrasound and tomography imaging are key for a proper diagnosis; today, digital technology makes it possible for the doctor to have them within seconds right on his computer. The huge radiography plates, which we tend to keep as souvenirs, will soon get straight to the physician. Today they have been replaced by digital images that can be sent quickly through the Internet. This digital procedure is available at Clínica Bíblica Hospital, so that the physician can quickly analyze the results of ultrasound, tomography and magnetic resonance radiographies. According to Giovany Cordero, Medical Technologist at the Hospital, the advantage is that they can still use traditional equipment and use computerized radiology to monitor the images captured.
This system makes it possible to transfer data to other places, images can be shared through Internet outside the Hospital and they can be accessed through customized licenses. “For many years the Hospital has offered digital services in the area of ultrasound, fluoroscopic studies, computerized imaging, magnetic resonance and helicoildal tomography,” adds Cordero.
When we talk about your health, we have to talk about quality and state-of-the-art digital medicine. Our Intensive Care Unit, Intermediate Care Unit, Coronary Care, Imagining Diagnosis and Hemodynamics have world-class, state-of-the-art technology. We make the difference by offering our clients quality, and are advancing towards Joint Commission International. Susana Guzmán, PR Clínica Bíblica Hospital Phone: 522-1000
“The material available is placed in a monitor protected by a framework, which is the one used during the exploration, and then the patient’s information is identified and it can be previewed in a monitor,” adds Cordero. According to the Mr. Cordero the use of this technology not only makes diagnosis faster, but it also offers many advantages for the patient and the doctor. Some of them include: 1. It minimizes the patient’s ionizing dosage since fewer repetitions are necessary. 2. It increases the amount of data for diagnosis, since the images can be manipulated. 3. It saves in film and chemicals used to print the images. So it also reduces pollution. 4. It works well with conventional equipment. 5. The image is digital. 6. It does not loose quality when stored, nor take up space. 7. It is more economical. 8. The resulting information is of a better quality.
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Dollars & $en nse by Alan Weeks
Investing In Times, Part 1
These
Uncertain
A number of respected professionals, and we ourselves, believe the US economic slowdown has already started, and that its severity and duration may be worse than most expect, or are willing to admit. Is this reason enough to liquidate all our stocks and stock funds (hereinafter referred to as equities), and switch to cash or short-term treasuries until the market ‘stabilizes’? Certainly not! As experienced professionals keep telling us, the best way to prepare for down equity markets is to apply common sense principles. Thus, the smart move for active equity investors has been to adjust their portfolios by selling equities in the most vulnerable sectors this late in the economic cycle, and moving the money into higher quality ones. This is not just done to avoid losses but also to capture the outstanding gains in smaller cap and emerging market equities that had such great ‘runs’ until recently. Even for passive equity investors, the key to achieving maximum gains is to ignore the short-term fluctuations and stay invested for the long term. (More on passive investing later.) WHY INVEST IN THE STOCKMARKET? Given the continuing volatility, why should one be investing in the stock market? The fact is that over the long run, the US stock market has gained dramatically more than either Long Term Government Bonds, or Treasury Bills. As will be mentioned time and again, the key to making money in equities is not to get scared out of them. How about real estate investments? It may still come as a surprise to some that, as an investment, the residential real estate market was one of the worst asset performers over the 20th Century, net of inflation. The latest chart from Dr. Robert Shiller’s book (1) (available on request), illustrates this extremely well. Net of inflation, it shows no gain in housing values over 60 years to 1950; a total gain of only 12% over the next 50 years to the end of 1999; and a 76% gain since 2000. Of course, the 1979 and 1989 ‘mini-bubble’ peaks in real estate home values are clearly shown, as are the very substantial slumps soon thereafter. There is no doubt this latest brief period of unprecedented
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“irrational exuberance” in the housing prices will soon be corrected. Many, including Merrill Lynch Chief Economist, David Rosenberg, have pointed out: “No asset class at any time has failed to ‘revert to the mean’ after such an unsupportable upside move”. David warned “bubbles and baths usually go together”. GLOOMY NEWS AHEAD To prepare you for the public sentiment likely to be making headlines in the US this fall and winter, here are a few headlines from the fall of 1990: “The Real Estate Bust” Newsweek; “How Safe is Your Job” Newsweek; “How Real Estate Crash Threatens Financial Institutions” U.S. News; “Uncertainty Rains for the US Economy” Wall Street Journal; “The Consumer Has Seen the Future, and Gotten Depressed” Business Week. The fact is, the US economy boomed and both individuals and businesses prospered throughout the 1990s. The need for investors to ignore the news, was expressed very well by Peter Lynch in his book “Beating the Street” (2) . Peter realized that far too many investors were being panicked by bad news reports and ‘cashing out’ of the equity market at the worst possible times. And, he observed that even his fellow top investment professionals, invited to participate in the Annual Barron’s Roundtable, were too often overly distracted by major bad news events. Thus, he wrote the following: “When we make the mistake of letting the news out of the bag, we are confronted with the latest reasons that mankind is doomed; global warming, recession, inflation, illiteracy, the high cost of health care, fundamentalist Muslims, the budget deficit, the brain drain, tribal warfare, organized crime, sex scandals, and money scandals.” “Even the sports pages can make you sick.” “Catching up on the news can not only be merely depressing, it can be a dangerous habit for the (nervous) investor.” “Who wants to own shares in the Gap if the AIDS virus is going to kill half the consumers, and the hole in the ozone the other half, either before or after the rain forest disappears and turns the Western Hemisphere into the new Gobi Desert, an event that will likely be preceded, if not followed, by the collapse of the remaining savings and loans, the cities, and the suburbs?” In summary Peter said; “Riding out the storms” in the market is often the hardest thing to do, but that it is the key to reaching your long-term investment goals. THE NEXT CORRECTION It has been noticed over the last few months, that US investors have wisely been selling off stocks in the most vulnerable domestic sectors, such as homebuilders and auto manufacturers. Declines in market values have also been noted in the lumber industry, durable goods, luxury travel, Continued on page 24...
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and other sectors related to housing and discretionary consumer spending. Some economists believe this is a sign of short-term scepticism among investors. And, they expect this may insulate the market from a very sharp correction, because the downturn in real estate seems to be well recognized, and possibly discounted. Oil and natural gas prices have also declined a significant amount recently and may now have stabilized. Of course, oil industry stock prices also declined. However, these somewhat lower energy prices are still very profitable for the industry and should sustain good equity valuations. Gold and base metal prices also ‘tumbled’ again in early September along with mining company stock prices. This should have brought their valuations back to more sustainable growth rates. Because there have already been two corrections so far this year, we believe there is now less likelihood of a greater than normal market correction ahead. However, it should be noted that some US market analysts have been calling for a nasty sell-off in equities and subsequent sharp rally, to create a classic US mid-term election year low, with the impetus this time being the steep housing price downturn, causing significant consumer ‘retrenchment’. We, and the market pros, continue to caution investors NOT TO SELL IN A PANIC, as the ‘bounce-back’ in equity prices could be just as strong. WHEN THE GOING GETS TOUGH ….. ……the ‘tough’ investor goes bargain hunting. That’s when opportunities are ‘knocking’. Knowledgeable investors know that the best moment to buy equities is when they go ‘on sale’ at lower prices. Or as Baron Rothschild exclaimed very long ago, and Sir John Templeton repeated often: “BUY WHEN THERE’S BLOOD IN THE STREETS”. Warren Buffett and other astute market professionals have simply been advising inexperienced investors to buy equities when prices are low. Regardless of the severity of the next equity market correction, we, and many others believe that the US economy is simply too strong and too diversified to go into a deep economic slump. And, Americans are expected to be enterprising and creative enough to “get going when the going gets tough”. The whole point is, that whenever equity prices fall, longterm investors have to be patient and let the ‘Cream (of investments) Rise to the Top’.
overall US stock market gain over just 4 months to June 30, 2003 was +14% and over the following 8 months, there was another +14% gain. As another good example; some credible sources early last year predicted the US housing market ‘bubble’ would start to deflate by mid year 2005 and, as a result, both consumer spending and the US economy were forecast to slow significantly for an extended period thereafter. This didn’t happen in 2005! In fact, had we ‘parked’ our own equity investments in short-term securities on June 30, 2005 the 25+% gains we made over the next 12 months would have been completely missed. As final proof that ‘timing the market’ is not significant over the long term, studies show the difference in total return is very small between investing on the ‘best’ vs. the ‘worst’ day of the year. Are you convinced yet? PRESERVING ONE’s ‘NESTEGG’ Even passive investors have to be aware that the spending power of their ‘nestegg’ can only be preserved if their return on investments is at least keeping up with inflation. This totalled 15% over the last 5 years, as measured by the US Consumer Price Index (CPI). Moreover, many retirees need to have their investment returns grow sufficiently more than inflation in order to continue withdrawing a percentage of the gains on a regular basis to augment their pension income. Out of curiosity, I reviewed how well the largest US equity mutual funds, each with assets over $20 billion, had performed in recent years. It was determined that the majority (61%) of these mega-funds had actually been ‘wealth destroyers’ because their total returns were substantially less than 15% over the last 5 years. What was even more disturbing was the fact that collectively, these huge funds still had almost 1/2 trillion dollars invested in them. And, substantially more money is still invested in 100’s of other equity funds with equally poor returns. From the shear magnitude of the money invested in these underperforming funds, it appears that too many Americans are being far too passive in their investing. It also begs the question: What have the brokers, financial advisors, fund managers, and the largest 3 fund companies been doing over this period other than collecting ill-deserved fees? Investors in Canadian equity funds should also be aware that too many of the largest Canadian based funds have also been ‘wealth destroyers’ over the same period.
WHY NOT JUST ‘TIME THE MARKET’? THE POWER OF COMPOUNDING The fact is that ‘timing the market’ is extremely difficult. It requires the improbable feat of picking the right time to buy equities and the right time to sell them. If you miss, and are not in the equity market even for relatively short periods, you could miss the best returns. For example, the
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Patient, long-term investors in diversified, international, quality equity portfolios should be able to continue to make Continued on page 25...
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at least the average annual double-digit historical return (in current US dollars). And, at this rate, through the power of compounding, the value of their investment would double in less than 7 years.
This was again done with aggressive media promotion. You can decide whether the media exercised proper standards of financial journalism or whether the strong promotion was strictly for their own short-term benefit.
CONCLUSIONS
Of course, those who ‘bought low and sold high’ in either market gained financially. However, the majority of investors ended up poorer but hopefully wiser to the fact there are far more prudent ways to invest.
As mentioned earlier, by this winter at the latest, many investors in the residential real estate market should have come to realize that this latest ‘get-rich-quick’ scheme was not the financial bonanza they expected. It was promoted aggressively for the benefit of the political and financial institutions, by and also for the media. Easy money policies out of Washington were intended for the creation of employment and economic growth. The unintended consequences, however, should ultimately be: significant job losses across all housing-related sectors; an unprecedented number of home foreclosures; and the widespread loss of personal wealth. I hope that most will come to realize that ‘get-rich-quick’ schemes are created and promoted for the benefit of the promoters, not the unwary investor. Indeed, many will remember how aggressively tech, telecom, and energy trading stocks as well as all manner of IPOs were ‘hyped’ in the late 1990s. After the fact, it became obvious that this ‘mania’ was created for the benefit of the company management promoters, Wall Street, and the other financial institution’s traders and brokers.
November-December, 2006
Perhaps it is time for many more investors to become sufficiently pro-active to ensure they now have or soon find, quality investments that can yield sufficient returns to satisfy their own long term needs and goals. ********** INVESTING IN THESE UNCERTAIN TIMES …. PART II,‘WHERE TO INVEST NOW’ Is to be published in the next edition of El Residente magazine. To arrange for a copy of Dr. Shiller’s latest housing values Chart, or an advance copy of PART II ‘WHERE TO INVEST NOW’, please contact Alan Weeks at his Casa Canada office (telephone# 256-5848) 1) 2)
“IRRATIONAL EXUBERANCE”, 2nd Edition 2006, by Dr. Robert J.Shiller, Princeton University Press. “BEATING THE STREET”, 1993, by Peter Lynch, Simon and Schuster Inc. N.Y.
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Exchange rate of the Costa Rican ¢ to the US Dollar April 506.59 May
508.80
June
511.93
July
514.96
August
517.21
September
519.73
Basic Interest Rate April 15.25 % May
13.75 %
June
13.50 %
July
13.75 %
August
13.75 %
September
13.50 %
Exchange rate of other currencies to the US Dollar Japanese Yen 118.05 Swiss Franc
1.2559
Canadian $
1.1183
Giro (DEG)
1.4764
ÂŁ Sterling
1.8645
Euro
1.2653
Mexican Peso
10.999
Korean Won
946.25
Danish Krone Norwegian Krone Argentine Peso
5.8941 6.5159 3.1045
Colombian Peso 2,393.8 Brasilian Real
2.1785
Libor Rate 1 month 5.3218 % 3 month
5.3700 %
6 month
5.3700 %
12 month
5.2975%
Prime Rate
El Residente
8.25 %
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Holidays Of Costa Rica December 25th ‘Christmas Day’ January 1st ‘New Years Day’ ******************** A Touch of Wisdom “Search others for their virtues, thyself for thy vices.” Ben Franklin (1706-1790) “The eyes are the windows of the soul.” T. Phaer (1545) “Tomorrow is a new day.” English proverb ******************** Holiday Humour I asked my wife if she could take any cruise she wanted, which would she take? She said, “Tom.” A cruise is when you go for days and days--and see nothing but food. We vacationed by car and saw the U.S.A. the old-fashioned way--one tow truck at a time. A dream vacation would be one where your family all gets along. There are always fortunetellers at the seaside. Two of them met on the beach one sunny summer day. ‘Lovely weather,’ said the first fortuneteller. ‘Yes,’ said the second. ‘It reminds me of the summer of 2019.’
November-December, 2006
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El Residente
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