El Residente A Publica on of ARCR Administracion S.A.
January - February 2012
January/February 2012
ARCR Administracion S.A. Apdo. 1191-1007 Centro Colon San JosĂŠ, Costa Rica 1 (www.arcr.net)
Contents: President’s Message................. 3 ARCR Update........................... 4 Wild Side of Costa Rica............. 7 - Ryan Piercy
Children Are Our Future........... 8
Editor’s Note Change is a good thing, though not always an easy thing. El Residente has now taken on a new form, a er some effort, and we have finally gone digital. As of this edi on members will now be able to view the newsletter online, and can switch to the internet subscip on at any me. Based on that, we also decided to add a li le more effort, and change the look as well. For their insight and assistance in the area or design, I would like to thank Forte Design Studio, as they provided us with many great ideas which we have put into use.
- Martha Rollins
Learning the Language............ 10 - Chris Howard
Costa Rica Living, Chili............. 12 - Patricia Diekroger and Jeanmarie Estabrook
A Day in the Life...................... 14 - Allen Dickenson
The New Currency................... 16 Legends................................... 19 - Jack Donnelly
Addi onally I would like to thank Mary Holmes, who has become our resident(e) proof reader, which I am certain many have realized makes a difference, and the many writers who provide us with such great ar cles. Lastly, to Allen Dickenson, who has helped write, review, proof, assist in design, and cri que, both directly and through personal contacts. It is nice to have a sounding board, especially when you are making changes. Ryan Piercy Contact Informa on:
- Alan Weeks
ARCR Administra on info@arcr.net www.arcr.net Ed tor in Chief: Ryan Piercy Adver sing, Publicity: Cindy Solano
Business Directory................... 26
Office Hours:
Monday- Friday, 9 am to 5 pm CRC me GMT-6
Address:
#101 Casa Canada, Av 4 Calle 40 San José, Costa Rica Tel: 506-2233-8068 Fax: 506-2255-0051
Mailing Address:
P.O. Box 1191-1007 Centro Colon San José, Costa Rica
Club Corner............................. 20 Dollars & Sense....................... 22
This magazine has been published every two months since 1995 as the official communica ons media of the ARCR. Our organiza on provides service to thousands of foreigners who have chosen Costa Rica to reside for short periods or for permanent residence.
Published by: Email:
Since 1984 the ARCR 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 applica on, immigra on, business and financial management, real estate purchases and rentals, property management, insurance, pet importa on and much more. If you wish to place an ad in El Residente, please contact the ARCR main office. Goods & services offered are paid adver sements. Neither ARCR Administracion nor El Residente research the companies and take no responsibility for the quality of such goods and services.
El Residente
2
President’s Message by Mel Goldberg Happy New Year
The American Legion, Post 10 of Escazu, invites all military veterans of any country to a end its mee ngs. Please see the Club Corner for further informa on.
Here’s hoping that everyone had a great me over the holidays and wishing all a happy and healthy New Year. When I am back in “the States” I really get mal de patria a er the first week away from Costa Rica.
Don’t forget that you need to be registered with your Embassy (if there is one here) in order to renew your Cedula. For certain countries, if you want to avoid visi ng the Embassy (and in the case of the US Embassy, avoid paying $50) to get the needed le er, call Saicy or Karla at the office (2233-8068) for an appointment. They will help you register online at no charge. Another benefit of ARCR membership!
Everything came together at the end of the year: paying taxes, marchamos, caja, La Liga season’s ckets, renewing membership, maintenance, mortgage, etc. One more is the annual elec ons of the ARCR Board of Directors. The new board is now in place and will be mee ng regularly star ng in January.
In addi on, the office has been nego a ng a new Dental Plan for the members, in conjunc on with a large network located here in the country. Details should be available early January, so come in and see what else your membership can do for you.
The law about having emergency equipment like triangles, fire ex nguisher, first aid supplies, etc. in your car is a great idea, I think. But, a er ge ng stuck for over two hours on the way to Liberia while a bridge was being repaired, I would like to add food and water. I was saved by a friendly Tico who gave me a package of soda crackers when my stomach really started bothering me and just water didn’t help much. I tried to get cash from two different ATM’s on my American Express card, but it just wouldn’t work. If you have ever tried to get cash from a bank here using your Amex card, you might have had the same experience. The bank phoned the USA and was told that I had no balance due and several thousand dollars available for advances, but no luck. I went to the American Express office in Sabana Oeste only to be told it was only an American Express Travel Service, and to go back to the same bank. I did, and this me used a different card. In a li le over an hour I did get the cash advance. For those of us who have not used the Discover Card for the last three years or so, you can now use it again as the 2% foreign country use charge was discon nued in November 2011.
Everyone is welcome to the dutch treat luncheon held the first Friday of each month, now mee ng at Mac’s American Bar in Sabana. Hope to see some more of you there. Don’t forget that the Li le Theatre Group’s plays are in English (no Spanish sub tles.) They adver se in the Tico Times, or check out our club corner for contact info. I was also delighted with the Symphony Orchestra performances when I started a ending concerts about eight years ago. It is a world-class orchestra. I lived in New Jersey just twenty minutes from New York for 35 years and a ended many concerts of both US and foreign orchestras there. The one here in Costa Rica is as good as or be er than most others I have heard. Also, if you enjoy opera and ballet performances, there are many visi ng companies here in Costa Rica which are excellent -- and they are not priced like New York! ARCR MONTHLY SEMINARS If you, or someone you know, is considering a move to Costa Rica, make certain you check out the monthly ARCR Seminar, which is full of current facts and good ps about things you really need to know. Email us now: info@arcr.net.
Cover: The White-tail deer (Odocoileus virginianus) Locally known as the Venado colablanca, it is difficult nowadays to encounter one in Costa Rica due to hun ng and loss of habitat. Its normal range here includes Guanacaste, as well as the Isla San Lucas. Natural predators include the coyote, the jaguar, and the puma, but more due to the habits of mankind this na onal symbol is actually in danger of ex nc on in the territory. Declared a Na onal symbol in 1995, it represents the natural fauna of Costa Rica, and shows on the reverse of the 1000 colon bill along with other elements of the dry forest zone. January - February 2012
3
ARCR Update Document Legaliza on For those who are going to start their residency, or need to complete other legal processes, legaliza on of foreign documents has now become simpler. As of December 14th, 2011, documents that originate from par cipa ng countries can now be Apos lled for use in Costa Rica. The benefit is that these documents no longer need to pass through the Costa Rican Consulate nor Relaciones Exteriores in Costa Rica. Costa Rica signed to adhere to the Hague Conven on on Apos lles last March and was awai ng approval by the other member countries, which has now been completed. This process will not only save me and inconvenience, but will also save the $40 fee that was charged by the consul in order to authen cate each document. The previous method of obtaining a Cer ficate of Authority, then the consular authen ca on, will s ll have to be done in those countries not party to the Hague Conven on. New Bank ID Since early December informa on has been published and passed around that banks will now require foreigners to use an iden fica on card, referred to as DIMEX, in order to make transac ons such as Sinpe transfers. Many members and others have been concerned about obtaining this new document as well as the addi onal $123.00 USD fee required to obtain it. The ARCR has been ge ng the word out that we are certain this is not in fact a new ID card, but actually the very same Cedula that is now issued for residents. These were created in a format so that each individual will have their own unique 12 digit iden fica on, as is needed by banks and many other ins tu ons in the country. The term used, DIMEX, is the acronym for Documento de Iden ficación Migratorio para Extranjeros. This is the same cedula that is currently carried by most residents; most members with residency will already have this version of ID, as Migracion has issued them since 2008. You can see the words in the lower right hand corner of the front of the Cedula. The memorandum that was issued by Migracion to the banks in late 2011 was simply to clarify what the three current types of residency iden fica on that are s ll accepted. These include certain types that are stamped El Residente
in the passport, the last of which are expiring in 2012, and the last of the residency “booklets” which will be expired by 2013. Both types will be replaced by the new cedulas by that me. The last type, the DIMEX, is the one that most Pensionados, Ren stas, and others already have as their iden fica on. Crackdown on Imported Packages Since December, Customs here has started to enforce exis ng tax legisla on on packages brought in through the various courier and mail forwarding companies. Previously, purchases ordered online came in mostly free of any du es, but the local tax authority has decided to put a stop to this. Representa ves of the government have stated there should always have been du es on these imports but that they were lax in the applica on of the law, which has been in effect since 2004. The various companies affected, such as Aerocassillas, as well as many clients, have been very upset over the unexpected increase in the cost of their items, especially over Christmas. Digital Version of El Residente El Residente has now decided to “go green”, at least as much as possible based on the members. The new Digital version of El Residente is now available on Internet and those who wish to convert to an online subscrip on can do so simply by emailing or mailing in a request to the office. The idea to have the magazine available in digital format is not only to help save the planet in reducing the use of paper, but those who switch to the digital subscrip on will also receive the new edi on much faster, usually one to two weeks before the hardcopy version will be available. Past edi ons are already up and available on the website, www.arcr.net, for those who wish to preview how the future edi ons will be, and your subscrip on method can be changed at any me simply by emailing us at admin@arcr.net. Dental Plan Star ng January the ARCR will have a new dental plan available to members. Contact us for details... 4
January - February 2012
5
El Residente
6
Wild Side LXV Ryan Piercy Travelin’ Teals If you enjoy birding or photography, then this is a good me of year to get out the camera. Many tourists flock here at this me of year, but so do many migratory birds. From December through February, Costa Rica is home to many Northern species not resident the rest of the year. An example is the Teal, of which three species may be encountered here. Teal are basically part of the duck family, but the rela onship of various duck species is the most confounding of all living birds. The current genus anas may eventually divide into different subgenus as studies permit.
The Blue-wing Teal, anas discors, and the Cinnamon Teal, anas cyanoptera, are two closely related species that appear in Costa Rica this me of year. They weigh about 400g and are about 15” in length. The Blue-wing is usually considered the first to head South, and the last to return North, and is by far the most numerous migrant duck you will find in the country from late September through April. Teals tend to prefer freshwater marshes and ponds, o en in lowlands or middle eleva ons. They will, however, se le for slow moving waters such as river pools or estuaries. Males have a dark blue-gray head with a white facial crescent at the dark gray bill. The upper wing sports large pale blue patches while the main body is cinnamon with black spo ng. Females are similar in appearance to the Cinnamon Teal below, but irises are darker. The Blue-wing Teal is known as a dabbling duck, based on the way it feeds; they mainly feed on the surface of shallower waters as opposed to diving. The diet of the Blue-wing consists mostly of plants, though may include some mollusk and aqua c insects. They build their nests on dry land near open waters, usually in grassy areas, or occasionally in areas of sparse, short vegeta on. In country the Blue-wings are abundant in the Tempisque basin and Rio Frio areas and are sporadically found in other appropriate se ngs up to about 3000m. January - February 2012
Cinnamon Teal are very closely related to, and o en indis nguishable from, the Blue-wing female. They are mainly a bright chestnut color marked with black. Their bills are black and the iris red. Their habits are very closely related to that of the Blue-wing Teals but they are a less frequent visitor. They are normally seen in Tempisque and may be spo ed amongst their brethren. Most commonly they visit November through February.
The Green-winged Teal, anas crecca, is a common duck but is only a casual or accidental winter visitor to Costa Rica. They should also be watched for amongst the Blue-wings. They are the smallest of the North American ducks at 14”, and 325g and can be iden fied by a green upper wing and a chestnut head with a spectacular glossy green side up to the eyes. Most of the upper body is covered with fine black and white spots and they have a white wing stripe. Underneath, the wing is mainly white. One specimen was recorded shot by a hunter in the Ochomogo region, but most (unconfirmed) reports have come from the Tempisque basin.
So you birders out there, if you have a chance to get out to some clean marshes over the next few months, now is the me to add more species to your list of sigh ngs. Get your cameras out and good luck “hun ng.” 7
Children Are Our Future by Martha Rollins Another World My friend, James Houston, recently caused me to take a closer look at the world of the blind. As you can see, even this simple statement indicates a presump on of sight; our very language takes sight for granted. Perhaps we should not. James, the founder and owner of JMH Consul ng S.A., a business providing language training, interpre ng, transla ng, and Braille services to individuals, businesses, and non-profits, is fluent in five languages and s ll studying. He was born in the United States and raised in Costa Rica, a ended boarding school in Maine, and university in Washington, D.C. He lived in Belgium and France for over ten years before returning to Costa Rica and has traveled, par cipated in home stay programs, and/or worked in North America, Central America, Eastern and Western Europe, South America, and the Caribbean.
Braille is a system of raised dots that can be “read” by touch. As James carefully corrected me, it is an alphabet (including punctua on marks, numbers, musical notes and computer symbols) not a language. James compares the raised dots to the audio dots and dashes used by Morse Code. The Braille alphabet is used in different languages including English, French, Spanish, Chinese, Arabic, and Hebrew. The system was invented by Luis Braille, a blind boy from France, who created and published the first Braille book when he was only fi een years old. Luis had lost his sight because of an accident involving a tool that he then used to create the raised dots of the Braille system. When Louis was three years old he grabbed an awl in his father’s harness shop; the tool slid and he hurt one eye. Infec on set in and spread to the other, blinding him in both eyes. Luis won a scholarship to the Royal Ins tute for Blind Youth in Paris when he was ten years old and, when he was twelve years old, a former soldier, Charles Barbier shared an inven on with him called “night wri ng” -- a code of twelve raised dots that let soldiers share top secret informa on without speaking. Luis simplified the system, then added symbols for math and music! Mr. Houston returned from France to Costa Rica and in 2008 formed JMH Consul ng S.A. In contrast with the extensive services for the blind in France, he discovered a void in services for the blind here. He began to fill that void; with his own funds he researched, and in 2010, bought the first commercial produc on embosser in Costa Rica, a machine used to convert transcribed words into the raised dots of Braille. He laughingly told me that he had a choice, to buy a car or to buy the machine! He chose the machine. Transcrip on involves conver ng informa on into Braille format for eventual embossing. The conversion is accomplished with the assistance of a special so ware program that transcribes informa on which is then embossed onto a special heavy paper. The result may then be “read” by touch alone. James provides transcrip on and embossing services for individuals, businesses, and non-profits.
While living and teaching English in Southern France, James passed a center for the blind every day on his way to work. One day he decided to go inside. As a good teacher, he thought to himself, “What if I were to have a blind student one day; how would I react; what would I do to teach that student successfully?” In three days he had memorized the Braille alphabet and ended up teaching English to the blind! El Residente
James’ volunteer work on behalf of the blind includes transcribing and embossing books by Costa Rican authors and dona ng those books to public libraries. He requests only a voluntary contribu on to cover the cost of the heavy paper that is necessary for conversion to Braille text. In partnership with the authors, James has transcribed and embossed the following books 8
into Braille: La Guerra de las Chispas, Siembre de Ilusiones, Una Pulgada antes del Premer Renglón, Los Ojos de Abril, El CentAuro de Aluminio, El Paralelo 10 Norte, Animal en Ex nción, Pesadillas entre Comillas, Parábolas Irreverentes, Corazon de los Dias, A Vuelta Redonda en pata de gallo con pie de Amigo, and El Tercer Arco Iris.
blindness, the Braille alphabet, transcribing and embossing text in Braille and presenta ons by special guests with visual impairment. It includes ps on ways to interact with the blind such as always men oning your name and brushing your arm against the le side of the person to offer assistance instead of grabbing the person’s arm. Level Two Workshops are currently being developed and will focus on reading and wri ng Braille. Braille is wri en backwards as in mirror wri ng and is read normally. Since childhood James loved wri ng backwards as in a mirror image. James quickly demonstrated his skill to me by wri ng his name backwards without hesita on. It is obvious that wri ng in Braille was a natural skill for him.
At the current me, eight of the 56 public libraries in Costa Rica are par cipa ng in his project. The libraries include the Na onal Library of Costa Rica and public libraries in Heredia, Desamparados, Alajuela, Cartago, Limón, Puntarenas, and Liberia. James also went to work approaching public ins tu ons such as transporta on systems and museums to encourage Braille signage. In many instances the people to whom he talked were not aware of the need, in some cases assuming incorrectly that the blind did not work or travel outside their homes. The Costa Rican Ministry of Culture just recognized his Braille project as a “Declara on of Public Interest” (Declaratoria de Interés Público in Spanish), thus adding governmental backing and merit to his efforts and deeds. James conducts workshops to teach Braille to the low vision and blind, as well as to interested sighted individuals. His workshops, which are open to all interested persons, are held each month in two loca ons and consist of weekly sessions for four successive weeks. The cost is 10,000 Colones per session for both handicapped and non-handicapped, and 10,000 Colones for the course book. Workshops are conducted in Spanish (other languages on request). The coursework for Level One Workshops include: the history of Luis Braille, the different degrees of January - February 2012
James develops his own innova ve training materials based on the needs of his audience. For example, in one workshop he had an adult par cipant from the construc on industry who had become blind because of diabetes and had lost his sense of touch as well as his sight. To assist the man’ s learning, he developed some jumbo wooden blocks with raised Braille dots on them as teaching aids, and let the man experiment with forming le ers and words from the blocks. So, the next me you see a person with a white pped cane, dark glasses, or a seeing eye dog naviga ng the damaged streets of San José, think of James at his machine transcribing books and signage into Braille, or in a classroom teaching blind and sighted alike how to move about in this other world. You might also think about dona ng to his founda on to defray some of his personal costs or make a reserva on to a end one of his workshops. You might see things a li le more clearly as a result. Workshop loca ons and days are: Heredia: Wednesdays 9-11 at La Casa de la Cultura Alfredo Gonzáles Flores San José: Saturdays 9-11 at The Episcopal Parish of the Good Shepherd (Avenida 4, Calle 3 and 5, southwest of the caja) Advance no ce is required. Telephone 8924-8924; fax 2289-9868 or e-mail info@imhic.com For more informa on see www.jmhlc.com click on “About” then “Social Responsibility” or contact: Martha Rollins at rollinsmartha@gmail.com or James Houston at jhouston@jmhlc.com 9
Learning the Language by Chris Howard Food Expressions Al no haber pan, bastan las tor llas – When you are hungry anything is good Amor con hambre no dura – Love with hunger doesn’t last Comer como lima nueva – To eat a lot. Lima is a file (tool) Comer como huérfano – To eat like an orphan or be very hungry Comer y tragar porque el mundo se va acabar – Enjoy food because the world will end Comerse vivo a alguien – To eat a person alive (figura vely) Con pan y queso, nadie se pone obeso – Even if you eat poorly you won’t get fat Cuando no hay lomo de todo como – When you are hungry you will eat everything Culo sentado no gana bocado – If you sit on your bu you won’t earn money to buy food. Bocado is a mouth full or a snack. Another version is. Barco anclado no gana flete. An anchored boat won’t make money. De la mano a la boca se pierde la sopa – Easier said than done El caldo sale más caro que las albóndigas – Means that something that is cheap is going to end up cos ng more El toro vivo embiste, el muerto en bistec – A live bull a acks and a dead bull ends up as a steak. This is a rhyme. Eres lo que comes – You are what you eat Es mejor comprar un bistec que toda la vaca – It is cheaper to rent a woman than to marry one Es mejor de morir de indiges on que de hambre – It is be er to die of indiges on than hunger Faja larga, vida corta – A long belt (fat stomach) will lead to a short life Gallina vieja hace buen caldo – An old hen makes a good broth. Older women aren’t so bad Hay más hambre que comida – There is more hunger than food in the world Hombre casado es el mejor bocado – Married men are best for romance Hombre casado ni frito ni asado – This expression is the opposite of the last one. Don’t get involved with married men. Hoy comemos, mañana no sabemos – We are here today and gone tomorrow (death) Los cementerios y panteones están llenos de los hartones – Cemeteries are filled with people who eat a lot Más gente se muere de envidia que de hambre – More people die of envy than hunger Más eso que un pan de tres diás – S ffer than a three-day-old piece of bread. We also say “Más eso que un cocodrilo enyesado” S ffer than a crocodile coated with plaster. Media naranja – One’s mate No entrarle ni una bala – To be so full a er ea ng that a there is even no room for a bullet in your body Pan comido – Something that is a very easy Pan duro es mejor que ninguno – Beggars can’t be choosers when it comes to food Panza llena, corzón contento – if you are full, you are happy Para la buena hambre no hay mal pan – if you are hungry, any food is good Perro que come huevos, ni quemándole el hocico – Hard to change a person’s nega ve behavior Ser como ballena, que todo le cabe y nada le llena – A person who likes to eat a lot and is never sa sfied Un queque – Something that is easy or a piece of cake as we say in English Quedar como perro de cura – To be full a er a meal. Estar sa sfecho is the correct way to express this idea Tiquismo (Costa Rican expression) of the week: Tener filo – To be hungry
El Residente
10
January - February 2012
11
Costa Rica Living by Patricia Diekroger and Jeanmarie Estabrook
chef was intended to compete against Wick Fowler of the Chili Apprecia on Society Interna onal.
I Didn’t Know Beans About Chili Since I am on the commi ee for the 5th Annual Atenas Chili Cook Off (Feb 12, 2012) I decided to do a li le research about chili. I was surprised to learn something any true chili cook already knows: real chili doesn’t have beans! I also learned that Chili peppers were na ve to the New World and were used centuries ago by the Indians of Central and South America.
Before it was to take place however, Tom Tierney, the owner of a public rela ons firm, called Frank Tolbert to tell him about something he had read in “Holiday” magazine: H. Allen Smith of Mt. Kisco, N.Y., had wri en an ar cle tled “Nobody Knows More About Chili Than I Do.” In the piece he disparaged Texas and its chili. His preferred recipe included onions, canned tomatoes, sweet bell peppers, and kidney beans. Chili heresy! The war was on.
In 1737 an immigrant in Arizona first described a stew made with chili peppers, lard, and meat. Then in the mid 1800’s, a San Antonio se ler ground some dried spices and chili peppers, and a blended chili powder was created. This led to the spread of chili stew recipes across the southwest and onward.
Smith was chosen to compete against Fowler. However, in an abusive and childish response, Smith declined the invita on. Fowler responded by saying “Smith has taken to his bed with the Buff Orpington syndrome,” the Buff being a breed of chicken! So, Smith acquiesced and the date was set, as was the me: high noon.
There are many stories of how “chili con carne” became popular, but almost all agree Texas was the place of origin. There are stories of the “chili queens,” who were Mexican women hired to feed the military in San Antonio. Stews, like chili, had become the food of choice among the poor because they could stretch a small piece of meat with lots of chili peppers and disguise any bad taste or odor with the spicy seasonings. There are theories that chili was served to the jail inmates for the same reasons. Later, these ladies became street vendors who arrived in the plazas in the evening with aroma c caldrons of chili to dish out.
On an autumn day, two pots of simmering chili scented the air while a band played and people milled about, assuaging their hunger with the other cowboy foods on offer. There had not been much hope for a big turnout considering the remote loca on; Terlingua was s ll quite isolated, being 80 miles from a real town and with no guest accommoda ons. It was believed all the a endees could be transported on one big chartered plane from Dallas and another from L.A. On the day of the cookoff however, to everyone’s astonishment, people arrived by car, bus, jet, and large and small prop-planes. Two hundred nine chapters of the Chili Apprecia on Society from across the U.S. would be represented in Terlingua that day.
By 1890 chili was being served in cafes in Texas. In 1893 chili made its big debut at the Chicago World’s Fair at the “San Antonio Chilley Stand.” It was a hit! And the rest is history. Un l . . . somewhere down that spicy road someone decided their chili was the best chili ever.
Finally, the chili was ready. Three judges would decide the winner: David Wi s, the mayor, Floyd Schneider, a brewery exec from San Antonio, and Hallie S llwell, Jus ce of the Peace of Alpine, Texas. (Unknown by the Chili Associa on
The Start of the Chili Wars. Jump ahead in me to Terlingua, Texas, a town which resides 10 miles inland of the Rio Grande. A bit of history: Terlingua is a corrup on of the original name of Tres Lingos, named for the three languages spoken in the area in the 1800’s, English, Spanish, and Comanche. At one me Terlingua was a major mining area for a brick-colored ore called cinnabar, from which mercury is extracted. A man from Cleveland, Howard Perry, owned the mines and moved the town closer to them. Along with 1,280 acres, he pre y much owned Terlingua and controlled everything in it. He discouraged visitors to his territory, so it would not have pleased him to know what was coming more than 100 years later when, in 1967, “The First World’s Chili Cook Off” was organized in Terlingua. In 1966 Frank X. Tolbert had wri en the first edi on of his book “A Bowl of Red,” which revived interest in chili con carne, and the cookoff was an a empt to promote the book. There were to be two cooks: actress Elizabeth Taylor’s El Residente
12
was that Hallie was a cousin of H. Allen Smith.) The pots were labeled 1 and 2 and the judges were blindfolded (moot points since one chili had beans and one didn’t) and the tas ng began. And The Winner Is… The judges gathered at the pots and Judge S llwell was the first to taste. Her spoon poised over pot #2, which was Fowler’s, she tasted the chili. She dipped again, and then once more before she moved to Smith’s pot, took a small bite and announced, “I vote for Soupy’s – I mean I vote for #1.” Soupy had been the adjec ve used, by his detractors, to describe H. Allen Smith’s chili and then the man himself. Judge Schneider then took one good bite from Smith’s pot. He did not look pleased. He then dipped into pot #2 and ate hear ly from it. He announced his vote for Pot #2, Wick Fowler’s. Mayor Wi s would have to cast the e-breaking vote. He dipped his spoon into Smith’s chili and took one bite. His face reddened and became contorted, falling to the floor having what appeared to be a convulsion. When he recovered he said his taste buds had been paralyzed by Smith’s chili and it would not be possible for him to cast the decisive vote. (Certainly one of the more inven ve ways a poli cian has avoided taking a stance and making enemies.) Consequently, Fowler was robbed as the contest was declared a draw! Smith and Fowler were supposed to face-off again in 1968. Smith, however, claimed a case of hives and didn’t a end. Woodruff De Silva, also known as “Wino Woody,” Chief Chili Head and state chili champ of a California chapter of the Chili Apprecia on Society, was invited to take Smith’s place. Fowler, though he made a far superior chili, had yet another victory taken from him. Some press agents had arranged, a er the votes were wri en and placed in a ballot box, for armed, masked men to take the ballot box and throw it into a mine sha ! The judges, feeling no pain from copious amounts of champagne, once again declared a draw. A year later in 1969 the doors would open for more contestants to enter the contest. And someone actually won. That man was C.V. Wood, whose many accomplishments included buying London Bridge and moving it piecemeal to Arizona and becoming the first general manager of Disneyland. He was a tough compe tor who ate chili for breakfast. His green chilies and lime juice recipe was judged best, but some suspect it was the bevy of beau ful starlets whom he brought with him on his jet that swayed the many Californian judges. As the years passed the judging became more honest and the contestants became more varied as women and Na ve Americans joined in. The popularity of the event increased greatly over the years and now there are numerous cookoffs throughout the U.S. and interna onally. January - February 2012
The Atenas Chili Cook Off. The most important cookoff to many of us is the one that is held here in Atenas. That is because it is held to benefit the Hogar de Vida (Home of Life) Orphanage. Not only do we have a great me, but the event helps support the orphanage. This year, the 5th Annual Atenas Chili Cook Off is set for Feb. 12th. The importance of the Hogar de Vida huge. It was recently reported that child abuse cases at the Na onal Children’s Hospital increased by 600 percent from 2007 to 2010. With this disturbing trend the need for a loving, temporary home place like Hogar de Vida can only grow. A visit to Hogar is at once both inspiring and heart wrenching; inspiring because of the obvious love and dedica on with which the Tias (Aun es) and staff care for the children, and heart wrenching because of the knowledge that these beau ful children are here due to sad and disturbing reasons: abandonment, abuse, or neglect. While Hogar does receive some financial support from government agencies, they also rely on dona ons from private ci zens. Therefore, there is an even greater need for support from the community and the Chili Cook Off is held for that purpose. Our support helps to provide clothing, good food, school supplies and the myriad other necessi es required to care for the up to 35 children who are in residence. (You can see their web site at h p: //www.homesoflife.org/ and look at their Facebook pages Group “We Love Hogar de Vida”.) In 2010 over 500 people a ended the 4th Annual Atenas Chili Cook Off. We had fun tas ng some of the fourteen pots of chili and vo ng for our favorites. Then we basked in the beau ful day, strolling the lovely grounds of the Quinta Romavista, while munching hot dogs and sipping a soda or a cold drink from the wine and beer garden. We joined the raffle, listened to live music and enjoyed the company of family, friends and neighbors. At the end of the day approximately $3400 had been raised for the Hogar. This year should be even be er. With a projected twentyfive or more chili teams, this will be the biggest and most successful cook off yet. And something else that has come out of this chili compe on are some great chili recipes. If you’d like to try making your own, we would love to share some award winning recipes with you. Please set aside Feb 12th to a end the 5th Annual Atenas Chili Cook Off. There isn’t any be er opportunity to have a fun day ea ng good food in beau ful surroundings while also making a difference in the lives of some deserving children. Bring your family, tell your friends, and together we can make a difference. For more informa on please go to: www.atenaschilicookoff.com Founded by Kay & Tom Costello 13
A Day in the Life by Allen Dickenson The End of the Rainy Season Local folklore has it that you can tell when the rainy season is ending – it is signaled by an earthquake some me around November / December. Maybe that is some sort of spiritual communica on wherein the Mother Earth signals Father Sky saying, “Okay, that’s enough. I’m not thirsty anymore. “ I have, however, iden fied another more secular indica on of the rainy season coming to a close, at least here in Santa Ana, which I assume is also seen in other parts of the country. It happens when the local municipality starts repairing the potholes in the roads. Without warning, baches that have existed for months suddenly start being filled with fresh asphalt. (I’m guessing that someone has decided that the holes are no longer needed to hold the rain to camouflage them from drivers, so it’s okay to go ahead and fill them.) Whatever the logic, chuck-holes that have existed
for months start spor ng new, black paving material patches.
I have observed the seasons come and go, and have come to the conclusion that there must be some arcane formula the maintenance crews use to decide which holes get filled and which get skipped. (Or maybe it is the re repair guys who make the determina on, I don’t know.) But whatever that formula is, I know it’s not always just the largest, most car-ra ling ones that get ranked at the top of the list for a en on; characteris cs of size and / or depth seem not to ma er. It’s not the li lest ones, the ones that take the least amount of repair material that get filled first, nor is it the loca on of the patch in rela on to vehicular travel (is it in the center of the re track or near the edge of the road?) that has any impact on the decision. Oops! “Impact” may be the wrong word here – no ma er where in the road the chuck-hole is, if you hit it, there WILL be an impact! I guess it’s best to not try and figure it out and just concentrate on the good news; that it is very possible that within a month or two, the same repair crew will
A NOTE OF CAUTION FOR NEWBIES: Don’t assume that just because you encounter a few chuck-holes which have been filled with new asphalt, that all of them in the immediate vicinity have also been filled. Oh no! As it o en happens, two or three holes within a few meters of each other will be patched; another one, two, or three close by will be skipped, and then a short distance farther on, another few will be filled. Figure that one out! So, a word of warning: If you encounter a newly patched pothole, view it with suspicion! I’ve been thinking about this for quite some me as El Residente
14
come back and the “missed” holes (which by then have become much larger and maybe even eaten their buddy next door that had go en the earlier repair) will get the same random treatment. Eventually, and I’m speaking generally here so don’t hold me to this, they will all be repaired – just in me for the next rainy season.
where he resided for 24 years. In 2006 he re red from opera ng his own licensed mortgage brokerage business and relocated to Costa Rica. He holds a Bachelors Degree from the University of New York and a Masters Degree from the University of West Florida. He can be reached via email at: allen@humphree.net
Anyway, if this is your first transi on to the dry season here in Costa Rica, and you drive, my advice is to keep the vigilance for chuck-holes you developed during the rainy season on high alert for a while. Eventually the authori es will get around to filling all (okay, many) of the old holes in the road. Then all you have to keep a lookout for are the new ones; the ones where somebody has deliberately dug a hole to access a water supply line . . . or maybe to dig for lost Inca treasure. Oh, and also keep an eye peeled for missing manhole covers; they are a different kind of treasure. Allen Dickinson is a member of ARCR. A er serving 23 years in the US Navy he se led in Pensacola, Florida,
January - February 2012
15
Take Note of the New Currency 1000 Colones Costa Rica’s new 1000 colon note went into circula on on June 20th, 2010. While maintaining the same red color, this new bill is made of a polymer, which should increase the lifespan of an average note. The first of the new series of bills to be put into circula on, it features the face of past president Don Braulio Carrillo Colina as its central figure. When the bill began circula ng many thought an error had been made prin ng the “State” of Costa Rica instead of the “Republic”, however authori es clarified that this mo o was used in conjunc on with the state shield that was in use at the me of Braulio Carrillo’s Presidency, also on the note, and was not an error.
Characteris cs of Costa Rican One Mil Bill: Size: 125 x 67 mm Substrate: Polypropylene Predominant Color: Red Mo f: Shield of the State of Costa Rica Personage: Braulio Carrillo Colina (1800 – 1845) Ecosystem: Dry Forest Featured Species: Guanacaste Tree Pitahaya fruit White-tailed Deer
Civil Service. Also during his second term he suppressed the Ambulance Act, which moved the loca on of the State Capital on a yearly basis. Braulio Carrillo firmly combated laziness and vice, repealing fes vals and religious holidays with the aim to combat idleness. Carrillo canceled the country’s foreign debt, and then, on November 8th, 1838, broke from the Central American Union declaring Costa Rica to be a “free and independent state.” To spare the country from paying high costs to export coffee to the Pacific, he had the road to Ma na built and put into service. He also organized the judicial system and enacted the General Code of Carrillo, the first na onal standards issued containing civil rights, criminal rights, and their respec ve procedures. To finish weaning the country from Spain, because un l then Spanish law was s ll used, Don Braulio decreed the organiza on of courts and tribunals, and set tariffs and rules for public finance and the police. Braulio Carrillo Colina was born on March 20th, 1800, in San Rafael de Oreamuno, Cartago. He studied law and graduated as a lawyer. He later became Magistrate of the Supreme Court and held the Presidency of this same body. Elected to Parliament in 1828 he served as President of Congress and represented Costa Rica in the Federal Congress. Head of State on two occasions, the first from 1835 to 1837, he assumed Government for the second me in May 1838 as a result of a coup. The Legisla ve Assembly recognized him on June 26th of that year and he was sworn in two days later. He remained in power un l 1842. He ruled with an iron fist, ins lling with firmness his habits of honesty, morality, and a strong work ethic. His term produced enthusiasm in the country’s development, and generated progress and order in the El Residente
In 1842, Francisco Morazán invaded Costa Rica and Don Braulio was overthrown and exiled into El Salvador, where he was assassinated on March 15th, 1845. In 1971, the Legislature declared Braulio Carrillo Benefactor of the Homeland and the architect of the Costa Rican State. Brief wri en by: Osvaldo Valerín Ramírez.
16
January - February 2012
17
El Residente
18
Legends by Jack Donnelly La Nigüenta: A Costarrican Folk Figure La Nigüenta is an unusual ceramic or plaster figurine and folk icon that is completely unknown outside of Costa Rica. It may well have originated with a French curio, but that remains uncertain. It portrays a young naked girl si ng with one leg on her knee picking parasites out of her toes. The noxious creatures in ques on are Niguas, hence the name la Nigüenta.
Money and other offerings were le by her to ask for good fortune or a par cular favor. A Nigüenta received as a gi is considered a much more potent charm that one purchased. The adora on of this sort of female figure is very Marianist, akin to worshipping the Virgin Mary. La Nigüenta has long been considered a subs tute for Mary in Cost Rican folk prac ce. Marianism is very strong in many parts of La n America, especially la Virgen de Guadalupe in Mexico, the earliest of the great La n American Virgins. Costa Rica has its own Virgen de los Ángeles, or la Negrita, who is the “patrona de Costa Rica y protectora de las Américas” (Patroness of Costa Rica and Protector of the Americas.) Interes ngly, the Spanish term Marianismo is also used by La n American sociologists to represent the idealized female counterpart to Machismo. The wife of the machista is expected to be demure and chaste, except for child bearing with her husband. The male is held to no such standard. How this figure came to represent good luck is anybody’s guess. I can’t see how the child with the parasi c infesta on is all that fortunate. And it certainly cannot bode well for the fleas that she is a acking with her nails. One of the joys of folklore is that you simply have to take it as it is and run with it.
This plaster Nigüenta has her mojo backstopped by two lucky symbols on the base: a Horseshoe-13 and a Shamrock. Niguas are parasi c arthropods called chigoe; fleas or jiggers (T. penetrans) in English. They are the smallest of the fleas and should not be confused with chiggers, which are larval mites found in more temperate climates. The female burrows head-first into the host, leaving the rear of her abdomen protruding through the skin. Infec ons are almost always on and between the toes. Niguas were a very common pest in Costa Rica when many rural people walked around barefoot. The skin reac on can range from mild irrita on to serious inflamma on. The statue e of La Nigüenta was tradi onally used as a powerful, all-purpose agüizote, or good luck charm, and many households had reverent spaces set up for her. January - February 2012
The prac ce of owning, displaying, and propi a ng la Nigüenta is a folkway that is dying out. A friend of mine in her early six es tells me that when she was a child in Puriscal every house had a Nigüenta. Today, some younger, urban Ticos will not know who she is, and if they are familiar with her, will be unlikely to have one in their homes. However, she is not en rely lost to the younger genera on. You can get a very colorful full-sleeve ta oo of her in some San José parlors. She also appears in some modern artwork and the names of Tico blogs. La Nigüenta is uniquely and quintessen ally Costa Rican. It would be a terrible shame to lose such an enigma c and intriguing Tiquicia cultural mo f or to condemn her to the arcane preserve of the artsy elite. She is a wonderful quirky folkloric image in our all too McModern world. Finding an a rac ve Niqüenta is difficult today. You can buy cheap and una rac ve models in tourist souvenir and artesanía shops, o en in two or three sizes. You can also find a good selec on of different sizes, shades and styles in the San José central market, and I am told that small ceramic shops will cast and custom paint one for you. But trust me, asking for one in a store selling religious items will get you a look that says, “We aren’t Pagans here!” 19
Alcoholics Anonymous Groups meet daily throughout the country; mes and places change frequently. Call for up-to-date informa on. San José 2222-1880 (Anchor club, also serves Narco cs Anonymous) Av 6 Calle 1, 2nd floor Maryland Building. Heredia (Laura) 2267-7466, Puerto Viejo Limon 2750-0080, Zancudo 2776-0012, Tamarindo 2653-0897, Flamingo (Don) 2654- 4902, Manuel Antonio (Jennifer) 2777-1548, Jacó (Nancy) 2637-8824, Zoo Group Escazu 2293-4322. Al-Anon Mee ngs Al-Anon Family Group is for all family and friends of Alcoholics. Mee ngs are at the Interna onal Bap st Church, 2nd floor, Saturday morning 10:30, located on the pista toward Santa Ana between the Mul plaza and Guachepelin exits. For informa on in English, please call Ken 2288-0317 and Rosemary 8993-1762; For Spanish please call Chris ne 8840-4658. American Legion Post 10- Escazu Post 10, The oldest and largest American Legion Post in Costa Rica, meets at 12 noon on the first Wednesday of each month at Club Cubano in Guachipelin. For informa on and map, please call Mel Goldbergat 2271-5556 or 8870-6756, or John Moran at 2232-1680. American Legion Post 12- Golfito Mee ngs are held 4 pm 1st Tuesday every month at Banana Bay Marina. The Golfito GOVETS have been helping Southern Costa Rica for over 20 years. Contact Pat at walkergold@yahoo.com or 27752809. American Legion Post 16- Goicochea Mee ngs are the second Wednesday of the month in the Hotel of the Hospital Clinica Catolica. Lunch at 11:30 and the mee ngs at 12: 30 Contact Jim Young at 2524-1265 or Ken Johnson at 2591-1695. 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 informa on contact us at costaricabirding@hotmail.com Canadian Club The Canadian Club of Costa Rica welcomes everyone to join us for our monthly luncheons, and at our special annual events, like our Canada Day Celebra on, no passport required. For informa on visit our website: www.canadianclubcr.com Democrats Abroad Democrats Abroad meets on the last Saturday of every month at theAurola Holiday Inn, San Jose. Contact Nelleke Bruyn, 2279-3553, e-mail cr.democratsabroad@yahoo.com. Join Democrats Abroad at www.democratsabroad.org. Register to vote absentee at VoteFromAbroad.org! Li le Theatre Group LTG is the oldest con nuously running English-language theatre in Central or South America. The group currently puts on a minimum of four produc ons a year offering a choice of modern, classic, serious, and farcical plays. The group’s monthly social mee ngs are held in the theatre on the first Monday of the month from 7p.m. to 9 p.m. and everyone is welcome. Membership: Student C2,500, Adult: C5000, Family: C8000. Also, earn your Wings, become an LTG Angel. For more informa on Call the LTG Box Office 8858-1446 or www.li letheatregroup.org
El Residente
Marine Corps League Meets at 11am the 2nd Saturday of the month, Int’l Bap st Church, in Guachipelen. Call Bill Enell at 8812-0126. Newcomer’s Club Newcomers Club of Costa Rica (for women) meets the first Tuesday of every month, September through May. September mee ng will be an interest fair. Contact: 2416-1111 costaricaporo@yahoo.com or h p://www.newcomersclubofcostarica.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 informa on call Chuck Jennings. Phone 2266-0123 www.pcclub.net Republican’s Abroad The Republicans Abroad of Costa Rica meets the second Tuesday of each month. Contact Francis 2203-6131, or fax 2282-2150. Radio control Sailing Club Meets at Sabana Park Lake. For informa on 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 educa on. For more informa on on upcoming events please contact us Phone 2279-8927, 2257-2223 Women’s Club of Costa Rica In 2010 The Women’s Club celebrated 70 years of philanthropy in Costa Rica. Current programs focus on educa on, primarily through scholarships and development of school libraries for children. It is one of the oldest, con nuously opera ng service organiza ons in Costa Rica. WCCR membership numbers 250 English-speaking women, represen ng 25 countries of the world, drawn together by the mo o: Friendship through Service. WCCR monthly mee ngs with guest speakers are held the second Wednesday of each month, as well as regular luncheons, teas, and many interest groups. Guests are welcome and further informa on can be found at www.wccr.org Women’s Interna onal 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 2433-7078 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 ac vity partners, and professional networking. www.YoungExpatsOfCostaRica.org Veterans of Foreign Wars: Post 11207 Mee ngs are held at 11 am, the first Tuesday of every month, at Club Colonial Casino on the second floor. All members are welcome and veterans who served overseas may join. For info please email the post at vfw112072003@yahoo.com
20
January - February 2012
21
Dollars & $ense by Alan Weeks
The Three Pillars of the Global Economy The ongoing saga of the Eurozone’s sovereign debt crisis has, understandably, been very cap va ng. So much so that the u er failure of the U.S. President, the Congress, and now the so-called “Super Commi ee” to get serious about addressing the burgeoning U.S. na onal deficits and debt is only now returning to the media and Ra ng Agencies “spotlight.” A very real concern, of course, is that an increasingly probable Eurozone sovereign debt crisis would immediately trigger widespread European bank insolvencies. In this regard, the recent rapid escala on of Italian bond interest rates has raised fears that a “ pping point” could soon be reached and plunge not only Europe, but also drag the U.S., into a much larger financial crisis than in 2008. There is now much discussion about the risks of the U.S. ge ng “ pped over” by Europe into another recession. The probability that this could happen at a me when U.S. condi ons have been described by the Co-CEO of PIMCO (1) as terrifying. His serious concern is that: unemployment is already too high. a quarter of U.S. households are underwater on their mortgages. the fiscal deficit is 9% and, interest rates are already at zero. Unfortunately, even four years a er the U.S. financial crisis, the underlying problems of excessive debt in the Western world have not gone away. This remains a threat to the solvency of banks as well as the solvency of countries. A respected economist (2) made the following points concerning some key global issues: The three global pillars of the world economy; the USA, Europe, and China, each have their own problems, but their impact is global because of the interconnected global financial system and economies. The process of deleveraging will be painful, but markets will no longer countenance indecision or inac on. Bond buyers have become much more wary of risk. Of course, most poli cians would prefer to avoid the issues or to “kick the can down the road.” However, most should, or at least need to, be aware of the following: Debts must be repaid. (Without confidence of this, lenders will stop lending.) The sheer amount of debt has reached the point when it is retarding growth. Addi onal debt will keep adding downward pressure. The extravagant promises made to Europeans and Americans will become increasingly impossible to keep, and low growth will just El Residente
worsen the problem. Ageing popula ons will keep undermining debt sustainability. In that regard, The BIS (3) study presented to Central Bankers at Jackson Hole in August es mated that ageing popula ons should cost the advanced G-20 na ons fourteen mes more than the financial crisis. As one credit strategist (4) graphically depicted this issue: “Debt may kill us before Old Age does.” Thus, he said: “To con nue to run our economies like a bunch of drunken sailors is incredibly reckless in the face of these huge future challenges.” With so much having already been wri en about Europe and the U.S., it seems appropriate to turn the focus on China, the third pillar of the global economy. IS CHINA A POTENTIAL GLOBAL ECONOMIC SAVIOR? It is widely perceived that China is now the economic powerhouse of the world and some suggest it could become a global financial and economic savior. In this regard, one very op mis c forecast was made by the McKinsey Global Group: they called this China’s century (or at least quarter century.) The Group based their staggering predic ons for China by 2025 on con nuing strong economic growth and stated: “The rising de of Chinese prosperity is projected to li an unprecedented number of households out of poverty and into the consumer class.” That would certainly be very good for the Chinese people and provide a powerful engine for future global economic growth. Other predic ons are for the Chinese “bubbles to burst” soon and create a “hard landing” for its economy. By reviewing some of the rela ve strengths and weaknesses of China, we should get a be er apprecia on of its poten al future prospects. In mid 2010, Chinese economic growth (as measured by GDP) surpassed that of Japan, making it the second largest economy in the world. However, there are a few key reasons why the Chinese economy seems to be seriously lagging. 1. LOW INCOME LEVELS AND WIDE DISPARITY Despite strong economic growth for decades, China is s ll a very poor country. In fact, per-capita income in China is ranked at No. 126 in the world, well below Jamaica and ed with Albania. The fact is that the average monthly income in China is only about 2,000 Yuan ($300), despite decades of huge growth. Thus, it is probable that China will not come close to the U.S. per-capita GDP even ten years from now. In addi on to mass poverty there is a humongous income disparity. It is reported that the wealth of China’s one million mul -millionaires and about 60,000 super rich grew almost 10% again last year. Furthermore, it is becoming increasingly apparent that corrup on and embezzlement by Chinese party officials is widespread and may go all the way to the top. Even more shocking was the revela on in a recent report that 22
about 18,000 party officials had already fled the country since 1990, taking an average with them of around $7 million each. The report didn’t include any es mate of embezzlement by officials who hadn’t yet fled. This would suggest that Crony Communism is working well for the rela vely few elite insiders. Therefore, the life message seemingly being grasped by the wealthiest Chinese is to “get rich-then get out.” According to a recent jointly-released report, about 60% of the rich Chinese people interviewed intend to migrate from the country. It was interes ng to note that the most favorable des na on of the wealthy Chinese is the U.S., with Canada as a distant second. The various reasons to emigrate were: higher-quality educa on available for their children overseas; be er healthcare; concerns about the security of their assets on the mainland; and hopes for a be er life in re rement elsewhere. This trend does not bode well for the future of the Chinese majority le behind. 2. HIGH UNEMPLOYMENT AND CIVIL UNREST The official Chinese unemployment rate was 9.4% before the financial crisis. However, rural unemployment has long exceeded 20%, with one current es mate pu ng it at 27%. This is a very serious and growing problem. The fact is that civil unrest has been increasing rapidly in China. The ripple of strikes across Guangdong province next to Hong Kong, referred to as the “workshop of the world”, as well as the Dadum riot, revealed a younger genera on of migrants with rapidly growing resentment. These migrants report they are subject to harassment and shakedowns from both public security teams, and local guards. The country experienced, by some es mates, well over 150 thousand mass incidents of riots, protests, and other acts of unrest last year, a very significant increase from prior years. In mid-November, a 9-seater minivan, crammed with 62 kindergartners, was reported to have slammed into a coal truck in northwest China killing 21 children and 2 adults. The Chinese social media sites lit-up immediately a er the accident, expressing heartbreak and/or outrage over the tragedy, un l they were shut down. However, this crash was so horrific that a state-run, reliably na onalis c, newspaper did something extraordinary: it published a chart. In one column, the paper recounted recent school-bus accidents in which about 60 children had died. In the adjacent column, it listed the sums that selected Chinese government departments had lavished on new luxury vehicles in 2010. The dangers facing students in sub-standard buses were well known to government officials. And, there are strict standards on paper for school buses. However, the rampant use of illegal vehicles, lack of enforcement, and probably a lack of priority to allocate money to pay for good buses, are s ll reported to be unresolved issues. This tragedy brought out what truly “eats away” at the ordinary ci zens. It is not so much the rich-poor gap as the vast canyon that separates the powerful from the January - February 2012
powerless and the systema c injus ces. 3. RESOURCE ISSUES China is not a resource-rich country. Hence, it is the largest importer of many commodi es. Also, one-fourth of China’s land is desert and, if business con nues as usual, China could become the world’s biggest desert. At the same me the demand for food is increasing, the percentage of land available for agriculture is decreasing. This is bad and ge ng worse for China, but an increasing opportunity for Canada and the U.S. with agricultural abundance being wasted. In addi on, not only is water scarcity an issue in other regions, too much of China’s water supply is threatened by increasing pollu on. Furthermore, there is a developing energy supply crisis. CHINA’S ECONOMIC PROBLEMS Chinese officials have been well aware of the problems the country faces. As Premier Wen put it in 2007; “The country’s growth is unstable, unbalanced, uncoordinated, and unsustainable.” Then, when China’s exports faltered a er the U.S. financial crisis and recession, the government went on a massive “spending spree” in order to keep its economy growing strongly. However, this credit-fuelled spree created humongous over-investment in produc on capacity, unnecessary infrastructure, and housing. It seems clear that huge amounts of borrowed money were spent on non-revenue producing fixed assets. Without any prospect of payback, it would appear that Chinese banks are si ng on more than an es mated $US 1.2 Trillion of bad loans. This is why Jim Chanos (5) remarked: “The Chinese banking system is built on quicksand.” This massive spending on fixed investment, which now makes up almost 50% of the Chinese economy compared with only 12% in the U.S., has also made any significant implementa on of plans to boost the domes c economy much harder. Despite all the years of calling for structural adjustments, the Chinese economy has become even more unbalanced and is s ll too heavily reliant on the export sector to generate growth. Chinese exports have con nued to slow down as this year progressed, and it is expected to worsen as Europe, its largest trading partner, suffers sinking economic ac vity as widespread austerity across the EU further slows imports. In addi on, the moun ng threat of a huge interna onal financial crisis is leaving a real cloud hanging over China, and forecasts for “rain” are increasing. THE COMING COLLAPSE Again, with the intense focus on the European debt crisis and steady rise in prices of credit default swaps (CDS), those of other countries appear to have slipped under the radar. The fact is that credit default swaps provide a window into the collec ve judgment of the rela ve risk of debt default. 23
What may have gone unno ced is that the price of China’s CDS rose exponen ally and doubled over the month of September. And yet, while global debt problems con nue to mount, as one professional put it, “we’re now in the 9th inning with a broken bat” and we’re s ll hearing how China is immune to the “disease” and will be the next world economic power. Some of us are very puzzled about the blind faith many observers place on the competence and ability of Chinese officials to guide its economy. Of course, everyone can look dazzlingly smart before any bubble bursts. Remember, less than 25 years ago it was predicted that Japan was “inevitably going to take over the world.” While on the subject of Japan’s “bubble economy” in the 1980’s, the descrip ons of what went wrong in Japan gives a disturbing sense of déjà vu and offers a thoughtprovoking historical backdrop for anyone trying to assess the consequences of China’s credit-driven boom. Another puzzling fact that should have been raising Red Flags is that, despite the posi ve comments about China’s growth, the Shanghai Stock Exchange Index has been in decline since the summer of 2009. Even more relevant, is the fact that the Chinese equity market has fallen 22% just since July. While on the subject of Red Flags, it was also just reported that in October China had its first monthly ou low of foreign currency since 2007. This seems to be signaling that global investors are pulling out money on fears over the global economy and reduced expecta ons that the Yuan will appreciate. Furthermore, the Chinese FOREX reserve growth in the third quarter was over 90% less than the monthly average in the first half of the year. It is ominous that a similar precipitous drop occurred in the second quarter of 2008, foreshadowing a huge drop in commodity prices and worldwide growth. MANIAS, PANICS, & CRASHES Jim Chanos (5) the famous short-seller and “The Man Who Called Enron,” has also found many trouble spots in China’s boom. He points out that fixed asset investment in China, at around 50% of its economy, easily exceeds figures from past “bubbles” in other markets. All that investment created ghost ci es with no people, highspeed rail lines to nowhere and, a vast number of empty apartments. He also flags the excessive debt engaged in real estate specula on. “The whole country of China has become a na on of real estate speculators on leverage”. Infla on is also ge ng out of hand, and costs for basic survival are now ea ng up 50% of the average Chinese budget. In addi on, many Chinese are buying gold to protect their wealth. Another financial guru(6) stated, “Commodity prices have reached the highest 1-year rolling return in 200 years.” Surely, this should ring some alarm bells. I have already warned that this is not a me to be invested in commodi es. It is expected that, with El Residente
so much leverage in the Commodi es market and in Commodity ETF’s, the value of all commodi es should again drop significantly in the near future as the world slows and China’s commodity imports decline. Certain countries have been riding the “coat-tails” of China’s commodity buying binge. It should be no surprise then that Brazil, a big supplier of China’s raw material needs, was amongst the worst-performing markets in the second quarter. The markets in Canada, Australia, Chile, Peru, Russia and others are also now turning down. The new descrip on coined for this is: As China goes, so go the “commodity” countries! Some knowledgeable market strategists, including Albert Edwards, (7) also noted that China has effec vely engaged heavily in its own Quan ta ve Easing for years, prin ng whatever quan ty of Yuan was necessary to buy up the U.S. dollar receipts. The FX interven on of this magnitude could not be “sterilized” and inevitably boosted domes c asset prices, ac vity, and infla on. Trying to slow property and consumer infla on using mainly credit restric ons while s ll keeping the prin ng press going, was described as a bit “like stopping a pressure cooker lid from blowing off by holding it down, rather than switching off the gas.” Edwards further postulated that the sudden cessa on of FX reserve growth may be “the last straw to break the Panda’s back.” And, if so, he recommends the authori es become “aggressively simula ve” with Yuan devalua on as one measure to so en an otherwise economic “hard landing.” Currency traders need to remain wary of this possibility. CHINA’S FUTURE PROSPECT China could fail as a pillar of the global economy for a number of reasons: (A) EXPORTS & TRADE China’s dependence on exports makes it highly vulnerable to slowing growth and the real possibility of another recession in the developed world. Trade tensions are already rising and, should another serious recession occur, protec onism and trade wars would likely increase and severely damage China. (B) MOUNTAINS OF DEBT China’s local governments have piled up mountains of debt. Over the last couple of years, more of the financing for the massive infrastructure boom was shi ed “off the books” to hide the loans. A empts by Beijing to halt the specula ve property and infrastructure frenzy by telling state banks to cut lending have not been very successful, as developers used other means to obtain more money, including ge ng high-interest loans from the wealthy. This was, of course, un l many of these loans went sour. A global recession should trigger a “hard landing” of China’s economy. Property prices, upon which much of the building boom was financed, are already declining, would tumble. With debt defaults already well over US 24
$1.2 Trillion, China would be squeezed with substan ally less revenue to prop up the major banks while the demand for money from local governments to maintain social services would escalate significantly. (C) CORRUPTION & OPPRESSION If the Communist party con nues to oppress the masses and resist reform it could eventually create a “powderkeg” of revolt; corrup on by officials must be brought quickly under control. (D) EMIGRATION China is suffering a significant financial drain as the wealthy con nue to emigrate. In addi on, China could lose entrepreneurs to the Anglo-Saxon world or elsewhere, where capital is available in free markets. And, if America can get back on track and start welcoming businesses, Chinese businessmen would form companies in the U.S. rather than back home to ensure their intellectual property was protected and there was a be er chance of keeping their wealth. (E) DEMOGRAPHICS If present prac ces con nue, the ageing and eventual shrinkage of the Chinese popula on will pass a point of no return within three decades. The elderly dependency ra o will keep rising and the Chinese Empire would eventually implode. FUTURE OUTLOOK FOR THE 3 PILLARS It is becoming increasingly apparent that the Eurozone, the second pillar of the global economy, may prove to be an unworkable system. This economic pillar is based on the Socialist model of big government, big compliant banks, and lavish unsustainable en tlements. The GrecoRoman na ons appear to be ac ng as the Achilles heel that is bringing this pillar down as a failing experiment. Based on the serious social, economic, and financial problems just reviewed, the future prospects for China, the third pillar of the global economy, appear to be far from promising. This economic pillar, based on the Sta st central control model, seems to be a “pillar that is beginning to crumble.” Unfortunately, many of the other Asian na ons, as well as the commodity supplying na ons, have become quite dependent on strong Chinese economic growth. Thus, China’s fall, not its rise, is the real global threat. Furthermore, it is believed that any major shock that caused significant damage to the Chinese economy, would severely “rock the world.” That brings us back to focus on the U.S.A, the No. 1 pillar of the global economy. Remember when the United States was the manufacturing, innova ve, and entrepreneurial powerhouse of the world? The U.S.A. also used to be “open for business.” This was the “magnet” that January - February 2012
a racted entrepreneurial foreigners, who added to the strength of the country. The U.S. also used to be a mecca for tourists. I am surmising that the U.S. leaders and powerful elites decided that the country did not need to be “blue collar” manufacturers and would thrive on being a “white collar” financial and services powerhouse. The future, it was then understood, was to create a “trickle-down” system to share the wealth. Unfortunately, too li le “trickled- down!” The “solu on” then implemented to maintain economic growth was to keep expanding credit so that Americans could keep spending to maintain their standard of living. This concept has been called “bubblenomics.” As an unintended consequence, it encouraged specula on and finally culminated in the building of a massive house of credit cards. The Capitalist system, based on manufacturing prowess and entrepreneurship, seemed to have been increasingly replaced by more Crony Capitalism in which the powerful elites and Insiders appear to have thrived. And, the produc on of “paper,” in the form of I.O.U.s, has accelerated to keep the spending going which, it seems, is to keep enriching the powerful elites. Regardless of how obnoxious the current system is, it is sad to hear so many giving up on America as a “Failing Empire” that is collapsing as surely as the Roman Empire did. Also unfortunate is that a large number of the younger genera ons appear to have lost a sense of personal responsibility and, instead, have come to expect en tlements (just like the Europeans.) There should be no doubt that the problems in America have been building up over several decades and the challenges to solving them will be huge. Unfortunately, the immediate future prospects for many Americans and the economy look grim. Moreover, a er decades of amassing excessive debt, the consequences of “unwinding” that debt will be painful. Some smart Americans, however, are convinced that the way ahead to a be er future is not insurmountable. We believe the future economic soundness and prosperity for the U.S. and the American people will have to come from a return to a country that produces much more of what it, and the world, needs. To do that, the U.S. must, once again, become “open for business.” In addi on to a rac ng entrepreneurial foreigners, it would a ract the a en on of many American company leaders who are already experiencing significant problems “offshore.” It is being reported that many of these businesses have encountered unexpected cost increases, disrupted supply chains, losses of technology, unfair prac ces to favor local businesses, and other downside issues. Making America an a rac ve place to conduct business once again should start to bring the manufacturing and assembling sectors lost to China over the last decade back “onshore.” Please note that the opinions expressed in this ar cle are solely those of the writer 25
Exchange rate of the Costa Rican ¢ to the US Dollar June July August September October November
509.57 510.88 516.77 519.87 521.11 512.10
Basic Interest Rate June July August September October November
7.25 % 7.25 % 7.25 % 7.75 % 8.00 % 8.00 %
Exchange rate of other currencies to the US Dollar Giro Canadian Dollar Euro Swiss Franc Nicaraguan Cordoba Danish Krone Norwegian Kroner Swedish Krona Honduran Lempira Bri sh Pound Argen ne Peso Columbian Peso Mexican Peso Dominican Peso Brazilian Real Guatemalan Quetzal Korean Won Japanese Yen Venezuelan BolĂvar Hong Kong Dollar Taiwan Dollar Bolivian Peso Chilean Peso Russian Rouble Peruvian Sol Polish Zloty Australian Dollar Chinese Yuan
1.55156 1.01480 1.35050 0.90860 22.87200 5.50720 5.73400 6.75620 18.92000 1.57350 4.27750 1,945.10000 13.54850 38.51500 1.79930 7.86850 1,142.57000 77.47000 4.29470 7.78270 30.33300 6.90150 513.25000 30.68210 2.70330 3.32000 1.02640 6.37940
Libor Rate 1 month 3 month 6 month 12 month Prime Rate
El Residente
0.27144 % 0.52889 % 0.74833 % 1.07106 % 3.25 %
26
Holidays of Costa Rica Sunday, January 1st New Year’s Day- Na onal Holiday ARCR Closed Monday, March19th Saint Joseph’s Day- Observance A Touch of Wisdom “A fool and his money are quickly parted.” - J. Bridges (1587) “Caesar did not merit the triumphal car more than he that conquers himself.” - Ben Franklin (1706-1790) “Failure is the path of least persistence.” - unknown A Bit of Fun... An elderly couple had dinner at another couple’s house, and a er ea ng, the wives le the table and went into the kitchen. The two gentlemen were talking, and one said, ‘Last night we went out to a new restaurant and it was really great.. I would recommend it very highly.’ The other man said, ‘What is the name of the restaurant?’ The first man thought and thought and finally said, ‘What is the name of that flower you give to someone you love? You know.... The one that’s red and has thorns.’ ‘Do you mean a rose?’ ‘Yes, that’s the one,’ replied the man. He then turned towards the kitchen and yelled, ‘Rose, what’s the name of that restaurant we went to last night?’ ***** Correc on: the ar cle on Health Care in Nov/Dec 2011 was authored by Dr. Lorena Acuña. Due to a miscommunica on it was credited to Shirley Aguilar S.
January - February 2012
27
El Residente
28