Inflation in Ecuador remains below three percent while there is virtually no unemployment. This comes as no surprise to me as I anticipated this when making my decision to retire here ten years ago. A consequence is the significant increase in my Social Security check in January will mean an actual increase in my buying power instead of a retrograde as it is for recipients living in the United States.
So why is inflation so low here? First, Ecuador is energy independent. We have hydroelectric power [Okay, it only operates at half its projected potential thanks to the incompetent China contractors who built it but it’s half more than we had before.] Ecuador also produces its own oil. There is no meaningful suicidal political movement against pumping oil. Unfortunately, the government never keeps its promises to preserve the Amazon where the oil rigs are located but it doesn’t slow development a bit. Being energy independent means outside economics do not drive its cost up and, as the U.S. is learning, energy costs drive up all prices for everything.
Second, Ecuador is food independent. We have some of the most fertile topsoil in the world and can grow anything. True, we import a fair amount of our fruits from Chile as the quality is better but we have plenty of our own fruits. We grow all our vegetables and produce all of our meat. Cattle are grazed in the Amazon [There are no feedlots in Ecuador.] and the use of growth hormones, massive antibiotics and blackened chicken coops are not only illegal but unconstitutional. Food here is entirely natural and what a difference it makes in health and taste. If you haven’t experienced it, you can’t imagine how different. We do import some luxury food items but they appeal to a small niche of consumers and have no meaningful effect on inflation. The only catch in food is that we do not grow wheat. There is a tiny movement to encourage bread production from bananas [I’ve never had it but am told it is wonderful.] but it hasn’t taken off. So far bread prices are relatively stable and I expect the government to subsidize wheat if necessary to prevent social unrest if bread prices rise significantly.
Third is real estate. No Ecuadorian with any sense trusts the banks here. During the economic collapse of 1999 nearly everyone with any money lost their fortune and were left with real estate. The banks are not insured by the national government and even if they were no one would trust them as Ecuador routinely defaults on its sovereign debt. The consequence is that cash is kept out of the country, Panama and the U.S. primarily, and the rest goes into apartments and houses for rent. Taxes on real estate are ridiculously low [ten dollars a year] and no one insures property as it is virtually fire proof and protected by armed guards. You can sit on unoccupied property indefinitely and many do. Cuenca, and I believe the rest of Ecuador, is awash in available apartments and houses and as a result rentals are very low, very low. Add to that incredibly low utilities and there you have it.
And that’s pretty much it. There are imports of course but they don’t have much effect on the cost of living for most people. If cars go up in price, don’t buy one, or buy a used one. Replacement parts for certain heavy equipment will go up as will the equipment itself but these costs are minimal against the entire economy.
If in considering this you recalled that the United States can be energy independent but has elected not to be you are getting it. It is food independent but as a big country it needs energy to transport it to the consumer.
Countries usually are what the elect to be. Sometimes outside forces dictate otherwise but most of the time they don’t. Ecuador has placed itself into a position to manage inflation, other countries, the U.S. and Europe, have decided the opposite.
I suspected the argument for people changing the world’s climate was a hoax when the media made the big switch from the hysteria about the coming new Ice Age to a new hysteria about the end of the world from over heating. The switch was very abrupt. Then the proposed solutions had almost nothing to do with the claimed problem. All they did was increase government control over our lives at all levels and increase our taxes.
Though both the traditional stock market and Bitcoin are down these days many financiers and investors are of the opinion that some crypto currencies and in particular Bitcoin are the future. So-called hard money like the U.S. dollar has existed in digital form for some time and this is used to transfer upwards of $5 trillion dollars every day rather than transport actual Greenbacks. Even the U.S. Treasury has acknowledged that a significant percentage of dollars put to use are never actually printed. Though the government denies this is in fact digital money that is what it really is as it only exists in electronic form.
When the Covid pandemic first struck a very good friend retired here in Cuenca, Ecuador, told me his concerns and fears at what was about to happen. A former Naval Officer and medical doctor who specialized in holistic medicine before retiring to Ecuador, he published an article of concern and prediction in our leading expat website, Cuenca Highlife. He was vilified by many for what he wrote. It turns out that this article, published in May, 2020, was prophetic. Read it and remember this was in the early weeks of the pandemic.
I’ve not written for some time. I can only blame laziness. But it has also been a very, very busy time. I have said from time to time that I never needed a social calendar until I retired. Just wait, you’ll see.
Time for some Pros and Cons on moving to and living in Cuenca, Ecuador where I’ve lived these past eight years. I’ve told friends for some months now that once the worse restrictions of this so-called pandemic have passed there will be a surge of expats into Cuenca. My reasons for thinking this is that many Americans will find they are no longer employable for any number of reasons. They will be faced with a retirement earlier than they expected and when they run the numbers they will see they cannot afford to live in the U.S. except as a pauper. So here are the Pros and Cons of Cuenca.
The agenda to drive universal vaccinations of the populace has forced the medical community and politicians into a corner when it comes to the question of natural immunity. They can’t say it’s not a reasonable question, nor can they say it’s already been answered properly. They just say this organization or that doctor or some study shows that even those with natural immunity must still get vaccinated. When pressed, they invoke the logical fallacy known as begging the question; they use the affirmative answer to the question of whether people who have recovered from Covid-19 should get vaccinated as the evidence that they should. The numbers don’t back up this claim. In fact, those who have recovered from Covid have far greater immunity than those who are simply vaccinated. Perhaps a quarter of the U.S. population has already had Covid and doesn’t require the jab. So the logical question is: Why insist on it? The answer, of course, is population control and maintaining a perceived state of fear to advance a political agenda. Read it all here. 
With my third entry in this ongoing series let me go to the beginning. Why become an expat? Why leave the country of your birth and nationality to live among strangers in a very different culture, perhaps one with earthquakes and volcanoes? My primary reason for moving abroad was that I always wanted to. I grew up reading Burroughs, Doyle [his lost world stories, not Sherlock Holmes], and later Graham Greene whose books were largely about expats getting into trouble. My goal almost from the first was to retire to another country. As I grew older and saw how narrow the lives of most of the elderly were, primarily from lack of money, I became convinced I didn’t want that for myself.
On April 30, 1977, 14 courageous women set aside fear and their families’ warning to leave their homes and confront the military dictatorship that had stolen and murdered their children. The went to the rotary outside the Presidential Palace and with signs and photos began a procession of protest. That day marked the first weekly march by the mothers of Argentina’s “disappeared” against the dictatorship that had carried out the systematic murder of thousands including their children. This simply action, repeated again and again, led to the collapse of the government and the restoration of democratic rule. Since then more than 1,000 torturers and killers have been tried and 700 sentenced. The fate of most, though not all, of the “disappeared” has been established.