Wealth Protection


News from Panama / Wednesday, August 10th, 2011

 

Today’s number one concern for one’s estate should be wealth protection.  Whether you are an astute investor (or crazy enough to be a day trader), this one theme should be in the forefront of your strategic plan to survive these turbulent times.  While I am not proposing that you run for the hills or move all of your money into investments in Panama or any other single area, as I have said before, diversification of your wealth portfolio should include having “one foot over the border”.

The down turn in the United States did impact Panama in 2008.  While our GDP was growing at a blistering rate of over 11%, the crisis caused a slowdown but not the hit that the rest of the World took.  We  have now returned to near double digit growth and while the story back in the US has not played out yet, there is fear that we may be impacted once again.  I predict that this time the hit will be less. Yes, traffic through the Panama Canal will be impacted by foreign trade but the Latin American base is strong, we do not have a debt crisis, we practice financial restraints and our reserves are significantly high.  Panama’s investment grade status has been repeatedly raised and reaffirmed, we have followed the advise of international advisers like World bank and the IDB over the years and we have reformed many of our systems.  If only the guys back in Washington would have come down and take a lesson or two.

Down here, I see Panamanians investing in their own land, literally for home sites, raw land investments, hotels, office space, retail stores, industrial parks and more.  Besides the obvious, one of the  reasons that I hear is “Por mi ninos” or “for my kids”.  They trust in the growth of Panama and do not want to keep their wealth in US Dollars even thought that is our official currency (for now).   I came here for that reason as I saw the train coming down the track in 2006.  While we are not wealthy by any means, the investment in our home here has multiplied vs disappeared like it did in Florida.  The opportunities to grow our investments here are only limited by the time and energy we can put into each venture.  Besides real estate, we are invested in cattle and we are expanding that into green house agriculture and dairy as well. 

          

Some of our girls!                                                                                 Our baby Angus calves, next years studs!                      

    

Hydroponic and organically grown lettuces                         This winter’s heirloom tomatoes, also organic.

My partner in real estate and our cattle operation is also involved in hydro electric projects on our cattle ranch.  Our ventures here, will be greatly enhanced in the future as most of the products are consumed by a growing middle class.  This is the same bet for most wealthy  investors throughout Latin America.

On another note, one of the reasons that we came here was not purely investment driven but also on lifestyle.  Like many people, my wife and I often took trips abroad to see other lands with the idea one day of having a second home or moving to another country.  I realized that time was running out and it was time to “stop and smell the roses”, so we made the move and here we are. Five years later, the stress is gone, the weight is way down, we live healthy lives and eat fresh food grown right in our neighborhood.  I found that while I would work with commercial real estate here in Panama to a limited degree, I also believe in great lifestyle properties in established locations.  Nobody is creating beachfront or prime mountain property here in Panama and this is a very small country with  diverse Eco systems that offer a huge venue of activities within a few hours of one another.  Here in Boquete, I wake up to 65 to 70 degree weather and head down to go out fishing from a marina that is an hour from here, where it is warm and the marine environment is incredible with hundreds of islands just off the coast.  In the other direction over the mountains,  I am in the azure blue waters of the Caribbean within 2 hours and boating in the islands of Bocas del Toro in three and a half hours.

Just last week we ventured out to the small fishing village of Pedasi where we stayed in a multi million dollar villa called Villa Esplenderosa, what a place that is.   Pedasi is just another place here in Panama that is within a half a days drive but a world away in terms of it’s local diversity and that of the province of Los Santos. 

We were a group of five couples who stayed here and it only cost $1,400 per night.    We are planning more real estate tours of Pedasi in the future. More on that in the next post called Paradise in Pedasi Part 2.

Anyway, I think that you get the picture so I will not belabor the subject.  Come down and see for yourself, how you can wisely invest in Panama with some of your money and at the same time, live a lifestyle of millionaires on not so big a budget!