Mexican life

The hissy fits

fitWE MEXICANS love our hissy fits. They rarely resolve anything, but we throw them anyway. Here are three examples:

First: Eight or so years ago, Mexico City switched its electricity provider from some unionized outfit that ran an antiquated system to the Comisión Federal de Electricidad, the modern entity that provides light to most of the nation.

The unionized outfit promptly threw a hissy fit. For months, they blockaded the entrance to the CFE high-rise on Paseo de la Reforma in Mexico City. The government ignored them.

These days the entrance is open, and electricity service is immeasurably improved.

Second: Mexico is in the early stages of an “education reform.” In part, this entails competency tests for teachers and they also lose the right to hand off their jobs to relatives on retirement. Unionized teachers promptly threw hissy fits.

The fits happened mostly in the usual suspect, backward states of Michoacán, Chiapas and Oaxaca. Unions blocked roads and highways, and squealed in the streets. The government is giving them lip service, but mostly it’s ignoring them.

Like the improved electricity provider in Mexico City, the education reform will happen.

Third, another reform is the energy sector, which is getting into high gear this year. For a variety of reasons, gas prices have gone up a lot. How did we react? We threw hissy fits, blocking highways, attacking gas stations, looting stores.

People want the old government-subsidized gasoline price. The government will ignore them and, in time, things will be better. Though gas prices likely will be higher.

Our hissy fits normally result in squat, but we throw them anyway. And it’s usually unions having the fits, fighting change, modernization and improvements.

13 thoughts on “The hissy fits

    1. Carlos: That would be my approach, and it seems it’s the government’s approach quite often. Good for them. I’d prefer tear gas and cudgels now and then, just for the fun of it, but ignoring the hissy fitters is better than nothing.

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    1. Señor Gill: Alas, that was the approach during the Tlatelolco Massacre in Mexico City in 1968. The government came to regret that big-time. No, let’s stick to tear gas and cudgels these days.

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  1. Paisanos in TJ are protesting and looting. Shoppers (the paying kind) are sharing the aisles with armed soldados.

    Also guarding the refineries in Vera Cruz.

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    1. Carole: Yep, hissy fits! And if you lug home a big new television without paying, all the better. Alas, my new paisanos seem to be learning from the denizens of black ghettos in the United States.

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  2. Felipe, don’t have you email address and would like to ask a question: we are reading that “this is the time to buy Real Estate in Mexico.” This, of course, due to the devaluation of the peso. Our question is, if a Gringo bought a house for $200k, how would he be able to sell it for $100k now, because the peso went from 10-20 pesos per dollar?
    Thanks

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    1. Beverly: The “Felipe” page that has a link in the header here has my email address.

      As for your question, I’m a bit confused. I do everything in pesos because that’s all I have. When my two pensions arrive in my Mexican bank via cyberspace, they morph into pesos.

      The exchange rate makes it a great time to buy pretty much anything down here if you have access to dollars and you’re paying in pesos, and paying in pesos is always advisable.

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    2. I’ve written some things related to this topic on my own blog, http://www.gringosuelto.wordpress.com.

      In short, real estate denominated in pesos is at risk from a reduction in the value of the peso. However, the specifics depend highly on which market you are in. So in a place like San Miguel de Allende, there’s a “Gringo real estate market” which sits alongside the local market. The former is mostly (by Mexican standards) luxury houses, priced in USD, while the latter are more ordinary dwellings occupied by Mexicans. In a Gringo market house, your chances of holding USD value are greater than they’d otherwise be. But with land prices and the like mostly driven by local purchasing power, you are still at risk from cheap competition. In cities where there is no notable foreign buyers, you probably are at greater risk from peso devaluation.

      What you perhaps should be more concerned about now is the fact that Mexican interest rates are rising to combat the weak foreign exchange rate. This seems likely to continue. And as you know, real estate is particularly sensitive to higher rates.

      I personally have been window-shopping Mexican real estate (in CDMX) for some time now, but the recent collapse in the peso combined with the problems of gasoline and high USD denominated debts across corporate Mexico and in the gov’t too have persuaded me to sit on my hands. Trump hasn’t even been inaugurated, and he’s already causing problems for Mexico. I suspect it will get worse before it gets better.

      So, I’d be very cautious about buying right now. But obviously opinions differ. Felipe recently purchased a lot in his burg and has an alternate view.

      As a final “bow” on this note, also consider that in Mexico like in the USA, it’s location, location, location, and that every real estate market is local, with it’s own particular drivers. So if nothing else, do a TON of research before buying, as transaction costs are high, and you are likely to get screwed if you haven’t done the due diligence. And DON’T skimp on professional help. (Notario/Laywer). They are cheap compared to the cost of a potential problem. And find your Notario/Lawyer yourself. DO NOT RELY ON YOUR AGENT’S RECOMMENDATION. There are simply too many “back door” dealings in Mexico.

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      1. PS: I’m sure there is lots of good advice in your feedback, but you do think and worry things to death. Have you ever closed your eyes and jumped into the deep end of the pool? I’m guessing not. You’ve been thinking about moving to Mexico, for instance, for about 40 or 50 years. And you’re still weighing the pros and cons. Tell me I’m wrong.

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        1. Hola Felipe!
          Almost every time I do something without carefully thinking about it, I get screwed. So I’m inclined, especially when making big financial decisions, to procede very carefully. Yes, I’ve been pondering Mexican real estate for a long, long time and at this point, I’m delighted that I haven’t taken the plunge. I still have my optionality, and I feel pretty confident that some great bargains are about to come along. Moreover, what I’ve done or not done has nothing to do with the quality of the advice proffered. No? At the very least, I haven’t made any bad decisions.

          If I were you, I’d at least take into consideration what I wrote above before you actually purchase that lot. If you do, and it still makes sense, then I can only imagine that it will be an even better decision than it might otherwise have been. In any case, I wish you the greatest success in your endeavors possible. Saludos!

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          1. Kim: Here’s my recommendation. Take all your worries, your figures, your dollar prices, your peso prices, your inflation, your deflation, your exchange rates, your lawyers, your notarios, etc., etc., and stuff them into a bag to be buried. Bury it.

            Then step to the edge of the deep end of the pool. No, wait! Forget that pool. Step to the edge of a high cliff. Do not shut your eyes. Open them wide, and leap. You will land on a soft cloud and breathe a sign of lovely relief. Trust me on this.

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