"It's only when the tide goes out that you discover who has been swimming naked."
Warren Buffett is perhaps the most frequently quoted investor, but of all the times he has been quoted, the quotation above is his most famous. He simply means that when the economy is doing well (the tide is coming in), you don't see their swimsuits. But when the economy sinks (the tide is going out), that is when you see who isn't wearing a swimsuit. Not a pretty picture!
The tide has gone out globally, especially in Latin America where nearly every nation is standing there, naked. It is hard to find a nation that is not in social or economic or political turmoil, sometimes two of those, sometimes all three.
As just one example, violence in the streets of Colombia has killed dozens and that number grows daily, along with hundreds who have been arrested or who are simply listed as 'missing".
As another, Costa Rica has severe economic problems and has had to turn to the IMF as a "lender of last resort" while its credit rating is deep into "highly speculative" territory. In search of income, Costa Rica chose to open its borders to all without requiring either a Covid test or proof of vaccination and now is suffering a terrible surge in infections and deaths.
Bolivia, Mexico, Chile, Argentina, Brazil, Peru, Ecuador, Nicaragua, and of course, Venezuela, pretty much everyone is facing serious problems … except Panama.
Panama is the exception in Latin America. Why? We had a major drop in national income (GDP) last year and a major rise in unemployment. By all rights, we should have had angry demonstrations, mobs shouting obscenities, destruction of property, and even violence toward people. We have had none of that.
What difference does it make? After 54 years of living and working as a consultant to private and public companies and institutions in some 45 nations that were once Third World, then Developing Nations, then today's Frontier and Emerging Markets, I may not have seen it all, but I have seen plenty.
If you plan to invest or relocate to another nation, be very sure you know as much as possible about its economic, political, and social reality. If things go wrong for the people who live in your area, they can go wrong for you too. You should not take sides, but you need to be aware that they exist. It is the same in every country, but most important in countries where you don't speak the language or simply live on the surface, expecting to be ignored. When things get bad, no one is ignored.
For more information about relocation to Panama, feel free to download a report from my non-profit site (no ads, no sales, no donations, simply free) dedicated to relocators from all over the world at Retirement Wave.
For serious investors, visit my business site at Panama Wave.