Friday, March 30, 2012

Reblog, "Coming to Visit? Bring an Extra Suitcase."

I know everyone in the Brazil blogger circuit knows prices are crazy here but for my family and friends back home I just want to remind you every day how lucky you are to have inexpensive goods at your disposal. I love living in Brazil and feel very lucky for the experience but I am afraid sometimes we worry about being priced-out. My friends in more expat friendly neighborhoods are enduring the pain of landlords asking for double if they would like to stay and sign another lease. Renting an apartment that isn't falling apart or off in some area way outside the city for under $US1600/month is impossible. For the lucky ones that found deals early on and signed 30 month leases, we are literally scared waiting for the renewal ticking clock. Our good friends Suzanna and Jeff over at "Rooted Journeys," just wrote a great post after having lunch at a little sandwich spot in Jardins. No fru fru just a sandwich and a coke = us$26.00 Our neighborhood padaria (bakery) made new menus and you know what that means. Charging us$12.00 for a chicken sandwich with cheese and tomato (no free sides EVER) was way too cheap. Now its $18.

Rooted Journey's "Coming to Visit? Bring an Extra Suitcase."

I’ve officially been demoted from Rooted Journeys co-author to guest contributor. Not because Suzanna said so (she never did), but because it turns out I’m just not very good at motivating myself to actually sit down and write something. But here I am, so vamos-lá.
Generally speaking, it seems that many Americans view Brazil as a chaotic tropical wonderland – think Carnaval, string bikinis, palm trees, samba dancing, bossa nova, favelas, drug lords…you know, all the fun stuff.  In reality, one of the most defining features of Brazil as an expat in São Paulo is simply how ridiculously expensive it is. No matter how much you try to stop talking about it, and even more importantly, try to stop converting prices into dollars, it just won’t fade into the background as a simple fact of life. For those of us living it, it’s like a permanent fat lip – the moment you think it’s healing, you bite it again and want to take out your aggression on the old lady walking too slow on the street in front of you. That’s right, it makes you want to push an old lady. It’s that ridiculous.  Although, just for the record, I would never actually push an old lady.  And the prices here are worse than a fat lip.  Maybe that wasn’t quite the right metaphor, but there’s no turning back now.  Let’s keep moving.
A couple of recent articles have highlighted some of the effects of this charming Brazilian reality.  The cover story a few weeks ago for Veja (a popular weekly magazine in Brazil) was titled Pague Um, Leve Dois, Tres, Quatro…. English translation: Pay for One, Get Two, Three, Four.  The lead-off explains further (translated): “The favorable exchange rate alone does not explain the low prices that mesmerize Brazilians who shop in the United States.”  To drive home the title, the article cites the happy fact that the cost of an iPhone in Brazil is the highest in the world, leaving shelves for $1,650 (USD equivalent) in Brazil.  In the US, the same unlocked iPhone 4S (32GB) goes for $815.  That puts it at just over double the price for us lucky brasileiros.  But why stop there, it gets better!  Asics sneakers that go for around $200 in the US? A cool $457 in the equivalent Brazilian play money.  That’s 2.3 times the price.  A PlayStation 3 goes for 2.8 times the price.  Calvin Klein jeans are 3 times the price and a Guess handbag tops it off at 3.8 times the price.  Go Brazil!
These are just random examples, but they do give an indication of general price levels.  Not everything comes in at double the price, but it’s fair to say that São Paulo has justly earned its ranking as the 10thmost expensive city in the world for expats and the most expensive in the Americas (Mercer Survey).  So, you may ask “why”, which we ask ourselves constantly. Of course there is no simple explanation, though the Veja article presents a pretty reasonable set of factors.  Here’s a summary:
  • Exchange Rate – the Brazilian Real (currency) is about 25% stronger against the dollar than its long-term average making goods more expensive accordingly, especially imports.
  • Demand – quite simply, growing demand is outstripping the country’s productive supply capacity. High demand + low supply = high prices.
  • Tax Burden – the Brazilian tax burden is 36% on average versus around 25% in the US.  The difference is even greater when considering additional taxes on goods Brazil classifies as “superfluous.”  Plus, Brazilian import taxes are triple what they are in the US.
  • Inflation – while the days of hyper-inflation have passed (hopefully for good), inflation is still significant and widens the price gap over time (6.5% inflation in Brazil last year versus 2% in the US)
  • Competition – as a matter of policy, the US government prioritizes competition over protectionism and Brazil vice-versa.  For example, whereas the US government made cheap credit available to US auto-makers to help them become more competitive with cheaper Asian imports, Brazil has chosen to simply elevate import taxes to artificially raise prices of the foreign competition.
  • Economies of Scale – US companies generally focus on selling more at a lower margin whereas Brazilian companies tend to focus on a small market at a high margin
  • Productivity – it’s just not rising fast enough relative to labor costs (due to low unemployment, a lack of qualified labor, insufficient investment, etc.)
The result?  Prices that make your eyes pop and a growing class of Brazilian consumers that have become America’s big-spenders.  It’s no wonder so many Brazilians take annual shopping trips to Miami and New York – they easily recoup the cost of the trip in savings on their purchases.  Brazilians now spend more in the US than visitors from any other country – on average, $5,400 per person per trip in 2010 (article).  Japanese tourists came in far behind at number two with $4,300 in spending per person.  So next time you see people filling up suitcases with stuff in the mall, try a warm bem-vindo.  Good chance they’re our neighbors.
So, please have some patience when you hear us (constantly) complaining about the prices here and be generous with your suitcase space when you come to visit – we’ll be filling it up.
PS – I  had a coke and a nice sandwich for lunch today (filet, brie, arugula).  No fries or chips or any extras.  The tab was R$45.  That’s about $26.  For a sandwich.

Saturday, March 24, 2012

my first novela run

is over. Small tear.


Just finished the finale of "Finas Estampa," the 9pm Novela that began back in August and ended this weekend. There were moments (loooong moments) where I didn't miss an episode (watching at least 5 of the 6 nights a week it comes on) and then months where I forgot it was still going. I caused a ruckus at home when for 3 weeks I refused to go out to dinner so as not to miss a wandering eye or a sneaky in-law even though they have an online globo recap. Then Christmas rolled around and it was hard to keep up so the show and I took some time off. But like all breaks I missed the routine and there I was in January trying to refigure it all out again.

In the end, it was good to see it all wrap up and come full circle.  The good guys won and in true scary movie fashion, the evil Tereza Cristina just wouldn't die. We never did figure out who "Cro" the secretary's lover was but all the nasty splits patched their wounds and life in Barra returned to normal.  Not sure if I am going to start the next one, "Avenida Brasil" with the same momentum as before but I am certainly addicted to the concept. When you watch you are one with the maids and taxi drivers, the ladies at the nail salon and just about everybody you come in contact with. Its a cultural phenomenon and name dropping a novela star gets you an extra nod of approval.  I'll never forget coming back from Rio on a Saturday night and seeing Milena Toscano grabbing her bag off my flight. I acted like a total tween about it and couldn't wait to tell my novela watching friends. Every magazine mentions them, my old portuguese teacher would review lessons around the drama and I finally knew a guest every once in a while on Mais Voce. For the past 7 months I felt like a part of the cool club. And now my nine pm network family is finally off for a much needed vacation.  What a crazy thrill that was! 

Monday, March 19, 2012

sorry its stuck

in my head. over and over and over and over and... you get the point. when this happens there is nothing better than to share it and cause the same damage to others. ahh those catchy Brazilian songs...

Tuesday, March 13, 2012

welcome, a naked bike parade!

Lets face it. People drive like maniacs here. Recently there have been a few bike accidents and one in particular on Paulista Ave where a young biologist was run over and killed by a bus. It has caused an uproar among the cyclist community causing demonstrations with people laying down across major intersections around the city. The Pedalada Pelada, a group promoting alternative modes of transportation also organized a Saturday night naked cycle on Paulista Ave. Lucky for us we had just picked up my brother (his first time to South America) from the airport Saturday night and we were driving towards home and saw a bunch of the nude riders. I wasn't quick enough to snag a photo but lucky for you, Folha was. Click here I would love for Sao Paulo to become more biker friendly, but with buses that act like tonka trucks that wish they were high speed Chinese rail and cars that think they are buses well I just hope they find a way to remedy this mess of a situation. 

Sunday, March 04, 2012

To new beginnings....

According to a recent pin on Pinterest, "Life begins at the end of your comfort zone." Verdade.

After 16 months in Brazil, I experienced my first dinner in Portuguese. We met a wonderful Brazilian couple in Mendoza and they ended up purchasing a bottle of wine for us. As a thank you, we insisted on having them for dinner back in Sao Paulo. This week couldn't have fallen at a worse time climatically speaking. 90 degree days with 89 degree nights. We don't have air conditioning so we gave them the option of coming over in sungas and bikinis or meeting at a favorite restaurant. As much as everyone wanted to dine in small pieces of lycra, we concluded one of our favorite new restaurants, Oryza might be a tad more classy.

Thursday, March 01, 2012

I dream of wine

Mendoza is a dreamy place. It's easy to see why we ran into so many honeymooners and world travelers while there, the romance grabs you and swings you into a whirlwind. The tree lined streets are magnificent, there are parks on every other corner, stained glass buildings and old world passion.  Authenticity is around every corner, in the wine, green spaces and red meat daring you to take another step. The color pallet is a simple one; the bluest blues of a dry hot sunny day, perfect fruit of the loom purple, deep forest greens, oaky wood and white capped mountains. In the span of a sip one understands life's greatest balance, the perfect blend of sun, water, vines, energy and sugar.