International Investments – Quality Control and Silliness


* International Investments – Quality Control
* Natural Health Tip – Quality Backs Equal Quality Thoughts
* Ecuador Real Estate – Quality of Passion

Inflation is here and this brings even more silliness.

Inflation could ruin those on fixed incomes, cheat salaried workers and make the rich richer while most people become poor. I do not like this fact but know how to profit from it. Invest in either the best or the cheapest. The middle road will suffer the most.

We can see signs of this diversion between the ‘haves’ and ‘have nots’ everywhere. Bugatti just introduced a 1001 horse power car selling for $1.3 million. Cheap Kia sales are on the rise and the Oldsmobile is gone. Soon it could be good bye Chevy good bye! We can see signs of this everywhere.

Warren Buffet gave away $31 billion …to Bill Gates! This is a real ‘haves’ deal.

Motorcycle sales are rising for example now, not because they are a rich man’s toy. A June 6 USA Today article by William Welsh says that rising gas prices are pushing rising motorcycles sales. The article begins:

“Vincent Stone, 36, of Los Angeles, shopping at L.A. Cycle Sports in Inglewood, is among those switching. He garaged his van and bought a 25-year-old motorcycle. ‘It cost me $85 to fill up the van. Man, it’s been killing me,’ he says. ‘My motorcycle only costs $13 to fill up.’

“At Coleman Powersports in Falls Church, Va., general sales manager Greg Keoho says the store sold 109 motorcycles last month, up from 76 in May 2005. Scooter sales were up to 44 from 35 a year ago.”

The article sales that these increased sales are fueled by expensive gas., You can find the article in the USA Today archives at pqasb.pqarchiver.com/USAToday/

Here is a great entry into the books of human silliness. The very same people who bought Hummers and huge SUVs for protection now buy motorcycles to save on gas. I road a motor bike on the freeway just once, when I was about 16 or 17. Even then I had enough sense to say, “I’m not doing this again”.

Yet the economic pinch is already pushing people to do dangerous things just to survive. It’s bad enough to get people to ride their hogs and such on the road rage filled highways along side the in a hurry – talking on the cell phone -drinking Starbucks – worrying about getting there on time – drivers in really big, fast cars.

Look for businesses that help the middle class survive. Wal Mart and Dollar Stores are great examples. Many middle class consumers may not like their tactics, but they have great futures because US consumers must cope with inflation.

Industry has already figured out about the disappearing middle class. Take for example an article in the Market View section of Foodprocessing.com: “The disappearing middle class – You may need to learn how to market food to the ‘have-nots’ by John L. Stanton, Contributing Editor. The article begins:

“About 25 years ago I lived in Brazil. One of the things that made it such an experience was there was no real middle class. There were the ‘haves’ and the ‘have nots’. The problem with marketing food there or almost any product was the bulk of the market was the ‘have nots.’

“I thought how different this was from the U.S., where we have a huge middle class with a fair amount of disposable income. Our marketing practices are geared to a large middle class.

“However, there are some harbingers that might make the U.S. more like the underdeveloped Brazil than the U.S. of the past. The Dept. of Education reports the number of people who will not graduate from high school is getting larger every year. And it might actually be worse than the DOE portrays. For example, the ‘official’ drop-out rate starts at 9th grade, so kids who drop out before 9th grade are not reported as drop-outs. Or if you fail to come back to school in the beginning of the year, you are not a drop out, etc.

“Our problem as food marketers is that income correlates with education. The lower the educational levels in the U.S., the more people there will be in the low-income groups. One estimate is that by 2025, about 50 percent of the population will be in the day-to-day income class.

“Since I don’t write social commentaries, my concern is the disappearing middle class will significantly change the way we market food. It already is changing. Look at the growth of dollar stores, the Sav-a-Lots, etc. They are becoming the store of choice for that lower 50 percent, with that group “splurging” at Wal-Mart. Even the next 40 percent will be very price-conscious and probably mass merchant-loyal; they’ll only splurge at today’s traditional grocery stores. The top 10 percent will shop wherever they want.” You can read the whole article at foodprocessing.com/articles/2005/404.html

Not getting enough kids through school? How could this be?

Whenever I visit Portland I get some keen insights because when I left there and did not return for decades. Often we miss seeing things because they creep up on us minute by minute. However when you are away a long time and then come back Wow! You see a lot of change. There are a number of silly things I saw this trip.

First, is the education problem. When I was growing up people were poorer (in dollar terms) than now and they were building schools like mad. Now they are shutting down the schools because they cannot afford to operate them.

This creates extra crime not having more kids in school so the county there, Multnomah, built a spanking new jail. Only…it has remained empty because they cannot afford to open it.

Could any of this be because taxpayers are spending all their money on debt, bombs and soldiers to protect us against terror? Frankly this would be very silly to worry about terror on the outside when the real terror is having a poor, unschooled criminal population that you cannot even jail!

Inflation? I drove by the house where I was raised in Rockwood Oregon. My folks bought it for $2,700 in 1947. They sold it in 1960 for $14,000. The house is back on the market, two bedrooms, one bath, a bit over 800 square feet in a so-so neighborhood. The price? $184,500!

Perhaps we can learn from the past. A big chunk of the debt that the US owes was created in the war against the Soviet Union. We spent lots of money on bombs and rockets because we feared that the Russians would take over. We won. Right? Maybe not. In the wasp suburbs of Rockwood, Oregon the neighborhood has been taken over by Russian immigrants! They know what inflation will do and have come to America (along with lots of Vietnamese) to work hard.

So there you have it. The one saving grace that might boost our flagging economy from the debt that we created to stop the Russians from coming may be the hard working Russians who have come. Is this silly or what?

But this is the way it is. The good part is that many people will become even richer and how about we all can be among them! One way to do so is invest in businesses and countries that are especially suited for either the very rich or the poor.

Learn more about fighting inflation by investing in emerging currencies, gold, silver, Ecuador, import-export, overseas markets and more. Join Merri, Thomas Fischer from Jyske Bank Copenhagen and Steve from Ecuador and me at our next International Business and Investing Made EZ course in North Carolina. Review where to invest and do business now and learn which markets and currencies may be strong in the year ahead. Learn more about Ecuador import and export from Steve. Our May course was overbooked and the September course is filling up quickly. Our free accommodations here on the farm are reserved on a first come first served basis so do not delay! Go to garyascott.com/catalog/ibeznc.

Natural Health Tip – Quality Backs Equal Quality Thoughts

One way to maintain your wealth is to have an effective low cost way to maintain good health. Try to avoid illness. Do not let the medical system get you on the pharmaceutical roller coaster if you can help it! This is why we have been focusing on a serial about the importance of spinal health written by Dr. Joe Culbertson DC. The serial continues. Here is my understanding of what Joe says:

“Muscles affect the neck and lower back.

“Most symptoms associated with distortion of the spine are in the neck, shoulders and lower back (there’s also the pain that runs down the back of both legs in sciatica). When the spine mirrors your thoughts (I will get to this shortly) the muscular system of your body is placed into tremendous stress maintaining the body upright. Muscles tighten, become imbalanced and inflamed. This further weakens the spine. The impact of muscular imbalance is worst in the neck and back, thus most symptoms (i.e. pain) are in these areas. If the structural distortions and muscular imbalances persist and are ignored or covered up with medication, massage, improper manipulation or other treatment degeneration and decay develops, most often in the neck and lower back.

“How does this happen?

“As we move from experience to experience, we interact with all that is around and within us. This interaction actually has its foundation in interrelationships of energy. We receive input from our environment in the form of vibrations. Each and every stimulus has its own unique vibration measured by its frequency. Science has shown that everything is energy. Our ability is our ability to recognize frequencies. This vibrational information has five major avenues to our brain; the senses of touch, sight, hearing, taste, and smell.

“Frequencies create thoughts that are sent via the nervous system to every cell in the body. There is no area that does not come under this influence. The bodies response is a change in frequency of the individual cell. The results of this change vary; muscles contract, pupils dilate, blood flow increases, respiration slows, cells begin to grow abnormally, and on and on it goes. The responses differ and, for the most part are temporary.

“However, at the cellular level, the changes in the cell’s vibrational frequency tend not to return completely to their original vibration. Instead they demonstrate a propensity of resonating at a slightly altered frequency. This phenomenon is supported by the fact that nerve fibers responsible for the neurological impulses reaching the cells become altered by a change in the positioning of the spine. As the neurological impulses resonating with the frequencies of our thoughts pass through the structure of the spine on their way to the specific parts of the body, they cause slight, almost imperceptible, deviations in the spine that ultimately impact and influence the nerve supply to our entire body.

“To simplify this a little more, our perceptions cause us to think. Each thought affects the alignment of the spine. When our thoughts are distorted, so too are the misalignments of our spine, which then leads to even greater distortions of thought.”

You can learn more about Joe Culbertson’s spinal tuner at www.spine-tuner.com

Join us with Dr. Terry Hambrick DC this August for a weekend course that will help you learn how to eat in wasy that balance your pH. Balancing pH on a regular basis is vital because it is a easy way to monitor our health and to optimize our health on a daily basis. Your pH balance is an index of the total health of the body. When the pH is too high or too low, it can lead to disease. At the course, you’ll learn about the life force energy that is the ultimate “balancing factor” of the body and how a balanced pH has far-reaching consequences on mental, emotional and spiritual health. To enroll or for more details contact Merri at merri@littlehorsecreek.com

Ecuador Real Estate – Quality of Passion

We have been looking at ways to turn our passion into profit by creating a business that is so enjoyable we’ll never want to retire. Our focus is on Ecuador because this is where we know, and this is where we live.

One of the great points of Ecuador is the high quality artisans. Ecuador runs on a guild system created by the Europeans back in the 1600s so work is unique and of such high quality it’s not available anywhere else in the world. Yet prices are extremely low.

Many countries have plenty of local crafts for sale, products made by the local economy that seem fun when you are shopping there, but upon return seem totally out of place. You ask, “Why did I buy that?” and the handicrafts gather dust in some closet.

Ecuador has artists…real ones that are incredibly good. World class. The best. I brag not!

Take for example, one of our neighbors at El Meson, a well know artist here, Diana Carrasco, who creates among other things incredible Faberge eggs, horses and wonderful Santos (religious statues) from wood.

Our man in Ecuador describes Diane’s work. “Diana prides herself on the strict quality process that each and every piece passes through. Each piece is unique and laboriously hand crafted.

“First the products are carved in wood and the process begins with selecting the correct wood. Diana only works with wood that has been approved for harvesting by the Ecuadorian Ministry of Environment. The two woods she works with are naranjillo, a local wood, and cedar. Diana’s workers select the highest grade wood that doesn’t have any knots or ‘core.’ Knots tend to separate after three months. Because it is impossible to see internal knots Diana never sells any work that has not aged three months.

“Next, the basic shape is cut and an outline of the piece carved. For example a horse shape or human figure etc. Then the piece is sculpted and given a basic polish. At this point a second control is made – to check on proportion.

“Before the human and religious figures and horses are passed to the sanding stage, the front of the head that depicts the face is cut off. Two holes for the eyes are carved out of the facial portion. Transparent glass is melted into the holes. Then the face is glued back. The eyes are painted and certainly look realistic.

“After the piece has been carved it passes to the sanding ‘department’ where they use up to 80 different grades of sandpaper! A substance, locally is called “tisa” (gesso) and which is made up of calcium carbonate, plaster and water mixed together is brushed over the sculpture and then left to dry. The piece can not be artificially dried in a kiln or oven as that would likely split the wood. It has to dry in the natural atmospheric conditions. This means that the sculptures dry according to the climatic conditions at the time. When the weather is cold or rainy they take longer to dry. At this point the wood is covered in the white tisa. After it is dried it is sanded down.

“This coating sanding process is repeated eight times! This is called the ‘first hand’. The mixture of calcium carbonate:plaster:water is at a ratio of 40:30:30. After this the process is repeated ANOTHER six times, the ‘second hand’, using a more dilute tisa.

“This is an extremely lengthy process but goes a long way to obtain the incredibly fine finish that one feels when handling any of Diana’s works.

“The third quality control inspection is made at this stage.

“The next stage is called ‘encarnardo’ (fleshed) – The human figures are given skin tones where appropriate; the face, hands, feet, and occasionally the body. Oil paint is applied only to figures of humans or angels. As a special order, Diana’s artists are able to replicate the technique used by the Quito School of Art. This was the school of art established by the Spanish conquistadors. The techniques have just about been kept alive over the generations in Ecuador because of the Guild System, a system of apprenticeship that has served within the artisan community. Angels and human figures carved by the ancient sculptors 3-400 years ago were typified by a shiny finish to the skin. This was achieved by rubbing the oil paint very carefully and skillfully with a dried sheep’s bladder. Diana’s artists do this too, although it has to be said they don’t much like doing it because it is extremely time-consuming. Nethertheless a fantastic replica of timeless art is achieved using this ancient technique.

“Following the painting of the skin, gold leaf is applied to the areas of the sculpture which show gold design. Typically this design looks as if it has been etched or painted on to the sculpture with the finest of fine touches. There is good reason for this. The process is as follows: First a sticky substance called ‘bol’ based on gum is brushed over the area where gold design will appear. The surface of the bol is wet with a cloth and then using a very fine brush, typically made from bison hair, gold leaf is brushed over the wet ‘bol’ and adheres to the surface. Then a small tool which is made of a handle like a paintbrush but instead of the brush has a stone made of agate, is used to polish and rub the gold leaf so that it is worked into the bol base and smoothes out any crinkles in the leaf.

“Up until this point the process is the same for nearly all of the products produced by Diana’s workshop; eggs, tops, animal figure, jewelry boxes, religious icons. All are carved and a trademark of Diana’s design is the filigree gold design that imparts a strong sense of fantasy to the majority of her work. At this point there is another quality control inspection to insure that the gold leaf has been correctly applied.

“After this, all the sculptures are oil painted in a process known as ‘matiza’ which is best translated as blend. The colors of the piece are painted on the parts which have gold, that’s to say over the gold, and also on the surfaces which will only show regular colors. Different types of oil paints are used and again; the drying time depends on the type of paint and the climatic conditions. At this point, if additional oil painting is needed to depict fine details, for example, small flowers or details of butterflies or humming-birds, then it is painted over the base colors.

“Then the next stage is to reveal the gold leaf. In other words, the artists show detail in gold that is at the same relief level as the oil colors by revealing the gold leaf. Using a tool called a ‘chonta’, something like a scalple, they scratch away the oil colors to reveal the gold leaf underneath. This requires an extremely fine eye for detail and the ability to hold the concept of the final design in the ‘mind’s eye’ as slowly the artist scrapes away all the oil around the finished patterns. At this point a further check is done. Now the piece is being examined for harmony – … “Are all the colors and the design in harmony?”

“As you can see from photos of the different pieces, some of the gold design is at a raised relief. That’s to say a millimeter or two above the surface of the oil colors and other gold work. To create this raised gold relief another paste is used that has the consistency of toothpaste. It’s made mixing in ocher and then passed through the mesh of a fine cloth so that once on the other side it has a far finer texture. The paste is painted on to the sculpture on the relevant spots. The paste has to dry naturally and this takes between 3-10 days according to climatic conditions and the consistency of the paste.

“Only the artisans know when the paste is ready and they judge solely on how the paste feels to touch – years of experience are called into play. This is crucial because when the paste reaches the precise level of dryness required, gold leaf is laid over the sculpture and pressure is applied to the parts where the paste is and the gold leaf sticks. The rest of the gold leaf doesn’t stick and is brushed away and wasted. This process is completed until the correct relief is achieved. This process is known as ‘estofado’ which refers to the fine dressing of the sculpture – similar to the final touches made to the dress of Spanish nobles as they were dressed by their servants in times gone by.

“Many of the pieces are adorned with semi-precious stones. A small hole is carved out and the stones are glued into place. These stones include, but are not limited to, rubies, zircons and garnets.

“Finally, the finishing touches are applied where needed. Eyes are painted, lips, hair and eyebrows too. These are not done at the beginning because it would be easy for these areas to become dirty during the other processes.

“A final quality control check is made. It is not unknown for horses hooves to be missing gold trim – but these sculptures never make it on sale – they are returned to be finished correctly before returning to take their rightful place amongst the treasures on sale in Diana’s showroom.”

This goes beyond craft. During each course at El Meson we visit Diana’s home and place where she displays her work. A number of our delegates now export her art.

Diana’s work is just one small example of the high quality products found in Ecuador. There are many types of antique art in Ecuador as well. Below is a photo of just one of many types of religious art found there. Merri and I bought quite old paintings like the one below *for a song) and are framing to hang on our walls here in North Carolina.

Our July Super Thinking – Super Spanish course in Ecuador is now totally full! Enjoy Ecuador and the sun! See real estate for sale. Inspect the great markets as you learn about global investing and business this November. For details go to garyascott.com/catalog/ibezecuador.html

Until next message, may you always “have” even in a “have not” world!

Gary

Is inflation getting to you? Enjoy the hot summer in cool Ecuador for just $875. See garyascott.com/catalog/ec_monthly_hometel.html

Or take a week’s R & R. See garyascott.com/catalog/elmeson.html


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