Posted on 11 August 2009.
Here is another reason to Retire and & Earn Abroad.
Yesterday’s message on lifestyle and Ecuador diversification was really backed up by Uncle Sam quickly!
Whether you retire in Ecuador or anywhere outside your home.. you want diversification. See why below!
One benefit of retiring in Ecuador is that it can help the poor there.
Yesterday’s article worried about weather change being called a threat to national security and wondered if this concept could further erode human rights.
I never imagined the very next day we would have even more concern… yet an article by James Risen in the New York Times entitled: “U.S. to Hunt Down Afghan Drug Lords Tied to Taliban” must give us pause.
Here is an excerpt: WASHINGTON — Fifty Afghans believed to be drug traffickers with ties to the Taliban have been placed on a Pentagon target list to be captured or killed, reflecting a major shift in American counternarcotics strategy in Afghanistan, according to a Congressional study to be released this week.
United States Marines on a recent raid in Helmand Province. Under a new policy, drug traffickers are subject to being killed.
United States military commanders have told Congress that they are convinced that the policy is legal under the military’s rules of engagement and international law. They also said the move is an essential part of their new plan to disrupt the flow of drug money that is helping finance the Taliban insurgency.
Part of our work at Meson de las Flores was to continue a policy at our hotel to feed the poor. We always keep a pot of nutritious stew on the stove and our less fortunate are welcome any time of the day. Above is one of our regular guests.
The problem is that the erosion of rights creeps upon us in small steps… like income tax. When to raise revenue to fund the Civil War, an income tax was introduced in the United States with the Revenue Act of 1861. It was a flat rate tax of 3% on annual income above $800.
When the idea was contested on concerns that the tax, once established, would grow, one Congressman stated that there was no way the population would let the tax ever be higher than 3%. Yet a year later flat tax this was replaced with a graduated tax of 3-5% on income above $600 in the Revenue Act of 1862.
This act made tax temporary ending in 1866. Regretfully, perhaps, in 1866, income tax collections reached their highest point ever, over $310 million. This made the tax popular and today we can see the effects of the small steps… one freedom eroded at a time.
So where does the legal right to kill drug dealers lead? If it is legal to kill Afghan drug dealers to disrupt the flow of drug money that finance insurgency, what about drug dealers in Mexico that are financing insurgency in the US? Can we kill them too? If so, how about if we catch them in the US, can we kill them there? If so what if they are US citizens or residents? Can we still kill them? Can the army become involved… in the name of national security? Do they have to check a person’s passport before they shoot the drone at them?
These are tough calls, but somehow making it legal for the army to kill non combatants seems like a small step in the wrong direction.
Merri and I visiting a village that our foundation supports… helping the old and supporting the young by improving their school. This is a fulfilling retirement activity.
Yet loss of rights is not the only reason we might want to live or retire in Ecuador or elsewhere, full or part time, for diversification.
The rising cost of living makes it difficult to retire in the West. Plus though taxes are rising… benefits for those who retire are not.
A recent BBC article “Pension age could rise further” shows how the rot in England has grown. An excerpt says: The state pension retirement age could be increased further, the UK’s pensions regulator has told the BBC.
David Norgrove said rising life expectancy meant millions of people would “undoubtedly” have to wait longer in future to draw a state pension.
People will not save as much for retirement as in the past, with many people “frightened” to do so, he said.
The state pension age is due to rise to 68, and Pensions Minister Angela Eagle said there were no plans to raise that.
Currently, the state pension age is 60 for women and 65 for men, but four years ago Lord Turner published a report calling for it to rise to 68 for everyone by 2044.
But Mr Norgrove said he thought it would end up higher.
Mr Norgrove said: “People are going to have to work longer, partly because we’re not going, as a nation, to save as much for retirement as we did in the past.” He added: “The government’s recent legislation is increasing the state retirement age progressively to 68. I think it will end up higher than that.”
Part of our program is to get readers who retire in Ecuador involved helping the poor. We also offer roses and donate the proceeds to help people like this charming woman. See more about her, and how the roses help, here.
Another reason to retire in Ecuador is that business opportunity seems to be rising there as it falls in the north.
A recent USA Today article. “Business bankruptcies up 240% since 2006”, by Christine Dugas outlines a US retirement and lifestyle problem. Here is an excerpt of that article:
Entrepreneurship and new small businesses are supposed to lead us out of the recession, just as they have in prior downturns, right? Sure.
Your neighbor’s grand idea will persuade a bank to lend her start-up money; she’ll open for business in six weeks; and money will immediately flow from customers to her to her employees. Taxes will be paid, and the national economic engine will hum effortlessly in no time. If only.
Today shows a different reality: Commercial bankruptcies are surging. Fewer people are starting small businesses, and firms already open are struggling under changing consumer habits, a lack of funding options and tougher bankruptcy laws. If a nationwide trend seen since January holds true, more than 300 businesses will file for bankruptcy today alone.
The first five months of this year have shown a 52% increase in the total number of commercial bankruptcy filings (36,106) compared with the same period last year (23,829), according to the Automated Access to Court Electronic Records. On average thus far in 2009, some 350 commercial enterprises file for bankruptcy daily an increase of 240% from 2006, the first year after the bankruptcy law was changed.
Major corporate failures, like GM and Chrysler, flash across front pages and websites. But the vast majority of commercial bankruptcies, which are not separated by size of firm by data keepers, are filed by entrepreneurs and small-business owners, says Robert Lawless, professor of law at University of Illinois.
Troubling for the economy, say Lawless and Todd McCracken, president of the National Small Business Association, is the double-whammy of fewer start-ups and increasing bankruptcies.
“In the past, small-business formation increased in a recession because people had self-employment thrust upon them,” he says. “One avenue out of economic hard times self-employment has become less attractive, because the bankruptcy law is less forgiving” and there are fewer options for those entrepreneurs to get bank loans or to find funding elsewhere.
Small business is considered the backbone of the economy. In the past, new businesses led economic recoveries, McCracken says. Small businesses those with fewer than 500 employees make up half of the gross domestic product and account for most job growth.
Problems from the devastated housing market, overall recession and suffering major industries all funnel down to small businesses, especially those that supply the troubled corporations.
Household spending cutbacks reach far, too. Dual-income families who are now single-income may no longer need or be able to afford child care, so many of those services are going out of business, says Lester Thompson, a bankruptcy lawyer in Dayton. Sporting goods stores and lawn-mowing services also have struggled.
Small-business bankruptcy filings jumped the most in the Los Angeles and Chicago metro areas, according to Equifax. But even smaller areas of the country are experiencing a big increase.
Many small businesses owe so much money to creditors that there is no future. Such owners often file for Chapter 7 bankruptcy and shut their businesses for good.
The credit crunch is a major contributor to the rise in filings.
Loan dollar volume from the U.S. Small Business Administration has increased 35% since the American Recovery and Reinvestment Act was passed on Feb. 17, according to the SBA. Even so, a National Federation of Independent Business trend report states that in May the percentage of business owners reporting that loans are harder to get rose to 16%, the highest reading since the 1980-82 recession.
With that reality, and loath to dip into their retirement savings, struggling small-business owners have few options other than bankruptcy. When the bankruptcy law changed in 2005 it was mostly aimed at curbing abuse of personal bankruptcy filing. But it also singled out small businesses for harsher treatment, and those changes did not apply to larger corporations, Lawless says.
Bankruptcy is still the only option for many small-business owners who are hanging by a thread.
This is why the idea of living or retiring in Ecuador or elsewhere, at least part time, for diversification and global earning potential makes sense because opportunity is growing elsewhere.
Nothing makes our retirement problems diminish faster than helping those who have even greater needs.
An excerpt from a recent Wall Street Journal article “Ecuador’s Business Confidence Index Up” by Mercedes Alvaro says: QUITO (Dow Jones)–Ecuador’s Business Confidence Index, measured by Deloitte and Touche, surged 5% in May to 93.2 points, compared with May 2008, the company said in its monthly report.
Deloitte said the index recovered by 31% in May against April, returning to the levels registered during the last quarter of 2008.
The Index’ recovery is largely due to the waning perception among executives of a deterioration of the country’s economic and political conditions, it said.
Deloitte found that 45% of those surveyed are less optimistic about the economy compared with April, while 52% perceive no change.
The slow but steady increase in oil prices and the revival of the global economy are grounds for expecting that the economy in Ecuador could improve by year’s end or in early 2010.
Questioned about the performance of their businesses, 34% said they had lower sales compared to the previous months and 39% reported revenues down on the same period of last year.
The survey found 20% reported a reduction in their workforce compared to the previous month.
Around 57% of the business leaders surveyed said that the country’s socio-economic situation makes it difficult to attract foreign investment.
We should help our neighbors at home as well. This is why we are developing environmentally sensitive, sustainable programs to encourage value-added, employment in the Blue Ridge as well.
I have written many times about the benefits of retiring in Small Town USA for lifestyle diversification as well. See more on lifestyle diversification at Inspired to Retire
We can see below why diversification remains important even if we retire in Ecuador.
Just because we want to live or retire in Ecuador does not mean that Ecuador does not have its own creeping erosion of rights problems as well. An August 3 news.Yahoo article says: Correa: Ecuador to take over radio, TV stations. QUITO, Ecuador – Ecuadorean President Rafael Correa says “many” radio and TV frequencies will revert to state control due to what he’s calling irregularities. The president has been at war with Ecuador’s news media since taking office in January 2007. He has called TV stations and newspapers corrupt and mediocre, and twice fined an opposition broadcaster. Correa did not specify Monday what sort of abuses or irregularities broadcasters have committed. Nor did he name any alleged offenders.
An August 5th update on this matter in the Wall Street Journal says: Ecuador Govt Braces For Reaction To Radio, TV Takeovers
QUITO (Dow Jones)–Ecuador’s government is expecting “strong reactions” to a report that will determine which television and radio stations will revert to state control.
Antonio Garcia, chairman of Ecuador’s National Radio and Television Board, said Wednesday that a report will be issued next week on which stations the government will take over.
President Rafael Correa’s government has alleged that a number of stations received their broadcasting concessions illegitimately and said that “many” would revert to state hands.
Correa’s announcement came on the heels of the government of Venezuelan President Hugo Chavez, the Ecuadorian president’s close ally, shutting down 34 privately-owned radio stations last weekend.
An initial report by an Ecuadorian government commission last year found that 236 of 1,637 frequencies had obtained their concessions illegally.
Garcia brushed off what he called “alarmist accounts” that all radio and television stations will revert to state control and that the government is looking at them on a case-by-case basis.”
He said that some media outlets, however, are “trying to misinform” viewers and listeners.
We’ll stay tuned to what happens with this takeover at our Ecuador Living Service.
The greatest asset for diversification is the ability to earn wherever you live and to keep your investments safe.
This is why we offer our course Tangled Web… How to Have an Internet Business.
A clear mind and healthy body are also a vital assets… plus a second language is a powerful diversification tool.
This is why I am willing to pay you $300 to attend either our Ecuador Super Thinking plus Spanish seminar in September or our North Carolina International Business & Investing seminar in October. Sign up for either seminar and I will email you our Tangled Web… How to Have an Internet Business Course (offered at $299) free plus I’ll knock an extra dollar off your seminar fee…. to round up the $300 savings.
See details of the two seminar below.
Here is Thomas Fischer talking with seminar delegates at a recent international investing course that I co hosted with Jyske Global Asset Management.
Join Merri, Thomas Fischer of JGAM, our webmaster David Cross and me in North Carolina this October and enroll in our emailed course on how to have a web business free. Save $300.
Learn more about global investing, how to have an international business and diversification in Ecuador at the seminar.
Oct. 9-11 IBEZ North Carolina
Or join us in Ecuador and learn more about living and retiring in Ecuador.
Seminar delegates visiting Otavalo market looking for Ecuador export ideas.
Sept. 17-21 Ecuador Spanish Course
Sept. 23-24 Imbabura Real Estate Tour
Sept. 25-28 Ecuador Coastal Real Estate Tour
Oct. 21-24 Ecuador Import Export Tour
Nov. 6-8 IBEZ Ecuador Seminar
Nov. 9-10 Imbabura Real Estate Tour
Nov. 11-14 Ecuador Coastal Real Estate Tour
Attend any two Ecuador seminar or tours in a calendar month…$949 for one. $1,349 for two.
Attend any three Ecuador courses or tours in a calendar month…$1,199 for one. $1,799 for two.
Learn more about the power of Ecuador export ideas
See WSJ article Ecuador’s government braces for reaction
See NYT article U.S. to Hunt Down Afghan Drug Lords Tied to Taliban