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Showing posts with label Cafayate. Show all posts
Showing posts with label Cafayate. Show all posts
Friday, April 8, 2011
Monday, April 4, 2011
Sunday, March 27, 2011
special report on La Estancia de Cafayate
[from Jeff Berwick's The Dollar Vigilante, 25 March 2011, published here under special permission from the author]
Special Report: La Estancia de Cafayate
Sitting Out TEOTMSAWKI In Galt's Gulch
I accepted an invitation (all at my own expense) to go down to Doug Casey’s, La Estancia de Cafayate, in Salta Province, Argentina without quite understanding what I was about to discover. I even told friends and those who asked that, “I doubt I’ll buy a place.”
Why? For starters, I like living in larger cities – or at least not “out in the country” somewhere. I like shops, restaurants, bars and discos. And secondly, I had the complete misperception that this was some sort of typical, planned gated community. Not my style.
What I discovered has excited me so much that I am, as I write, working on purchasing a lot on which I will build a small home. As well, I am telling all my like-minded friends that if they can, they must come down and see what is being developed there.
GALT’S GULCH
It’s Galt’s Gulch. There is no better way to describe it. For those who haven’t read Atlas Shrugged, the long awaited movie based on the book is coming out next month (see the movie trailer here).
Galt’s Gulch, in the book, was a place where many of the most productive, intelligent and industrious people of the world esconded when the rest of the world was thrusting socialism/communism upon them.
The parallels to Galt’s Gulch are numerous, including the fact that Galt’s Gulch was built far away from civilization at a high altitude.
ABOUT CAFAYATE
Founded in 1840 and protected by incredible red rock formations that frame the drive in from Salta, Cafayate is internationally known for its wines - of which we tasted many on this particular tour.
It is a high altitude valley, 1600 meters (5800 ft) above sea level, which offers ideal conditions for producing world-class wines, and is known for its Torrontes and Malbec which grow easily inside of the temperate climate and over 320 days of sunshine each year - something which I consider crucial to health - free, daily Vitamin D.
One of the nicest features of La Estancia is that it is just outside the city boundary of Cafayate - about a 2 minute drive from town. So, you are out-of-town, but within minutes of dozens of world-class restaurants and shops.
WHAT IS LA ESTANCIA DE CAFAYATE?
La Estancia is an ultra-modern, luxury development in Salta Province, Argentina. It was conceived by best-selling author Doug Casey (The International Man, Crisis Investing and founder of Casey Research) and partners as the quintessential retreat for discerning individuals looking for an amenities rich lifestyle in the company of a diverse community of residents from around the globe (at this point, owners come from more than 20 different countries - off the top of my head, of owners I met: Germany, Lithuania, Mexico, Romania, US, Canada...).
La Estancia de Cafayate is simply massive in size, stretching over 1,360 acres - a meandering collection of vineyards, horse pastures, and the brand new Bob Cupp links style golf course. All of the properties enjoy stunning views of the surrounding mountains, then, depending on personal tastes, also benefits from golf course or polo field frontage, or surrounding vineyards or pastures.
It will be home, upon completion, to 360 housing lots. Already 200 are sold and, in my opinion, it won’t be much longer for the rest to sell. And once they are sold, that is that. They will not be building more.
WHAT MAKES LA ESTANCIA SPECIAL?
La Estancia De Cafayate is the brainchild of Doug Casey – an avid fan and past friend of Ayn Rand – who scoured much of the world looking for the perfect place to sit out The End Of The Monetary System As We Know It (TEOTMSAWKI). According to him and his wife they spent years looking for a place that had all the right characteristics.
What characteristics?
It had to be far from “civilization”. Cafayate meets that, in that the closest large city is a thousand miles away. But that doesn’t mean it isn’t “civilized” – it is, in fact, ultra-civilized in this remote location in Salta Province. However, it should be noted, even if there were large population centers nearby, La Estancia would still be one of the safest places on Earth. Why? Nearly everyone I spoke with who intends on living in La Estancia are the type of people who consider self-defense their responsibility and not the responsibility of the state.
It also had to be fairly self-sufficient. Cafayate meets that in that it is built atop a giant aquifer where much of the Andes drains into. Water? No problem. Electricity? The power comes from hydroelectric so even in the event of serious supply chain collapse there is very little chance that the waterfalls and rivers supplying the power will come to a halt. Coal fired, natural gas and nuclear plants could see their supply of energy get cut-off for a period of time as supply chains grind to a halt – but this is very unlikely to happen to hydro plants.
As well, La Estancia is home to hundreds of acres of vineyards (which are owned by home owners in the project) – so no shortage of wine. And on or near the estate almost any and every form of agriculture and farm animals are nearby. Doug Casey, in fact, owns a very large cattle ranch just a few hours north of Salta. So, in the event of parts of the world being forced into a famine situation as supply chains seize, those at Cafayate will be dining on steak, fresh vegetables and fine wines.
Another important factor for locating La Estancia in Cafayate is that it needed to be situated in a country where government is not much more than a nuisance. Argentina fits the bill here. In fact, the ex-Governor of Salta Province is a partner in the development so, even if the government in Argentina begins to try to appropriate land or wealth from residents (something it has never done) it is highly unlikely that La Estancia de Cafayate will be targeted.
WHAT AMENITIES WILL LA ESTANCIA OFFER?
La Estancia de Cafayate has been designed from the ground up to support an incredibly rich lifestyle.
These are just a few of the amenities:
§ 60-100 hectares of shared-ownership vineyards – As a property owner you legitimately pick up bragging rights as owning a vineyard in Argentina!
§ Vintner’s Heath Golf Course – An 18-hole Bob Cupp-designed golf course with a clubhouse, driving range and short game practice facility. When completed, this will be one of the finest golf courses in all of Argentina, and even South America - and from what I understand, owners play at $12/round!
§ Authentic Argentine equestrian experience – With stabling and pasturing facilities for private and community horses.
§ Polo fields and associated facilities
§ A network of riding trails, also used for nature walks and mountain biking - as well as horse riding - many people even ride their horses into town... that's just normal for this part of the world
§ Tennis, squash, bocce & parcours facilities;
§ Heath Club – offers a bar, restaurant and asado, as well as locker rooms, a pro-shop, viewing tower, wide patios, WiFi and more.
§ Social clubhouse with all the amenities for civilized living – featuring a bar and lounge, wine cellars, game room, library (only stocked with the best in libertarian, anarcho-capitalist, austrian finance classics), cigar lounge, business center and even a poker room!
§ Full-service Spa – With multiple swimming pools, locker rooms, fitness center and treatment rooms; this is one of the most important features to me: the Gym - I spoke with Doug Casey on this and he intends to make it a world class gym! He is even likely putting in Power Plates - something I wrote up in the September Issue of TDV (Premium/Basic)
§ Kids clubhouse – With game room and more;
§ Pueblito – A small village center with asado (barbeque) cabin, small shops with crafts and conveniences, gathering and game spaces;
§ Cafayate Concierge – A dedicated staff which can help you with anything you need
COSTS
There are 3 types of lots available:
§ Chacra: 5,000-10,000 Square Meters (averaging 1.5 acres) - cost $320-$400k USD
§ Quinta: 4,000 Square Meters (averaging 1 acre) - cost $235k-$295k USD
§ Jardin: 2,000 Square Meters (averaging 1/2 acre) - cost $135k-$195k USD
Home building costs in Cafayate today range from $800 - $1300 per square meter (about $80 - $130 per square foot). As in most places, building costs do not include design and engineering, earthwork, landscaping, and furnishings. “All-in” building costs are likely to run from $1100 - $1500 per square meter (about $110 - $150 per square foot) for high quality homes that include natural stone and wood, in-floor radiant heat, high ceilings, outside verandas and gracious patios.
Annual dues are assessed to each owner to pay for the management and maintenance of all the common elements and services, including golf, vineyards, equestrian facilities, roads, landscaping, and other amenities. The current estimate for the fees is a very reasonable $3500 -$5000 per year per property. However, Doug Casey has stated that it is his intention to have the vineyard profits get those fees to as close to zero as possible.
In the meantime, at normal production levels, it is anticipated that approximately 10 - 15 cases or 60 - 90 bottles per year will be distributed to each owner. Once fully mature, the property vineyards will have the potential to produce about 550,000 bottles of wine each year.
The wine allocation to all the owners will equate to approximately 5% of the total grape production.
SCHOOLING
The schooling system in Argentina offers two options, public and private. The Elementary stage is called primary and children attend from the age of 6 to 12. The next stage is called secondary and it is attended from the age of 13 to 18.
Cafayate has 6 primary public schools, 4 secondary and 2 private schools. Private schools offer an 8-hour day with a secondary language, which is typically English.
However, of the owners I talked to who have children, nearly all do home school or plan to home school. This brings up the next topic: business opportunities.
BUSINESS OPPORTUNITIES
If you can't afford to buy a place in La Estancia and/or you need some sort of income to live there, I lost track of all the business opportunities I came up with over just a few days.
This is going to be a community of about 300 homes - and almost every person there will be well off or outright wealthy. They will need and want a multitude of specialized services.
As example, most of the families want to home school, but I am sure many of the mothers would love to have a VERY private, almost home school style school in Cafayate which only teaches the subjects the parents want their children to learn... Austrian Economics, as example.
As well, a smart young entrepreneur would be wise to go down to Cafayate, rent an apartment in the town of Cafayate itself (for $300/month or less in many cases) and spend some time surveying the landscape and talking to new owners at La Estancia about products or services they would be interested in - and then offer that to them.
Not to mention, buying real estate in the town of Cafayate will almost, without doubt, be an excellent speculative investment. Think of it like buying real estate or land in Aspen, Colorado, fifty years ago.
NEGATIVES
No place is perfect but it wasn't easy to come up with too many negatives for La Estancia:
§ Weather - While there is rarely a cloudy day in Cafayate it can definitely get chilly. It never snows but overnight there can definitely be nights where a sweater and even a jacket are needed. Many people have the misconception that most of South America is hot/tropical but this isn't the case. But if you don't mind chilly evenings and having some warm weather clothes then you'll be fine.
§ Distance - This is both a positive and a negative - depending on perspective. If one of your biggest concerns is the unforeseen risks of TEOTMSAWKI then Cafayate's distance from virtually anywhere is a big plus. However, if you see Cafayate as being a place where you might visit for a week or so from time to time, unless you live in South America plan on spending a full day (24 hours) in transit. There are two main ways to get there... through Buenos Aires or through Santa Cruz, Bolivia (onAerosur) but even once you get to Salta you still have a 3 hour drive - or another short flight. This isn't a "weekend getaway" kind of place. But, again, that can be a positive as you don't get the weekend tourist crowd
§ There is no local international school (yet)
§ Everyone at La Estancia speaks English but you will be hard pressed to find anyone in the town of Cafayate who speaks English. However, one of the best investments you can make, in my opinion, is to learn Spanish. It is one of the best languages to know, with over 20 countries that speak it and more native Spanish speakers in the world than native English speakers.
CONCLUSION
Of course, if it is Galt’s Gulch, then I am breaking one of the sacred rules - as was written in Atlas Shrugged. To liken it to Fight Club: “First rule of Galt’s Gulch, Don’t talk about Galt’s Gulch!”
However, I am so excited about this project that I am putting my money where my mouth is and buying a place there. And I recommend to anyone looking for something of this sort that you take a look ASAP. I will be surprised if there are many lots left by October/November when they are having their next big celebration.
In a recent blog post I called La Estancia, "the world's first libertarian enclave". I used the word "libertarian" because that was the best one-word label I could put on it. However, it is more than that. The people who are gravitating to La Estancia can best be described as non-conformists. They tend to be individualistic, non-statist, free-minded and free willed people who refuse to accept and live life the way they are told to live it.
This, more than anything, is why you should consider having a place there. There is no other place in the world, that I know of, where you can live amongst a group of people like this.
CONTACT
During my time at La Estancia de Cafayate I got to know virtually everyone - all the salespeople, concierges, developers and planners. They have set-up a special email just for TDV subscribers:tdv@lec.com.ar. They understand that TDV readers are going to be quite a bit more intelligent and savvy in regards to wanting a place in a spot like La Estancia than just regular off-the-street enquiries, so you'll get priority attention by contacting them through that email.
Or if you contact them directly through their website (www.laestanciadecafayate.com), just mention you heard about it from The Dollar Vigilante and they'll give you prompt attention.
Special Report: La Estancia de Cafayate
Sitting Out TEOTMSAWKI In Galt's Gulch
I accepted an invitation (all at my own expense) to go down to Doug Casey’s, La Estancia de Cafayate, in Salta Province, Argentina without quite understanding what I was about to discover. I even told friends and those who asked that, “I doubt I’ll buy a place.”
Why? For starters, I like living in larger cities – or at least not “out in the country” somewhere. I like shops, restaurants, bars and discos. And secondly, I had the complete misperception that this was some sort of typical, planned gated community. Not my style.
What I discovered has excited me so much that I am, as I write, working on purchasing a lot on which I will build a small home. As well, I am telling all my like-minded friends that if they can, they must come down and see what is being developed there.
GALT’S GULCH
It’s Galt’s Gulch. There is no better way to describe it. For those who haven’t read Atlas Shrugged, the long awaited movie based on the book is coming out next month (see the movie trailer here).
Galt’s Gulch, in the book, was a place where many of the most productive, intelligent and industrious people of the world esconded when the rest of the world was thrusting socialism/communism upon them.
The parallels to Galt’s Gulch are numerous, including the fact that Galt’s Gulch was built far away from civilization at a high altitude.
ABOUT CAFAYATE
Founded in 1840 and protected by incredible red rock formations that frame the drive in from Salta, Cafayate is internationally known for its wines - of which we tasted many on this particular tour.
It is a high altitude valley, 1600 meters (5800 ft) above sea level, which offers ideal conditions for producing world-class wines, and is known for its Torrontes and Malbec which grow easily inside of the temperate climate and over 320 days of sunshine each year - something which I consider crucial to health - free, daily Vitamin D.
One of the nicest features of La Estancia is that it is just outside the city boundary of Cafayate - about a 2 minute drive from town. So, you are out-of-town, but within minutes of dozens of world-class restaurants and shops.
WHAT IS LA ESTANCIA DE CAFAYATE?
La Estancia is an ultra-modern, luxury development in Salta Province, Argentina. It was conceived by best-selling author Doug Casey (The International Man, Crisis Investing and founder of Casey Research) and partners as the quintessential retreat for discerning individuals looking for an amenities rich lifestyle in the company of a diverse community of residents from around the globe (at this point, owners come from more than 20 different countries - off the top of my head, of owners I met: Germany, Lithuania, Mexico, Romania, US, Canada...).
 |
| Doug Casey speaking at La Estancia lunch |
La Estancia de Cafayate is simply massive in size, stretching over 1,360 acres - a meandering collection of vineyards, horse pastures, and the brand new Bob Cupp links style golf course. All of the properties enjoy stunning views of the surrounding mountains, then, depending on personal tastes, also benefits from golf course or polo field frontage, or surrounding vineyards or pastures.
It will be home, upon completion, to 360 housing lots. Already 200 are sold and, in my opinion, it won’t be much longer for the rest to sell. And once they are sold, that is that. They will not be building more.
WHAT MAKES LA ESTANCIA SPECIAL?
La Estancia De Cafayate is the brainchild of Doug Casey – an avid fan and past friend of Ayn Rand – who scoured much of the world looking for the perfect place to sit out The End Of The Monetary System As We Know It (TEOTMSAWKI). According to him and his wife they spent years looking for a place that had all the right characteristics.
What characteristics?
It had to be far from “civilization”. Cafayate meets that, in that the closest large city is a thousand miles away. But that doesn’t mean it isn’t “civilized” – it is, in fact, ultra-civilized in this remote location in Salta Province. However, it should be noted, even if there were large population centers nearby, La Estancia would still be one of the safest places on Earth. Why? Nearly everyone I spoke with who intends on living in La Estancia are the type of people who consider self-defense their responsibility and not the responsibility of the state.
It also had to be fairly self-sufficient. Cafayate meets that in that it is built atop a giant aquifer where much of the Andes drains into. Water? No problem. Electricity? The power comes from hydroelectric so even in the event of serious supply chain collapse there is very little chance that the waterfalls and rivers supplying the power will come to a halt. Coal fired, natural gas and nuclear plants could see their supply of energy get cut-off for a period of time as supply chains grind to a halt – but this is very unlikely to happen to hydro plants.
As well, La Estancia is home to hundreds of acres of vineyards (which are owned by home owners in the project) – so no shortage of wine. And on or near the estate almost any and every form of agriculture and farm animals are nearby. Doug Casey, in fact, owns a very large cattle ranch just a few hours north of Salta. So, in the event of parts of the world being forced into a famine situation as supply chains seize, those at Cafayate will be dining on steak, fresh vegetables and fine wines.
 |
| The Vineyards at La Estancia de Cafayate |
Another important factor for locating La Estancia in Cafayate is that it needed to be situated in a country where government is not much more than a nuisance. Argentina fits the bill here. In fact, the ex-Governor of Salta Province is a partner in the development so, even if the government in Argentina begins to try to appropriate land or wealth from residents (something it has never done) it is highly unlikely that La Estancia de Cafayate will be targeted.
WHAT AMENITIES WILL LA ESTANCIA OFFER?
La Estancia de Cafayate has been designed from the ground up to support an incredibly rich lifestyle.
These are just a few of the amenities:
§ 60-100 hectares of shared-ownership vineyards – As a property owner you legitimately pick up bragging rights as owning a vineyard in Argentina!
§ Vintner’s Heath Golf Course – An 18-hole Bob Cupp-designed golf course with a clubhouse, driving range and short game practice facility. When completed, this will be one of the finest golf courses in all of Argentina, and even South America - and from what I understand, owners play at $12/round!
§ Authentic Argentine equestrian experience – With stabling and pasturing facilities for private and community horses.
§ Polo fields and associated facilities
§ A network of riding trails, also used for nature walks and mountain biking - as well as horse riding - many people even ride their horses into town... that's just normal for this part of the world
§ Tennis, squash, bocce & parcours facilities;
§ Heath Club – offers a bar, restaurant and asado, as well as locker rooms, a pro-shop, viewing tower, wide patios, WiFi and more.
§ Social clubhouse with all the amenities for civilized living – featuring a bar and lounge, wine cellars, game room, library (only stocked with the best in libertarian, anarcho-capitalist, austrian finance classics), cigar lounge, business center and even a poker room!
§ Full-service Spa – With multiple swimming pools, locker rooms, fitness center and treatment rooms; this is one of the most important features to me: the Gym - I spoke with Doug Casey on this and he intends to make it a world class gym! He is even likely putting in Power Plates - something I wrote up in the September Issue of TDV (Premium/Basic)
§ Kids clubhouse – With game room and more;
§ Pueblito – A small village center with asado (barbeque) cabin, small shops with crafts and conveniences, gathering and game spaces;
§ Cafayate Concierge – A dedicated staff which can help you with anything you need
COSTS
There are 3 types of lots available:
§ Chacra: 5,000-10,000 Square Meters (averaging 1.5 acres) - cost $320-$400k USD
§ Quinta: 4,000 Square Meters (averaging 1 acre) - cost $235k-$295k USD
§ Jardin: 2,000 Square Meters (averaging 1/2 acre) - cost $135k-$195k USD
Home building costs in Cafayate today range from $800 - $1300 per square meter (about $80 - $130 per square foot). As in most places, building costs do not include design and engineering, earthwork, landscaping, and furnishings. “All-in” building costs are likely to run from $1100 - $1500 per square meter (about $110 - $150 per square foot) for high quality homes that include natural stone and wood, in-floor radiant heat, high ceilings, outside verandas and gracious patios.
Annual dues are assessed to each owner to pay for the management and maintenance of all the common elements and services, including golf, vineyards, equestrian facilities, roads, landscaping, and other amenities. The current estimate for the fees is a very reasonable $3500 -$5000 per year per property. However, Doug Casey has stated that it is his intention to have the vineyard profits get those fees to as close to zero as possible.
In the meantime, at normal production levels, it is anticipated that approximately 10 - 15 cases or 60 - 90 bottles per year will be distributed to each owner. Once fully mature, the property vineyards will have the potential to produce about 550,000 bottles of wine each year.
The wine allocation to all the owners will equate to approximately 5% of the total grape production.
SCHOOLING
The schooling system in Argentina offers two options, public and private. The Elementary stage is called primary and children attend from the age of 6 to 12. The next stage is called secondary and it is attended from the age of 13 to 18.
Cafayate has 6 primary public schools, 4 secondary and 2 private schools. Private schools offer an 8-hour day with a secondary language, which is typically English.
However, of the owners I talked to who have children, nearly all do home school or plan to home school. This brings up the next topic: business opportunities.
BUSINESS OPPORTUNITIES
If you can't afford to buy a place in La Estancia and/or you need some sort of income to live there, I lost track of all the business opportunities I came up with over just a few days.
This is going to be a community of about 300 homes - and almost every person there will be well off or outright wealthy. They will need and want a multitude of specialized services.
As example, most of the families want to home school, but I am sure many of the mothers would love to have a VERY private, almost home school style school in Cafayate which only teaches the subjects the parents want their children to learn... Austrian Economics, as example.
As well, a smart young entrepreneur would be wise to go down to Cafayate, rent an apartment in the town of Cafayate itself (for $300/month or less in many cases) and spend some time surveying the landscape and talking to new owners at La Estancia about products or services they would be interested in - and then offer that to them.
Not to mention, buying real estate in the town of Cafayate will almost, without doubt, be an excellent speculative investment. Think of it like buying real estate or land in Aspen, Colorado, fifty years ago.
NEGATIVES
No place is perfect but it wasn't easy to come up with too many negatives for La Estancia:
§ Weather - While there is rarely a cloudy day in Cafayate it can definitely get chilly. It never snows but overnight there can definitely be nights where a sweater and even a jacket are needed. Many people have the misconception that most of South America is hot/tropical but this isn't the case. But if you don't mind chilly evenings and having some warm weather clothes then you'll be fine.
§ Distance - This is both a positive and a negative - depending on perspective. If one of your biggest concerns is the unforeseen risks of TEOTMSAWKI then Cafayate's distance from virtually anywhere is a big plus. However, if you see Cafayate as being a place where you might visit for a week or so from time to time, unless you live in South America plan on spending a full day (24 hours) in transit. There are two main ways to get there... through Buenos Aires or through Santa Cruz, Bolivia (onAerosur) but even once you get to Salta you still have a 3 hour drive - or another short flight. This isn't a "weekend getaway" kind of place. But, again, that can be a positive as you don't get the weekend tourist crowd
§ There is no local international school (yet)
§ Everyone at La Estancia speaks English but you will be hard pressed to find anyone in the town of Cafayate who speaks English. However, one of the best investments you can make, in my opinion, is to learn Spanish. It is one of the best languages to know, with over 20 countries that speak it and more native Spanish speakers in the world than native English speakers.
CONCLUSION
Of course, if it is Galt’s Gulch, then I am breaking one of the sacred rules - as was written in Atlas Shrugged. To liken it to Fight Club: “First rule of Galt’s Gulch, Don’t talk about Galt’s Gulch!”
However, I am so excited about this project that I am putting my money where my mouth is and buying a place there. And I recommend to anyone looking for something of this sort that you take a look ASAP. I will be surprised if there are many lots left by October/November when they are having their next big celebration.
In a recent blog post I called La Estancia, "the world's first libertarian enclave". I used the word "libertarian" because that was the best one-word label I could put on it. However, it is more than that. The people who are gravitating to La Estancia can best be described as non-conformists. They tend to be individualistic, non-statist, free-minded and free willed people who refuse to accept and live life the way they are told to live it.
This, more than anything, is why you should consider having a place there. There is no other place in the world, that I know of, where you can live amongst a group of people like this.
CONTACT
During my time at La Estancia de Cafayate I got to know virtually everyone - all the salespeople, concierges, developers and planners. They have set-up a special email just for TDV subscribers:tdv@lec.com.ar. They understand that TDV readers are going to be quite a bit more intelligent and savvy in regards to wanting a place in a spot like La Estancia than just regular off-the-street enquiries, so you'll get priority attention by contacting them through that email.
Or if you contact them directly through their website (www.laestanciadecafayate.com), just mention you heard about it from The Dollar Vigilante and they'll give you prompt attention.
Friday, March 18, 2011
Casa Época
If you're here in Cafayate, you should visit Merry & Paul's latest renovation, Casa Época, it's epic.
Just north of Resto Bar Baco on Guëmes.
Just north of Resto Bar Baco on Guëmes.
Monday, January 17, 2011
Porter Stansberry re La Estancia
[from Porter Stansberry, November, 2010]
I never thought I'd cite Peggy Noonan in one of my reports. In my mind, she is a hack political writer, completely out of touch with what's happening in the real world – the world outside the Washington D.C. beltway. But recently... she wrote this in the Wall Street Journal:
The biggest threat to America right now is not government spending, huge deficits, foreign ownership of our debt, world terrorism, two wars, potential epidemics or nuts with nukes.
The biggest long-term threat is that people are becoming and have become disheartened, that this condition is reaching critical mass, and that it afflicts most broadly and deeply those members of the American leadership class who are not in Washington, most especially those in business.
I've been writing about this risk – I call it the Atlas Shrugged risk – for months . . .
Most people don't understand how dangerous a narrow tax base is, especially when those few heavily taxed people have the means to exit. Right now, we're running deficits approaching $2 trillion annually. We can get away with this kind of fiscal behavior for a little while because we control the world's reserve currency (at least for now) and the world thinks of America as a law-and-order place, where people pay their taxes.
Unfortunately for our creditors, only about 1% of Americans pay around 40% of all income taxes. There are roughly 100 million U.S. households, which means about 1 million people are currently paying for about 40% of all the income tax receipts. That doesn't count the big contributions these folks make to the tax base as a whole – their corporate taxes, their sales taxes, the payroll taxes they pay on their employees, etc.
Now... what if this 1% – these million people – decided they don't need a big income anymore? Or what if they decided they'd rather live somewhere else... some place where the weather is always perfect... where a great bottle of wine costs $5... where a steak dinner (grass-fed beef, no hormones) costs $10?
Well, several of my friends went to Cafayate, Argentina, in 2005 looking for a place to build our version of Gault's Gulch. You couldn't find a more beautiful place: Cafayate sits in the middle of an enormous, high desert valley, about 7,000 feet up in the Andes mountains. It's high enough and close enough to the equator that the weather is essentially the same year round. And it's perfect – highs in the 80s, lows in the 40s each night. No humidity. My friends built a small luxury hotel overlooking a crystal blue pool. They planted a vineyard that stretches out beneath a vista of 15,000-foot mountains. (The climate and the dry, rocky soil are perfect for planting high-quality grapes and making super-premium wines.)
This is easily one of my favorite three or four places in the world. It is also a very, very safe place. It's a small community that's literally at the end of the road. Even a nuclear holocaust wouldn't change life around here very much.
As recently as 15 years ago, you wouldn't have found a single American here – it's just too far out. (It took me 23 hours of constant travel to get here yesterday, and that's the fastest I've made the trip.) But technology is allowing lots of folks to come here without losing touch with their businesses, investments, and families. And so the area's advantages – its incredible beauty, fantastic climate, friendly and educated people, etc. – have begun to outweigh the disadvantages of distance.
I've written about these efforts over the years. Most people thought the idea was crazy. But this fall, I gave a speech at the grand opening of La Estancia de Cafayate – where more than 150 lots have been sold, where a golf course has been built, and where a beautiful clubhouse now stands. I shared the podium with Doug Casey, Rick Rule, and Bill Bonner – the three most successful and influential businessmen I know well...
And 270 other people – nearly all Americans – will join us. I don't know if all 270 folks here are in the 1%... But it's a safe bet most of them are significant taxpayers. These are the wealthy folks Peggy Noonan is afraid will stop paying their taxes. And she's right. That's why many of them are here. They're looking for a place to escape, where the government will leave them alone... where they are safe... and where they are free.
I never thought I'd cite Peggy Noonan in one of my reports. In my mind, she is a hack political writer, completely out of touch with what's happening in the real world – the world outside the Washington D.C. beltway. But recently... she wrote this in the Wall Street Journal:
The biggest threat to America right now is not government spending, huge deficits, foreign ownership of our debt, world terrorism, two wars, potential epidemics or nuts with nukes.
The biggest long-term threat is that people are becoming and have become disheartened, that this condition is reaching critical mass, and that it afflicts most broadly and deeply those members of the American leadership class who are not in Washington, most especially those in business.
I've been writing about this risk – I call it the Atlas Shrugged risk – for months . . .
Most people don't understand how dangerous a narrow tax base is, especially when those few heavily taxed people have the means to exit. Right now, we're running deficits approaching $2 trillion annually. We can get away with this kind of fiscal behavior for a little while because we control the world's reserve currency (at least for now) and the world thinks of America as a law-and-order place, where people pay their taxes.
Unfortunately for our creditors, only about 1% of Americans pay around 40% of all income taxes. There are roughly 100 million U.S. households, which means about 1 million people are currently paying for about 40% of all the income tax receipts. That doesn't count the big contributions these folks make to the tax base as a whole – their corporate taxes, their sales taxes, the payroll taxes they pay on their employees, etc.
Now... what if this 1% – these million people – decided they don't need a big income anymore? Or what if they decided they'd rather live somewhere else... some place where the weather is always perfect... where a great bottle of wine costs $5... where a steak dinner (grass-fed beef, no hormones) costs $10?
Well, several of my friends went to Cafayate, Argentina, in 2005 looking for a place to build our version of Gault's Gulch. You couldn't find a more beautiful place: Cafayate sits in the middle of an enormous, high desert valley, about 7,000 feet up in the Andes mountains. It's high enough and close enough to the equator that the weather is essentially the same year round. And it's perfect – highs in the 80s, lows in the 40s each night. No humidity. My friends built a small luxury hotel overlooking a crystal blue pool. They planted a vineyard that stretches out beneath a vista of 15,000-foot mountains. (The climate and the dry, rocky soil are perfect for planting high-quality grapes and making super-premium wines.)
This is easily one of my favorite three or four places in the world. It is also a very, very safe place. It's a small community that's literally at the end of the road. Even a nuclear holocaust wouldn't change life around here very much.
As recently as 15 years ago, you wouldn't have found a single American here – it's just too far out. (It took me 23 hours of constant travel to get here yesterday, and that's the fastest I've made the trip.) But technology is allowing lots of folks to come here without losing touch with their businesses, investments, and families. And so the area's advantages – its incredible beauty, fantastic climate, friendly and educated people, etc. – have begun to outweigh the disadvantages of distance.
I've written about these efforts over the years. Most people thought the idea was crazy. But this fall, I gave a speech at the grand opening of La Estancia de Cafayate – where more than 150 lots have been sold, where a golf course has been built, and where a beautiful clubhouse now stands. I shared the podium with Doug Casey, Rick Rule, and Bill Bonner – the three most successful and influential businessmen I know well...
And 270 other people – nearly all Americans – will join us. I don't know if all 270 folks here are in the 1%... But it's a safe bet most of them are significant taxpayers. These are the wealthy folks Peggy Noonan is afraid will stop paying their taxes. And she's right. That's why many of them are here. They're looking for a place to escape, where the government will leave them alone... where they are safe... and where they are free.
Tuesday, January 4, 2011
Cafayate videos
Watch this 2-minute video of Cafayate town square & this 1-minute video of a walk through Cafayate, both filmed by Lee Harrison, Latin American roving editor of International Living.
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