Saturday, October 17, 2009

American yuppies in Argentina

CptnRick sent me this (thanks man). It’s the other side of the coin, of all those stories about Americans living the rich and famous life here in Buenos Aires, and doing so cheaply. There’s a reason why Argentina is “cheap”.
I didn’t hotlink the source for obvious reasons, but I really wanted to share this because its in fact how life is here for some people, the double standard sometimes travel agencies or even people that relocated here prefer to omit.
The link for the complete story is for adults only. I included the most relevatn parts here.

Raging Bulls
By Spencer Morgan

Around October, when the economy went into free fall, a bunch of out-of-work finance guys in their 20s descended on Buenos Aires, where you can have the penthouse, the steak dinners and the bottle service at ridiculous nightclubs and still save money renting out your apartment in New York or London.

Lifestyle arbitrage, baby! The word got out, and the party built on itself, making the fantasy it offered all the more intoxicating: Come spend a month—or four—in Buenos Aires, where you really are a master of the universe, where nights are sleepless and potential business deals are all scams and the clubs teem with unemployed expat bankers looking for their identities in piles of cocaine and the bloodshot eyes of hookers and thieves.
Unable to get a job in New York, Jason began looking at emerging markets—Buenos Aires, Prague, São Paulo. If he could get something substantial going abroad, create a market in a country where there was none, he could build a bridge back to Wall Street and come out on top. Risk and reward. A friend sent Jason's résumé around to a few people he knew in Buenos Aires.

In June he flew down for an interview, and a friend from Morgan Stanley tagged along. The interview did not result in an offer.

Jason and his friend booked a room in a posh boutique hotel in Palermo Soho for $150 a night. That weekend they wound up at a party in another gringo's suite with a couple of girls who turned out to be hookers. The girls stole everything in the kitchen, which amounted to about $1,000.
At the airport the next day Jason's friend was shocked when Jason told him he wasn't getting on the plane. The 20-minute cab ride from Ezeiza International Airport back to the city offers views of the villas miserias (shantytowns) that surround the downtown area, as well as a fancy soccer facility, a training ground for the nation's top-ranked team, whose coach is the legendary Diego Maradona—a notorious ex–coke addict.

By local standards Jason got bilked when he rented an apartment for a week for $500 from Apartments BA, a leading developer that has in the past decade purchased, largely through foreign investors, roughly half a billion dollars in properties, in cash. There is no credit in Buenos Aires, no loans, no mortgages. Every transaction is in cash. This is because banks here have no money to lend because they have no capital because no one in his right mind keeps much money in the bank since the government defaulted on its public debt during the 2001 financial crisis, robbing its citizens of some $93 billion. Since the latest financial crisis, short-term rentals have gone down, while month-to-month rentals are up 15 to 20 percent. Apartments BA chief executive Michael Koh doesn't ask, but clients often tell him, "I just lost my job in finance."

Jason met a cocky 22-year-old porteño (Edited by FerFAL: Porteños are those of us born in Buenos Aires city) named José Rodrigo. José worked for a New York–based private equity group as its representative in Montevideo, Uruguay, which is three hours east of Buenos Aires by water taxi and home to a number of legal tax shelters. José was happy to set up some meetings for Jason with the tax shelter operators he knew and offered to accompany him on his trip. What a guy.The trip was productive, and Jason was eager to get back to Buenos Aires.

José said that since they were already in Uruguay they should spend an afternoon in Punta del Este, a well-known resort town a mere hour-and-a-half drive—along the completely barren coastline—from Montevideo. They lunched at the famous Parador La Huella. Jason got up to use the bathroom. After lunch he suggested they hit the road. José asked him if he was feeling all right. When Jason said he wasn't, José said it was probably best to head home.

Twenty minutes out of town Jason asked José to stop the car. He was feeling queasy and his legs were numb. As soon as he got out of the car he fell to his knees and began vomiting. José drove off. Jason could not believe his eyes.

It was dark and cold, and he was alone. He thought he was going to die. He crawled two miles to a bus station. After five buses passed, a driver took pity on him and allowed him to ride for free. The driver radioed ahead to a hospital that he had a sick passenger. At the hospital Jason realized he had no money. He remembers a nurse had to get someone who spoke English. "You're in Uruguay," they told him. "Medical care is free." Diagnosis: He had been poisoned.

Two days later Jason finally made it back to the Palermo neighborhood in Buenos Aires. At José's apartment the police found Jason's stuff, except his computer, which was all that mattered (though the police reports did make fine souvenirs).

A couple of days later Jason was still feeling like hell. Jordan came into his room: "Guess what, man." He told him Bank of America had acquired Merrill Lynch. Not long after, Lehman Brothers went under. The finance industry was crumbling; the demise was stunning in its breadth and immediacy. According to the U.S. Bureau of Labor Statistics, between January 2008 and April 2009 some 276,000 Americans with jobs in the finance industry were handed their walking papers. Jason and Jordan started to get phone calls from their banker buddies in the States. Many of them were headed for Buenos Aires.

After being poisoned and left for dead, Jason gave up trying to put together deals in Buenos Aires. Building a bridge back to Wall Street wasn't happening.

On October 21 Argentina's leftist government nationalized the $30 billion private pension system. The stated purpose was to protect investors from losses resulting from the global market turmoil. Another effect was that trying to raise foreign capital, even for a tourism venture, became pointless; no one wants to invest in a country that recently nationalized $30 billion in private investments. Besides, tourism was sure to go down, because social upheaval and violence would likely ensue.


Through January and February Jason began hearing more stories of expats getting robbed or being kidnapped. One friend, Mike, who had worked at a now-defunct hedge fund in San Francisco, and another guy were leaving a bar in Microcentro, doing bumps off their hands as they walked. A cop car pulled up. They thought they were going to jail. The cop in the passenger seat pointed a shotgun at them and told them they were going to make a tour of ATMs, which are few and far between in this city. Two hours and $3,000 later, the cops set them free.

Prostitution is a huge industry in Buenos Aires. The whorehouse district is across the street from the historic Recoleta Cemetery, a major tourist attraction, on Vicente López. The street is lined with "cabarets." Customers pay a charge at the door; inside, the bars are full of working women. What you do from there is your business.



Anonymous said...

I encourage everybody to read that entire article. No wonder Americans are so hated. They have more money than sense-or souls. The American youth just party all the time. What a shitty life. Look, I'll just stay here in my mobile home on the California floodplain and sell refurbished laptops for a living. If this is what it means to be rich, I want no part of it.

Anonymous said...

Anon, Americans are hardly the only people who party too much and visit prostitutes. I'm not defending the losers in the article, but let's not pretend that Americans are the only ones guilty of this. And there are plenty of people here who roll their eyes at these self-destructive antics (including myself)--their lives and opinions just aren't exciting or titillating enough to be noticed by Playboy or the mainstream media.

In regards to the article: There was something very strange and missing about the whole poisoning story. The criminal, Jose, had a decent job representing some financial company. Why would he risk his job by poisoning someone just for a computer?!? If he was just going to steal a computer, why would he even waste the time and trouble taking the victim out to lunch and using poison? If you were going to go to those lengths, wouldn't you try to steal more? Wouldn't it be more efficient just to show up at the apartment with a gun? How very bizarre.

Don Williams said...

With gloomy viewpoint here I suspect a lot of readers are married. :)

I grew up in a part of the USA that suffers boom and bust economic cycles due to mining -- sometimes times are good and sometimes they were/are very bad. It seemed to me that what sustained people's spirits in the bad times were partying on occasion as a community.

Something like Lionel Rich's old song --All Night Long.


So I wonder, Ferfal, if people still party in Argentina. Not as as a nightclub business provided for the tourists but for fun.

Not as something sordid --but to let the tribe celebrate that --yes, life is good and sweet.

Patrick said...

To be fair that writer is a hack and douchy finance guys are not represenative of all American expats.

KeithC said...

Anon 2, re: poisoning. It might not have been a direct murder attempt - think around the edges. Maybe "roofied" for a kidnapping but they overdosed or used the wrong stuff. Maybe the idea was he would get sick after they got back and he would be willing to provide any passwords, et cetera, to access his contact info for people in the states to notify when he went to the hospital (also giving access to any corporate info on the 'puter) but, again, they got the dosage wrong. Maybe just bad food or someone kept the rat poison on the wrong shelf in the kitchen. Life's funny that way.

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