# Reasons not to open investment accounts



## Me Linda (Jan 26, 2017)

Hello all , I have very specific questions about opening a CD or investment account here in Mexico. I have read advise here never to do it. Why? Has a major bank here like Santander or bancomber or HSBC gone under before? Is fraud and theft with no federal insurance a problem a problem , even with a CD? The interest rate on a 1 year CD in the USA is .05 here it is 5%. some here on line say it is because of the instability of the government? Do you believe someone could be elected that would just take your money, or NAFTA disappears and everyone loses everything? Please all posters with investments here in Mexico help me understand? Thank you.


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## ExpatEmigre (Nov 22, 2015)

I suspect the reason is because the peso is generally weak & typically declines against the dollar, and they're afraid of another devaluation like the one from MXP to MXN. This is just conjecture on my part, though.


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## horseshoe846 (Feb 8, 2017)

I can't speak for them but I believe the naysayers are looking back at the Mexican Peso Crisis of December 1994. There is plenty of info on the internet on that topic. Personally 
- I think Mexico is in a different place today.


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## horseshoe846 (Feb 8, 2017)

ExpatEmigre said:


> I suspect the reason is because the peso is generally weak & typically declines against the dollar, and they're afraid of another devaluation like the one from MXP to MXN. This is just conjecture on my part, though.


In my humble view - most everything is cyclical. Today the Peso is at 18.16.

The 52 week range is 17.904 - 22.029.


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## AlanMexicali (Jun 1, 2011)

You are possibly reading articles from US "financial speciaists" who always, no exceptions, start their articles with a similar senario about Mexico as do Texans.  : "Mexico is corrupt from the top to the bottom". This is suspect as that claim is unknowable and corruption is only know to those involved in corruption at any given time and not by anyone else. So if news reports are statistics Mexico has some corruption in specific proven cases and not from the top down. Maybe 1/10 of 1% of the billions of yearly transactions envolved some form of corruption reported and verified. With these types of articles just think what is the advantage of those writing them? To get people to send their money in investment accounts in foreign countries or get people to put their money in investement accounts in their own country where their base readers make commisions off these accounts. A win win situation for the writer and his countrymen.


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## joaquinx (Jul 3, 2010)

ExpatEmigre said:


> I suspect the reason is because the peso is generally weak & typically declines against the dollar, and they're afraid of another devaluation like the one from MXP to MXN. This is just conjecture on my part, though.


This is a "is the glass half full or half empty" assumption. In comparing currencies, it isn't that the Peso is weak but that the US dollar is very strong. Compare the US dollar to the British Pound or the Euro over a period of 2 or 3 years.


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## chicois8 (Aug 8, 2009)

Higher inflation rates may be one reason, from Mexico Daily News: June 8th. 17


The annual inflation rate soared to 6.16% last month, the national statistics institute said today, double the target rate set by Mexico’s central bank.

Bank of México head Agustín Carstens said at the end of May he believed inflation was under control, and predicted it would drop towards the end of the year, returning to the target of 3%, plus or minus a point, in 2018.

But the prices of some goods, including agricultural products, helped push the May rate to the highest since the global financial crisis in April 2009 when it reached 6.17%.

The rate at the end of April was 5.82%, the highest since early 2009.

Analysts surveyed by the bank last month raised their forecast for the inflation rate at the end of the year to 5.9%, up from 5.7%.

- See more at: May inflation rate was highest recorded in eight years


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## UrbanMan (Jun 18, 2015)

Me Linda said:


> The interest rate on a 1 year CD in the USA is .05 here it is 5%. some here on line say it is because of the instability of the government?


You can do much better than 0.05% in the USA. Example:

https://www.depositaccounts.com/banks/ally-bank.html

Agree its not as nice as 5%, but you do not have to settle for 0.05%.


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## chicois8 (Aug 8, 2009)

My AT&T stock pays a dividend of 5.05%
My Verizon stock pays a dividend of 4.94%

why lock up a 5 year CD for 2.25%?


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## Me Linda (Jan 26, 2017)

chicois8 said:


> My AT&T stock pays a dividend of 5.05%
> My Verizon stock pays a dividend of 4.94%
> 
> why lock up a 5 year CD for 2.25%?


. Tech stocks crashed this week Stock market crazy high on things they hope will happen , in a weird unpredictable world , and Batman just died and won't be around to save us.CD is a safe port.


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## horseshoe846 (Feb 8, 2017)

chicois8 said:


> My AT&T stock pays a dividend of 5.05%
> My Verizon stock pays a dividend of 4.94%
> 
> why lock up a 5 year CD for 2.25%?


It has been a while since we have owned any US stocks. Individual investment grade bonds sure - we hold them to maturity.

The 6 month CETE I purchased Tuesday directly from the Bank of Mexico pays 7.25 %


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## eastwind (Jun 18, 2016)

CDs expose you to inflation risk, and in my opinion do not adequately compensate you for it. You're giving up yield in exchange for the safety of the principle. 

There is a very good reason for not opening an account here in Mexico that has not been given in this thread. It only applies to US citizens/residents but not others, (but your 'flag' says originally from USA so I assume these rules apply to you). 

Google "FINRA and FATCA rules" and make sure you understand your obligations under those rules before you do anything that might break those rules as the penalties are severe.

We've been over this before, and there's someone here who will tell you not to worry about it that the bank handles everything and you don't have to do anything. I disagree, you need to be aware and you need to make sure the bank is doing what it is supposed to and I think there are additional forms that need to be filed directly by you in at least some cases.


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## chicois8 (Aug 8, 2009)

horseshoe846 said:


> It has been a while since we have owned any US stocks. Individual investment grade bonds sure - we hold them to maturity.
> 
> The 6 month CETE I purchased Tuesday directly from the Bank of Mexico pays 7.25 %


And like I related on an earlier post:


"The annual inflation rate soared to 6.16% last month,"

Just like gas in Mexico always goes up,up,up, unlike the US where is fluculates with the world market Mexican gas never goes down ........gas goes up 22% this year so goes cost of goods to market........


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## eastwind (Jun 18, 2016)

One of the timeless pearls of wall street wisdom is "don't fight the fed". 

Since 2007 the fed has been actively encouraging investors to own stocks by setting interest rates near zero for most anything else. That may finally be starting to change, but if you went along with the fed for the last 10 years you have been richly rewarded.

For example, by simply buying an S&P500 index fund after the crash in 2007 and holding it for 5 years you could have achieved 20% growth per year, more than doubling your money. A 5 year CD would have given you a pittance. 

But I think that many, if not most, people have extremely low tolerances for principle risk and prefer to take on other kinds of risk (such as opportunity cost, inflation risk, and exchange rate risk). Forgive me for being a cynic, but I think that's because they simply don't understand the other kinds of risk as well as they understand principle risk.


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## Me Linda (Jan 26, 2017)

I live a simple life social security is my only income , I rent with all utilities included , I have no car and I shop at local markets. How will inflation effect my interest income? I don't think the interest I receive from my savings will impact my taxes much if at all . I understand filing USA and Mexico taxes showing interest income. Unless Mexico taxes my social security ? I am a permanent resident here. I had friends that lost their entire life / retirement savings when the stock market crashed. I am not going that route because I am too old to ever get it back. The official at the bank stated Mexican taxes would be withheld from the interest of the CD. And I believe that as long as I report the interest income on my USA taxes I should be fine? Maybe I am wrong?


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## horseshoe846 (Feb 8, 2017)

eastwind said:


> CDs expose you to inflation risk, and in my opinion do not adequately compensate you for it. You're giving up yield in exchange for the safety of the principle.
> 
> There is a very good reason for not opening an account here in Mexico that has not been given in this thread. It only applies to US citizens/residents but not others, (but your 'flag' says originally from USA so I assume these rules apply to you).
> 
> ...


Let's start with the forms. You need to file FINRA forms (online) and you need to file an 8938 with your taxes if you exceed a certain threshold. That is all the forms you need to deal with. For us the FINRA form has the exact same information as the 8938. I would probably file both - even if I were not required to - for peace of mind. They can't fine me for being overly honest...

All of the Mexican financial institutions we deal with provide us with a timely annual report of the status of our accounts for the previous tax year. All of them comply with the FATCA regulations. They file independently of us with the IRS but we are still required to file our own forms.

The banks 'handle' nothing. You have to take the information you have from your statements, combined with the annual reports from your Mexican institutions and complete forms as best/honestly as you can. So it comes down to - rather than waiting for your US banks to send you a 1099 - you have to create your own and file that with your taxes.

By all means - if math intimidates you - or you can't think for yourself - you should never consider investing in any institution which will not 'handle everything' for you. But it is a BIG world and there is no reason that a US citizen should be required to invest solely in the US.

Something else not touched on in this thread is diversity of your investments. What happens when you have all your money tied up in a US money market account and something happens (which they are already talking about) and they say you can not withdraw your funds due to market volatility (or perhaps without a sizable penalty). I'm not making this scenario up. You need to read the prospectuses they send you.

I've got no skin in your game. I'm just sharing with you my viewpoint.


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## horseshoe846 (Feb 8, 2017)

Me Linda said:


> I live a simple life social security is my only income , I rent with all utilities included , I have no car and I shop at local markets. How will inflation effect my interest income? I don't think the interest I receive from my savings will impact my taxes much if at all . I understand filing USA and Mexico taxes showing interest income. Unless Mexico taxes my social security ? I am a permanent resident here. I had friends that lost their entire life / retirement savings when the stock market crashed. I am not going that route because I am too old to ever get it back. The official at the bank stated Mexican taxes would be withheld from the interest of the CD. And I believe that as long as I report the interest income on my USA taxes I should be fine? Maybe I am wrong?


I am not an accountant - far from it.

Mexican banks etc will withhold 0.6% in taxes on your earnings - which - if you were a Mexican citizen is all the taxes you would need to pay on your earnings - unless you had A LOT of income. Unfortunately if you are a US citizen that is not good enough. You need to report your interest to the IRS and pay them as well. If there is good news in that scenario - you can claim an exclusion of the taxes you already paid Mexico so you are not double taxed.

We have never made a significant amount of money in the stock market - but we never lost a significant amount either. I purchased my first share of Microsoft in 1983 - and I lost money. The only time we made money in stocks was when I was issued 'founders' shares in a small company at 15 cents a share that later sold for more. I would never have paid more than 15 cents - but in the end people did...

There is an excellent forum on this site with some super helpful/informed people. Search on 'expat taxes' on this site.


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## eastwind (Jun 18, 2016)

Me Linda said:


> I live a simple life social security is my only income , I rent with all utilities included , I have no car and I shop at local markets. How will inflation effect my interest income? I don't think the interest I receive from my savings will impact my taxes much if at all . I understand filing USA and Mexico taxes showing interest income. Unless Mexico taxes my social security ? I am a permanent resident here. I had friends that lost their entire life / retirement savings when the stock market crashed. I am not going that route because I am too old to ever get it back. The official at the bank stated Mexican taxes would be withheld from the interest of the CD. And I believe that as long as I report the interest income on my USA taxes I should be fine? Maybe I am wrong?


When you put your money in the bank (either in a checking account, savings account or CD) you expect to "get your money back" plus interest. The risk of inflation is that when you get your money back, you might not be able to buy as much with it as you could when you deposited it. 

Suppose you have an extra 10,000 pesos, and that's enough to pay your rent for 2 months. You deposit that in a 1-year CD at 2%. A year later you get back your 10,000 pesos plus 200 pesos interest. Let's ignore taxes. Suppose, however, that your landlord raises your rent 10% at the end of the year. So now you need 11,000 pesos to pay the rent for 2 months, but you only have 10,200. You're worse off. That's inflation.

It's like Alice in Wonderland:

Alice looked round her in great surprise. "Why, I do believe we've been under this tree the whole time! Everything's just as it was!"
"Of course it is," said the Queen, "what would you have it?"
"Well, in our country," said Alice, still panting a little, "you'd generally get to somewhere else—if you ran very fast for a long time, as we've been doing."
"A slow sort of country!" said the Queen, "Now, here, you see, it takes all the running you can do, to keep in the same place. If you want to get somewhere else, you must run at least twice as fast as that!"​
If you know your landlord is going to raise your rent by 10% a year, you need an investment that increases your money by 10% just to stay even.


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## UrbanMan (Jun 18, 2015)

horseshoe846 said:


> Something else touched on in this thread is diversity of your investments. What happens when you have all your money tied up in a US money market account and something happens (which they are already talking about) and they say you can not withdraw your funds due to market volatility (or perhaps without a sizable penalty). I'm not making this scenario up. You need to read the prospectuses they send you.


Every mutual fund in the world (money market, equities, bonds - all) are this way, ie. they generally send your money very quickly if you instruct them to sell, but they all have the right in highly unusual conditions to slow or halt exchange activity. What are the odds? Not win-the-lottery slim, but pretty darn unlikely.

One solution to this is to have money placed with multiple vendors, ie. not all with one bank or mutual fund seller. Ties into your point about diversity. If/when unusual conditions arrive, its unlikely they will all lock down or slow transactions in the same way (*). 

Also, don't maintain cash on hand so low that being unable to access your funds for a few weeks will cripple your life. Call it depression era thinking if you like, but I do believe in having currency carefully hidden in a few different places in your home. Not massive amounts, but enough to function for at least a month.

(*) If all the money market funds in the world ever were to simultaneously lock down indefinitely, we'd all be so massively #[email protected]%ed that it would not matter where you have your money.


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## Me Linda (Jan 26, 2017)

eastwind said:


> Me Linda said:
> 
> 
> > I live a simple life social security is my only income , I rent with all utilities included , I have no car and I shop at local markets. How will inflation effect my interest income? I don't think the interest I receive from my savings will impact my taxes much if at all . I understand filing USA and Mexico taxes showing interest income. Unless Mexico taxes my social security ? I am a permanent resident here. I had friends that lost their entire life / retirement savings when the stock market crashed. I am not going that route because I am too old to ever get it back. The official at the bank stated Mexican taxes would be withheld from the interest of the CD. And I believe that as long as I report the interest income on my USA taxes I should be fine? Maybe I am wrong?
> ...


. If my landlord raises my rent by 10 % I move somewhere cheaper, unlike Alice I am not stuck in a rabbit hole. Only someone that eats magic mushrooms and reads Alice in wonderland would buy into a stock market that's at a all time high.


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## chicois8 (Aug 8, 2009)

Only problem Linda is the food prices will increase little by little so soon since you still need to eat you cannot just move somewhere cheaper to eat...and if you are on a fixed income your screwed...


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## eastwind (Jun 18, 2016)

I'm not necessarily advocating anyone buying stocks now, and there are a lot of people I'd never advise to buy stocks. But people who don't understand inflation end up getting screwed by it. 

There has historically been higher inflation in Mexico than in the US, so it has mattered more for those who kept their savings in pesos in Mexican banks than those who kept their savings in dollars in US banks. You asked for specific reasons (risks) to avoid Mexican bank accounts, so that's one.

Another risk is bank insolvency. What happens in Mexico when a bank "goes bust"? I don't know. And assuming that there is some system backstopping Mexican banks, what happens when that system is overwhelmed by multiple banks all failing more or less at once? Does Mexico do taxpayer bailouts or account holder bail-ins? 

There is also good advice here on keeping some of your money close at hand and easily accessible so that you have something to spend if the financial system freezes up and (temporarily) stops working. Living in a foreign country puts you "out on a limb" more than before, so some extra precautions are probably worthwhile. But that doesn't mean I'm advocating holding all your wealth in gold bars under the bed, either.


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## joaquinx (Jul 3, 2010)

Free advice. Now, what's that worth?


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## Me Linda (Jan 26, 2017)

joaquinx said:


> Free advice. Now, what's that worth?


. Probably more than the advice all the people who lost all that money a few years ago got from their paid stock brokers lol. I trust the people here in this thread more.


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## horseshoe846 (Feb 8, 2017)

eastwind said:


> I'm not necessarily advocating anyone buying stocks now, and there are a lot of people I'd never advise to buy stocks. But people who don't understand inflation end up getting screwed by it.
> 
> There has historically been higher inflation in Mexico than in the US, so it has mattered more for those who kept their savings in pesos in Mexican banks than those who kept their savings in dollars in US banks. You asked for specific reasons (risks) to avoid Mexican bank accounts, so that's one.
> 
> ...


I understand inflation - but I'm not losing any sleep over it. Even if it erodes our savings over time those monies will likely last longer than we will. I don't know what goes into the inflation figures released in the US or Mexico. I've always assumed that the US probably cherry picks what it includes. For example - I wouldn't be surprised to learn that medical costs are excluded. I remember how I felt when I learned that the key component in figuring US GDP is consumer spending !! That is terrible.

More importantly for us is that our cost of living is 1/4 to 1/3 what it was in the US. In some cases it is more dramatic. Here in Mexico our medical costs are about $2000 USD/year. I can only guess what that would be in the US these days - perhaps $12000 or more ? That negates a lot of Mexican inflation.

Mexico is much kinder to its citizens in terms of inflation. Mexican banks etc report to you both nominal and real interest earned and a Mexican only need worry about 'real' (after inflation). The IRS is not that kind and an American must report the nominal interest earned in Mexico. Also - in Mexico you can purchase UDIBONOs which are linked to inflation and pay something like 3%+ today.

Bank solvency is probably something that should receive some consideration - although I do believe there is a fund similar to FDIC in Mexico - I'll have to research that again. I don't think Citibanamex is going anywhere. Same with HSBC. But some of the smaller ones ? At the same time you - even an American in Mexico - can bypass banks and invest directly with the Bank of Mexico (the Mexican Fed if you will). And personally - I put more faith in Sr Carstens (who is soon leaving to head the Bank of Int'l Settlement) than Sra Yellen.

I remember back in 2008 when the US government needed to created an emergency insurance plan to assure the solvency of the largest money market accounts. It is what allowed companies like Fidelity to preserve the NAV at $1 USD. I think that insurance was in place for longer than a year. I think the new plan in place is to freeze / limit redemptions. 

Finally - I misspoke yesterday when I said Mexican banks don't do any paperwork to help you with the IRS. This year we received a real 1099-INT from Citibanamex (in English). We called and it represented all of our dealings with banamex for the prior year. I would have been much 'harsher' had I created the 1099 myself...

Edit : I kind of like the look and feel of silver Libertads myself


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## eastwind (Jun 18, 2016)

In the US the official estimate of inflation is the CPI. The cost of medical care is a component of the CPI, but it is only given a weight of 7% according to this, which seems low to me. Note that the pie chart is from 2012 and the weights get adjusted from time to time.

As for how much free advice is worth, consider that forum rules sometimes prevent appropriate advice from being given.


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## lagoloo (Apr 12, 2011)

Free advice: Don't keep more money in a Mexican bank than you can afford to lose. Other than that, it's a useful place to keep your monthly needs.

The CPI is a bad joke, and hardly represents the spending habits of older people. However, that's what they use to determine increases in old age benefits.........or not.
Poor us.


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## Me Linda (Jan 26, 2017)

lagoloo said:


> Free advice: Don't keep more money in a Mexican bank than you can afford to lose. Other than that, it's a useful place to keep your monthly needs.
> 
> The CPI is a bad joke, and hardly represents the spending habits of older people. However, that's what they use to determine increases in old age benefits.........or not.
> Poor us.


. That is exactly what I asking ,Has anyone here ever lost money in a Mexican bank ? And if so how? I know many of you have been here for years . Have you or anyone you know lost money in a Mexican bank ?


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## horseshoe846 (Feb 8, 2017)

Me Linda said:


> . That is exactly what I asking ,Has anyone here ever lost money in a Mexican bank ? And if so how? I know many of you have been here for years . Have you or anyone you know lost money in a Mexican bank ?


I did a google search on "mexico bank insurance". The very first results is an excellent source of info.

In a nut shell - there is a bank deposit protection institute (IPAB) which insures deposits up to something like 2 million pesos. 

Instituto para la Protección al Ahorro Bancario | Gobierno | gob.mx


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## LMtortugas (Aug 23, 2013)

Tacking back to the concern originally put forward, risk variables such as yield, inflation, currency strength, IRS compliance, etc, are neither exclusive to Mexican investments are valid indicators when assessing “safety” of investment/deposit accounts in Mexico. Financial gain, or lack thereof, doesn’t equate to “safety.”

Comparatively, the market in Mexico is rather stable and has been for several years. National banks are well capitalized & mostly secure, credit portfolios are performing positively, & the country is a growing economic power globally with a robust financial services sector. A small investor can invest in government securities, insured bank deposit accounts, and trade stocks.

Bottom line, knowledge & tolerance to risk and uncertainty should be a principle factors when guiding investment. If 10 years ago in the U.S. a broker advised all my General Motors stock is soon to be worthless, Bear Stearns will cease to exist, and Donald Trump will lead free world I would have discarded such rubbish with the evening trash.


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## Isla Verde (Oct 19, 2011)

Me Linda said:


> . That is exactly what I asking ,Has anyone here ever lost money in a Mexican bank ? And if so how? I know many of you have been here for years . Have you or anyone you know lost money in a Mexican bank ?


I have lived here for almost 10 years and have had an account with Santander for almost that long. Never lost any money, except the few times I've bought lottery tickets!


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## lagoloo (Apr 12, 2011)

There was an occasion some years ago when there was a massive devaluation of the peso after it had had a huge increase. People who invested during the top swing lost badly. Sometime in the 90's I think. A friend was encouraging me to invest. I declined. He lost heavily.


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## chicois8 (Aug 8, 2009)

lagoloo said:


> There was an occasion some years ago when there was a massive devaluation of the peso after it had had a huge increase. People who invested during the top swing lost badly. Sometime in the 90's I think. A friend was encouraging me to invest. I declined. He lost heavily.


Correct,few remember December 31st 1992 the peso was 3100 x $1USD, the next day January 1st 1993 ( yes overnight ) it devalued to 3.1 x $1USD......lots of folks lost lots of dinero that New Years Day.....

An aside, only Banorte is fully owned by Mexico intrests, all the others are owned by foreign banking concerns...


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## UrbanMan (Jun 18, 2015)

Re: value of the peso, you don't need to go very far back. 

2013 and most of 2014, the USD to MKP xrate was about 13.

2016 to today, consistently the xrate has been over 17.

In percentage terms, huge change - over 30% devaluation.


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## horseshoe846 (Feb 8, 2017)

UrbanMan said:


> Re: value of the peso, you don't need to go very far back.
> 
> 2013 and most of 2014, the USD to MKP xrate was about 13.
> 
> ...


And as I mentioned earlier - this year's range is 17.9037 - 22.0289.

So at 18.16 - is that a 20 % increase ?

Sometimes it does a country good to have a weak currency from time to time. I have not researched it - how is the peso doing against the other major world currencies (other than the dollar) ? What happens to the dollar when Russia and China move away and the dollar is no longer the world's reserve currency ?

Wait - the EUR/MXN 52 week range is :
20.3073 - 20.3245

JPY/MXN : 0.164 - 0.1647

CAD/MXN : 13.46267 - 13.49

I'm not big into economics - I don't know.


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## chicois8 (Aug 8, 2009)

The actual 52 week range is 13.44 - 16.57.......CAD / MXN


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## horseshoe846 (Feb 8, 2017)

chicois8 said:


> The actual 52 week range is 13.44 - 16.57.......CAD / MXN


??

https://finance.yahoo.com/quote/CADMXN=X?p=CADMXN=X

Edit : I'll stand corrected - when I look at the chart it does appear that your reality is correct. Guess they have a glitch there ...


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## Meritorious-MasoMenos (Apr 17, 2014)

horseshoe846 said:


> I can't speak for them but I believe the naysayers are looking back at the Mexican Peso Crisis of December 1994. There is plenty of info on the internet on that topic. Personally
> - I think Mexico is in a different place today.


Even further, to Aug.-Sept.1982, when President Lopez Portillo nationalized the banks and ended free peso-dollar exchange.

The Mexican stock market fell 90% in a week. I was fairly new to the country then but had read a lot about the US market and knew the "buy low sell high" motto. I considered opening a mutual fund account, available then but no "no-loads." I decided not to risk it. People were forecasting years of chaos.

But De la Madrid was sworn in as prez Dec 1, ended anti-American ranting of Lopez Portillo, and US lent enough money to greatly ease the crisis. Within a year, market had risen to previous high and kept on growing. People who bought at crash prices made huge fortunes. My lost chance to become a millionaire.

I had also been a Mac person since early 80s. In early 90s, predictions were the company would fold soon and stock was down to $2 a share, maybe under a $1, maybe even 30 cents a share. Don't remember.

My two brothers were PC techies. At Christmas, they would always spend hours to install new PC software, while non-techie I just had to hit "install" button on Mac software.

For months I thought about investing. I had capital from my many years living overseas on expense account and successful small biz in Mexico.

I opened up a PC and Mac side by side and worked on both. Mac was SO superior, but much more software then available for PCs. I couldn't believe Macs weren't winning, even though more expensive. Their superiority sand beauty were remarkable, and I kept on saying to myself, "If enough people only knew ... " but this knucklehead listened to the "experts" and held off.

A $10,000 investment in Apple in early 90s is worth something like $40 million today.

Don't come to me for investment advice.'

New US tax laws now make having overseas investments so difficult, but if it ever drops 90% again, I'm flying in with all my saved pennies to buy.


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## lagoloo (Apr 12, 2011)

Woulda, coulda, shoulda, eh? Chuckle. I shoulda bought that cute little house in San Francisco back when, too!
You did miss out on some whoppers!


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## horseshoe846 (Feb 8, 2017)

I would have bet you that the computer mouse was never going to catch on. Same with the 3.5" floppy. At one point I had a very lucrative position working with Windows 1.0 - back before the days you could even overlap windows (they were tiled). Remember preemptive multitasking  I left that situation right about the time Windows 3 was released, because I was sure IBM's OS/2 was the future. Boy was I wrong.

At one point I had a Mac on my desk (along with a few other computers). I never liked the Mac because it did not have a command prompt


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## dwwhiteside (Apr 17, 2013)

If you want to open an investment account in Mexico because you think you might get a higher rate of return, in terms on U.S. dollars, that would probably be a mistake. However, if you live in Mexico and are looking to maximize the number of pesos you're receive on an investment with very little risk to your principal investment, there is really no reason not to buy a CD from a Mexican bank.

The reason a U.S. investment adviser would not recommend investments in pesos in a Mexican bank, other than their own self interest, is that the U.S. dollar is a much more stable currency than the Mexican peso. For example, if you converted dollars to pesos in 2012, you may have gotten somewhere around 13 pesos for each dollar. Five years later, if you wanted to take those pesos plus the interest they had earned and turn them back in to U.S. dollars, those dollars would cost you around 19 pesos (I am doing a lot of rounding and averaging for purposes of this illustration). So, you would have needed to earn well over 6 percent annually just to stay even. IF you planned to convert those pesos back into dollars. If you plan was to earn interest on the pesos you were going to spend in Mexico, that part does not apply.

And it is not so much that the peso has been weak, it is more that the dollar has been very strong; against most foreign currencies. So, if you plan to stay in Mexico and use whatever interest you can earn on your investment here in Mexico, there is really nothing wrong with purchasing a CD from a Mexican bank. But, if you think you may one day need to take those pesos and convert them back to dollars, then there is a risk that the pesos value against the dollar will be lower when the CD matures.


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