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Part I:
My wife has owned, for some time now, a small lot near the beach just outside of Lima Peru. Since we weren't planning on doing anything with it, we decided to sell it. When her sister asked around to find the value, it turns out it's worth about 50% more than it was worth 3 years ago. After more investigating, it seems there's a horrendous residential and commercial building boom going on in the Lima area and prices are rising fast.
Part II:
My wife's niece is a top marketing official in one of the largest textile companies in Peru. She says business is starting to pick up from the crash of last year and it's being led by exports. She said she was at a meeting with her Peruvian clients ( the wealthy of Peru) and was told investment capital is flowing into Peru from around the world as people who don't want to hold dollars look for places to put their money. It also seems, the wealthy of Peru are not so interested in investing in Peru, or anywhere else, they're buying gold. Having experienced a classic hyperinflation in the 1980's, they may have learned a lesson or two.
I'm trying to figure out what this all means. It sure seems like they're following in the footsteps of the U.S. with an asset inflated bubble, although it doesn't appear it's something they are trying to do. I'm wondering if Peru is a pretty typical emerging market country, and if it is, what's going to happen around the world when these bubbles start bursting?
My wife has owned, for some time now, a small lot near the beach just outside of Lima Peru. Since we weren't planning on doing anything with it, we decided to sell it. When her sister asked around to find the value, it turns out it's worth about 50% more than it was worth 3 years ago. After more investigating, it seems there's a horrendous residential and commercial building boom going on in the Lima area and prices are rising fast.
Part II:
My wife's niece is a top marketing official in one of the largest textile companies in Peru. She says business is starting to pick up from the crash of last year and it's being led by exports. She said she was at a meeting with her Peruvian clients ( the wealthy of Peru) and was told investment capital is flowing into Peru from around the world as people who don't want to hold dollars look for places to put their money. It also seems, the wealthy of Peru are not so interested in investing in Peru, or anywhere else, they're buying gold. Having experienced a classic hyperinflation in the 1980's, they may have learned a lesson or two.
I'm trying to figure out what this all means. It sure seems like they're following in the footsteps of the U.S. with an asset inflated bubble, although it doesn't appear it's something they are trying to do. I'm wondering if Peru is a pretty typical emerging market country, and if it is, what's going to happen around the world when these bubbles start bursting?
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