Pan Dulce Don't You Think The Prices Are A Bit Crazy?

[nlaruccia]

What does the currency of your salary have to do with the price of a Panettone?

If 25 bucks is the going rate for Panettone (I have no idea), then in dollar terms the price here (allegedly ~200 ARS) is lower using even the official rate.

In the States a secretary makes around $2,500 US per month. A fruit cake in the States cost $25 US or 1% of a secretary's monthly salary. A secretary in Buenos Aires earns around $4.000 pesos per month. Let's say a good pan dulce costs $300 pesos. That's 7.5% of the secretary's salary!!! Expensive.

 

[sesamosinsal]

In the States a secretary makes around $2,500 US per month. A fruit cake in the States cost $25 US or 1% of a secretary's monthly salary. A secretary in Buenos Aires earns around $4.000 pesos per month. Let's say a good pan dulce costs $300 pesos. That's 7.5% of the secretary's salary!!! Expensive.

If I am a baker and I have to sell my pan dulce at 200 pesos to pay for my production costs and churn a profit, then that's what I am going to charge. People will either pay for it, or they won't. If they pay for it, great. If they don't, then I simply won't waste my time making pan dulce.

So, the problem is not that the cost of a pan dulce is too high. The problem is that the salaries are too low.

Some might say we're playing semantics. However, I think blaming the prices and producers is a pretty typical government response here to this issue because blaming themselves for creating poor economic conditions is just impossible for them to do.

 

[nlaruccia]

If I am a baker and I have to sell my pan dulce at 200 pesos to pay for my production costs and churn a profit, then that's what I am going to charge. People will either pay for it, or they won't. If they pay for it, great. If they don't, then I simply won't waste my time making pan dulce.

So, the problem is not that the cost of a pan dulce is too high. The problem is that the salaries are too low.

Some might say we're playing semantics, but honestly, I think blaming the prices and producers is a pretty typical government response here to this issue because blaming themselves for creating poor economic conditions is just impossible for them to do.

Then it's the government's fault that pan dulce is too expensive. Those coming with US dollars enjoy your pan dulce.

 

[sesamosinsal]

Then it's the government's fault that pan dulce is too expensive. Those coming with US dollars enjoy your pan dulce.

The Argentine government has created severe distortions in the economy -- unfortunately. They are not completely at fault, however. In my opinion, there are lots of actors to blame, including the media and the unions.

At any rate, this does not change the point, that salaries here are much lower in dollar terms than they were several years ago, and this just makes sense from a supply perspective. The dollar reserves have gone down about 50 percent since 2012, and the amount of pesos in public circulation has increased by 60 percent. The pesos in circulation increase alone has profound consequences for price inflation. Salaries almost never keep up with it.

 

[ariel81]

Well,as allways there is different products for different people,you can buy also,pan dulce at supermarkets for 40 pesos
Regarding prices,dried fruits and nuts and so forth,are very expensive here.

 

[nlaruccia]

The Argentine government has created severe distortions in the economy -- unfortunately. They are not completely at fault, however. In my opinion, there are lots of actors to blame, including the media and the unions.

At any rate, this does not change the point, that salaries here are much lower in dollar terms than they were several years ago, and this just makes sense from a supply perspective. The dollar reserves have gone down about 50 percent since 2012, and the amount of pesos in public circulation has increased by 60 percent. The pesos in circulation increase alone has profound consequences for price inflation. Salaries almost never keep up with it.

I agree, I just don't understand how foreigners that live here with an income in US dollars can compare prices in the States with those in Argentina? It doesn't make any sense. So pan dulce is cheap for them, but for many Argentines it's expensive regardless of the reasons why. Thank goodness I don't like pan dulce. Turron de mani from Spain is much tastier.

 

[Rich One]

Forget Pan Dulce ...!! Look for Paaaaannnn Caseeeerooooo...

 

[ElQueso]

Things are not only problematic for those who earn in pesos. Although, I will readily admit that anyone living here earning in dollars is automatically better off than anyone living here and earning in pesos, without a doubt.

Thing is, people who compare prices in the States or in Europe to prices here don't seem to take into account things like families, budgets and other forward-looking plans (stability is necessary to know roughly how much you can spend towards the future).

People make commitments (many long-term) based on costs, no matter where their money comes from. I'm certainly not poor, and I have very little to complain about in relation to people earning pesos here. But even so, the rise of prices here and the artificial value of both the official exchange rate and the blue rate are hurting us quite a bit.

The relative money I may be saving on food costs in comparison to the US (in these days of great inflation here - and I'm not convinced that outside of places like New York, San Francisco, LA, etc, the prices are better here for many things), for example, is far outweighed by the price of putting three young ladies through school (I never paid for primary or secondary school in the US, considering that the average level of public education there far exceeds the best I've paid for here at great cost), buying school supplies (at least on a level with the US costs seem high to me, though I've not actually compared - although the price of books, or even making copies, is an expense I never had) and clothes (decent clothes that last more than a few washes are much more expensive than the US), paying for school trips (which aren't a "lower" price when the school travels outside the country at the end of the year, for example) and other things that young folk need to be healthy and bright.

Hell, I just went out and bought a pair of shorts and a shirt and spent $1300 pesos, just for myself. $100 USD at blue rate, or $152 USD at official rate, is nowhere near a good deal for these clothes, but rather 2-3 times more than I would have paid in the US.

I'm a bit of a big guy (not fat, slightly overweight, just somewhat big) and I can't find any freaking XXL shirts for the most part here. When I do find them, they are not XXL where I come from, but the actual sizes range between L and XL. So I go to Legacy where they do have sizes that big (and are actually what I'm accustomed to). The shirt cost 500 pesos - pretty much the same style of shirt I bought 9 months ago in the States (chomba - can't remember what we call them in English hehe). The shirt I bought here was very thin (why I bought it, for the heat) cotton. I know a friend that buys from Legacy and he swears the shirts don't shrink (which is another problem I have with almost all clothes I buy here, even washing in cold!) The same shirt I bought in the States was microfiber, very elegant looking, and about as cool as the thin cotton I just bought. I paid $19 USD in the States, or $247 pesos at the current blue rate, or $161 pesos at the official rate. What I bought in the States was much better quality, fits me better, looks better and is still half the price than what I bought here. (I just don't have enough shirts!)

Let's not even talk about tools, appliances, and other items that are either way more expensive or terrible quality - or completely unavailable.

Not to mention that I'm paying about 50% more to live in an apartment that doesn't have central air/heating, decent plumbing and other "modern" amenities that I was used to previously, and it's about half the size of my house (compare 3000 sq ft with 170 sq mtrs, not to mention a corner lot with some of my own land, there in the States) and I don't even have my three car garage that went along with it! (An additional expense to pay for parking, although a good price, that - a bit over $100 USD per month) Yeah yeah, tell me "but where else can you live in a 'beautiful' capital city in the middle of the city itself for that price?" Don't even get me started on the broken sidewalks, litter, dog crap, and worry about tens of thousands of villeros living not that far from us with economic conditions that may have them boiling out of there at some point in the future.

In addition, if I was living in the US, I could be making around twice what I make now, and could be working less hours. I have to hustle to find clients and projects to work on and have to work real hard to maintain all of that so I have a steady flow of money coming in.

Furthermore, the amount of money I have available to help the family here (those that don't live with us, in the form of loans, or buying clothes and school supplies for the kids of family members who really have next to nothing, or the rest of the family living near-subsistence level in Paraguay, etc) has been severely curtailed. and they are truly, truly suffering because except for one, they don't belong to a union and don't see the kinds of raises union jobs see (and even those don't keep up with inflation).

People who come here as tourists, or have enough money to travel back and forth and pick up things from their home countries and come back, or are only one or two people, don't feel things the way a lot of us who have many obligations here often feel things. Easy to be flippant about prices and assume that anyone who earns in dollars shouldn't be bitching when renting smaller temporary apartments and don't have many mouths to feed and so on, but I feel the reality for some of us is quite different, dollars or not.

I am, however, thankful every day that I earn in dollars and have been able to make enough connections that the cost of bringing those dollars into the country isn't at the level of an additional 5-6% of the cost of living here (the prices that cuevas charge nowadays to bring in money). If my way of getting the money here to change to pesos went away, I'd be screwed given the current obligations I have.

Just don't tell me that living here is cheap because I earn in dollars. For me it isn't...

Of course, I'm sure the next thing people will say is "but, if you're so unhappy, why do you stay here?" That's actually a question I ask myself everyday, but there are good answers to it. The greatest is love and a wonderful sense of family that I get from my Paraguayan relatives. But if MY screwed-up government would allow me to take all four of those who live with me now to the US, I'd be hard-pressed to stay here given the current economic climate. It gets harder and harder to enjoy oneself here and not simply drudge through life on a daily basis considering the direction things have taken in the last 2-3 years or so.

Sorry for the pessimistic rant. It's Christmas and I bought two turkeys yesterday to feed everyone, for a whopping $750 pesos. And they're small (why I had to buy two). According to sources on the internet, an entire turkey dinner a month ago in the US cost an average of slightly less than $50 USD. At the official rate, just my turkeys cost $88 USD, and at the blue rate $58 USD. I didn't included the cost of everything else...

I also want to reiterate (as I've said many other times) - I feel really, really bad for Argentinos and any foreigners who earn in pesos, and mostly for those who are not in "protected" jobs. It has to really suck big green...well you get the drift...to live with that handicap and my hat is off to those of you who manage to get by anyway.

 

[jbeas176]

who would have thought nancy, that a comment on actual cost 40 % less in Ba vs NYC would turn into relative costs. merry Christmas all.

 

[Girino]

I think you miss that the "high quality" clothes and stuff found in the U.S. and the EU are considered "cheap" in the relevant countries because they are made in sweat shops in Asia. I am not arguing if they are of better quality (they are), I am just raising a point toward considering these prices as "fair" prices.

A lot of things are cheaper and of better quality in Italy, but I bought them at discount supermarkets and they were made in China or Germany (milk, cheese, yogurt, jam, tissue, etc)

Anyway, I'd like to read more of these comparison between cost of living in Argentina vs the U.S. since the reason my husband doesn't want to move to the U.S. is that we couldn't afford the same standard of living as we do in BsAs (earning US dollars). I noticed a raise in prices myself, and with the blue rate going down this has meant a raise of 15% in out monthly expenditure. Some days, buenos aires no longer looks the "deal" it was when we arrived on last May (and this is a very short period to realize this, indeed!)