Generally speaking, it seems that many Americans view Brazil as a chaotic tropical wonderland – think Carnaval, string bikinis, palm trees, samba dancing, bossa nova, favelas, drug lords…you know, all the fun stuff.  In reality, one of the most defining features of Brazil as an expat in São Paulo is simply how ridiculously expensive it is. No matter how much you try to stop talking about it, and even more importantly, try to stop converting prices into dollars, it just won’t fade into the background as a simple fact of life. For those of us living it, it’s like a permanent fat lip – the moment you think it’s healing, you bite it again and want to take out your aggression on the old lady walking too slow on the street in front of you. That’s right, it makes you want to push an old lady. It’s that ridiculous.  Although, just for the record, I would never actually push an old lady.  And the prices here are worse than a fat lip.  Maybe that wasn’t quite the right metaphor, but there’s no turning back now.  Let’s keep moving.

A couple of recent articles have highlighted some of the effects of this charming Brazilian reality.  The cover story a few weeks ago for Veja (a popular weekly magazine in Brazil) was titled Pague Um, Leve Dois, Tres, Quatro…. English translation: Pay for One, Get Two, Three, Four.  The lead-off explains further (translated): “The favorable exchange rate alone does not explain the low prices that mesmerize Brazilians who shop in the United States.”  To drive home the title, the article cites the happy fact that the cost of an iPhone in Brazil is the highest in the world, leaving shelves for $1,650 (USD equivalent) in Brazil.  In the US, the same unlocked iPhone 4S (32GB) goes for $815.  That puts it at just over double the price for us lucky brasileiros.  But why stop there, it gets better!  Asics sneakers that go for around $200 in the US? A cool $457 in the equivalent Brazilian play money.  That’s 2.3 times the price.  A PlayStation 3 goes for 2.8 times the price.  Calvin Klein jeans are 3 times the price and a Guess handbag tops it off at 3.8 times the price.  Go Brazil!

These are just random examples, but they do give an indication of general price levels.  Not everything comes in at double the price, but it’s fair to say that São Paulo has justly earned its ranking as the 10^th most expensive city in the world for expats and the most expensive in the Americas (Mercer Survey).  So, you may ask “why”, which we ask ourselves constantly. Of course there is no simple explanation, though the Veja article presents a pretty reasonable set of factors.  Here’s a summary:

• Exchange Rate – the Brazilian Real (currency) is about 25% stronger against the dollar than its long-term average making goods more expensive accordingly, especially imports.
• Demand – quite simply, growing demand is outstripping the country’s productive supply capacity. High demand + low supply = high prices.
• Tax Burden – the Brazilian tax burden is 36% on average versus around 25% in the US.  The difference is even greater when considering additional taxes on goods Brazil classifies as “superfluous.”  Plus, Brazilian import taxes are triple what they are in the US.
• Inflation – while the days of hyper-inflation have passed (hopefully for good), inflation is still significant and widens the price gap over time (6.5% inflation in Brazil last year versus 2% in the US)
• Competition – as a matter of policy, the US government prioritizes competition over protectionism and Brazil vice-versa.  For example, whereas the US government made cheap credit available to US auto-makers to help them become more competitive with cheaper Asian imports, Brazil has chosen to simply elevate import taxes to artificially raise prices of the foreign competition.
• Economies of Scale – US companies generally focus on selling more at a lower margin whereas Brazilian companies tend to focus on a small market at a high margin
• Productivity – it’s just not rising fast enough relative to labor costs (due to low unemployment, a lack of qualified labor, insufficient investment, etc.)

The result?  Prices that make your eyes pop and a growing class of Brazilian consumers that have become America’s big-spenders.  It’s no wonder so many Brazilians take annual shopping trips to Miami and New York – they easily recoup the cost of the trip in savings on their purchases.  Brazilians now spend more in the US than visitors from any other country – on average, $5,400 per person per trip in 2010 (article).  Japanese tourists came in far behind at number two with $4,300 in spending per person.  So next time you see people filling up suitcases with stuff in the mall, try a warm bem-vindo.  Good chance they’re our neighbors.

So, please have some patience when you hear us (constantly) complaining about the prices here and be generous with your suitcase space when you come to visit – we’ll be filling it up.

PS – I  had a coke and a nice sandwich for lunch today (filet, brie, arugula).  No fries or chips or any extras.  The tab was R$45.  That’s about $26.  For a sandwich.

Jeff and I started our time in Santiago with local Chilean beer and traditional dishes at Galindo in Bellavista, the neighborhood known as the bohemian part of town. This fun bar/restaurant was a perfect start to our trip and only a few minutes from our hotel.

Just outside of our hotel we were able to hop on the funicular for a ride to see the beautiful views from atop San Cristobal. You’ll notice very few clouds in the sky (though maybe a little smog held in by the not-so-far-off Andes), which is telling of how perfect the weather was for our trip (apparently quite typical for this time of year). Sunny, hot during the day, cool at night, nice and dry.

After our afternoon adventures we took a nap in our lovely hotel room at The Aubrey and then went to dinner at El Meson Nerudiano where we enjoyed a wonderful, intimate setting on the back patio, delicious seafood, THE BEST PISCO SOURS, and lovely live music.

Throughout our stay in Santiago, we truly enjoyed The Aubrey boutique hotel. The grounds are beautiful, the staff very sweet and accommodating and the breakfast just delicious.

On Saturday we caught up with our new favorite travel buddies and explored a few neighborhoods of Santiago, including Lastarria and Centro. We started and ended the day with ice cream at Emporio La Rosa, walked up the hill/park Cerro Santa Lucia, explored Plaza das Armas and ate a seafood lunch at the Mercado Central. We hit up a local, hole-in-the-wall bar La Piojera for “terremotos”, which I’ll let you read about on April’s entertaining blog (click here) and after that stumbled on to enjoy some Chilean contemporary art at Museo de Bellas Artes. Besides April’s bag getting snagged while we were too focused on the delicious ice cream and coffee (and Jeff being sad about how tiny his coffee was – see picture below), it was a flawless day that we ended in the hustle of Bellavista nightlife for dinner and drinks at Etniko.

Though all of our days in Chile were spectacular, the hands-down winner was our bike tour and wine tasting day with La Bicicleta Verde. It felt so good to be amongst the vineyards again, on a bike and breathing fresh air. Not to mention, the wine. Just spectacular. We ate some fresh almonds along the way (see picture below where they are drying out), drank wine straight from the barrels and learned a lot from our wonderful guide and winery hosts. We ended the tour with a tasty Chilean lunch (chicken stew, empanadas, pork ribs and of course more wine) at a little country house called K-feteria Tipica (no joke).

We enjoyed the evening back in Santiago sipping beers outside with beautiful cool evening weather.

Monday morning we savored our tasty breakfast at the hotel one last time and hopped in our rental car with April and Jeff to head to Valparaiso.  We made a few stops in the Casablanca valley for more wine tasting at Vina Indomito and Metetic. We enjoyed the remote setting and tour at Metetic more than the more lounge-like setting of Indomito, but views from both were spectacular and the region, known for its white wine grapes, puts out some wonderful, refreshing wines. I also became minorly obsessed with the fact that there were llamas around – okay, alpacas, but still. Awesome.

Later in the evening we made it to Valparaiso, a funky port town spread over five or so very steep hills – each having it’s own name starting with cerro, meaning hill. We made our way to Cerro Alegre (aka Happy Hill) where we were staying. We spotted our hotel from way below and it only took us 3 to 4 attempts before we finally found a street that didn’t dead end into an 8-foot wall – many thanks to our brave driver Jeff Jones (the car was a manual!).

From the second upon arriving at Hotel Cerilo Armstrong, I knew I was going to love this town. Wonderful, colorful street art, rustic materials lining all buildings and spectacular views from every corner of the city. It is definitely not a place for everyone – ask most Brazilians and they’ll tell you to skip over the port city and head straight to Vina del Mar, the beach resort 20 km up the road – but, we loved it. Our hotel was perfect. A fun balance between rustic, contemporary and artsy with a great balcony and friendly staff.

We had one full day in which we took advantage of the sunshine and walked around a lot. We explored Pablo Neruda’s house La Sebastiana, wandered through different neighborhoods, hopped in to many cute shops (lots of fun jewelry and artsy accessories), ate tasty seafood, and of course, drank lots of wonderful Chilean wine.

We also rode up one of the many funiculars in Valparaiso, which transports pedestrians from the port up to the top of the hillside neighborhoods. While arguably much better than climbing hundreds of stairs, we all decided that once was enough due to the feeling that it might just fall apart, at any second.

We had lots of fun wandering and taking pictures. And as you might assume from pictures like this one, we had lots of laughs as well.

April and I memorialized our llama encounter with “So Sexy” alpaca wool “llamas” and we ended our day-of-wandering by spending an inordinate amount of time at a little shop called the Traveling Chili. We picked up everything from ceramic coffee mugs to special Chilean chili powder to beef jerky. We then went back and enjoyed our patio and the exceptional weather at the hotel suite with a few good games of Farkle, amazing cheese, bread and wine – all Chilean, obviously (besides Farkle, which is an American game April and Jeff have introduced us to. so fun.). Then we rolled ourselves out for one last Chilean dinner (tasty seafood) and more wine at a casual Chilean joint in the neighborhood.

The drive back to Santiago the next morning was easy and we even made it back in time to go to the Los Dominicos market, where I found a pretty copper ring and a nice alpaca shawl.

Let me tell you – good wine, excellent cheese, delicious seafood, beautiful jewelry and all at a reasonable price – I could have stayed for weeks/forever. Especially knowing how much more there is to see and do in Chile – skiing, patagonia, the desert, the lakes – we’ll be going back.

We had an amazing weekend at the beach with Tara, Jana + Alex, and April + Jeff. The weather was perfect, the water crystal clear and refreshing, and the company outstanding. These are the kinds of weekends that help me embrace living in São Paulo (along with our jaunts to the country-side). We stayed at a cute little pousada a few minute walk from the beach.

Both days we parked ourselves under some umbrellas, took in lots of sun, enjoyed a few drinks on the beach, tried out paddle boarding in choppy water and laughed lots.

On Saturday night we went to Manaca for dinner, which is a spectacular restaurant that gained popularity because of Anthony Bordain who highlighted it in his show No Reservations. It is located down a sand-road alley and not so easy to find, but turns out to be a gem. Surrounded by lush green, you sit on the wood deck and enjoy their delicious Brazilian meal (for a price, but worth it).

That’ll be a hard weekend to beat . . . but we’ll certainly try with many more trips to the beach!

Tara, Jeff’s sister, is here with us for a month working from her company’s Sao Paulo office. It has been a lovely few weeks for us with the addition of her smiling face in our apartment. Her visit gives us a good excuse to get out and see more of Sao Paulo and brings a lot of laughter into our home. Her husband, Thayne, came for a short visit and we made a trip out to the countryside. This weekend we’re headed to the beach!

I turned 30. So, I think that means I am an adult now. officially.

We started the weekend with a delicious dinner at our favorite spot Chou (mind you this is only the second time we’ve been). Simple, yet fresh and delicious with the perfect ambiance.

We then celebrated with a day out of the city with April and Jeff  in Embu das Artes. It is a small town only 45 minutes away full of arts and crafts shops and kiosks. You can see some pics from April here on her awesome and hilarious blog.

Then on Sunday we had a home-made dinner with Rance, Lone and Tara, which was lovely (complete with party hats as shown above).

We got internet in our house and a bank account! Slowly, but surely, things are settling.

We had a lovely New Years celebration, just the two of us, despite the rain in Florianopolis!

We had a truly wonderful and special Christmas at Fazenda Alfheim. It was complete with delicious, homegrown food, lots of games and as always, great conversations and laughs. We learned a few Danish traditions, read Twas the Night before Christmas, and sang Silent night in three languages (English, French and Danish). We relaxed a lot, took a dip in the waterfall, a hike up the river, and butchered our first chickens ourselves (Jeff and I that is). We even got to skype with our families with the addition of satellite internet at the farm! So, while nothing beats being home, we are so thankful for such wonderful friends to share the holiday with.

And, I will even go as far back as Thanksgiving . . . see the next post.

Stay tuned for more updates on our life in Brazil. Thanks for following and being patient with the sporadic updates.

A few weeks ago, our friend Alexandre took us to a hotel that lies in the midst of a number of parks (PETAR, Xitue Ecological Station, Carlos Botelho State Park and Intervales State Park), about 270 km south west of the city. Though it was misting or raining the entire time, it was so lovely to be in the middle of the forest for a few days. The hotel – Paraíso Eco Lodge – provided a variety of hikes through the forests, the highlight being a trip into a cavern. The hotel is still in the process of defining itself, but has an incredible setting to offer and an interesting museum focused on native Indian artifacts.

I am always amazed at what you find in the Brazilian rainforest . . .

Caverns

Green for as far as you can see

Vines that are the size of tree trunks

The original coffee tree from Brazil

Spectacular waterfalls

Alexandre and Jeff

During another weekend, one spent in São Paulo, I visited the contemporary art show “In the name of the Artists” at the Pavilhao do Bienal. The exhibit showed work from 51 of the biggest names in international contemporary art – a collection from Oslo’s Astrup Fearnley Museum of Modern Art. The art museum in Ibirapuera park, designed by Oscar Neimeyer, has a wonderful interior space with white curving ramps. The outside of the building is a bit dated and not as nice, in my opinion, but that is just part of the concrete jungle we call São Paulo. The work of Damien Hirst was showcased at the front of the exhibit, specifically his work of two cows split in half Mother and Child Divided. The exhibit, which was quite extensive, was inspiring, thought provoking and quite odd at times (as I find much contemporary art).

Comtemporary Art Exhibit