MANZANILLO, MEXICO. Walking the hills at sunrise, I see a sight that is typical here--- a large abandoned concrete structure, a multi-storied house with a domed roof. Unpainted, unfinished and studded with gaping holes where the windows would be, it is slowly streaking to darker greys. Nearby, other houses are carefully tended, finished in whites and muted colors, awash with brilliant fuschia, cerise, and orange bougainvillea.

On the way back I notice movement in the house.

Through the large opening for a terrace I can see a table, a makeshift collection of chairs, and several figures. Propped against a nearby wall I can see a broom. A family is having breakfast. Minutes later my walk is detoured: the cobblestone road has eroded and collapsed, revealing a gaping hole. But not far away, a development of condominiums still being finished cascades down a hillside, offering stunning views of the bay. Poet Wallace Stevens might easily have invented "venereal soil" for Manzanillo, if he had not experienced it first in Miami. In the older sections of the resort, such as the Hotel Santiago, you can imagine Malcolm Lowry holed up, drinking his way through "Under the Volcano".  

While the world was watching the dietary habits of former President Salinas with an attention approximating that lavished on O.J. Simpson in his Bronco; as the former Presidents brother is accused of murder; as the currency of Mexico collapsed yet again; nothing changes in Manzanillo except that the beer gets cheaper... if you are lucky enough to be buying it with dollars.      

You don't get to Manzanillo by accident. It is the site of Las Hadas, a magnificent resort built by a Bolivian tin magnate that may be one of the most romantic places in the world. It is also where the movie "10" was filmed with Bo Derek.   Quite incidentally, it is also the largest Mexican seaport on the Pacific Coast, a port jammed with container ships and unimaginably large trucks.

To get here you need to fly to Mexico City first, descend into the chaos of an airport undergoing renovation, and wonder if you have accidentally landed in a Spanish version of "Blade Runner", or an early edition of the post-apocalypse, cyber-punk city William Gibson pictures in "Virtual Light". Only the noise and dust of the Heironomous Bosch-like scene that surrounds Guadalahara is more compelling.

Then you switch to Mexicana for a crowded flight over the coastal mountains into Manzanillo airport, a single runway parallel to the beach. Except for a handful of charters from Denver, you also can't get here cheaply: the fare this year was $510.

We are veterans here, my wife and I. Accompanied by our friend International Misdemeanor ( so named because he will never be a Supreme Court Justice) and his wife, Too Prepared, we are joined by another couple, Mr. Too Tall and Ms. Too Clean, from Los Angeles.

There is a stark scene of future technological unemployment as we disembark: a phalanx of porters meets a line of Americans pulling the new underseat suitcases with wheels. There is a look of dismay on the porters' faces as they realize there are only two kinds of Tourists in their future: Club Meds, who travel in workout clothes and lug their duffels with athletic intent... and The Wheeled Suitcase People.  

The Burns are in the latter group and have this trip down to three bags: a trundle bag each for husband and wife, plus a third bag reserved for Beauty-Materials-In-Plastic-Bottles-That-May-Explode and Other High-Maintenance type Gear. During the long cab ride into the Las Hadas complex we notice there is more activity and more commerce. There seem to be more people swimming at the public beach than there were three years ago or five years ago.

Burgos Audencia I, a small development of townhouses where we rent, is unchanged except for new paint. The recently completed Sierra Radison Hotel is nearby. Now it is filled with Canadians who wear colored plastic bands on their wrists, like patients awaiting to have their maladies assigned. We assemble there for dinner the first night and celebrate with our first margaritas, carefully ordered in Mandarin Spanish by Too Prepared, the least liquistically impaired member of the group.

A second revelation comes with the arrival of the check. Asking if we can pay in dollars, we are told the exchange rate is N$4.40 to the dollar. Outrageous. The official rate, that day, is about N$5.7, less whatever.

We counter with Tourist Weapon Number One: Plastic. Citibank will provide a better exchange rate... and we'll get the Aadvantage miles, too.

The next day, a local bank will exchange for N$5.25 per dollar... less than the $N5.60 it should be, but acceptable. Through the week, the rate slowly climbs, reaching N$6.00 as we leave. Now it is higher still.

Whatever the official rate, the Peso denominated world has suddenly become very cheap. Coronas are N$6.00; top shelf ritas' are the N$6, N$7, and N$8--- just over $1, American.   

Dinners at Willy's, a beachfront french restaurant with the best food in Manzanillo, are less than $20 a person with multiple courses, wine, tip, and no attention to what is ordered. Entrees of giant shrimp are $10, American. Ditto lobster. The cab ride to get there is N$15 or $3, American if you do a rough 5:1 exchange. Even dinner at Legazpi, the most spectacular of the Las Hadas Hotel restaurants, is inexpensive with Chateaubriand at $11 a person.

And that was LAST week.

Three years ago, Las Hadas was owned and managed by Westin Hotels. As of last summer, it became a Camino Real property. On the beach the first weekend, the Camolot-like tent houses are filled with Mexican nationals. Next to ours, a Mexican businessman with wife, children, and nannie, bellows and scowls into his cellular phone.

During the week, Las Hadas is very quiet. Too quiet. Nearly empty. The restaurants are opened on alternating days and the guitar player moves like a sheet that's too short, trying to cover El Terral one night and Legazpi the next. A man from Denver tells me he and his wife bought a package, airfare and seven nights, for $700--- this in a hotel listed as "one of the leading hotels of the world"   that didn't have a rate under $200 a night three years ago.

Nearby, a mammoth hotel sits unfinished, hamstrung by a lawsuit over ownership of the land. The long, graceful arc of condos associated with Las Hadas is unnaturally quiet. At one place, the numbers of condos listed under a "Se Vende" sign account for more than half the units.   Houses--- spectacular, mind blowing, gorgeous houses--- that were for sale three years ago are still for sale. An apartment building that was finished in the last three years now advertises rents at N$70 a night... $13.32 at last weeks exchange rate... perhaps at little as $10 this week.

We are not talking about a shabby location. We are talking about waking up, every day, to a drop-dead beautiful view.

Is this all due to events since the December currency collapse?

I think not. The currency collapse is in the price of the beer, the margaritas, and the food. But the big event, the collapse of the durable assets, is still to come.   

All we see now is too many rooms, too many condos, too many houses... and not enough people to rent or to buy. It all has an eery resemblance to the hills of Austin in 1986. Back then, Austin was platted out, lined with new roads, and a fair number of mammoth houses. Ready for a prosperous and expanding future. Ready for everything but the severe shortage of millionaires that came to characterize all of Texas.

It would be dangerous to celebrate, too loudly, the declining price of Corona and Bohemia. The price of Paulaner and Kirin is going up.

This is bigger than Mexico and the biggest loser of all, when the smoke clears, may be the once Almighty Dollar.