OK, I have some research to do on this one. I've now had two independent recommendations to Panama as a quiet and inexpensive place to retire. This picture was clipped from a Panama City condo ad on the web. According to Frank Kurk, there are lots of expat beach bums living comfortably on the Pacific coast. Comfortable condos are apparently as cheap as $150k. Now living on the equator is not my ideal situation, but its an interesting answer to the "simple life" question.
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