Uruguay and Argentina among the ten countries worldwide with highest inflation
Inflation in Uruguay was not only far above target domestically but also figures among the ten highest in the world, and in Latam only behind Argentina and Venezuela
Uruguay ended 2011 with 6.8% inflation, above the target range of 4% to 6%, which nevertheless completes a seven year period below two digits, the longest since stats started back in 1939.
However Uruguayan economists are divided as to the future approach: some believe it’s not so important the actual percentage increase but the fact that the acceleration of prices is under control. They argue that in a global volatile environment it’s not necessarily advantageous to strictly implement “monetary policy”.
Although monetary policy helps contain prices it also slows the economy and job creation, and helps an increase in imported goods and services because a stronger currency (and cheaper dollar) means Uruguayan goods (particularly with a high component of local costs) can loose competitiveness.
The other school believes it’s time to begin cutting government expenses, containing the budget deficit and salaries’ agreements so as to give monetary policy more flexibility. Anyhow they consider the current monetary policy “too expansive” and President Jose Mujica in his daily radio chats has warned families about over spending, “plastic credit” and increased indebtedness.
But in spite of the debate in Uruguay the fact is that before the rest of the world and even in Latam, Uruguay with 6.8% inflation ranked poorly out of 71 countries: eighth highest inflation at world level and third in Latam.
Venezuela leads (for the sixth year running) with an inflation of 27.6% (mainly food and textiles) followed by Argentina and including Bolivia. However Argentina’s data is questioned because the official index is 8.8%, but the so called Congressional index signals 22%, and is the reference for salaries, the private sector and judicial rulings.
Panama and Brazil (6.5%) missed the first ten, but figure in positions 11 and 12. Other rankings in Latam include Guatemala with 6.1%; Ecuador, 5.41%; Paraguay, 4.9%; Chile, 4.4% and Colombia, 3.73%.
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17 comments Feed
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While people are employed by the government they do not contribute to the country in the form of income tax: and yes, I know they pay tax, but WHO pays their wages to pay the tax - the employed do, no-one else.
What is really needed are a few lessons from Brasil in encouraging manufacturing and other wealth producing industries / sectors. Every 10% reduction in goverment employees WHO ARE GAINFULLY EMPLOYED IN THE PRIVATE SECTOR (and yes I know that is difficult but think it through) means a 20% reduction in fiscal drag.
The UK are going the way of Uruguay and it is costing the actual productive workers their savings growth, if they can save at all.
I know this will be very unwelcome by goverment employees but it needs facing.
I wish it were the case that cuts were being made but you only have to look at public spending.
It should have been going down by now and in fact, it is still going up!
Difficult to understand that if cuts are being made and even Osborne has admitted that 'cuts have yet to take effect'.
The same with regard to working less hours than the private sector, especially with the plethora of holidays AND the strikes, usually over the slightest thing. They seem to be directly comparable to the NHS.
The government should start programs of public works to creat jobs and money,
government investment in
Rebuilding of roads and motorway’s,
Rebuilding and upgrading railways
Rebuilding and upgrading of the ship yards
Re building and investing of the steelworks,
And of course re investing in the fishing industry,
Build new dams and electric generators, save us importing it from abroad,
Just a few things that may help to create thousands and thousands of jobs, instead of waiting on the Europeans,
Rebuilding of roads and motorway’s,
Rebuilding and upgrading railways
Rebuilding and upgrading of the ship yards
Re building and investing of the steelworks,
And of course re investing in the fishing industry,
Build new dams and electric generators, save us importing it from abroad,
Just a few things that may help to create thousands and thousands of jobs, instead of waiting on the Europeans,
Can only happen when you stop bailing out the banks (who are looting the country) by putting BOE out of business! To many zombies still haven't figured out and won't since they (the banksters) have their tools (the government, both sides, labour/tories) in their pockets.
by the way, how's tony blair? :D
ozhouse.org/2012/01/08/tony-blair-inc-profits-soar-through-complex-web-of-deception/
The solution for Uruguay is the same as it should be the world over... reduce government spending (shrink government), eliminate income taxes altogether, raise import duties. allow (even encourage) competing currencies, eliminate minimum wage, and stop regulating. One huge problem for government is unions. Unions have no place in government. Why? Because, they can always “vote” themselves a raise. Besides, the only real beneficiaries from unions are the union leaders. Unions have their place in private industry, but no in government.
Allowing competing currencies keeps the government from “overprinting” money, which is the real reason there is inflation. When the government (or a private bank) has the ability to print as much money as it wants, you get the terrible boom/bust cycles, of which we're all very painfully aware. You also get a huge amount of corruption. Next time you visit your bank, just take a look around and ask yourself, where did all the money come from to build that beautiful building. It was from having the ability to create money to loan right out of thin air... just the push of a computer button.
Oh, sorry. Was I not supposed to tell argies that?
Did you really manage it last night has the pain abated a little?The wife must be in compliant mood tell us about it.
BTW Argentinas growth rate 2011 is 9% Englands is 0,000000001%
In 2012 it will be more of the same!!!!!!!
Careful now mind the back not to mind that little thing you finally got to use after so long
Take care dear boy
Spot on!
But how will it change when the government know there may be riots if only 10% of govt employees are cut loose, neverming the 50% that is really needed.
Perhaps one way would be to split up the really big govt monopolies such as ANCAP, ANTEL, the insurance concert party (BSE et al) but only in 25% bundles to promote real competition.
No possibility for rejoining by amalgamation, purchase, whatever, so genuine competition is ensured.
Yes, there would be considerable unrest, but in the end, prosperity would prevail.
Genuine competition is only possible, when you remove the driving factor behind the corruption. And, that is to stop the printing presses for churning out more and more fiat money, which is just handed over to the bankers, who control the politicians. Uruguay is already further down the path to success than most countries, because it has “private” banks, where one can have an account in whatever currency one wishes. The next step would be to back up the country with gold reserves, instead of worthless Dollars and Euros.
Interesting .
10 Fido Dido, we don’t always get on,, but you understood what I meant,
Yes we must stop bailing out banks, and governments should invest in its people,
[others]
Sorryright reply but wrong blogg,
But the result would be the same, one must invest to create wealth and jobs,
Just a thought .
.
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