Argentina’s Central bank stand-off: police to block access of Redrado

Monday, January 25th 2010 - 14:20 UTC

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Argentine central bank President Martin Redrado vowed to stay in his post until Congress considers a government decree firing him for not setting aside 6.6 billion US dollars in reserves to pay debt due this year. Read full article

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argie
Barrado's moves to block the use of Banco Central reserves were what he was expected to do under the stringent laws governing the bank whose reserves are kept to maintain Argentina's currency value vis á vis the value of other world currencies. The Executive Power abused of its rights by issuing a decree to expel Redrado but the decree was basically illegal and made the Central Bank chairman to oppose legal defence to stay in his post. The pretended use of the reserves was NOT to pay external debt but, as the Government itself recognised on a 59-pages long document presented to the Chamber Courts, to pay for “expenses”. When the budget for 2010 was voted, the payment of external compromises was secured with an amount reserved for the Fondo del Bicentenario, but these funds disappeared somehow at Mrs. Kirchner's hands or of her administration. That was the reason she re-invented the Fondo del Bicentenario alibi to grab reserves and compensate the deficit, which would have severely endangered currency stability bringing in an inflation that would eat-up salaries, privately held reserves and savings, and brought the country to a standstill. Now that apparently Redrado will not be back to his post, the danger of manipulation of the Central Bank's reserves and balance-sheets - as done in the INdeC - is very high and shouldn't be watched with a blind eye. Cheers!
Jan 27th, 2010 - 01:47 am - Link - Report abuse 0
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