MercoPress. South Atlantic News Agency
Argentine prepared to let the Peso and central bank reserves slide
Argentina's international reserves have been declining for weeks as the central bank tries to stem the peso's slide against the US dollar, but policymakers have signaled that they intend to keep dipping into reserves to prevent an even swifter depreciation. Read full article
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Disclaimer & comment rulesAnd the argentines say our country economy is gong down the pan, yet its actually theirs that is sliding into the very pan they are talking about.
Sep 08th, 2011 - 12:40 pm - Link - Report abuse 0As i said time and time again the inflation will end up making argentina another zimbabwe, though without Mugabe at the helm but CFK instead.
Yes teh devaluation will help exporters in the short term but in the long term the higher inflation will make the costs of production go up and therefore counteract any benefit from such deprication of the currency. Making it harder to export due to rising costs increaseing the price of the goods that are to be exported and pricing companies out of the export market
Not a good time to want to be President - especially as the expected incumbent can't blame the problem on the previous administration.
Sep 08th, 2011 - 02:33 pm - Link - Report abuse 0They can only use about 5B more of the reserves until it all starts unravel and they start to have serious liquidity problems then the peso goes into free fall. Every U$ is flying of the country now and I think BCRA is beginning to panic. The Brazilian devaluation really hurt and will only get worse. 5/1 exchange will be right around the corner.
Sep 08th, 2011 - 04:42 pm - Link - Report abuse 0This also may be what is driving car/appliance purchases since its better to buy sooner than later when it cost a lot more pesos.
I'm curious where some people here from the US get their information from and since when are they so interested in South America.
Sep 08th, 2011 - 05:09 pm - Link - Report abuse 0Teabaggerboy, it's not only Argentines who see that our Economy (Yes, though I'm Dutch, I live in the US and face reality) is going down the drain, it's also the people here in the US who don't have their head stuck in the sand and blabber nonsense or type BS infront of the computer about other nations they've never been. Same for yankeeclown (bet he doesn't even know what yankee realy means and why they, the people in the US were called that nick..i'll give you a hint..in dutch it means Dief )
Sorry but as we are not in recession at the moment then the economy is not going down the pan, yes we may head back into recession but thats not the end of the world or even our economy, but the argentinian situation is a hell of a lot, their are basically letting their economy get out of control, and yes it will implode in on itself at some point. So the UK economy will remain more or less where it is now give or take 3-4% either way for the next 5 years or so. But argentinas will slide into free fall, so their is a clear difference Fido.
Sep 08th, 2011 - 06:51 pm - Link - Report abuse 0You forget something fido, the UK is not part of the Euro currency therefore we are not part of the euro economy, nor are we being dragged down by the failing euro countries, as we can say no we have spend enough money bailing you out and our own country must come first. So i think your confusing the issues with the EURO to the issue the UK face which is more stable then the EURO by a long long way.
Whats up guys. you know
Sep 08th, 2011 - 07:24 pm - Link - Report abuse 0The currency is just a tool used for growth.
If Argentina is growing 10% each year and unemployment is going down that's the most important.
Argentina has a lot of potential, don't underestimate her.
Argentina has always had a lot of potential. Realising it is another matter.
Sep 08th, 2011 - 07:53 pm - Link - Report abuse 0Argentina has had (and still does) a lot of potential, and she has realized it in the past. However, right now the growth is not 10% and unemployment is not going down. About the only real growth is the auto business because Brazil buys over 80% of the autos made in Argentina, and with less buying from Brazil starting to happen, this growth is ready to slow down also. Soya has continued to be the main product of Argentina. As far as employment, every time additional handouts are given to the populace, they are counted as “employed”; the employment figures are as phoney as the cost of living given by INDEC as being about 8% ayear.
Sep 08th, 2011 - 08:30 pm - Link - Report abuse 0no comment.
Sep 08th, 2011 - 08:48 pm - Link - Report abuse 0The handouts you are talking about are given to parents of poor kids going to school nothing to do with employment.Unemployment now under 7% is not inaccurate even Clarin recognizes this.Growth is 8% with Auto exports in August growing 29,22% year on year not much sign of decline there.Like may of the contributors here you are wishing Argentina to fail but its growth rate will continue even as the european/North American collapse gathers pace.The poor clown who imagines the Eurozone problems wont affect England is obviously an economic genius
Sep 09th, 2011 - 12:11 am - Link - Report abuse 0O gara, your missing the point - yes the economy will grow with huge increase in the short term - which is what you are currently seeing. But as i have said, you will reach apoint where inflation will make the costs of raw materials, products and basic living cost increase so much that they will end up having to increase the sale price of the products in order to make a profit, that will put up the export prices and as they go up the slow down followed by decrease in exportation will begin. As a knock on effect their will be an increase in unemployment, to try and cut cost, yet inflation by then will be out of control and will not decrease, meaning the slow down in exports and increase in prices and unemployment, will only increase the inflation as the government tries to cover the cost of the unemployed, the higher price of products/goods/materiels. Your on a road to economic oblivion. Zimbabwe should be a lesson for you to learn from and not repeat like your country is looking to do. Remeber it was as early as 1998 when zimbabwe was one of the strongest economies in africa.
Sep 09th, 2011 - 01:11 am - Link - Report abuse 0@Teaboy2
Sep 09th, 2011 - 08:34 am - Link - Report abuse 0China is doing the same, i don't see any problems.
@11
Sep 09th, 2011 - 10:53 am - Link - Report abuse 0It's easier to teach a pig algebra than to teach economics to an Argentinian. I have tried many many times and they just can't grasp the concepts.
They think inflation is good because it makes their salaries go up and more pesos in their pocket means more to spend!
They're not a really a bright bunch so don't kill yourself trying to get them to understand.
@12 yes and many economist have warn that chinas current growth is unsubstainable, plus they are not intentionally devauling their currency, but more or less holidng it at a steady rate and keeping inflation down. So china is not the same as Argentina how currency is as we speak losing value and has increase rate of inflation.
Sep 09th, 2011 - 11:23 am - Link - Report abuse 0@Your right their yankee, seems they much prefer to believe the political propaganda and fake inflation stats. I geuss their parents never taught them never to trust politicians lol. Yeah their salaries do go up but they'll get a shock when bread starts costing 100,000 peso a loaf lol.
I just came back from BA and just about everything is 4- 5X more than they were a in 2006. I was going through 100 Peso bills like they were worthless (maybe they are). Everyone I talked to was worried about the cost of necessities, food, clothes etc. Most “middle class” families can't afford to feed their families or clothe their kids. So when CFK keeps saying how good it is I am not sure who she is talking about or who actually believes her? I think it is because if you keep repeating lies over and over people start to believe them and it is really scary.
Sep 09th, 2011 - 11:49 am - Link - Report abuse 0One summer of drought and it will all come crashing down anyway so it is just a matter of time.
@Yankee #15 - Thank you, your post just confirms everything i have been saying.
Sep 09th, 2011 - 12:59 pm - Link - Report abuse 0The worst thing about this is that the increase in cost was so obvious to you when you were there, yet these idiots on here are pretending its not happening or are in complete denial - When you have just confirmed that it is happening, and i we can safely say thats its going to get a hell of alot worse if they do not stop their governements current economic policies.
I dare say they have steadied the boat somewhat just so CFK can be re-elected, but after october theres going to be another landslide, just this time it be the banks and their money along with their jobs and countries economy falling into obilivion. it may happen as soon as xmas or it may happen in 2-3 years, but either way it is going to happen, and when it does all hell will bring loose in argentina as no one will beable to buy a loaf of bread and that will result in looting, rioting, and the possible the breack up of the republic of argentina itself i.e. the states that make up argentine could breack away and go their own way.
It might not be as bad as you suggest, Teaboy.
Sep 09th, 2011 - 01:11 pm - Link - Report abuse 0Brasil has an agreement to absorb for settlement individuals and families from many South American countries, including Argentina.
I can envisage the number of Brasil's favelas increasing greatly to absorb the poverty-stricken Argentinian economic refugees, but at least they won't starve.
That's also the reason they lost visa waiver with the USA and will never get it back. Let Brazil take them we are full thanks!
Sep 09th, 2011 - 02:27 pm - Link - Report abuse 0Commenting for this story is now closed.
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