Tag Archives: Argentina

Argentina's peso depreciated significantly after the primary elections last month, with the clear victory of the opposition. The crisis has come full circle now with the re-imposition of capital controls, and with the default on domestic bonds, the latter a puzzling and clearly unnecessary measure, since it was in domestic currency (Standard & Poor's says it's a selective default, whatever that means, and Fitch called it a restricted default). So here a few things that might be useful...

Argentina's peso depreciated significantly after the primary elections last month, with the clear victory of the opposition. The crisis has come full circle now with the re-imposition of capital controls, and with the default on domestic bonds, the latter a puzzling and clearly unnecessary measure, since it was in domestic currency (Standard & Poor's says it's a selective default, whatever that means, and Fitch called it a restricted default). So here a few things that might be useful...

As Reuters reports, citing a decree published in an official bulletin on Sunday, the Argentine government authorized the central bank to restrict currency purchases. The decree includes major exporters, which will need permission from the central bank to access the FX market to purchase foreign currency and make transfers abroad. The central bank will also set a deadline for exporters to repatriate foreign currency.... Zero HedgeArgentina Imposes Currency Control Tyler Durden

I was interviewed yesterday about the situation in the country (Cítrica Radio, Siempre Es Hoy). Interview was cut short as a result of a bad connection. The audio of the part of the program I appear is here.

My interview on the Argentinean crisis with Javier Lewkowicz from Página/12 is available here. In Spanish, though.

The Left rises again after the neoliberal president blows it. Naked Keynesianism — Hemlock for economics studentsThe return of populism or Argentina on the verge of collapseMatias Vernengo | Associate Professor of Economics, Bucknell University

The Argentinean primary elections, which are very peculiar and take place all at once with all parties, were last Sunday. The primaries made some sense when the Peronist party was all divided and that allowed the main candidate to proceed, but with the move of Cristina Kirchner to the vice-presidential spot next to Alberto Fernández, and the unification of a good part of Peronism (in particular Sergio Massa), the primaries become essentially an anticipated election. And Peronism won...

The figure below, from a recent piece in the Wall Street Journal, shows the catching up of the South. Note that most occurs after the New Deal, and up to the 1980s. The piece emphasizes the reversal, with divergence since the last recession. This suggests that the New Deal and the period in which the segregationist policies were eliminated were a period of prosperity for the South. The catching up story is one associated mostly to State action, since the New Deal in many ways was a sort...

It's been a while since I wrote about Argentina. In all fairness, because it is difficult given all the mistakes of the last few years since Macri's victory. I discussed the prospects of what to expect back then. Since then I posted here and here on the supposed improvement in 2017, and the beginning of the still unfolding crisis in 2018. And this could simply be an "I told you so post," since I did warn about most things that would happen. But there are important and interesting news about...

My interview with Nicolás Fiorentino and Cecilia Camarano from Led.fm yesterday (in Spanish) on the Argentinian situation and the new central bank policy. [embedded content] I basically suggest that the new policy to control exchange rates using the IMF loans (with IMF authorization) might control the exchange rate, but will finance essentially capital flight, and tries to interfere with the elections later this year.