Amazing how expensive BsArs is

[davonz]

Bringing the peso down will also drive up inflation. CFK has got a catch-22 situation and the only solution to their problem is an economic collapse, where, once again, they restructure everything and get it ready for the next crash. I don't believe in the "crash once every decade" BS. I just think that people here just don't know how to run the economy of a country.

The reason she is in the shit is because they have been keeping the peso artificially high... Brazil is slowing, and the real has gone from 1.70 to the US$ to just over 1.90 since mid feb, around 12%.. what has happen to the AR$ in that time.. sod all...
This was a big contributing factor to the last crisis, arg peso was pegged against the US$, the global economy slowed, the real, chilean peso, NZ$, AU$ etc all dropped against the US$.. but the little old arg peso didnt, so their exports became expensive compared to everyone else and imports became even cheaper... so they had a trade imbalance that grew and local companies/commodities that couldnt compete internationally...

You would think they would learn.. but not argentina !!!!!

As for inflation, it wouldnt increase to much if the peso dropped to fair value.. why.. because all the external factors that would cause inflation (imports become expensive) have already been taken care of by way of import restrictions..

 

[trennod]

Food (as a whole) is only slightly cheaper than Australian cities these days as well. Wine is still cheaper as is fruit and vegies, however with fruit and vegies and other food the quality is not there. Clothes are probably in the same basket (no pun intended).

Nico I agree with you about inflation. A devaluation will only strengthen inflation. Its not easy thing to fix, but Kristina (and any government) would need to really be disciplined with her fiscal policies. Perhaps she could look to Brazil. But she wont, she would prefer to follow Chavez than economies heading in the right direction and anyhoo runaway spending and hand outs to the poor are part of her mandate.

I do think its funny how the Big Mac is half the price of everything else on the menu at McDonalds. And yes the fact its price is obviously deliberately and artificially set has not been a secret for a long time.

 

[davonz]

I do think its funny how the Big Mac is half the price of everything else on the menu at McDonalds. And yes the fact its price is obviously deliberately and artificially set has not been a secret for a long time.

Can someone confirm that the big mac here has 2 beef patties, as i am sure it doesnt... but it could be just my imagination.. as i dont particully like McD's and have only ever had it once here, and i think it was just a one patty burger..

 

[steveinbsas]

I do think its funny how the Big Mac is half the price of everything else on the menu at McDonalds. And yes the fact its price is obviously deliberately and artificially set has not been a secret for a long time.

I remember "banners"on lamp posts in Belgrano in 2010 advertising the Big Mac for 8 pesos.

 

[AlexanderB]

Either all of you are making very exotic purchasing decisions, or something has changed radically in the last six months. I visited in November 2011 from Atlanta, which is by no means an expensive city by US standards (and has experienced considerable asset deflation as a result of the overall macroeconomic situation).

I found Buenos Aires rather cheap, even from a touristing persective. No, not very cheap--not like Perú cheap, or poor Central American country cheap, or other gringo fantasy where US$1 will go half a billion dollars far. Tough s___, BA is a major world capital, not a small village in Bolivia. But in general, I found BsAs to cost around 1/3rd less across the board in the sorts of ways relevant to an itinerant visitor -- eating out, alcohol, transport. Some things, like taxis and the Subte, were far more than 1/3rd less.

Now, of course, I was not exposed to most structural, long-term expenses of living there, nor the joys of inflation. However, I do feel like I got a pretty good taste of what it's like to be a consumer there, and it's not bad, really. I am more sympathetic to the arguments about poor quality and selection relative to price, especially in the area of apparel and appliances, but I also found some Industria Argentina wares much more durable, rather unlike the cheap, plastic crap that permeates every category of good in the US--the sort of thing we mean when we talk about planned obsolescence.

In any case, the situation did not seem worse than in any other Latin American capital I have been to, and in many respects, was a lot better. I think a lot of you who live in Palermo or Recoleta may be getting gouged on daily errands because of where you are. I stayed in San Telmo and had no sticker shock.

Otherwise, could it be that you lot are expecting BsAs to be so dramatically, magnitudinally cheaper than your home countries that you get angry and bitter when it falls short of your precise, desired ratio? Perhaps you came a few years after the corralito and have developed a bit of a sclerotic entitlement syndrome with regard to the prices you found when you first got there? I hear you loud and clear about inflation, economic mismanagement, crime, corruption, and import restrictions--the latter are most infuriating to me. However, if I didn't know better from personal experience, I would say the narrative being constructed here paints BsAs as a place with Tokyo prices and Kinshasa quality. Come on now.

 

[wreReynolds]

Check out The Economist´s ´Big Mac Index´ which ranks the cost of a big mac in each country after making several adjustments to get a fairish exchange rate. Argentina had the eighth most expensive Big Mac in the world.

And it´s still crap.

http://www.economist.com/blogs/graphicdetail/2012/01/daily-chart-3

 

[steveinbsas]

Either all of you are making very exotic purchasing decisions, or something has changed radically in the last six months. I visited in November 2011 from Atlanta, which is by no means an expensive city by US standards (and has experienced considerable asset deflation as a result of the overall macroeconomic situation).

I found Buenos Aires rather cheap, even from a touristing persective. No, not very cheap--not like Perú cheap, or poor Central American country cheap, or other gringo fantasy where US$1 will go half a billion dollars far. Tough s___, BA is a major world capital, not a small village in Bolivia. But in general, I found BsAs to cost around 1/3rd less across the board in the sorts of ways relevant to an itinerant visitor -- eating out, alcohol, transport. Some things, like taxis and the Subte, were far more than 1/3rd less.

Now, of course, I was not exposed to most structural, long-term expenses of living there, nor the joys of inflation. However, I do feel like I got a pretty good taste of what it's like to be a consumer there, and it's not bad, really. I am more sympathetic to the arguments about poor quality and selection relative to price, especially in the area of apparel and appliances, but I also found some Industria Argentina wares much more durable, rather unlike the cheap, plastic crap that permeates every category of good in the US--the sort of thing we mean when we talk about planned obsolescence.

In any case, the situation did not seem worse than in any other Latin American capital I have been to, and in many respects, was a lot better. I think a lot of you who live in Palermo or Recoleta may be getting gouged on daily errands because of where you are. I stayed in San Telmo and had no sticker shock.

Otherwise, could it be that you lot are expecting BsAs to be so dramatically, magnitudinally cheaper than your home countries that you get angry and bitter when it falls short of your precise, desired ratio? Perhaps you came a few years after the corralito and have developed a bit of a sclerotic entitlement syndrome with regard to the prices you found when you first got there? I hear you loud and clear about inflation, economic mismanagement, crime, corruption, and import restrictions--the latter are most infuriating to me. However, if I didn't know better from personal experience, I would say the narrative being constructed here paints BsAs as a place with Tokyo prices and Kinshasa quality. Come on now.

This is one of the best posts I've read in the past...almost six years as of Saturday...my own cinco de mayo (independence from Mexico).

 

[GS_Dirtboy]

Argentina had the eighth most expensive Big Mac in the world.

And it´s still crap.

McD's is way over-priced here if you compare it to other goods and services on a Purchase Parity scale. I've found some things cheaper - like laundry, and some things much more expensive.

 

[steveinbsas]

McD's is way over-priced here if you compare it to other goods and services on a Purchase Parity scale. I've found some things cheaper - like laundry, and some things much more expensive.

Thanks for reminding me to get my air dried sheets off the line. There was just enough wind today not to use fabric softener.

 

[trennod]

Either all of you are making very exotic purchasing decisions, or something has changed radically in the last six months. I visited in November 2011 from Atlanta, which is by no means an expensive city by US standards (and has experienced considerable asset deflation as a result of the overall macroeconomic situation).

I found Buenos Aires rather cheap, even from a touristing persective. No, not very cheap--not like Perú cheap, or poor Central American country cheap, or other gringo fantasy where US$1 will go half a billion dollars far. Tough s___, BA is a major world capital, not a small village in Bolivia. But in general, I found BsAs to cost around 1/3rd less across the board in the sorts of ways relevant to an itinerant visitor -- eating out, alcohol, transport. Some things, like taxis and the Subte, were far more than 1/3rd less.

Now, of course, I was not exposed to most structural, long-term expenses of living there, nor the joys of inflation. However, I do feel like I got a pretty good taste of what it's like to be a consumer there, and it's not bad, really. I am more sympathetic to the arguments about poor quality and selection relative to price, especially in the area of apparel and appliances, but I also found some Industria Argentina wares much more durable, rather unlike the cheap, plastic crap that permeates every category of good in the US--the sort of thing we mean when we talk about planned obsolescence.

In any case, the situation did not seem worse than in any other Latin American capital I have been to, and in many respects, was a lot better. I think a lot of you who live in Palermo or Recoleta may be getting gouged on daily errands because of where you are. I stayed in San Telmo and had no sticker shock.

Otherwise, could it be that you lot are expecting BsAs to be so dramatically, magnitudinally cheaper than your home countries that you get angry and bitter when it falls short of your precise, desired ratio? Perhaps you came a few years after the corralito and have developed a bit of a sclerotic entitlement syndrome with regard to the prices you found when you first got there? I hear you loud and clear about inflation, economic mismanagement, crime, corruption, and import restrictions--the latter are most infuriating to me. However, if I didn't know better from personal experience, I would say the narrative being constructed here paints BsAs as a place with Tokyo prices and Kinshasa quality. Come on now.

I think 30%ish cheaper is probably not too far off the money in total (when you include eating out, public transport, housing, health care n supplies etc). But when you add in the poor quality of things as you mentioned and particularly when you look at the relative cost of living when you consider local wages, that is where you realise your certainly not in Tokyo or any other first world city. Real wages continue to fall.

Dont get me wrong, I love Buenos Aires at the moment, but not for its prices or its value for money from a purchasing goods and services point of view.