Do you fear a crash similar to 2001?

[perry]

Not really, is quite easy to go to germany and become successful there as an Argentinean or as anyone actually if you have a proper degree, not much of a trick to perform good in a steady economy, you just go every day to work and you don’t need to do much else, and that is very easy to do when no one else arrives late, is way easier than here, smartness don't have any relation with society development, smartness is an individual attribute and there for I don't understand why you talk about society's, there are a lot of values that are more important for economic development than a smart population, you can have all smart people in a society but if they all disagree on the way to go forward or they are all just competing with each other or sunk in corruption then smart people only make it harder to fix the problem because they will be smarter as well to cheat and to play against you. Hopefully you got what I meant, in any case is an interesting topic, but I think we are probably off topic lol and i'm already sleepy :9

I do believe that you are exagerrating Argentinian smartness . Being oportunistic is a learning mechanism and is not a sign of intelligence . The best societies in the world are those where the citizens work as a team . This is the main reason that Argentina has failed as a nation as egoismo and oportunisism is too heavily ingrained in the culture here . Australia , New Zealand , Canada work because their societies teach people to work as a team and to respect others ( of course their are exceptions ) . In South America the best society that works together is Chile where its ingrained to assist others . Their responses in natural disasters show this incredible outpouring of support and communal spirit to get things done . In Argentina people would be fighting for weeks between each other and in the meantime rome will burn . Germanic culture is orderly and efficient . They get the job done without twists and turns and also offer the best of themselves in their quality of materials and workmanship . German made products are world famous for a reason .

 

[Bajo_cero2]

I disagree. The reason this caoubtry failed is nazism.

 

[pizzadreams]

I do believe that you are exagerrating Argentinian smartness . Being oportunistic is a learning mechanism and is not a sign of intelligence . The best societies in the world are those where the citizens work as a team . This is the main reason that Argentina has failed as a nation as egoismo and oportunisism is too heavily ingrained in the culture here . Australia , New Zealand , Canada work because their societies teach people to work as a team and to respect others ( of course their are exceptions ) . In South America the best society that works together is Chile where its ingrained to assist others . Their responses in natural disasters show this incredible outpouring of support and communal spirit to get things done . In Argentina people would be fighting for weeks between each other and in the meantime rome will burn . Germanic culture is orderly and efficient . They get the job done without twists and turns and also offer the best of themselves in their quality of materials and workmanship . German made products are world famous for a reason .

Couldn´t have said it better myself. People can -and do- come up with all sorts of explanations, but in the end it is something heavily ingrained in the culture. Political parties, corruption, whatever it is, just mirrors that. I honestly think Argentina will be one of the poorest and less developed countries in the region in a couple of decades. Colombia has made remarkable economic and social progress; Peru has been growing at a fast rate; Chile is by far the most advanced nation here and has been growing non stop during those years where Argentina has stalled. I don´t think Argentina´s future is bright. Not only if you look at the numbers which are frightening, but you can see how stuck in the past the country is even by arguing with people that have attained a high educational level. It´s tragic, really. Like a kid that has been spoiled and grew up to deal with the crude reality, but instead of bettering his/her situation, keeps blaming others. Argentines, a good proportion of them, dislike the USA; the English; Peruvians; Bolivians; Colombians; have a rivalry with Brazil that sometimes goes beyond football; often act condescending towards their little neighbor Uruguay, and the list goes on and on.

 

[pizzadreams]

And with all due respect to lamarque, who I like reading and take his opinions into account, that so called smartness, like perry said, is not more than being opportunistic since it´s a typical trait among people in countries that suffer from high levels of corruption

 

[perry]

A very famous argentinian writer once said that the human ego is the little argentinian in us all. To run a business here is made very difficult due to this huge entitlement complex that is rampant in argentinian society . Most people give up and I know very few expats who keep their business after a few years due to employee problems and unfair taxes and charges . Will Argentina change for the better I personally am not optimistic as the last chance for many was Macri and now what will they have in the future a more left wing peronismo is the future and this also is not a answer for the huge problems that this country has

 

[pizzadreams]

A very famous argentinian writer once said that the human ego is the little argentinian in us all. To run a business here is made very difficult due to this huge entitlement complex that is rampant in argentinian society . Most people give up and I know very few expats who keep their business after a few years due to employee problems and unfair taxes and charges . Will Argentina change for the better I personally am not optimistic as the last chance for many was Macri and now what will they have in the future a more left wing peronismo is the future and this also is not a answer for the huge problems that this country has

Tell me about it. I had a friend who never managed to get his company started in Buenos Aires. After 7 years or so he gave up and settled in Mexico when a new window opened; not exactly a business paradise, but much better from what he´s told me, and he´s doing well right now. This is just one instance of many, though. These are people that could be creating jobs and contributing to the arg economy with genuine labor. Then they wonder why there´s so little entrepreneurship here and brain drain. A loss for Argentina...

 

[sergio]

Tell me about it. I had a friend who never managed to get his company started in Buenos Aires. After 7 years or so he gave up and settled in Mexico when a new window opened; not exactly a business paradise, but much better from what he´s told me, and he´s doing well right now. This is just one instance of many, though. These are people that could be creating jobs and contributing to the arg economy with genuine labor. Then they wonder why there´s so little entrepreneurship here and brain drain. A loss for Argentina...

This is an old story. History keeps repeating itself in Argentina.

 

[lamarque]

I do believe that you are exagerrating Argentinian smartness . Being oportunistic is a learning mechanism and is not a sign of intelligence . The best societies in the world are those where the citizens work as a team . This is the main reason that Argentina has failed as a nation as egoismo and oportunisism is too heavily ingrained in the culture here . Australia , New Zealand , Canada work because their societies teach people to work as a team and to respect others ( of course their are exceptions ) . In South America the best society that works together is Chile where its ingrained to assist others . Their responses in natural disasters show this incredible outpouring of support and communal spirit to get things done . In Argentina people would be fighting for weeks between each other and in the meantime rome will burn . Germanic culture is orderly and efficient . They get the job done without twists and turns and also offer the best of themselves in their quality of materials and workmanship . German made products are world famous for a reason .

I'm not sure if you understood me then, I never said that Argentineans are smarter than any other nation, I said that in general intelligence is something you find in every country in the same quantity, if you go to my text that was my observation. Is not intelligence that define a country’s wealth is more the other attributes that you mentioned later on. I agree with you that best societies in the world are those where citizens work as a team and follows rules (of course best is relative to the observer), I actually agree in most of what you said. With 2 exceptions, first intelligence is not related with cooperation, an intelligent person can many times be as egoist or more egoist and opportunist than a non-intelligent person so I had difficulties following you in that part of your answer.

The second part is when you mention Chile, I think you don't understand the cause behind Chilean relative stability and growth in the last times, first of all Chile is not particularly a cooperative society, is quite conservative, reluctant to change and with big divisions in its society (is fun that just because you see on tv people helping each other on the earthquake you finish in the conclusion that they must be a cooperative society- they do have the factor of reluctance to change that helps stability), they managed to succeed relative to their neighbors thanks to a single factor that push all the rest of the economy out of the poverty it was sunken in, that factor is that they have a relative small population and their main product is cooper with has gone up in price a lot faster than any other commodity including oil, they export 67 billon dollars, a little less than the total exports of argentina with a population that is only ¼ of Argentinean population and most of what they export is cooper, wine is only around 1.78% of their exports while cooper is more than 50% even now a days.

Guess when their relative prosperity started? They manage to start the growing path around 1962 (of course back then they where one of the poorest nation in south america), their main production was cooper and totaled at that time around 80% of the exports, the price was 0,20 cent per ton, since that time their economy growth as the price of the cooper in the international market start rising to a crazy 4.57 dollars, so they saw in this period an increase in the price of the main product of their economy by a factor of 2280%, this gave them plenty of dollars, and as they didn’t have any national industry or industrial complexes in place that required protection they just open trade deals with all the world so you can have international prices of every product with zero risk of having inflation as you don’t make the prices, as well no one was lobbying in favor of local industry neither had a risk to loose his job (they had and still now a days have a very simple economy and very commodity dependent, does that look like Germany to you or more like an Arabian emirate model?). Argentina in the other side had some attempts of following a similar path, but it could never work out in here, as the exports are relative small in comparison to the size of the economy and the population of the country will be mostly unemployed if they just open up, this brought more and more populist crowny capitalist and protectionist government as every time a free trade government or dictatorship tried to open the economy a lot of people lost their employs fueling up the anti-world, anti American and anti free trade national mindset, for argentina having a relatively big industrial base for south america and a strong middle class, opening the economy meant at that time a lot of unemployment and turmoil as the local population is to big to subsist only on soy and derivates commodities exports, and the soy exports for argentina are not even the equivalent of half the cooper exports for chile in a country with a lot more population.

I hope this was at least informative and gave some context to the rise in prosperity of the Chilean economy, another thing you have to take into account is that argentina pass through a very similar process of prosperity early on this century when price of the main products of argentina increased fueled by the first and second world war, but this prices plummeted once europe recovered and started their food proteccionism that destroyed farmers business around the world, adding to that the increase that the argentinean population from 250.000 in 1850 to 20 millons by 1955, mostly due to huge wave of european migrants was already unsustainable to rely only on a wekened agricultural and comodity based economy, added to that once the population took a taste to living in a certain level and got some things for granted as free education a very caring state and free health between many others was very difficult to step back from that, so they started a slow an painfull way down, they could have attacked the source of the problem but at that time they preferred the state safety network than a suden crash with reality, Chilee is just now reaching some sort of prosperity and is a mildly prosperity, is quite new in there and the state is still not overspending, but give them time and the state size will growth making it more and more difficult to support just based on a single commodity export, there is social pressure to make the education free as is here, and to increase social spending already, and the lower classes in chile have no help from the states and have quite a resentment toward anyone in the middle or higuer clases, if prize of cooper goes down things can go south very fast in Chile, they had something with is to congratulate witch is how few changes they have introduce, this gives companies the feeling of a very stable country in where regardless of government you can invest knowing that very few will change.

 

[lamarque]

I'm not sure if you understood me then, I never said that Argentineans are smarter than any other nation, I said that in general intelligence is something you find in every country in the same quantity, if you go to my text that was my observation. Is not intelligence that define a country’s wealth is more the other attributes that you mentioned later on. I agree with you that best societies in the world are those where citizens work as a team and follows rules (of course best is relative to the observer), I actually agree in most of what you said. With 2 exceptions, first intelligence is not related with cooperation, an intelligent person can many times be as egoist or more egoist and opportunist than a non-intelligent person so I had difficulties following you in that part of your answer.

The second part is when you mention Chile, I think you don't understand the cause behind Chilean relative stability and growth in the last times, first of all Chile is not particularly a cooperative society, is quite conservative, reluctant to change and with big divisions in its society (is fun that just because you see on tv people helping each other on the earthquake you finish in the conclusion that they must be a cooperative society- they do have the factor of reluctance to change that helps stability), they managed to succeed relative to their neighbors thanks to a single factor that push all the rest of the economy out of the poverty it was sunken in, that factor is that they have a relative small population and their main product is cooper with has gone up in price a lot faster than any other commodity including oil, they export 67 billon dollars, a little less than the total exports of argentina with a population that is only ¼ of Argentinean population and most of what they export is cooper, wine is only around 1.78% of their exports while cooper is more than 50% even now a days.

Guess when their relative prosperity started? They manage to start the growing path around 1962 (of course back then they where one of the poorest nation in south america), their main production was cooper and totaled at that time around 80% of the exports, the price was 0,20 cent per ton, since that time their economy growth as the price of the cooper in the international market start rising to a crazy 4.57 dollars, so they saw in this period an increase in the price of the main product of their economy by a factor of 2280%, this gave them plenty of dollars, and as they didn’t have any national industry or industrial complexes in place that required protection they just open trade deals with all the world so you can have international prices of every product with zero risk of having inflation as you don’t make the prices, as well no one was lobbying in favor of local industry neither had a risk to loose his job (they had and still now a days have a very simple economy and very commodity dependent, does that look like Germany to you or more like an Arabian emirate model?). Argentina in the other side had some attempts of following a similar path, but it could never work out in here, as the exports are relative small in comparison to the size of the economy and the population of the country will be mostly unemployed if they just open up, this brought more and more populist crowny capitalist and protectionist government as every time a free trade government or dictatorship tried to open the economy a lot of people lost their employs fueling up the anti-world, anti American and anti free trade national mindset, for argentina having a relatively big industrial base for south america and a strong middle class, opening the economy meant at that time a lot of unemployment and turmoil as the local population is to big to subsist only on soy and derivates commodities exports, and the soy exports for argentina are not even the equivalent of half the cooper exports for chile in a country with a lot more population.

I hope this was at least informative and gave some context to the rise in prosperity of the Chilean economy, another thing you have to take into account is that argentina pass through a very similar process of prosperity early on this century when price of the main products of argentina increased fueled by the first and second world war, but this prices plummeted once europe recovered and started their food proteccionism that destroyed farmers business around the world, adding to that the increase that the argentinean population from 250.000 in 1850 to 20 millons by 1955, mostly due to huge wave of european migrants was already unsustainable to rely only on a wekened agricultural and comodity based economy, added to that once the population took a taste to living in a certain level and got some things for granted as free education a very caring state and free health between many others was very difficult to step back from that, so they started a slow an painfull way down, they could have attacked the source of the problem but at that time they preferred the state safety network than a suden crash with reality, Chilee is just now reaching some sort of prosperity and is a mildly prosperity, is quite new in there and the state is still not overspending, but give them time and the state size will growth making it more and more difficult to support just based on a single commodity export, there is social pressure to make the education free as is here, and to increase social spending already, and the lower classes in chile have no help from the states and have quite a resentment toward anyone in the middle or higuer clases, if prize of cooper goes down things can go south very fast in Chile, they had something with is to congratulate witch is how few changes they have introduce, this gives companies the feeling of a very stable country in where regardless of government you can invest knowing that very few will change.

To resume it, I think I wrote way to much about Chile, once I started with it i forgot myself, the point was that Chilean economy is mostly a consequence of a commodity based economy helped by the rise in their commodity price and a relative small population that can import the goods they consume with this dollars, same with Peru, only difference with Peru is that the product of this commodity need to sustain a bigger population base and they have less cooper but in both countries they didn't have much industry to protect so it was quite easy and convenient for them to open up their economies, and the stability on their economy is mostly due to the fact that is a very simple economy that can be sustained by a single commodity or two, and that commodity has an stable rise in price over the time, so they can pay for the increase in consumption of products of the population that they import from the rest of the world, they don't need to worry about inflation at all as long as their trade balance with the world is positive with in this case will be as long as cooper price is going up or as long as they manage to find new cooper reserves at a higher speed than they mine it out.

 

[pizzadreams]

Lamarque:

I think you oversimplify many things here and get some things wrong. I think the main point is that you may have a big population or you may have a small population; you may rely more or less on imports; you may have a lot of natural resources or relatively scarce naturales resources; you may have a more democratic regime versus a more authoritarian one; you may have a more open or less open economy. In the end, what I feel matters the most is one thing you mentioned: stability and a consensus regarding policies and certain types of ideologies. It´s not a case of Chile being a major exporter of copper or copper prices hitting new highs that explain Chile´s rise and development. It´s the people. If common sense is not applied collectively, none of the things I mentioned in the beginning matter. Yes, you may be able to ride along on the big demand for commodities wave, but what matters is how you set yourself up to weather the bad times too; the long term planning that is needed for the country to succeed. Argentina could have just as much copper as Chile, and you know what? I do think it would still be in the same position. Look at Venezuela, then look at Norway. Major exporters of oil. Both took a considerable hit during the downfall of oil prices, but while Venezuela hasn´t been able to capitalize on it, Norway, in spite of having a much lower GDP per capita today, is still one of the richest countries in the world. What do we make of this, then? That the reasons you mentioned are insufficient to explain why Chile is what it is today. Chileans, unlike Argentineans, are known to be hard working. Does that mean there aren´t hard working Argentines? Not at all, but in the grand scheme of things, stereotypes exist for a reason, and no one would dare to call the Japanese lazy and dishonest. Check what Chile did with its copper industry. It instituted a copper fund decades ago where its revenues can only be accessed during bad years. Can you imagine something like that occurring in Argentina? That, to me, is concrete evidence -not just a general perception of our day to day interactions with a few Chileans- of cooperation. Yes, there are dishonest and corrupt citizens in Chile, but there is a reason corruption in Chile around the world is perceived to be low, whereas the exact opposite happens to Argentina. You can see this in the institutions. Chilean police, the Carabineros, for instance, as criticized as they might be there (and let´s be honest, the police are often criticized no matter what country you´re in) are not known to be corrupt. In fact, one thing ANY Chilean would tell you is to never, EVER try to bribe a Carabinero. Let´s not even mention Argentina in this regard. Argentina never opened its economy enough to compete with the world and be a competitive player in global supply chains or adopted a true liberal stance like that of Chile, which is not to say Chile doesn´t have it´s own problems. On the contrary, Argentina´s has historically had the out-of-control fiscal deficit I so emphasized; the opposite of keeping public expenditures in check. One last thing, many countries protect certain sectors of the economy from competition; Argentina, on the other hand, adopts a radical stance (as with everything) and protects itself from EVERYTHING, never mind how inefficient it is to do that when not even national companies are free to import goods or products they need to develop their own production. Chileans are smarter in this (and many if not all) regard. Chile -like New Zealand, like Australia, like Canada- will never have a productive and competitive textile industry, so they import what they need. Argentina is one of the most closed economies in the world where the population has to pay up to 4 times the price of something while the ones taking advantage of this are union leaders, politicians and businessmen that get extremely rich at the expense of everyone. Lastly, it is not true that you will have unemployment by opening up the economy. You will have a better allocation of resources because does it really matter if you have 7% unemployment rate when most of the people working do so in jobs that aren´t needed or/and aren´t productive? Importing what you will never produce means people will not only benefit from lower prices and better quality of goods, but will keep more money in their pockets, money that will fuel REAL jobs and productive companies and investment. Your logic here is unfortunately a fallacy that many Argentines share. To sum up everything, what you need -just take a look at the leading countries in social and economic indicators- is a relatively open economy and a sane and honest enough population. The latter a result of historical processes across the centuries, something which cannot be changed -if it can- overnight.

Argentina could be blessed today with Australia´s natural resources and wealth, and it would still manage to dilapidate most of it in a couple of decades if not years. And here, is where the problem lies: it´s the mentality of a nation.