In Argentina, Inflation Passes 100% and the Restaurants Are Packed

[MilHojas]

In Argentina, Inflation Passes 100% (and the Restaurants Are Packed)

Argentina’s financial crisis has a surprising side effect: a flourishing dining scene in Buenos Aires, as residents rush to spend pesos before they lose more value.

www.nytimes.com

Archived version

 

[Ries]

I have been to a bunch of those restaurants, earlier this year, and many of the diners are far from spending their last pesos- the clothes, shoes and handbags, hairdos and watches all indicate that there is plenty of money in Argentina still, its just not evenly distributed. There is no question that most people are having a tough time, prices are constantly going up, and keeping savings in pesos is silly. But many people I know, including some who are absolutely "poor", still have a few US 20 dollar bills, as security against inflation.
And there still is a substantial upper middle class and upper class who are driving new cars, and dining at expensive restaurants, this week and next.
Inflation porn, much like Disaster porn or Ruin porn always sell newspapers, but the truth is always more complicated.

 

[antipodean]

I have been to a bunch of those restaurants, earlier this year, and many of the diners are far from spending their last pesos- the clothes, shoes and handbags, hairdos and watches all indicate that there is plenty of money in Argentina still, its just not evenly distributed. There is no question that most people are having a tough time, prices are constantly going up, and keeping savings in pesos is silly. But many people I know, including some who are absolutely "poor", still have a few US 20 dollar bills, as security against inflation.
And there still is a substantial upper middle class and upper class who are driving new cars, and dining at expensive restaurants, this week and next.
Inflation porn, much like Disaster porn or Ruin porn always sell newspapers, but the truth is always more complicated.

Let's say you earn a "good" lower management / professional salary of around ARS 400.000 (yes, that's a good salary here, those en-blanco in the service sector are generally on less than ARS 300.000 and still considered middle class here).
You pay basic living expenses of around ARS 300.000.
You have ARS 100.000 leftover (or more realistically, to pay off last months credit card balance and open up more of your credit limit to be able to go out and spend it again).

What are you going to do with your surplus? Buy USD 200 to add to your modest savings, which you likely accumulated when the dollar was "cheaper", or simply say "f*** it, I'm never going to be able to buy a house/ car/ holiday abroad with $200" so go out and spend that ARS 100.000 on some nice nights out while you ride out the storm?

That ARS 100.000 may be filling restaurants and creating a surface deep illusion of economic prosperity, but the truth is that it is not adding any lasting value or wealth for the people who work to earn it in the first place, and thus only serves to deepen the inequality of wealth distribution by transferring the little that they have to the owners of the restaurants to finance their fancy hairdos, watches and new cars.

 

[carride]

It was on the NYtimes front page, for those who still get the paper version.
Also it is an article they provide translated. A decent study guide to read each version side-by-side

https://www.nytimes.com/es/2023/06/...mAHQWbyGrLyFER9svhFqwJiZOrnSPu&smid=url-share

 

[Ries]

all I can say is I know a bunch of people who dont earn much, and they still stash small amounts of cash in dollars.
Sometimes, sure, they splurge on pizza.
As I said above- MOST people in Argentina are having a tough time right now, economically.
But there are still 40 plus million people in the country, and there are still a few million with enough money to eat out.
So restaurant patrons dont really tell us much about macro economics, which is kind of my point.
There are still people buying electric bicycles and Lopez handbags, while the conurbano is pinching centavos.
I guess my main point is we are not Venezuela, not by a long shot, and the fact that there is still enough money to fill La Preferida most nights is a good sign. There are plenty of bad signs that are much worse.


But this article doesnt say anything about inequality of wealth distribution, because that is not something the NYT talks about- its a bit too close to home.