Is Buenos Aires a Third World City?

[BlahBlah]

I want to contribute to the black market of coins. We have 297 peso coins...highest bid wins I have an offer of 350 for it.

But there is no blackmarket for coins

 

[ssr]

Here's what I've heard about the "black market" for coins here in Buenos Aires (this may or may not be bullshit):

The bus companies have all of the coins because their buses suck up coins all day, every day. They are willing to sell coins to other businesses, but they take a small commission when they do. So, for example, when some coinless kiosk owner gives a bus company a 100 peso bill for coins they get something like 97 pesos in coins in return.

The chinese supermarket owners are having none of it, however, and are offering little paper IOUs in lieu of coins. And most kiosks, of course, just give you chewy, little candies (which aren't half bad).

This leads me to wonder what the hell the banks are doing. I don't have a business or a bank account here so I have no idea, but can't anyone just go to their bank and get rolls of coins?

 

[Ries]

If thats a "black market", then there is a black market in coins in the USA as well.

We have the opposite problem in the USA- we are so wealthy that people can afford to give coins away for less than face value. Many americans are totally obsessed with lower torso visual appeal- they HATE having anything in their pockets. So americans dont spend coins, they throw them on their dressers, or in their car consoles.

As a result, we have big coin changing machines in grocery stores. You feed in your jar of coins from your house, the ones that are too much trouble to carry and spend, and it gives you back a credit slip you can spend at the cash register- less 8.9%. Just like the bus companies, only in reverse. You actually get paid less for coins here.
This is actually a much worse percentage than the "third world" pays in Argentina.

But neither of these is a real black market.
Black markets in currency, as mentioned above, takes place when the government supports an unrealistic exchange rate, and enforces it, and you can get a better rate on the street. I have traded dollars for black market local currencies in places like Burma, and nothing resembles that in Argentina.

I do have a big baggie of emergency collectivo change, but I dont think I am responsible for the shortage...

The way to tell if its really a black market or not is to see what happens when the collectivos switch to pay by card.

 

[fedecc]

This leads me to wonder what the hell the banks are doing. I don't have a business or a bank account here so I have no idea, but can't anyone just go to their bank and get rolls of coins?

Supposedly the bank could give you up to 100 pesos in coins, then they lowered it to 20. Now most banks give you 5 pesos if any at all.

This is mostly because the Central Bank doesn't provide the banks with coins.

Black markets in currency, as mentioned above, takes place when the government supports an unrealistic exchange rate, and enforces it, and you can get a better rate on the street. I have traded dollars for black market local currencies in places like Burma, and nothing resembles that in Argentina.

Since almost forever the Argentine government has controlled the currency, so it has always maintained an "unrealistic exchange rate".

Because of this, the has always been a black market for dollars. The so called "dolar paralelo" is that, the unofficial price of the dollar as opposed to the official price.

What changes is the differences between the paralelo and the oficial, which increases or decrases the amount of people that buy dollars.

 

[HDM]

Oops! Okay, got me, I confess ... according to Ries:

We have the opposite problem in the USA- we are so wealthy that people can afford to give coins away for less than face value. Many americans are totally obsessed with lower torso visual appeal- they HATE having anything in their pockets. So americans dont spend coins, they throw them on their dressers, or in their car consoles.

I never actually thought about it. I have been following a habit of decades of tossing coins into a large coffee mug. At some point, I take a handful of coins with me to give to the down-and-out on the street. It did not occur to me that people use them or want them. So if there is a coin shortage here, maybe it's because I've got a coffee mug full of them on my bookcase. actually, now a mug and a half.

On the other hand, there are occasionally some street people with a handful of coins, so there is the possibility of recycling them.

I keep getting coins because when store clerks say something to me -- I know they are asking if I have monedas -- I just say, no hablo castellano, and I get a pocketful of coins, which are then tossed into the mug. If you need coins, just pretend you don't speak Spanish. I have not yet come across an English speaking store clerk, so I presume they find it easier just to give me coins in change rather than try to figure out how to ask for exact change in English.

Sorry if I am screwing up the moneda shortage. I am just not used to taking coins seriously. I'll work on it.

 

[BlahBlah]

Here's what I've heard about the "black market" for coins here in Buenos Aires (this may or may not be bullshit):

The bus companies have all of the coins because their buses suck up coins all day, every day. They are willing to sell coins to other businesses, but they take a small commission when they do. So, for example, when some coinless kiosk owner gives a bus company a 100 peso bill for coins they get something like 97 pesos in coins in return.

The chinese supermarket owners are having none of it, however, and are offering little paper IOUs in lieu of coins. And most kiosks, of course, just give you chewy, little candies (which aren't half bad).

This leads me to wonder what the hell the banks are doing. I don't have a business or a bank account here so I have no idea, but can't anyone just go to their bank and get rolls of coins?

Watch for the bigest line at every train station

 

[ssr]

...americans dont spend coins, they throw them on their dressers, or in their car consoles.

While I'm not aware of any American obsession with "lower torso visual appeal" (on the contrary, it seems that for many Americans the visual appeal of any part of their enormous, overfed bodies--and particularly the masses of fat testing the buttons on their pants--is the last thing on their minds), I do agree that we don't much like coins.

I don't agree, however, that "we are so wealthy that people can afford to give coins away for less than face value." I think we're just accustomed to convenience. There's really not much of a need to carry cash around in the US anymore. Everything can be paid for with the swipe of a card, or by tapping something with your keychain, or by driving your car through the special toll lanes that don't even require you to slow down anymore. Paying a toll at 60MPH; that's what we're used to.

So, coins, eh. They're sort of annoying. They bulk up your wallet or rattle around in your pockets and are often worth less than the metal they're made of. I believe it costs the US Mint something like ten cents to produce a nickel. That's just stupid.

BTW, for anyone who finds themselves in the US with some coins to get rid of, Commerce Bank has coin counting machines and doesn't charge a commission to exchange them for real money. And you can always grab a free pen on the way out.

 

[Bianca]

I recently came across an article on Buenos Aires' moneda crisis that explains a few different causes of the problem, such as the bus companies hoarding the coins in a warehouse (they got busted hoarding 13 MILLION coins) and why the banks refuse to give change. It's a pretty interesting read.

Here is an excerpt:

No one can say what's causing this absurd situation. The government accuses Argentines of hoarding coins, which is true, at least to some extent. When even the most insignificant purchase requires the same order of planning and precision as a long-range missile strike, you can hardly blame people for keeping a jar of monedas safe at home. The people, in turn, fault the government for not minting enough coins. In fact, the nation's central bank has produced a record number of monedas this year, and the problem has gotten even worse. Everyone blames the bus companies, whose buses accept only monedas. (Buenos Aires' 140-plus bus routes are run by a number of separate, private companies.) These companies, exploiting a loophole in the law, run side businesses that will exchange clients' bills for monedas for a 3 percent service fee. This is legal, but the business community also routinely complains of being forced into the clutches of a thriving moneda black market—run by the local mob, or the bus companies, or both—in which coins sell for a premium of between 5 percent and 10 percent. The bus companies steadfastly deny any involvement in this racket, but their claims were undercut by the discovery of a hoard of 13 million coins, amounting to 5 million pesos, in one company's warehouse this October.

Read the full article here:
Yes, We Have No Monedas!
Inside the world's most annoying economic crisis.

 

[BlahBlah]

While I'm not aware of any American obsession with "lower torso visual appeal" (on the contrary, it seems that for many Americans the visual appeal of any part of their enormous, overfed bodies--and particularly the masses of fat testing the buttons on their pants--is the last thing on their minds), I do agree that we don't much like coins.

I don't agree, however, that "we are so wealthy that people can afford to give coins away for less than face value." I think we're just accustomed to convenience. There's really not much of a need to carry cash around in the US anymore. Everything can be paid for with the swipe of a card, or by tapping something with your keychain, or by driving your car through the special toll lanes that don't even require you to slow down anymore. Paying a toll at 60MPH; that's what we're used to.

So, coins, eh. They're sort of annoying. They bulk up your wallet or rattle around in your pockets and are often worth less than the metal they're made of. I believe it costs the US Mint something like ten cents to produce a nickel. That's just stupid.

BTW, for anyone who finds themselves in the US with some coins to get rid of, Commerce Bank has coin counting machines and doesn't charge a commission to exchange them for real money. And you can always grab a free pen on the way out.

I wish there were 1,2,5 and 5 dollar coins. You then would finally get rid of those ugly and dirthy bills

And 5 dollar is about the same as 2 euro nowadays

 

[Liam3494]

Wish it was - US $5 is around 3 euro, and there are One Dollar coins.