Is It Time To Close The Blue Market?

[Rich One]

11.65 today no ceiling on sight until March....

11.93 before closing......??? 15.00 hours

 

[Gringoboy]

According to The Captain:
"Hay un mercado libre de cambios"
Does he make it up as he goes along or what?

 

[glasgowjohn]

According to The Captain:
"Hay un mercado libre de cambios"
Does he make it up as he goes along or what?

Well if its free for the Ministers and Echegaray , it must be free for all !!

 

[Dublin2BuenosAires]

Is it demand or the lack of supply.


Or the concentration of supply, in other words. For instance La Serenisima and Sancor share more than 80% of the milk and derivatives market. If theres a tambo (milking yard) that grows and grows and capture an important percentage of market (always less than 5%), they simply buy it. So every pyme in the sector cant compete with these giants.

Fortunately they still exist, but are totally marginal.

Last year La Serenisima and Sancor, acting together, raised their prices (average) 42%. How can you fight inflation with this?

So its not only the strong demand but a weak supply.

Good point, why doesnt the govt un-monopolise it?...you know, like the media. This is why most of the dairy produce is quite poor in the supermarkets. Avoid.

 

[Dublin2BuenosAires]

Sheesh sorry about the delay. Way too many things getting in the way of my mindless chattering on the web.

OK so you're totally right about QE not technically being printing, but printing both in the OECD and here is a lot more complicated than we're making it here. Even Bernanke's response as to whether QE is printing money was "sort of". So we can either go into this long tangent or I could just withdraw the comparison, which would probably be better for sticking on topic.

So let me rephrase then: Argentine inflation is a result of excess aggregate demand. There are monetary factors that can aggravate or improve it, but the root issue is demand. For me, personally, what is most important is employment and real median household wealth, and in general I would be against any economic policy that would hamper them. When you talk about cutting government spending, yes that will cut inflation, but my first concern would be what effect that would have on unemployment, which Argentina's history in the 90s has shown to be intimately connected. Basically, the only solution Argentine politicians have come up with in the past for lowering inflation has been to raise unemployment (e.g., Rodrigo, Cavallo). I'm trying to come up with another solution, to work on a way to ease inflation down without the austerity.

If you have another way to prioritise employment and cut public expenditures I'd be all ears.

We wont agree, but i argue that a 40% increase in money supply is the main driver.

Not all that money is well spent (...para todos etc), efficiencies are possible.

 

[EdRooney]

It's an excellent point about breaking up big monopolies, but they are not the reason why there is inflation, and that's exactly why the recent price control games are merely cosmetic. Long-term structural changes are needed, not band aids on the supply chain.

 

[Matiasba]

Good point, why doesnt the govt un-monopolise it?...you know, like the media. This is why most of the dairy produce is quite poor in the supermarkets. Avoid.

Is not that easy. And in fact it is not a monopoly. Altghough Im pretty sure this people must know of this government. And the media is waaaaay much more important, is who has the power of the word, is which voices to prevail, it has a lot of political power.

 

[EdRooney]

OK so cut government spending by 40% and you get a 10-15% increase in unemployment. Is that really what you want?

 

[Matiasba]

It's an excellent point about breaking up big monopolies, but they are not the reason why there is inflation, and that's exactly why the recent price control games are merely cosmetic. Long-term structural changes are needed, not band aids on the supply chain.

A solution could be the government to make its own milk company, you know, as Carrefour, Coto, Dia, etc have their own brands, with its prices, without inflation or speculation. They surely win by far in price and people would chose them, but the political cost, being called Comunist at least, is important I think.

 

[Rich One]

A solution could be the government to make its own milk company, you know, as Carrefour, Coto, Dia, etc have their own brands, with its prices, without inflation or speculation. They surely win by far in price and people would chose them, but the political cost, being called Comunist at least, is important I think.

You are correct go the way of Cuba or Soviet Union have one large Milk owned company with subsidized prices operating at a loss , like a AAerolineas, where corrupt apparatchiks steal more than now. Examples El Pami medicines or Anses employees and noquis. Then 50 years later, go back like Cuba to free market competition and free pricing..... jajjajjjajajajaj