Milei’s quest to defuse Argentina’s currency control bomb

dollar accounts are traceable by the government.
most of the liquid assets in Argentina are in the form of the estimated $400 billion in paper US hundred dollar bills held by individuals.
But real estate is permanent, its sentimental, and under Argentine law and custom, its almost never repossessed, or seized by the government for back taxes.
So wealthy Argentines dont mind owning real estate, as they never plan on selling it anyway.
The truly wealthy here own estancias that the family has held for, in some cases, literally centuries.
Their dollars are in cash,or in Uruguay and Miami, or in investments we only find out about in the Panama Papers.
Bank accounts are for the lower middle class.
This is true globally.
The wealthy do not keep their money in the bank.
Yes, I'm aware of the many ways that the wealthy launder and hide assets. However, the article is not talking about rich Argentine families. It's talking amount multinational companies that have invested in Argentina but can't transfer declared profits outside of country because of CEPO limitations. That's a really problematic statement. Imagine a french farming conglomerate wanting to grow grains in Argentina for profit being required to keep all it's profits within the country. What would be the point? Sounds like a huge impediment to foreign investment.
 
did milei invent the CEPO? It dates back to 2011 as a name for the policy.
I was under the impression that Milei wants the CEPO gone, and he is in favor of a free and unregulated flow of capital.

So, to answer your question, no, the CEPO is not libertarian.
The CEPO, to Milei, is an inconvenient reminder that the adults in the room, the oligarchs, and the congress, will not let him have his way, will not let him sign executive orders, like Trump, that instantly abolish everything he hates.
Is it Congress that is preventing ending the CEPO? I thought the President was unwilling to do so because he fears inflation if the peso is allowed to float.
 
What would be the point? Sounds like a huge impediment to foreign investment.
That's the catch 22, the only thing we know for sure is the 10 billion will flow outwards, and there's no guarantee a new 10 billion would come in to replace it. When this happens you basically have two options: let the peso devalue to lessen the impact, or, like Macri, you have the IMF front you the money while waiting for the "lluvia de inversiones" that ultimately turned out to be storm clouds.

I don't envy their position, but I deplore the bullshit. They sound like Ks more and more everyday "cabals of financiers" or "speculators against the Argentine people" or "firms are overcharging, the dollar is based in reality"
 
Yes, I'm aware of the many ways that the wealthy launder and hide assets. However, the article is not talking about rich Argentine families. It's talking amount multinational companies that have invested in Argentina but can't transfer declared profits outside of country because of CEPO limitations. That's a really problematic statement. Imagine a french farming conglomerate wanting to grow grains in Argentina for profit being required to keep all it's profits within the country. What would be the point? Sounds like a huge impediment to foreign investment.
again, milei's professed economic theory is 100% in favor of allowing these companies to do whatever they want.
he simply does not have the political power to change this.
and frankly, I am not convinced that he actually believes enough in the Austrians to actually do this, because I think even he suspects that it would result in a disaster.
If these magic "investors" everybody talks about unleashing only want to transfer their profits out of the country, then they are not investors at all, and will only suck us dry and buy mansions in London...
Investing in Argentina is largely appealing to Argentines.
The Singers of the world just want to pick the bones clean.
French Farming Conglomerates? Seriously?
 
Is it Congress that is preventing ending the CEPO? I thought the President was unwilling to do so because he fears inflation if the peso is allowed to float.
afraid is a good descriptive term here, but it infers he is not a true believer in libertarianism
 
again, milei's professed economic theory is 100% in favor of allowing these companies to do whatever they want.
he simply does not have the political power to change this.
and frankly, I am not convinced that he actually believes enough in the Austrians to actually do this, because I think even he suspects that it would result in a disaster.
If these magic "investors" everybody talks about unleashing only want to transfer their profits out of the country, then they are not investors at all, and will only suck us dry and buy mansions in London...
Investing in Argentina is largely appealing to Argentines.
The Singers of the world just want to pick the bones clean.
French Farming Conglomerates? Seriously?
Doesn't matter what he believes, he knows it will ruin all the effort. As happened to Macri. People voted him to escape with dollars, hell, I did the same in 2016, because me, and most of people don't like to bet significant amounts. Also Argentines not, they invest just enough to suck everyone dry, but there isn't real patriotism involved. Most of their assets and money are outside, or how much they are able to get out.

And I don't believe in libertarian way, if anything the state should be stronger here to achieve anything. But then again, corruption... It's just never ending story.
 
If these magic "investors" everybody talks about unleashing only want to transfer their profits out of the country, then they are not investors at all, and will only suck us dry and buy mansions in London...
Investing in Argentina is largely appealing to Argentines.
The Singers of the world just want to pick the bones clean.
French Farming Conglomerates? Seriously?
I don't even know where to begin with this statement. Why do you think American cars are being manufactured in Mexico? So all of them can be sold to Mexicans? What do you think an international company does to grow crops here...hires international aliens to farm the crops? Ships in international machines to till the soil? Buys food and lodging and trucking from international sources to bring it a port to export? You think taking unused land and turning it into a productive source of income for the townsmen there is picking Argentina's bones? Jesus christ, why not return the land to Mapuches and Tehuelche and call it a day. We can all go back to Spain, German, Italy or wherever "bone pickers" came to this country from. You sound 100% for the CEPO and "industria" everything. Argentina should close it's airspace until Boeing and Airbus agree to build their planes here while we are at it.
 
People voted him to escape with dollars...
He just did a massive blanqueo which brought in 19 billion dollars with CERA requirements to invest it domestically. Doesn't sound like much of an escape plan to me...
 
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