Nothing We Don't Already Know

[gsi16386]

https://www.moodys.com/research/Moodys-Outlook-negative-for-Argentine-banking-system-as-business-conditions--PR_284174?WT.mc_id=NLTITLE_YYYYMMDD_PR_284174

Just for fun...

 

[MikeB12]

From US hedge fund manager Kyle Bass,

[background=transparent]
"People don't understand what is happening there. Lots of things there are fixable. Leadership in control has "issues" . Energy has been an issue, but recently there have been major energy findings that will change that. 2 years from now, he thinks there will be a new President in October 2015 and pro business people will be running things to take advantage of vast prairies of nature resources. Argentina's problems can be fixed in 2 years. Now is the time to start investing. Sees 50% upside in the sovereign debt."[/background]

http://www.marketfolly.com/2013/09/john-burbank-kyle-bass-macro-discussion.html

 

[ElQueso]

If there is a new president in two years (likely, I'd say), then fixes can START in two years. However, I wonder if Bass really understands Argentina politics and the thinking of a lot of people here when he says he thinks things could be REPAIRED in two years.

For example, seems to me that there are a majority of people who are Peronists and/or have a very socialistic view of how economies should work. Even should a pro-business leader come into power, he or she will have to overcome the inertia that exists related to all the powers-that-be (unions, judges, etc) that are so pro-laborer and anti-business. The new person will have quite a mess to clean up. Just opening up the floodgates wouldn't necessarily do, I'd think.

But it reminds me of a political sign I've seen hung up around Santa Fe recently: It has two guys (can't remember their names - one of them is Barbaro I think) running for office. The title? "El buen Peronismo". That says quite a bit about the political climate here. Of course, I think most people think Nestor's brand of Peronismo is much better than Cristina's, but does that mean his particular brand of Peronismo (or any other for that matter) would be effective for pulling Argentina out of its current hole?

And if anyone thinks that the energy concerns will be cleared up within these two years - well, I wouldn't be too sure, personally...

Obviously, Cristina stole the majority share of YPF from Repsol with the dreamy hope of fueling her strange policies with oil money. But YPF needs a partner to do exploration - that is a very expensive and expertise-required business (I have spent about 9 years working for an offshore drilling contractor and another 5 years or so working directly with engineers at Chevron, all as a programmer, not an engineer or accountant, but I got to see both sides of the business. Not an expert, but know a little something about it).

Fields like Vaca Muerta produce now, but there is not enough infrastructure and producing wells to make much of a difference - or else Argentina wouldn't be worried at the moment. Chevron was going to partner with Argentina to expand exploration and production, until one of the Argentine judges threw a monkey wrench into the deal by answering Ecuador's request to take money (from Chevron Argentine assets) that Chevron owed to Ecuador due to a lawsuit related to environmental problems created some thirty years or so ago by Texaco (bought by Chevron a long time ago). Last I heard, Chevron's assets in Argentina were tied up in that issue and I don't see much progress being made in oil production as a result.

There's China as well, who would be very interested in sharing oil production, but they're a little gun-shy because of the deals the Argentine government made related to trade with that country - and then broke them. Probably not enough to deter China from participating, but there is still some time needed to get deals, manpower and equipment into place and I wouldn't doubt if China is waiting to see if the other shoe drops here in Argentina economically before deciding how they're going to get involved.

I don't see Argentina being "repaired" economically in two years, but what the hell, I'm not an economist, just a small businessman who has lived here for a goodly amount of time and has experienced a lot of what Argentina, and Buenos Aires in particular, has to offer: the good, the bad and sometimes the downright ugly.

I don't know how Argentina's economic decline over the next couple of years will look, but I don't see it getting better while Cristina's president and not soon after with anyone else at the helm either.

 

[John.St]

If there is a new president in two years (likely, I'd say), then fixes can START in two years.

Like Máximo Kirchner?

 

[ARbound]

For example, seems to me that there are a majority of people who are Peronists and/or have a very socialistic view of how economies should work. Even should a pro-business leader come into power, he or she will have to overcome the inertia that exists related to all the powers-that-be (unions, judges, etc) that are so pro-laborer and anti-business. The new person will have quite a mess to clean up. Just opening up the floodgates wouldn't necessarily do, I'd think.

I don't suppose you're one of those people who think the USSR/China was/is communist too, right? Kirchnerism, Peronism, etc. can't hold a candle to real socialist economic policies and or practices. They are statist if anything, I dream of a socialist Argentina where the trains actually don't kill people every year, the streets are clean of dog shit, and Moreno goes to jail for abuse of power.

I don't have to tell anyone that the level of bureaucracy here would make Brezhnev proud, but as long as this country drinks the revisionist Peronist history Kool-Aid then the country is going to be stuck in the mud like the past 10 years. This is not due to "socialist" or "left-peronist" economic policies, just peronism in general, which is a political disaster.

 

[ajoknoblauch]

I don't suppose you're one of those people who think the USSR/China was/is communist too, right? Kirchnerism, Peronism, etc. can't hold a candle to real socialist economic policies and or practices. They are statist if anything, I dream of a socialist Argentina where the trains actually don't kill people every year, the streets are clean of dog shit, and Moreno goes to jail for abuse of power.

I don't have to tell anyone that the level of bureaucracy here would make Brezhnev proud, but as long as this country drinks the revisionist Peronist history Kool-Aid then the country is going to be stuck in the mud like the past 10 years. This is not due to "socialist" or "left-peronist" economic policies, just peronism in general, which is a political disaster.

Peronism is not ideological politics. It is personalized clientelism.

 

[John.St]

I don't suppose you're one of those people who think the USSR/China was/is communist too, right?

I get it. The communist parties all over the world were neocons, right?

 

[camberiu]

I get it. The communist parties all over the world were neocons, right?

The other way around, actually. The founders of the neoconservative movement such as Irving Kristol, Nathan Glazer, Sidney Hook, and Albert Wohlstetter were all former Trotskysts. And they made no secrets about it. On his book "Reflections of a Neoconservative", Irving Kristol openly discussed his communist past.
The neocon concept of conquering Iraq and using it as a platform to "spread democracy" across the middle east, for example, is deeply rooted in Trotskyst doctrine, such as "exporting and spreading the revolution".

 

[John.St]

The other way around, actually. The founders of the neoconservative movement such as Irving Kristol, Nathan Glazer, Sidney Hook, and Albert Wohlstetter were all former Trotskysts. And they made no secrets about it. On his book "Reflections of a Neoconservative", Irving Kristol openly discussed his communist past.
The neocon concept of conquering Iraq and using it as a platform to "spread democracy" across the middle east, for example, is deeply rooted in Trotskyst doctrine, such as "exporting and spreading the revolution".

But that does not explain this:

I don't suppose you're one of those people who think the USSR/China was/is communist too, right?

If USSR/China were not communist, then what were the communists in the rest of the world?

 

[EdRooney]

But that does not explain this:
If USSR/China were not communist, then what were the communists in the rest of the world?

"When the world's two great propaganda systems agree on some doctrine, it requires some intellectual effort to escape its shackles. One such doctrine is that the society created by Lenin and Trotsky and molded further by Stalin and his successors has some relation to socialism in some meaningful or historically accurate sense of this concept. In fact, if there is a relation, it is the relation of contradiction.
It is clear enough why both major propaganda systems insist upon this fantasy. Since its origins, the Soviet State has attempted to harness the energies of its own population and oppressed people elsewhere in the service of the men who took advantage of the popular ferment in Russia in 1917 to seize State power. One major ideological weapon employed to this end has been the claim that the State managers are leading their own society and the world towards the socialist ideal; an impossibility, as any socialist -- surely any serious Marxist -- should have understood at once (many did), and a lie of mammoth proportions as history has revealed since the earliest days of the Bolshevik regime. The taskmasters have attempted to gain legitimacy and support by exploiting the aura of socialist ideals and the respect that is rightly accorded them, to conceal their own ritual practice as they destroyed every vestige of socialism.
As for the world's second major propaganda system, association of socialism with the Soviet Union and its clients serves as a powerful ideological weapon to enforce conformity and obedience to the State capitalist institutions, to ensure that the necessity to rent oneself to the owners and managers of these institutions will be regarded as virtually a natural law, the only alternative to the 'socialist' dungeon.
The Soviet leadership thus portrays itself as socialist to protect its right to wield the club, and Western ideologists adopt the same pretense in order to forestall the threat of a more free and just society. This joint attack on socialism has been highly effective in undermining it in the modern period."
-- N. Chomsky