Peso what level do you see it this year?

[bigbadwolf]

I can't think of any reason why banks would refuse to change dollars into pesos. I think those worries are probably unfounded. Let's hope for the best.

You are right. If they did, the black market (or rather, the blue market) would step in promptly. Of course the banks might not give the best rates but that's what the blue market is there for.

 

[HenryNisental]

Uruguay, here we go!!!
Anyway,I have a good solution: why don't we discard the peso and use the USD for everything (except coins maybe).
Ecuador did it and Panama too, as far as I know. How this is done? Is it possible to do it here? If not, why not?

 

[Pensador]

Uruguay, here we go!!!
Anyway,I have a good solution: why don't we discard the peso and use the USD for everything (except coins maybe).
Ecuador did it and Panama too, as far as I know. How this is done? Is it possible to do it here? If not, why not?

It would be my estimation that a corrupt government cannot print and control USD as they can the peso. Maybe I am wrong but that is MHO. I am not stating Macri is corrupt but his predecessors surely were.

 

[HenryNisental]

That is precicely the point, this will force the gov to a balanced budget, whether they liked or not. They could not print worthles papers as they do it now.

 

[sts7049]

Uruguay, here we go!!!
Anyway,I have a good solution: why don't we discard the peso and use the USD for everything (except coins maybe).
Ecuador did it and Panama too, as far as I know. How this is done? Is it possible to do it here? If not, why not?

this is a good overview of what happened last time they tried to peg the peso to the dollar.

https://en.wikipedia.org/wiki/Convertibility_plan

 

[bigbadwolf]

this is a good overview of what happened last time they tried to peg the peso to the dollar.

https://en.wikipedia.org/wiki/Convertibility_plan

There's a difference between pegging the peso to the dollar (while continuing to run fiscal and trade deficits that eventually make the peg unsustainable) and actually using US dollars (like Panama and Ecuador). I'm not sure that an economy the size of Argentina (which is G20, all said and done), could adopt the USD and whether the USA would even welcome such a measure.

While on the topic, the general trend in the world is to move away from the USD, with countries like China and Russia at the forefront, and even a staunch US ally like Saudi Arabia having second thoughts about whether they want to continue being paid in dollars for oil. An alternative financial architecture is gradually taking shape that will bypass US dollar hegemony.

 

[perry]

There's a difference between pegging the peso to the dollar (while continuing to run fiscal and trade deficits that eventually make the peg unsustainable) and actually using US dollars (like Panama and Ecuador). I'm not sure that an economy the size of Argentina (which is G20, all said and done), could adopt the USD and whether the USA would even welcome such a measure.

While on the topic, the general trend in the world is to move away from the USD, with countries like China and Russia at the forefront, and even a staunch US ally like Saudi Arabia having second thoughts about whether they want to continue being paid in dollars for oil. An alternative financial architecture is gradually taking shape that will bypass US dollar hegemony.

Big Bad Wolf do you ever see the day that the USA dollar loses its status as the preferred currency worldwide and lose its value? The USA has over 20 trillion dollars in debt and this is growing at a accelerated rate in the last 10 years . What currency in the future do you believe will overtake the USA dollar?

 

[sts7049]

There's a difference between pegging the peso to the dollar (while continuing to run fiscal and trade deficits that eventually make the peg unsustainable) and actually using US dollars (like Panama and Ecuador). I'm not sure that an economy the size of Argentina (which is G20, all said and done), could adopt the USD and whether the USA would even welcome such a measure.
.

that is true. i am far from a financial expert but i would have to think that in order to just throw the peso away and switch to the dollar, there would have to be some sort of intermediate step of conversion. the central bank would have to have enough reserve to buy back all of the pesos in circulation. that's my very limited understanding of what the peg is doing.

last time they tried it the govt screwed up and got too greedy and violated a number of the philosophies that could have made it more successful

 

[bigbadwolf]

Big Bad Wolf do you ever see the day that the USA dollar loses its status as the preferred currency worldwide and lose its value? The USA has over 20 trillion dollars in debt and this is growing at a accelerated rate in the last 10 years . What currency in the future do you believe will overtake the USA dollar?

No currency will "overtake" the USD. Probably no other country wants the status of global reserve, which among other things means running up persistent deficits. But countries that are exporting tangible things (like oil) want to make sure they're going to get paid in something of enduring worth. Not the fiat money of an economically failing hegemon that needs to use its waning military might to prop up its currency and that will one day have to inflate itself out of the corner it has painted itself into.

Mentioning inflation allows me to segue into talking about US inflation, which is arguably running at around 10% annually (the official figures are complete bunkum).



Keeping your money in dollars or in dollar-denominated US Treasuries means a steady erosion of purchasing power. At the same time, the US government is rigging the price of precious metals, so that their appreciation in dollar terms does not undermine the dollar and have the rubes discovering how fast their money is losing value.

 

[sergio]

As long as they can print the economy will be a mess. The only solution is to take away that power.