prices on my street went up 20% this week

[jaredwb]

The price of drugs is insane recently!

Quality has gone down and the price has gone up!

I give a BIG second to that. Last months buds were blah!

 

[gsi16386]

The whole pricing situation is an absolute outrage if you ask me. And I understand that it's a product of the economy and that me being an American I better get used to it, but how can you explain this??

One of my FAVORITE places to eat is Siga La Vaca in Puerto Madero and I used to pay 65 pesos for a meal. I came back from the States in January and they are now charging 85 pesos for the same meal!!?? I mean, how can you explain that? A 30% markup!! Other things are going up too such as my health insurance, expensas, gastos, todos....and Again, this is just UNEXPLAINABLE...

Let's look at it rationally. The exchange rate with the dollar within the past year has gone up approximately 5% (from 3.80 to about 3.99). Against the Euro it has been 2%. If you include a 3% inflation adder for US inflation, that gets you about 8% inflation. So I can understand a 8% increase in prices or something along those lines, but 30%??? Then I start thinking about me as an American, one who is by no means struggling, still earn in dollars, and are armed with the decision as to whether or not I want to pay these prices and I simply do not. I choose not to pay it. SO if I choose not to pay it, I'm certain others earning less than me probably feel the same way, nobody is going to buy anything, and this whole economy is going to come to a standstill.

I'm actually really scared to see what is soon to come for the Argentine economy. It's starting to get really bad.

 

[Aconcagua]

The whole pricing situation is an absolute outrage if you ask me. And I understand that it's a product of the economy and that me being an American I better get used to it, but how can you explain this??

One of my FAVORITE places to eat is Siga La Vaca in Puerto Madero and I used to pay 65 pesos for a meal. I came back from the States in January and they are now charging 85 pesos for the same meal!!?? I mean, how can you explain that? A 30% markup!! Other things are going up too such as my health insurance, expensas, gastos, todos....and Again, this is just UNEXPLAINABLE...

Let's look at it rationally. The exchange rate with the dollar within the past year has gone up approximately 5% (from 3.80 to about 3.99). Against the Euro it has been 2%. If you include a 3% inflation adder for US inflation, that gets you about 8% inflation. So I can understand a 8% increase in prices or something along those lines, but 30%??? Then I start thinking about me as an American, one who is by no means struggling, still earn in dollars, and are armed with the decision as to whether or not I want to pay these prices and I simply do not. I choose not to pay it. SO if I choose not to pay it, I'm certain others earning less than me probably feel the same way, nobody is going to buy anything, and this whole economy is going to come to a standstill.

I'm actually really scared to see what is soon to come for the Argentine economy. It's starting to get really bad.

The economy is humming along here because people who hold pesos realize inflation is running out of control. There is no reason to keep pesos in the bank, you mattress or even your pocket. Spending pesos on consumer or other goods as well as real estate is currently a better way to ¨save or invest¨your pesos.

 

[citygirl]

The economy is humming along here because people who hold pesos realize inflation is running out of control. There is no reason to keep pesos in the bank, you mattress or even your pocket. Spending pesos on consumer or other goods as well as real estate is currently a better way to ¨save or invest¨your pesos.

The woman in the grocery store in front of me the other day charged 70 pesos worth of groceries to her credit card. I believe she said 6 quotas although it may have been more. But I guess if you gamble that the peso is going to fall, she'll wind up paying less over the lifecycle. But seriously - 70 pesos on a credit card.

 

[esllou]

Let's look at it rationally. The exchange rate with the dollar within the past year has gone up approximately 5% (from 3.80 to about 3.99). Against the Euro it has been 2%. If you include a 3% inflation adder for US inflation, that gets you about 8% inflation. So I can understand a 8% increase in prices or something along those lines, but 30%???

that's not how inflation works. Inflation in argentina, internal inflation with no reference to outside currences, is somewhere between 20% and 30%. The rises you talk of are explainable - the businesses concerned are covering higher costs. Nobody gets up and think "oh, let's raise all our menu prices by 30%...you know, for a LAUGH".

Go and speak to that owner and he'll be happy to explain how HIS costs have been going through the roof. All his suppliers have been upping their prices and he has to pass those increases on to his customers.

It's a vicious circle and one that's tough to break. Wage restraint is one possible place to start - what increases did the government give the large unions recently?? That fuels increases elsewhere, like ripples on a pond.

 

[Celia]

70 pesos is a lot if you're earning 10 or 12 pesos an hour. It's like 70 dollars in the States or 70 pounds in UK. It just doesn't seem like a lot because it won't buy you anything these days!

 

[estebandepraga]

I love Argentina and am an Argentine but I HATE the fact that we can't plan from one week to the next much less from month ot month or year to year!
The only thing that hasn't gone up recently is the price of a local city bus or subte(subway) And when things go up it's not a subtle 5% its 50% to 300%. Property taxes in the suburbs went up for some 257% this year. On a great sale 2 weeks ago I bought tomatoes at Carrefour for .99centavos per kilo A TRUE GANGA! they were at 7.99 last night. I work as a guide and my salary in pesos didn't go up but everything I need on daily basis did.
Look at property prices both to buy and rent! Renting is now out of reach for so many. AND IT AIN'T GETTING BETTER FOR THE FUTURE!
Better buy those dollars that no one else in the world wants and SOON!

 

[Towncryr]

that's not how inflation works. Inflation in argentina, internal inflation with no reference to outside currences, is somewhere between 20% and 30%. The rises you talk of are explainable - the businesses concerned are covering higher costs. Nobody gets up and think "oh, let's raise all our menu prices by 30%...you know, for a LAUGH".

Go and speak to that owner and he'll be happy to explain how HIS costs have been going through the roof. All his suppliers have been upping their prices and he has to pass those increases on to his customers.

It's a vicious circle and one that's tough to break. Wage restraint is one possible place to start - what increases did the government give the large unions recently?? That fuels increases elsewhere, like ripples on a pond.

What people are confusing here is "price inflation" v. "REAL inflation." Inflation, ALWAYS, is a monetary phenomena. The rampant inflation here in Argentina, like everywhere in the world, is a result of an increase in the circulating money (what we call money anyway) supply. The retailers HAVE to increase their prices because their supplies cost more. This is a result of people realizing that more fiat paper (what we call 'money') has been issued into the system diluting the purchasing power of the existing fiat supply. The classic economics definition is "more 'money' (read: debt because ALL paper is loaned into existence with compound interest and attached collateral) chasing fewer goods."

Argentina's REAL problem with their 'money' supply is that they are unable to export their monetary inflation like the U.S. can. As ALL countries of the world HAVE to use U.S. dollars for their oil purchases the U.S. is able to literally 'export' their inflation to other countries Central Bank vaults where they sit and accumulate waiting to purchase oil. In essence, when the U.S. (Nixon) closed the Gold Window in 1971 they switched the backing of the currency in gold to one backed in oil. All one has to do is look no further than China to see the potential disaster. China now holds TRILLIONS of U.S. debt, both dollars and Bonds. They've got the U.S. over a barrel and they are also stuck with a depreciating asset.

This is the BIG world game now as you see the results of ALL countries devaluing their currencies by much the same rate, 15-20+ % per year. It's only with government "creative accounting" that you see how inflation rates in the U.S., much like the vastly understated employment rates you also see published. The real unemployment rate is between 20-25%. Check http://www.shadowstats.com/ for more accurate figures.

There is a reason that BOTH Henry Ford and Thomas Edison said the exact same thing in the 1030's. "The financial system is the single most important subject ANY man can study."

Not to be the bearer of bad news here but a educated opinion, mine and many more knowledgeable people I've followed for more than 15 years. We're about to see the single biggest financial disaster in world financial history. If you have ANY expendable funds where you want to 'protect' your "purchasing power" (the REAL key phrase idea here v. inflation) park them in gold and/or silver. In the coming years those (and selected jr. mining stocks) will be virtually the ONLY safe haven to protect what you've worked and slaved so hard to earn and save.

For the people that have or do there are going to be opportunities of a lifetime ahead. If you were here and liked 2001-02 you're gonna LOVE the next couple of years. It will take decades to straighten out the current world financial situation. It didn't happen overnight and it will take even longer to work the inequities and mis-allocated investments OUT of the world financial system.

Mark Twain on "advice": "Wise men don't need it and fool's don't heed it."

BTW, I live in San Rafael not in the BA area.

 

[perry]

What people are confusing here is "price inflation" v. "REAL inflation." Inflation, ALWAYS, is a monetary phenomena. The rampant inflation here in Argentina, like everywhere in the world, is a result of an increase in the circulating money (what we call money anyway) supply. The retailers HAVE to increase their prices because their supplies cost more. This is a result of people realizing that more fiat paper (what we call 'money') has been issued into the system diluting the purchasing power of the existing fiat supply. The classic economics definition is "more 'money' (read: debt because ALL paper is loaned into existence with compound interest and attached collateral) chasing fewer goods."

Argentina's REAL problem with their 'money' supply is that they are unable to export their monetary inflation like the U.S. can. As ALL countries of the world HAVE to use U.S. dollars for their oil purchases the U.S. is able to literally 'export' their inflation to other countries Central Bank vaults where they sit and accumulate waiting to purchase oil. In essence, when the U.S. (Nixon) closed the Gold Window in 1971 they switched the backing of the currency in gold to one backed in oil. All one has to do is look no further than China to see the potential disaster. China now holds TRILLIONS of U.S. debt, both dollars and Bonds. They've got the U.S. over a barrel and they are also stuck with a depreciating asset.

This is the BIG world game now as you see the results of ALL countries devaluing their currencies by much the same rate, 15-20+ % per year. It's only with government "creative accounting" that you see how inflation rates in the U.S., much like the vastly understated employment rates you also see published. The real unemployment rate is between 20-25%. Check http://www.shadowstats.com/ for more accurate figures.

There is a reason that BOTH Henry Ford and Thomas Edison said the exact same thing in the 1030's. "The financial system is the single most important subject ANY man can study."

Not to be the bearer of bad news here but a educated opinion, mine and many more knowledgeable people I've followed for more than 15 years. We're about to see the single biggest financial disaster in world financial history. If you have ANY expendable funds where you want to 'protect' your "purchasing power" (the REAL key phrase idea here v. inflation) park them in gold and/or silver. In the coming years those (and selected jr. mining stocks) will be virtually the ONLY safe haven to protect what you've worked and slaved so hard to earn and save.

For the people that have or do there are going to be opportunities of a lifetime ahead. If you were here and liked 2001-02 you're gonna LOVE the next couple of years. It will take decades to straighten out the current world financial situation. It didn't happen overnight and it will take even longer to work the inequities and mis-allocated investments OUT of the world financial system.

Mark Twain on "advice": "Wise men don't need it and fool's don't heed it."

BTW, I live in San Rafael not in the BA area.

I work in property as many know here but I am planning my escape hatch at the moment to a very small town in Patagonia away from Buenos Aires and the worlds problems.

Keeping fiat currencies now is playing with fire . Use the monies NOW buy land , buy gold silver and one years supply of food . Prices for food will double in 2011 and inflation of 30 % will seem like the good old days.

 

[MikeB12]

Yes, inflation is out of control at the moment and will be until the conclusion of the election this year, that is clear. However, I'm not quite as gloom and doom on Argentina as many. There is a BIG difference between the current situation and 2000/2001. Argentina was in a huge amount of debt. Debt multiples any policy mistakes and makes the economy more fragile as a whole.

The situation is Spain, Portugal, Greece, maybe Italy is the most worrisome in my opinion. All overly indebted. Very likely will see Spain have to drop the euro and print their own currency in the next 5 years.

I see commodity producing countries doing well going forward, but the problem with gold is... what happens if all these gov'ts go bankrupt like some say. Even though all gov'ts don't have enough gold to back their paper currencies, they still have a very significant amount. They'll probably sell their gold off and the rest of us suckers will be left holding a metal where the supply has increased and price has just dropped.