Radical change in rental law

[YanquiGallego]

While they may not all be jetting off, even the lower middle classes these days seem to want and have imported gizmos and gadgets, and have the hook up SOMEHOW, whether it be asking a friend who does have the means to travel, a colleague going somewhere for business, or heck, even paying it off in an absurd amount of cuotas. Some of my friends who i know earn around 3000 pesos a month are rocking iphones and blackberries, plasmas, etc. My cleaning lady has just purchased a Blackberry Torch and is paying it off
in about 18 cuotas.

 

[ElQueso]

The problem with stopping imports is that Argentina doesn't have a big enough manufacturing base to supply the demand.

 

[willwright]

The problem with stopping imports is that Argentina doesn't have a big enough manufacturing base to supply the demand.

I think the reason is really the market is too small to support industries to manufacture all the things used in daily life today. When you decide to have a closed system with no imports and only locally manufactured goods two things usually happen. 1. The goods produced are inferior in quality. 2. The price of the goods are high relative to competitive products available outside the closed system. Smaller countries can become manufacturing powers. South Korea would be an example of a country only a little larger population than Argentina. Their manufacturing is primarily to supply needs outside their own borders. Argentina could develop a manufacturing under the right circumstances and encouraging policies from the government. Sealing off the borders to competitive products isn't going to get it done.

 

[citygirl]

And the above is exactly what is happening. Prices are going up and there aren't enough locally produced goods on the market to meet the demand (and I'm not even discussing the absolute lack of quality and consistency that plagues most products manufactured here).

 

[surfing]

Yes let's first close the barn door and then hope that a horse somehow magically appears inside!

 

[TrevorCito]

1. Good point. We almost agree. She wants to avoid that people send the dollars to banks abroad. If there are too many dollars for this small market, then the price fall. And then the BC can buy them cheaper. So, this is not about ruling the price of the dollar, if you look well, she is trying to make the market healhier.

I agree that the the imports must be matched by exports to control the current account deficit.

Too many dollars for the market? Really?

2. The idea about sttopping imports is regarding to produce those goods here. So, it creates more work and the money stays here.

Argentina is really saying that it is not ready to work with the world and wants to close it's borders to trade. The country does not have the capacity (nor desire) to innovate and manufacture technology products but so desperately desires them (TVs, computers and other high tech electronics). Assembling tv's and mobile phones in ushuia is not manufacture, no matter how you cut it.

3. Instead of taking the dollars away, she wants that, whoever wants to take money away, takes goods: that they export made in argentina.

If Argentina floats the peso then it too will be treated like a commodity, just as the USD and other floated currencies are treated like commodities. Would that be a good or bad thing? It would certainly force Argentina to swallow its pride as the international market would place a value on the economic state of Argentina.

Argentina has no 'save haven' for savings other than property and USD, possibly gold. Where will the Argentine people keep their savings now?

3. Plus she is enforcing the AFIP and the tax collecting.

This is a good thing.

4. The SUBE, YPF, and those anti-neoliberal mesures are regarding to find a way to pay the State bills without printing money.

Make government smaller not bigger. Make things easier, not more complicated.

The government is addicted to printing money. I wish I had a money printing machine and didn't need to work, just print a few new bank notes to pay for my next holiday. What a joke!

I am an investor and am short YPF because I know that from an investment perspective, Argentina cannot be trusted. This would never happen in Australia. Imagine, the Australian government nationalises BHP because, like a drug addict, needs more money. Sad really.

So, the government is taking many mesures to avoid the crisis and it is being sucessful even she doesn t believe in the neoliberal dogma.

Time will tell whether the government is successful or not.

Like I said... make things easier, not more complicated. Make it easier to do business, not harder. Make innovation profitable and make Argentine products attractive internationally.

 

[John.St]

2. The idea about sttopping imports is regarding to produce those goods here. So, it creates more work and the money stays here.

Import Substitution Industrialization (ISI) only works if the internal consumer market is large enough, as in Brasil with 203 million people and a steadily growing middle class (today close to 50%) consuming more and more - a small population means a too limited market for e.g. refrigerators or cars.

A typical result of ISI when the population is too small is inefficient industries resulting in reduced quality and higher prices caused by lack of international competition.

This lesson has obviously not been understood - or is ignored for short term gains - by the present Argentine government.

 

[KarlaBA]

Import Substitution Industrialization (ISI) only works if the internal consumer market is large enough, as in Brasil with 203 million people and a steadily growing middle class (today close to 50%) consuming more and more - a small population means a too limited market for e.g. refrigerators or cars.

A typical result of ISI when the population is too small is inefficient industries resulting in reduced quality and higher prices caused by lack of international competition.

I guess South Korea and Japan respective uses of ISI were failures because of too small of population by your logic. I guess same idea applies to basically every country that has ever industrialized.

ISI is pretty much the only method by which countries has been successful in industrializing. Even the great neo-liberal USA used ISI during its industrialization phase. The reasons why ISI works for some groups and not for others is varied. Yes there is some sort of minimum population size required, but it far less than 40 million. It's really a function of the number of technically skilled workers (basically engineers).

 

[John.St]

I guess South Korea and Japan respective uses of ISI were failures because of too small of population by your logic...

South Korea and Japan used ISI as a basis for producing goods for export and the Japanese population was close to 80 mio. in 1946.

 

[Bajo_cero2]

Make government smaller not bigger. Make things easier, not more complicated.

Amen. 123456789