Recession Continues Under Macri

[camel]

Doesn't devaluing something by 100% mean it is worth zero? Do you mean devalue by 50%?

 

[garryl]

I am trying to say is that making your currency under valued can enable you stay competitive, that's what China has been doing.
Now China is like Argentina, the currency is over valued, the economy is getting stagnant. So Argentine peso needs to go way way lower ..

 

[Noesdeayer]

garryl
What China has been doing for years has been manipulating its currency to appear under valued and for dumping purposes.
This is the source of its problems with the US and other countries and one of the reasons that it has yet to be admitted to the WTO--World Trade Organization.
With the recent agreements between Macri's gov't and some petroleum workers unions on Vaca Muerta, I wouldn't expect the economy to remain "stagnant" for too long.
Regarding the over 100% devaluation in 1975 which brought on total havoc to Argentina,I wouldn't hold my breath waiting for the Argentines to make that mistake twice.
Those who refuse to learn from history are destined to repeat it----------Think about it.

 

[Noesdeayer]

garryl:
Correction
China has been a member of the WTO for 5 yeats but wth problems.
See Harvard paper WTO --China What price membership?

 

[garryl]

garryl
What China has been doing for years has been manipulating its currency to appear under valued and for dumping purposes.
This is the source of its problems with the US and other countries and one of the reasons that it has yet to be admitted to the WTO--World Trade Organization.
With the recent agreements between Macri's gov't and some petroleum workers unions on Vaca Muerta, I wouldn't expect the economy to remain "stagnant" for too long.
Regarding the over 100% devaluation in 1975 which brought on total havoc to Argentina,I wouldn't hold my breath waiting for the Argentines to make that mistake twice.
Those who refuse to learn from history are destined to repeat it----------Think about it.

It's time for Argentina to manipulate its currency peso, makes it under valued, more people will visit Argentina, more people will do business in Argentina.
The 2001/2002 devaluation by 66% was great, that was the best thing happened to Argentine economy. After that, peso continues to devalue, but the government printed way more currency. Finally it caught up, things started to go bad a few years ago.

 

[Bajo_cero2]

The issue is that the peso is overvaluated.

 

[Noesdeayer]

Bajo_cero2 :
Who says so? You?

 

[toongeorges]

The issue is that the peso is overvaluated.

Bajo_cero2 :
Who says so? You?

I think there is some credibility to that statement. The dollar to peso rate is about the same than 1 year ago, yet there was an annual inflation of about 41%. So either Argentinians have become 40% more productive in a year, or the peso has become more overvalued. I follow bajo cero in this.

During Cristina, the informal dollar was continously devaluing and following the inflation to a certain degree, from 4.3 to 1 5 years ago to 16 to 1 1 year ago (which is an annual devaluation of over 35%). Last year the inflation was higher than during Cristina and almost no devaluation.

 

[Pensador]

Correction, recession began with Macri.

LOL ROFLOL what the hell are you. Quoting Arnold!

 

[ben]

The issue is that the peso is overvaluated.

This, coming from the man who insisted ad nauseam that the value of the peso is (or was) by definition whatever Vanoli wanted it to be.
Amazing how perspectives change.



UPDATE: Reading up to fetch those links was a nice trip down memory lane. We were treated, for example, to predictions that the cepo would continue albeit under a different name. Presumably a fiscal policy that, for all of its faults, didn't revolve around coercion was simply unimaginable.

For all of the woes of the present, and the performance of the current administration which leaves much to be desired, one needs to go back and read to bring back memories of just how bad things were. A small example, related to my day job: Most airlines (American, Air Canada, Copa, Avianca, etc) had completely halted the sale of air tickets in pesos, whereas just about everyone else (LAN, TAM, Delta, etc) had severely restricted the same. Fare rules for most tickets I dealt with stated MAY NOT BE SOLD IN VENEZUELA/ARGENTINA. We were well on our way to becoming the second Bolivarian paradise of South America.

Things now are far from satisfactory, but just a year out one needs to strain to remember what a twilight zone things were.