Some unpleasant arithmetic: Let's go liberty

earlyretirement said:
No one will loan the money.
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earlyretirement said:
I can't see any scenario where people are loaning yet more money. Argentina is broken and no one can easily fix it.
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Well, just playing devil's advocate here, but...

Loaning money to Argentina doesn't require fixing it, just being able to get your money back, plus interest.

There are many scenarios under which this might, at least theoretically, be possible. Most of those scenarios involve horrific exploitation, and would be disastrously bad for the country and its people, but when has that ever stopped a financier/banker?

Some scenarios might resemble the manner in which the European powers ran their franchises in China prior to the Boxer Rebellion, or the operations of the British East India Company in the Indian subcontinent prior to the Sepoy Mutiny. (Notice the common element here? This modus operandi makes the locals very unhappy). A truly worst case scenario might resemble more the way the Spanish ran the silver mines at Potosí. Yes, such horrors can still happen in the modern world.

Obviously, I don't want any of that to happen, but fate doesn't give a donkey fart for my wants or desires.

Maybe we could just pass on this dollarization idea, eh?
 
earlyretirement said:
No one will loan the money. People keep talking about all these billions held abroad by locals. No one is going to rush to bring anything back. They already did many tax amnesties to bring undeclared income from abroad. I guess it wouldn't hurt to come up with some new amnesty program where you promise not to prosecute locals for evading taxes. You give them an amnesty period of X months to bring all their funds back and as long as it's invested in real estate, local businesses, etc. they will pay NO tax on it.

There would still be a lot of mistrust and I just doubt many locals would want to but it's going to take something really really drastic to get all those billions back in the country.

I can't see any scenario where people are loaning yet more money. Argentina is broken and no one can easily fix it. As many people mentioned, it's going to take many, many years of structural reforms, changing of laws and creative thinking to get themselves out of this mess.

I don't think any expats have to worry at all in the short-term that the situation will improve too drastically. JMHO. For as much as I love the country, it's wickedly messed up.
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When the economy stablises and people see a less corrupt government they will start returning money (assuming there are amnesties as you said). This will not happen overnight. It will take time because people will need to see that there is serious and enduring change. Dollarisation would assure some stability but it will have to be accompanied with some of the other changes that have been mentioned here such as labour reform. I see it as a slow process. It's clear that the current scenario just can't go on.
 
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cuando_volverá said:
I was mostly being sarcastic. Divesting from China and Brazil would certainly be an interesting move. Not sure how that is going to improve the economic situation in Argentina in any way.
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Divesting wouldn't be possible but further ties / contracts / loans could be avoided.
 
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29 August 2023
www.perfil.com

Cómo funciona la economía bimonetaria de Melconian, el posible ministro de Economía de Patricia Bullrich

En las últimas horas se confirmó que, en caso de que Patricia Bullrich gane las elecciones presidenciales el doctor Carlos Melconian será su ministro de Economía.
www.perfil.com www.perfil.com
How the bi-monetary economy of Melconian works, the possible Minister of Economy of Patricia Bullrich. In the last hours it was confirmed that, in the event that Bullrich wins the presidential elections, Dr. Carlos Melconian will be her Minister of Economy....
 
gracielle said:
Click anywhere on the article in Spanish to open the menu. Next click on Translate to English.
29 August 2023
www.perfil.com

Cómo funciona la economía bimonetaria de Melconian, el posible ministro de Economía de Patricia Bullrich

En las últimas horas se confirmó que, en caso de que Patricia Bullrich gane las elecciones presidenciales el doctor Carlos Melconian será su ministro de Economía.
www.perfil.com www.perfil.com
How the bi-monetary economy of Melconian works, the possible Minister of Economy of Patricia Bullrich. In the last hours it was confirmed that, in the event that Bullrich wins the presidential elections, Dr. Carlos Melconian will be her Minister of Economy....
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My personal opinion is that bimonetarism is the best solution (for now) as it acknowledges the reality of the situation in Argentina as is, while making it possible for the peso to come back in the future, which I gather is what Melconian is arguing.

My main opposition to dollarization is the fact that it causes an increase in the costs of goods and services in the short term, with a lagging (if ever) increase in wages, i.e. you pay more for things up front, right away, but earn the same or even less right away, and that we have no idea where the 40 Billion needed to dollarize will come from. Finally, I'm also against it because it makes it difficult to compete globally as you can't devalue your currency to encourage exports, or print money in the event of a crisis like COVID.
 
Quilombo said:
My personal opinion is that bimonetarism is the best solution (for now) as it acknowledges the reality of the situation in Argentina as is, while making it possible for the peso to come back in the future, which I gather is what Melconian is arguing.

My main opposition to dollarization is the fact that it causes an increase in the costs of goods and services in the short term, with a lagging (if ever) increase in wages, i.e. you pay more for things up front, right away, but earn the same or even less right away, and that we have no idea where the 40 Billion needed to dollarize will come from. Finally, I'm also against it because it makes it difficult to compete globally as you can't devalue your currency to encourage exports, or print money in the event of a crisis like COVID.
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This, exactly. Allowing someone else to control the currency your nation uses is a horribly bad idea, especially for a country whose economy utterly depends on exports.
 
Redpossum said:
This, exactly. Allowing someone else to control the currency your nation uses is a horribly bad idea, especially for a country whose economy utterly depends on exports.
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It's a measure taken under extreme circumstances. After many decades of mismanagement Argentina doesn't have any other realistic way out.
 
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31 August 2023
www.pagina12.com.ar

Resultados escrutinio definitivo: Milei bajó del 30 %, Massa y Bullrich se acercan | Elecciones PASO 2023

El recuento oficial confirmó la elección de tercios que se viene de cara a las presidenciales de octubre. El ultraliberal finalmente obtuvo el 29,8% de los votos y quedó debajo del umbral del 30% que había superado en el escrutinio provisorio. Juntos p...
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Final scrutiny results: Milei fell below 30%, Massa and Bullrich are close....The ultraliberal finally obtained 29.8% of the votes and fell below the threshold of 30% that he had exceeded in the provisional scrutiny. JuntosXCambio gathered 28% and Union por la Patria obtained 27.2%....
The National Electoral Chamber already has the results of the final scrutiny of the PASO that were held on August 13. According to reports, the numbers showed some differences with respect to the provisional scrutiny: the main data was that the ultra-libertarian Javier Milei fell below the threshold of 30% of the votes. Thus, there is a margin of less than 3% between the three main forces....
 
gracielle said:
Click anywhere on the article in Spanish to open the menu. Next click on Translate to English.
31 August 2023
www.pagina12.com.ar

Resultados escrutinio definitivo: Milei bajó del 30 %, Massa y Bullrich se acercan | Elecciones PASO 2023

El recuento oficial confirmó la elección de tercios que se viene de cara a las presidenciales de octubre. El ultraliberal finalmente obtuvo el 29,8% de los votos y quedó debajo del umbral del 30% que había superado en el escrutinio provisorio. Juntos p...
www.pagina12.com.ar www.pagina12.com.ar
Final scrutiny results: Milei fell below 30%, Massa and Bullrich are close....The ultraliberal finally obtained 29.8% of the votes and fell below the threshold of 30% that he had exceeded in the provisional scrutiny. JuntosXCambio gathered 28% and Union por la Patria obtained 27.2%....
The National Electoral Chamber already has the results of the final scrutiny of the PASO that were held on August 13. According to reports, the numbers showed some differences with respect to the provisional scrutiny: the main data was that the ultra-libertarian Javier Milei fell below the threshold of 30% of the votes. Thus, there is a margin of less than 3% between the three main forces....
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Much Ado About Nothing
 
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