Spike In Blue Rate

[lamarque]

If you are correct, this is a short-term measure (as opposed to a solution). There are limits to how long they can get away with this.

Yes i supose the objetive is not to maintain that on the long term they just don't want this kind of peak on the prices, but if they really want they can keep it on that price for a really long time, the quantity of transactions made it in the black market is relatively small for the goverment, i think they want the black dollar hight but without jumps just small grow that people and media don't put in the main page, specially in an election year.

 

[expatinowncountry]

Yes i supose the objetive is not to maintain that on the long term they just don't want this kind of peak on the prices, but if they really want they can keep it on that price for a really long time, the quantity of transactions made it in the black market is relatively small for the goverment, i think they want the black dollar hight but without jumps just small grow that people and media don't put in the main page, specially in an election year.

While the effective (observed) demand maybe small at the black market price of today it does not mean that the notional (latent) demand at an artificially low price is not huge. Imagine that the government decide to intervine and says "dolar para todos a 6 pesos". How much do you think the demand would be? How long do you think it will take until the government will have to give up (or run out of reserves)?
This is really ECON 101, supply and demand analysis.

 

[lamarque]

While the effective (observed) demand maybe small at the black market price of today it does not mean that the notional (latent) demand at an artificially low price is not huge. Imagine that the government decide to intervine and says "dolar para todos a 6 pesos". How much do you think the demand would be? How long do you think it will take until the government will have to give up (or run out of reserves)?
This is really ECON 101, supply and demand analysis.

I know that is supply and demand, but when there is a big player like the government, they can put the price down by ofering more the question here is if they are willing to do it in the long term with the leak of dollars this produce or if they are just wanting to let it grow but without peacks so it dosn't catch so much attention, anyway at 8,5 on the moment there is a relative small demand and offer as well, by just putt some fresh dollars on the market it can retain it on that value without so much of a hassle, of course not forever and i don't thing is their intention neither, at 6 there will be a huge demand but at 8,5 not, as people will use the credit card when they can in this moment, now a day people buy the minimum possible at blue and the rest they pay with the credit card at least the majority, but as the demand is very small and limited the price of the blue continue going up, the average person here is not willing or able to pay 8,5 per dollar, they use the CC as much as possible before getting dollars at that rate of course with the time they will get use to that price specially when the government put more and more taxes to the credit cards and barriers to get dollars but by that time the blue will be much higher for sure.

 

[trennod]

But Lamarque, tomorrow (and I dont mean literally necessarily), 10 will be the new 8.5. They can flood the market for a bit, but even if they wanted to get it to 6 ( obviously they would prefer no gap between the blue and the official) they dont have the power (reserves) to do it AND maintain it. In summary, they cant control the blue exactly as they would like and therein lies the problem.

 

[lamarque]

But Lamarque, tomorrow (and I dont mean literally necessarily), 10 will be the new 8.5. They can flood the market for a bit, but even if they wanted to get it to 6 ( obviously they would prefer no gap between the blue and the official) they dont have the power (reserves) to do it AND maintain it. In summary, they cant control the blue exactly as they would like and therein lies the problem.

Of course, no one tell that is posible on the long term neither that they are willing to do it, but they can and maybe they will control the spikes if they are smart enought (i doubt it but still they are political animals so i supose they will try to avoid this spikes until de elections at least) in the other hand they can keep the control on this level on the short term if they are willing to do it, but i think they will priorize the conservation of the reserves

 

[esllou]

governments cannot beat markets. Go and ask the Tory chancellor from 1992, Lamont. They were throwing BILLIONS at the problem and still lost. The Casa Rosada is small fry compared to that.

http://en.wikipedia.org/wiki/Black_Wednesday

 

[ajoknoblauch]

governments cannot beat markets. Go and ask the Tory chancellor from 1992, Lamont. They were throwing BILLIONS at the problem and still lost. The Casa Rosada is small fry compared to that.

http://en.wikipedia....Black_Wednesday

Markets are less than perfect, but against a government like this one it's strictly no contest. Even if some of them know how markets work, nobody who counts really cares.

 

[Rich One]

Blue dollar is going down now quite abruptly, i supose the government is flooding the market. 8.27 Blue dollar to buy right now. There was almost no demand on the 8,76 pike anyway.

you are a K fundamentalist...!! if there was no demand how could it reach to $8,76....!! (Morenos theory the supermarkets bought several millions US$ inflating the price, it was not a REAL demand.... jajajaj) If you read the comments there was little offer, no one wants to sell, it will climb more next week. Today closed above $8,50 . Very good price . I'll buy from youi at $8,27..!!!

 

[Rich One]

While the effective (observed) demand maybe small at the black market price of today it does not mean that the notional (latent) demand at an artificially low price is not huge. Imagine that the government decide to intervine and says "dolar para todos a 6 pesos". How much do you think the demand would be? How long do you think it will take until the government will have to give up (or run out of reserves)?
This is really ECON 101, supply and demand analysis.

I would sell my car to buy dollars at $6 ...ªª there would be a run on the CB reserves

 

[lamarque]

you are a K fundamentalist...!! if there was no demand how could it reach to $8,76....!! (Morenos theory the supermarkets bought several millions US$ inflating the price, it was not a REAL demand.... jajajaj) If you read the comments there was little offer, no one wants to sell, it will climb more next week. Today closed above $8,50 . Very good price . I'll buy from youi at $8,27..!!!

Deal, jajaja K fundamentalist lol make me laught you couldn't be more wrong, i'm actually Anti K lol.