Tough Times Ahead?
- Thread starter steveinbsas
- Start date
Simple question steveinbsas:
Why not?
We did it.
If it comes another crash everything will become cheap again (at least for some time).
Argentina was an expensive Metropolitan City before the crash and it is becoming expensive again. The whole world does have inflation - some more some less some earlier some later.
If it becomes to expensive for someone and anybody couldn't afford it anymore he could always just move to the beach at Viña del Mar in Chile to live cheaper or to Asunción (Paraguay) to live on a budget ;-)
Anyway if anybody wants to move to Argentina because he wants or needs to live cheap he could/should simply move to cheaper countries.
Why not?
We did it.
If it comes another crash everything will become cheap again (at least for some time).
Argentina was an expensive Metropolitan City before the crash and it is becoming expensive again. The whole world does have inflation - some more some less some earlier some later.
If it becomes to expensive for someone and anybody couldn't afford it anymore he could always just move to the beach at Viña del Mar in Chile to live cheaper or to Asunción (Paraguay) to live on a budget ;-)
Anyway if anybody wants to move to Argentina because he wants or needs to live cheap he could/should simply move to cheaper countries.
What makes you think "everything will become cheap
again" if (when) there is another crash of the Argentine economy?
Things only became cheap in Argentina for foreigners with dollars and
euros after the peso was massively devalued in 2002, robbing many
Argentine citizens of their savings, as well as a great deal of their
future purchasing power. The middle class was instantaneously devastated, the ranks
of the impoverished swelled, and continue to grow daily. Yes, there
has been significant recovery in the following years, but the future remains uncertain.When comes the next "crash" prices won't necessarily decline unless
inflation has been so severe that the government issues a new currency,
and that won't necessarily increase individual purchasing power. By
that time, the poor may make more than their voices heard, and current
peaceful demonstrations might become a lot more physical, as they have
in the past. Constitutional "safeguards"
may not prevent "drastic" measures by those in power to deal with a
severe crisis in the future. The "whole world" does not always deal
with problems in this fashion, but too many counties have, and too many
continue to do so.
Obviously, you have recently arrived. It will be interesting to see what you think after you have lived here for a year or two. Were
you aware of the political and economic history of Argentina for the
past 35 years when you made the decision to come here...or the past
ten...or even the past two? In the past two years prices have
increased dramatically here on many goods and services, but wages and
salaries haven't kept pace. The exact consequences if this continues
are impossibly to predict. Of course I hope there is no violence,
initiated either by the civilian population or the government in response to the next crash, but anything is
possible.
again" if (when) there is another crash of the Argentine economy?
Things only became cheap in Argentina for foreigners with dollars and
euros after the peso was massively devalued in 2002, robbing many
Argentine citizens of their savings, as well as a great deal of their
future purchasing power. The middle class was instantaneously devastated, the ranks
of the impoverished swelled, and continue to grow daily. Yes, there
has been significant recovery in the following years, but the future remains uncertain.When comes the next "crash" prices won't necessarily decline unless
inflation has been so severe that the government issues a new currency,
and that won't necessarily increase individual purchasing power. By
that time, the poor may make more than their voices heard, and current
peaceful demonstrations might become a lot more physical, as they have
in the past. Constitutional "safeguards"
may not prevent "drastic" measures by those in power to deal with a
severe crisis in the future. The "whole world" does not always deal
with problems in this fashion, but too many counties have, and too many
continue to do so.
Obviously, you have recently arrived. It will be interesting to see what you think after you have lived here for a year or two. Were
you aware of the political and economic history of Argentina for the
past 35 years when you made the decision to come here...or the past
ten...or even the past two? In the past two years prices have
increased dramatically here on many goods and services, but wages and
salaries haven't kept pace. The exact consequences if this continues
are impossibly to predict. Of course I hope there is no violence,
initiated either by the civilian population or the government in response to the next crash, but anything is
possible.
Steve I suggest that you take these sensational articles about Argentina with a grain of salt. have read this article and it was full of glaring errors. The classic one was inflation
it experienced skyrocketing inflation, reaching 1,000% in 1998. Now Steve and others here who lived here in the 1990s there certainly was not 1000 percent inflation in 1998 . There are many long term expats here who lived here durning one dollar to one peso and all have told me that inflation was low in that period.
In the 1980s there was a period of hyperinflation in Argentina where it reached very high levels . This was the time of the Austral and it was bedlam. I remember that it was reminiscent of Zimbabwe today.
it experienced skyrocketing inflation, reaching 1,000% in 1998. Now Steve and others here who lived here in the 1990s there certainly was not 1000 percent inflation in 1998 . There are many long term expats here who lived here durning one dollar to one peso and all have told me that inflation was low in that period.
In the 1980s there was a period of hyperinflation in Argentina where it reached very high levels . This was the time of the Austral and it was bedlam. I remember that it was reminiscent of Zimbabwe today.
Pericles, I didn't say that I agreed with the article. I just wanted to know what others thought of it, and if articles like this have any effect on their decision to "move" here. Please note that the link to it was posted by the forum moderator on July 20 in the "Daily URL" on the home page of this website. This is the kind of information that is quickly found in general web searches. Since it is now linked to here by those who (rightfully) "control" this site, I think it's even more important to discuss it. The more you can say to debunk it the better! (Just don't forget to polish your crystal ball...or do you consult the oracle?)
Quoting "pericles": ". . . . t experienced skyrocketing inflation, reaching 1,000% in 1998. Now Steve and others here who lived here in the 1990s there certainly was not 1000 percent inflation in 1998 . . . ."
You're right, of course, Pericles. But as the context of the article was the 1980s, I assumed that the typesetter transposed two numerals: that the year should have been 1989. I don't know what the rate was then, but I've been told by Argentines that it was in the thousands of percent: larger than the figure given.
You're right, of course, Pericles. But as the context of the article was the 1980s, I assumed that the typesetter transposed two numerals: that the year should have been 1989. I don't know what the rate was then, but I've been told by Argentines that it was in the thousands of percent: larger than the figure given.
Inflation is a world wide phenomenon right now. Everytime you read an Irish newspaper or turn on the news, all you hear/read about is growing inflation, rising unemployment and bleak times ahead. I think that media sources thrive on sensationalizing topics.I'm not denying that inflation isn't taking place - in Ireland, rents and energy costs are spiralling out of contral, but this is also happening everywhere else. I think that if we pay too much attention to articles like this one then you'd be afraid of going anywhere! Does anyone know of any good links on worldwide inflation? It would be useful to see a chart displaying the breakdown of inflation worldwide. I'm sure that certain countries are experiencing inflation at the higher rate, compared to Argentina.
I am in agreement with that tough times are ahead. I have read many "sensationlist" articles in the "imperalist" press. Perhaps those that don't believe this could provide some sources that indicate Argentina is on the right path economically, I haven't found any.The current government economic policies could never work over the long term and their shortcomings are becoming more evident daily. In my opinion major economic problems or a meltdown are just a matter of time.Many people believe that Argentina will default on their debt for second time within the next year or two. Many people believe they are in fact in default now. What I mean by that is the "cooked" inflation figures have greatly reduced the governments interest payments on their debt (payments tied to inflation). What impact the next economic crisis will have on asset prices and the cost of living is open to debate. However, I'm not aware of any instance where an imploding economy supported asset prices (incomes reduced, savings ravished by inflation, etc.). You would expect the general cost of living to reduce as demand falls, but not necessarily.Right now I wouldn't be a purchasing or holder of any Argentine assets including stocks, bonds, or real estate. The current risk is just too high. What assets would be worth in a post crash environment is unknowable.
These are 2007 estimates and specifically reaffirm Argentina's struggle of real vs. published:
https://www.cia.gov/library/publications/the-world-factbook/fields/2092.html
And a few numbers but no detailed breakdown:
http://www.economist.com/opinion/displaystory.cfm?story_id=11409414
A link from the above article that includes a chart with Argentina at the top:
http://www.economist.com/opinion/displaystory.cfm?story_id=11402856
Enjoy.
https://www.cia.gov/library/publications/the-world-factbook/fields/2092.html
And a few numbers but no detailed breakdown:
http://www.economist.com/opinion/displaystory.cfm?story_id=11409414
A link from the above article that includes a chart with Argentina at the top:
http://www.economist.com/opinion/displaystory.cfm?story_id=11402856
Enjoy.