Historically speaking, Argentina is really only unquestionably the best at one thing: creating and then surviving economic crises.
By Bianca Fernet, Argentina, The Bubble: In 2012, Argentina introduced a 15% tax on credit card purchases made in foreign currency. Which turned into 20%. And now, after promising not to raise it again, the government raised it to 35% and closed the last legal window to acquire dollars at the official rate.
By Bianca Fernet, Argentina, The Bubble: President Cristina Fernández de Kirchner returned to her post this week, shuffling her cabinet and shaking up financial markets. Balding men marked the occasion by holding their heads in their hands in front of computer screens.
In many circles, President Cristina Fernández de Kirchner is pinned up as the primary source of Argentina’s many woes. And while she is miles away from blameless, Cristina is possibly even further from the root of Argentina’s cyclical and seemingly inescapable economic demise.
By Bianca Fernet, Argentina, The Bubble: The black/blue/unofficial ARS/USD rate hit 10/1 again. The Federal Police, the Prefecture, the Border Patrol, and representatives of the Central Bank are stomping around downtown, shutting down currency exchanges and being as obvious as possible. And now a gag order on the exchange rate!
By Bianca Fernet, Argentina, The Bubble: I bring up Venezuela because I am frequently asked what I think is going to happen in Argentina. Venezuela provides a very sobering cautionary tale, because their economic policies look like Argentina’s on steroids.
Ahh. Nothing gets me going quite like the smell of defaults in the morning. Argentina’s path to economic ruin feels like a drunk snail making its way through molasses.
Now that the dust has settled from the November/December 2012 drama surrounding the US Court ruling(s) regarding Argentina’s payment on defaulted bonds, I want to take a look at this snaggle—ahead of what will be a titillating appeal in February.
Contributed by Bianca Fernet. Sometimes I have to hand it to the Argentine government – their systematic clampdown on the movement of goods and capital across their borders is creeping along just enough to make international headlines about once a week without incurring any real domestic outcry to speak of. But now they have a new thing.
The US, Japan, and Mexico followed the EU’s lead and filed complaints at the WTO against Argentina’s import restrictions. Argentina promptly responded with its own complaint—against the US for blocking imports of beef and lemons. Yet, its beef market is one of the top 10 most protected in the world—and not in favor of its own beef producers! Just to keep the country glued together for a little while longer.