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Argentina Crisis: Financial turmoil could spark market chaos, experts warn
Topic Started: May 16 2018, 05:14 AM (1,024 Views)
Che On The Rocks

Robert Stout
Jun 6 2018, 05:53 PM
Argentinians are like babies wanting their bottle back....It was never THEIR bottle to begin with................ :oyvey:
It was never OUR bread to begin with, it seems:

Bakers in Argentina give away 5 tons of bread in protest
Quote:
 
Bakers in Argentina are threatening to continue protests if the government does not lower the cost of flour.
Posted Image
Argentinian bakers protest the rise in the price of flour by giving away five tons of bread, in front of the Congress in Buenos Aires, Argentina, June 6, 2018. EPA-EFE/David Fernandez

Argentina: Bakers, Truck Drivers and Press Workers Against the Crisis.
Quote:
 
In Argentina, bakers are giving away bread to address the income crisis, truck drivers are undertaking a general strike and press workers are rallying for better working conditions.
https://youtu.be/YHJYv-HBSsk

"Let them eat cake"
Posted Image
"It's so good to be an oligarch, ha ha ha ha!"
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Che On The Rocks

IMF talks may push Argentina to more central bank independence
Quote:
 
BUENOS AIRES, June 6 (Reuters) - Argentina’s financing deal with the International Monetary Fund (IMF) will likely include measures strengthening the central bank’s independence, which has been questioned since the government changed inflation targets last year, economists said.


Putting Debt On Display
Quote:
 
Argentina's most unique museum takes on a painful subject.
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Argentina says in talks with China on forex swap extension
Quote:
 
BUENOS AIRES (Reuters) - Argentina is in talks with China about extending a currency swap program due to recent financial turmoil, the country’s cabinet chief said on Wednesday.


Explainer: How Argentina's sovereign debt could threaten Macri's program
Quote:
 
BUENOS AIRES (Reuters) - Argentina is in talks with the International Monetary Fund (IMF) for a credit line to guarantee government funding and bring stability to financial markets, after the peso currency sharply weakened.
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Che On The Rocks

So, if a YUUUGE external debt doesn't do it, more external debt will do it:

Argentina clinches $50 billion IMF financing deal, to speed up cuts
Quote:
 
BUENOS AIRES (Reuters) - Argentina and the International Monetary Fund said on Thursday they reached an agreement for a three-year, $50 billion standby lending arrangement, which the government said it sought to provide a safety net and avoid the frequent crises of the country’s past.
Quote:
 
HIGHER INFLATION, FOR NOW
Quote:
 
In a separate statement, the president’s office said it had clinched agreements for an additional $5.65 billion from the Inter-American Development Bank, the World Bank and the CAF development bank over the next 12 months.
Read the same news here and here.

"All those billions and billions and billions are already practically in the bank"
Posted Image
"In the bank of Panama, ha ha ha ha!"
Edited by Che On The Rocks, Jun 8 2018, 03:15 AM.
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Robert Stout
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Che On The Rocks
Jun 8 2018, 03:12 AM
So, if a YUUUGE external debt doesn't do it, more external debt will do it:

Argentina clinches $50 billion IMF financing deal, to speed up cuts
Quote:
 
BUENOS AIRES (Reuters) - Argentina and the International Monetary Fund said on Thursday they reached an agreement for a three-year, $50 billion standby lending arrangement, which the government said it sought to provide a safety net and avoid the frequent crises of the country’s past.
Quote:
 
HIGHER INFLATION, FOR NOW
Quote:
 
In a separate statement, the president’s office said it had clinched agreements for an additional $5.65 billion from the Inter-American Development Bank, the World Bank and the CAF development bank over the next 12 months.
Read the same news here and here.

"All those billions and billions and billions are already practically in the bank"
Posted Image
"In the bank of Panama, ha ha ha ha!"
The people of Argentina will pay back that $50 billion by cutbacks in pet hamster benefits.....If they fail to pay , the IMF will utterly destroy Argentina this time............ :shakeshead:
Jesus can raise the dead, but he can't fix stupid
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W A Mozart
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A Saturday morning, coffee percolating in the other room, Trump winging his way to Singapore, the expected "blue wave" in November looking more and more like a mangy dog lifting a hind leg and peeing on a tree and the demented Nancy Pelosi is still running the Democratic Party. Can life get much better than this? ..... :)

Argentina.

So, OK, the IMF granted Argentina a 50B drawing right for emergencies. This is a GOOD thing. Argentina is getting shellacked by economic uncertainty and the 'far' left-wing mobs of Argentina smell blood in the water. To the streets! Bring placards, whistles and flags! Hoot for the camera's. Maybe he'll resign? The real reason why most Argentinians are fearful of the IMF is because, in the past, they said, ...no. IMF: ...no, you can't do that. IMF, ...no, you have to live within your means. Liberals/socialists don't like being told, ...no. It's no different here. It is why we have a 20T debt in this country. Hey, we've gotten away with it so far, why stop spending money now?

The central bank of Argentina has agreed to let the Peso find its own price. Yesterday it dropped to 25.5. Where it goes from here, no one knows. When you print 30% more Peso's, year-after-year, than what can be absorbed by an economy, you get, ...inflation. Too many Peso's chasing fewer and fewer goods and services. Economics 101.

Here's what the Financial Times said yesterday:
https://www.ft.com/content/40372974-6b2c-11e8-8cf3-0c230fa67aec

Quote:
 


Investors welcomed a $50bn International Monetary Fund rescue package for Argentina, seeing the IMF’s second biggest ever credit line in cash terms as a strong show of support for the market-friendly President Mauricio Macri’s attempt to forestall a return to populism.

Argentine bond prices stabilised on Friday in reaction to the IMF standby arrangement. It will require Mr Macri to accelerate his “gradualist” economic reform programme without imposing unpopular austerity measures that could undermine his government. Its 100-year bond was up 0.2 per cent at 86.97 cents on the dollar in early trading.


What happens next? Dunno. But, it will be an interesting story to watch...


Mozart
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Che On The Rocks

Mr. Robert Stout: yes, i agree.
Herr Professor Mozart: the FT article is not free, so i can't read it, but "a strong show of support for the market-friendly President Mauricio Macri’s attempt to forestall a return to populism" is just the continuation of a "proud tradition". :cool:
------------------
Argentina Bailed Out With Biggest Ever Loan In IMF History
Quote:
 
by Tyler Durden
Fri, 06/08/2018 - 09:48
Quote:
 
Oh, and thank you American taxpayers: the IMF’s largest shareholder, the U.S., said in a statement Thursday from Treasury Secretary Steven Mnuchin that it supported the program, according to the WSJ.
[twitter=USTreasury/status/1004885788230811649]

"I get the bail out. Nicolás Maduro gets the sanctions"
Posted Image
"It's so good to be a US-backed oligarch, ha ha ha ha!"

IMF: Argentina’s targets possible but require commitment
Quote:
 
WASHINGTON (AP) — The International Monetary Fund said Friday that fiscal targets set for Argentina as part of a $50 billion deal are possible but will require a strong commitment from the South American country.
Quote:
 
On Friday, the Argentina peso reached another all-time low of 25.80 per dollar after the government announced that it would stop its weekslong policy of intervening to defend the currency.
Posted Image
Roberto Cardarelli, mission chief for Argentina, left, and Alejandro Werner, director of the International Monetary Fund’s Western Hemisphere Department, hold a news conference at IMF headquarters in Washington, Friday June 8, 2018. (AP Photo/Luis Alonso Lugo)
Read here, too.

"a strong commitment"... Ha ha ha ha! I love this hypocritical euphemisms!
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Robert Stout
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Perhaps I should buy a ranch estate in Argentina rather than Venezuela....Decisions, decisions.................. :dunno:
Jesus can raise the dead, but he can't fix stupid
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Che On The Rocks

Robert The Cowboy: buy it in Argentina, of course!
So, when the Populists rise to the power again, you will be nationalized and you will become El Gaucho Roberto. :biggrin:
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UPDATE 3-Argentina's peso firms as central bank sells dollars, holds rate
Quote:
 
BUENOS AIRES, June 12 (Reuters) - Argentina’s peso strengthened on Tuesday, breaking two sessions of losses as the central bank said it sold some $695 million, returning to the spot market despite signaling last week that exchange rate volatility had passed.

The peso closed up 1.4 percent at 25.75 per U.S. dollar, rebounding from a record low of 26.20 touched on Monday. Traders said the central bank, along with state-run Banco Nacion, had offered to sell dollars at various times and at several different levels.
There goes the free flotation of the dollar! It lasted like, ten minutes!
And now?

Moyano Confirms Teamsters Strike for Thursday
Quote:
 
Moyano blamed the government, saying it didn't allow employers to offer more than a 15 percent annual salary increase. The union demands a 27 percent increase.
Posted Image
Hugo Moyano. Photo via La Nación
Read here, too.

Argentina biggest labor group calls strike, raising pressure on Macri
Quote:
 
BUENOS AIRES (Reuters) - Argentina’s leading labor federation announced plans on Tuesday to stage a one-day general strike on June 25 to protest against government economic policies, raising pressure on President Mauricio Macri as he moves to speed up spending cuts to balance the budget.
Posted Image
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Robert Stout
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A general strike in Argentina means that no welfare checks will be mailed out............ :wah:
Jesus can raise the dead, but he can't fix stupid
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Che On The Rocks

Argentina to use $7.5 billion from IMF deal to finance budget
Quote:
 
BUENOS AIRES (Reuters) - Argentine authorities have asked to use $7.5 billion of the $50 billion financing deal signed with the International Monetary Fund to fund their budget, IMF Managing Director Christine Lagarde said in a statement on Wednesday.


Argentina Peso Falls as Government Fails to Ease Market Concerns
Quote:
 
+Government says sales will support budget; peso weakens
+IMF to vote on Argentina’s $50 billion credit line on June 20


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W A Mozart
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Here's the key as to what is going-on in Argentina, (from yesterday's Bloomberg):

Quote:
 
As detrimental, the IMF entrance means an end to the economic gradualism of the last two-and-a-half years: Macri's strategy of trying to right the policy wrongs of more than a decade of mercurial rule by his predecessors while avoiding the political pain of austerity. Despite the public messaging that Argentina will make the decisions, and that social policies will remain in place, the new economic constraints accompanying the package threaten the political future of one of Latin America’s most market-friendly leaders.

Macri’s fate shows how hard it is to recover from economic populism. Despite a deep bench of technocrats and broad societal support for change, Argentina’s structural flaws remain, hampering growth, productivity and competitiveness.

https://www.bloomberg.com/view/articles/2018-06-13/argentina-s-imf-package-could-trigger-ugly-blowback

First, all the 'far' lefties of Argentina (er, including Che, .... :) )believe that the IMF is EVIL. They caused this, they caused that, ...way back during the first Argentinian fiasco, ...2001. The IMF = Nazi's (well, so to speak). But, the ONLY thing that the IMF does is impose discipline to a government. You can's spend on this, you can't print more money, you can't run 300% budget deficits, you can't sign labor contracts with all kinds of goodies and absurd pension clauses.

So, what Bloomberg is saying above is that the loons from the "previous administration," and we all know who that is, .... ;) , imposed all kinds of weird stuff which hamstrings the government, and noting that Macri had "to right the policy wrongs of more than a decade of mercurial rule by his predecessors while avoiding the political pain of austerity." First order of business, let the Peso FALL to whatever value the market sees in it. When you print, year-after-year, 30% more Peso's than the goods and services supporting that Peso (basic Economics 101), you get inflation. The IMF, like the Nazi's, will impose financial discipline on the government. The "lefties" of Argentina don't like discipline, ....there's your problem. .... :mad:

His BIG mistake was NOT instituting drastic reforms immediately to Argentina. Now they will be forced upon them by the Nazi's, er, no, ....the IMF.

Interesting stuff, .....

Mozart
Edited by W A Mozart, Jun 14 2018, 09:16 AM.
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Che On The Rocks

Herr Professor Mozart: Nazis and their Quislings were executed together, at the end of WWII. :biggrin:
I like that Bloomberg opinion piece. That air "Macri is the Economic Jesus, but he broke Argentina because former Populism" is so... errr... postmodern, that! :biggrin:
-------------
Argentina details IMF goals, says new measures possible
Quote:
 
BUENOS AIRES (Reuters) - Argentina outlined plans to reduce its fiscal deficit and make the central bank independent in a letter of intent to the International Monetary Fund on Thursday, explaining it could take additional measures to achieve the targets of the $50 billion financing deal.


Argentina Got a $50 Billion Loan and Peso Is in Free Fall Anyway
Quote:
 
+Argentine peso extends losses as central bank keeps mum
+Macri may be challenged to reach IMF’s fiscal targets
Posted Image

Dollar Breaks More Records and Barrels Past 28-Peso Mark
Quote:
 
After a perceived stabilization on Friday at $25, the peso took another leap.
Posted Image
A newsstand owner counts Argentine pesos bills in Buenos Aires. Ph: LEO LA VALLE/AFP/Getty Images)

ARGENTINA: Annual Inflation Rises To 26.3% In May
Quote:
 
(RTTNews) - The consumer price index in Argentina rose 26.3% in May from a year before, gaining strength from the previous month, when the index increased 25.5%, according to the country's statistics office (Indec).


Now Truckers in Argentina Are on Strike
Quote:
 
+Protesters blocking streets in Buenos Aires, planning a rally
+Strike is a test to Macri’s austerity measures under IMF deal
Posted Image
Photographer: Diego Giudice/Bloomberg
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Argentina Names New Central Bank Chief as Peso Plummets
Quote:
 
+Luis Caputo to lead monetary authority after Sturzenegger exit
+Policy makers seeking to regain credibility to protect peso
Posted Image
Luis Caputo Photographer: Andrew Harrer/Bloomberg
Read here, too.

Toto! Putting Luis "Toto" Caputo in charge of the Argentina's Central Bank is like putting Bernie Madoff in charge of the FED!

Read Toto's rap sheet here and here.
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Robert Stout
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Starvation of the Argentine masses will cure the fiscal crisis and teach the people discipline in their expectations.......... :hooray:
Jesus can raise the dead, but he can't fix stupid
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Che On The Rocks

Mr. Robert Stout: yes, that is neoliberalism 101. Be in Argentina, be in the US. :cool:
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Argentina peso weakens after central bank shake-up
Quote:
 
BUENOS AIRES (Reuters) - Argentina’s peso weakened on Friday, a day after the resignation of former Central Bank President Federico Sturzenegger, who was replaced late Thursday by former Finance Minister Luis Caputo.

The peso opened up more than 4 percent but ended the week down 1.05 percent at a record low 28.45 per dollar as traders took in central bank leadership under Caputo, who worked for JP Morgan for more than a decade before joining President Mauricio Macri’s government. The Merval stock index fell 1 percent.
Edited by Che On The Rocks, Jun 16 2018, 05:24 AM.
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Robert Stout
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Che On The Rocks
Jun 16 2018, 05:22 AM
Mr. Robert Stout: yes, that is neoliberalism 101. Be in Argentina, be in the US. :cool:
-------------
Argentina peso weakens after central bank shake-up
Quote:
 
BUENOS AIRES (Reuters) - Argentina’s peso weakened on Friday, a day after the resignation of former Central Bank President Federico Sturzenegger, who was replaced late Thursday by former Finance Minister Luis Caputo.

The peso opened up more than 4 percent but ended the week down 1.05 percent at a record low 28.45 per dollar as traders took in central bank leadership under Caputo, who worked for JP Morgan for more than a decade before joining President Mauricio Macri’s government. The Merval stock index fell 1 percent.
Macri needs to END, not reduce, much of Argentina's pet hamster benefit programs...Your poor country can not afford them....Argentina is not rich like the USA.............. :shakeshead:
Jesus can raise the dead, but he can't fix stupid
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Che On The Rocks

Mr. Robert Stout: "kill the pet hamster, save the rich" is neoliberalism 000. That dogma has been deployed far longer and far more extensively and intensively in Argentina than the US.
Perhaps that is one of the reasons why Argentina is not rich (in monetary terms) like the US? :cool:
----------------
Argentina to replace energy and production ministers
Quote:
 
BUENOS AIRES (Reuters) - Argentina´s government said on Saturday that it would replace its energy and production ministers, just two days after the resignation of former Central Bank President Federico Sturzenegger.
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Che On The Rocks

Merval drops 8%, pulled down by declines in energy, bank shares
Quote:
 
Stocks plummet 8% in first day of trading after Cabinet reshuffle that saw Aranguren depart
Posted Image
Outside a foreign exchange in the capital.Foto: Télam-Daniel Dabone

Argentina peso firms, stocks fall after central bank action
Quote:
 
BUENOS AIRES (Reuters) - Argentina’s peso currency snapped its slide on Monday as the central bank said it would hike reserve requirements for banks, a move that also sent bank shares tumbling as the country’s stocks had their worst performance since December 2014.
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W A Mozart
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Mr. Dujovne noted:

Quote:
 

https://www.ft.com/content/23975fd2-701d-11e8-92d3-6c13e5c92914

He likened the temporary slowdown in growth to a bout of turbulence on an aeroplane which would be overcome by the fourth quarter, with growth picking up more strongly in 2019. He expected a 10 per cent year-on-year increase in infrastructure spending next year, driven by a programme of public private partnerships that is under way. 

“Winning the elections will not depend on whether growth is at 4 per cent rather than 2 per cent, but on whether people continue to want the change this government represents, or to go back to populism,” he said, arguing that the Peronist opposition was “very far from offering itself as an alternative” for voters. 

As for Argentines’ prejudice towards the IMF, he said he understood it. But referring to the previous government’s decision to borrow from Venezuela at punishingly high interest rates, he added: “I prefer to work with the international community with a programme that gives us credibility, and enables us to borrow at low interest rates rather than from a dictatorship at 15 per cent.”


Let's see if I got this right. The Kirchner's borrowed from the Chavista's at, ...at, .....15 percent interest rate? Well, that explains a lot.

:)


Mozart
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Robert Stout
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W A Mozart
Jun 19 2018, 09:02 AM
Mr. Dujovne noted:

Quote:
 

https://www.ft.com/content/23975fd2-701d-11e8-92d3-6c13e5c92914

He likened the temporary slowdown in growth to a bout of turbulence on an aeroplane which would be overcome by the fourth quarter, with growth picking up more strongly in 2019. He expected a 10 per cent year-on-year increase in infrastructure spending next year, driven by a programme of public private partnerships that is under way. 

“Winning the elections will not depend on whether growth is at 4 per cent rather than 2 per cent, but on whether people continue to want the change this government represents, or to go back to populism,” he said, arguing that the Peronist opposition was “very far from offering itself as an alternative” for voters. 

As for Argentines’ prejudice towards the IMF, he said he understood it. But referring to the previous government’s decision to borrow from Venezuela at punishingly high interest rates, he added: “I prefer to work with the international community with a programme that gives us credibility, and enables us to borrow at low interest rates rather than from a dictatorship at 15 per cent.”


Let's see if I got this right. The Kirchner's borrowed from the Chavista's at, ...at, .....15 percent interest rate? Well, that explains a lot.

:)


Mozart
If Argentina adopts Venezuelan currency, all Argentinians will be millionaires !!!!!............. :hooray:
Jesus can raise the dead, but he can't fix stupid
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