View Full Version : Argentine Economy
The currency market did not seem to react at all to the mayoral election as ambito.com is showing 14.07 over 14.22 which is very similar to Friday. Anyway, it would seem to me that a right wing victory would strengthen the currency rather than weaken it. That would be particularly true, I would think, if the election augurs a Macri victory in the presidential election, which is what the argie newspapers are saying.Most of the polls have Macri behind Scioli DH, though the pollsters sure missed the close race for mayor yesterday. In addition Macri has more than hinted at eliminating currency controls if he is elected, meaning a likely devaluation of the peso.
Macri is too far to the right for me personally, but he is a bright guy and undoubtedly aware that any time you have a parallel black market in a currency, a devaluation is inevitable. Argie pride notwithstanding, of course.
I see the dollar has gone up by about 15 centavos since I posted this morning. Decent wine is really getting ridiculously cheap.
maybe its good time to leave now for a country with future.
In the last 100 or so years has Argentina had a future? The only things keeping the country from being a complete basket case are cows, corn, and soy. It certainly is not the people.
Tres3.
Spassmusssein
07-22-15, 03:06
In the last 100 or so years has Argentina had a future? The only things keeping the country from being a complete basket case are cows, corn, and soy. It certainly is not the people.
Tres3.Well, everyone in his place.
I love Argentina, allmost everyone of my friends here is an Argentine and, as beeing in real-estate, I do not have problems.
Do not underestimate, ARG is one of the few midlleclass-countries here around.
I do not see our prob with "the people" here. They are my friends and bizz-partners. Since many years and meanwhile I prefer the "easy going" here to the suicidal "Merkelism" of my Origin.
You are right, that ARG-Industrie is campocampocampo. Manufacturing industry goes in China, India, Southcorea o Burundi Faso (maybe). Absolute brainlessness to try "industrialize" Argentina with the actual labor-laws.
Concerning mongering...ARG is leaving the spot, so Medellin, Cali, Manaos or Rio are better places. Cartaghena just 4 me...
NievelEvil I will stay here as I did within the last years.
Going on vacacions to...yes, ok, wherever.
It looks as if Judge Griesa is tightening the screws.
http://finance.yahoo.com/news/us-judge-says-argentine-assets-fair-game-debt-001217033.html
Tres3.
It looks as if Judge Griesa is tightening the screws.
http://finance.yahoo.com/news/us-judge-says-argentine-assets-fair-game-debt-001217033.html
Tres3.Unfortunately, too little, too late.......
Retire N Trave
08-20-15, 20:46
Found an amusing article on Argentine economy http://www.bloomberg.com/news/articles/2015-08-20/only-in-argentina-where-minus-3-bond-yields-are-all-the-rage.
The Blue Peso has finally made International news.
http://www.bloomberg.com/news/articles/2015-08-20/argentina-s-black-market-peso-falls-to-weakest-in-10-months?cmpid=yhoo
Tres3.
I am in Europe now with an argentinean friend and she has 10.000 pesos with her. Prior to our trip, the conversation went like this:
Argie: Should I bring pesos with me to exchange in Europe for euro?
Me: No, you will not be able to exchange pesos in Europe. Exchange pesos for euro before you leave.
Argie: (Looks at me sideways dog-head). Should I bring my ATM card?
Me: No, your ATM card will not work outside of Argentina because of the currency restrictions KFC (I call CFK KFC because her neck wattle makes her look like some type of fowl) has imposed.
Argie: (Looks at me sideways dog-head).
Fast forward to Spain:
Argie: I am going to use the ATM to get some euro.
Me: <crickets>.
Argie: The ATM won't give me any money.
Me: <crickets>.
Argie: I am going to go inside Santander Bank (her argie account is at Santander) and get some euro that way.
Me: <crickets, big smile>.
Argie: They are telling me my ATM card is no good here.
Me, fantasy reply: Boluda, I told you that twenty times before we left.
Me, actual reply: Ay ¡qué lástima!
Fast forward to Italy:
Argie: I am going to go to Western Union and they will exchange my pesos.
Me: (no they fucking won't) Dale.
Argie: Western Union won't take my pesos.
Me: (Duh) No, and neither will anyone else. They are worthless outside of Argentina and a few neighboring countries.
Argie: (Hateful look, tiny feet stamping on the ground). Why?
Me: Detailed explanation of KFC's restrictions (argie hates KFC because 'she gives everything to all those boliguayos and nothing to me'), the default on the debt, Argentina's international reputation for defalcation, etc.
Argie: Why would KFC do that? Isn't that really stupid?
Me: I have no fucking idea and yes it is insanely stupid.
Argie: Well, down by the train station there are a bunch of money changers and banks and I will go there and someone will exchange them, but you need to come with me because I don't feel safe walking around with 10.000 pesos.
Me: No, I will not go with you because you are wasting your time and there are better things to do in this beautiful city.
Argie: Hate face, fume, tiny feet stamping, malas palabras, and so forth.
Six hours later:
Argie: I went to six banks, three exchange offices, and drank twenty mates with a bunch of stupid little crackers I dragged all the way from Argentina and no one will take my pesos.
Me, fantasy reply: Meanwhile, I went to three beautiful museums, four gorgeous parks, and had some gelato.
Me, actual replay: ¡Qué lástima!
Imagine the futility of spending six hours trying to exchange worthless toilet paper. Then further imagine doing so while carrying a backpack containing: your mate, half a kilo of 'zherba,' half a kilo of sugar, a heavy jacket in case the temperature drops below 25 C, a cell phone that does not work in Europe, all your makeup and perfume so the maid won't steal it (because the maid is black), and god knows what else.
I mention that Macri says if he gets elected he will remove the restrictions immediately but that Scioli says he will he will remove them gradually.
Argie: Scioli es un hijo de rrrre mil puta de la mierda y me cago en él y encima es rengo (has only one arm) (at this point the zhizhing and slurring became so pronounced I lost track but none of it sounded very positive towards Scioli) and if he gets elected I will rip off his other arm and stuff it up his culo.
Me: Vamos a comer algo?
Argie: ¡Ojalá! Estoy rrre cansada.
Later she stated with relative certainty that she will be able to exchange the pesos in Germany.
Denial is not just a river in Egypt.
Denial is not just a river in Egypt.What a closer!
Instead of the word 'rengo' (someone who limps) in my last post, the word should have been 'manco' (someone with one arm). I think she said 'rengo' meaning he is crippled but that is not right. Maybe she said 'manco'.
Argentina must turn up the printing presses to make up the difference between the world price of oil and the Argentine price. Someone needs co clue CFK that try as she may, Argentina cannot print dollars. Has no one in the current government studied economics 101? Someone needs to make them truly believe that there is no free lunch.
http://www.bloomberg.com/news/articles/2015-08-25/oil-at-77-argentina-marches-to-a-different-drummer?cmpid=yhoo
Tres3.
Argentina: Great Economists, Awful Economy.
By Noah Smith.
http://bv.ms/1SHmcwF
Bloomberg View.
The below link appeared in today's Miami Herald. Oppenheimer is a well respected, bilingual, and well connected, columnist who writes a syndicated column about Latin America.
http://www.miamiherald.com/news/local/news-columns-blogs/andres-oppenheimer/article38452695.html
Tres3.
Arbitrage theory tells us that the price of a product can only differ in two markets by the difference in taxes and transportation cost. I don't drink much wine but I like Trapiche Malbec. When I was in Argentina this year it sold for about 90 pesos in Cotto, about 7 dollars at the time in the blue market.
So I am in Portugal now and I see it for 4,65 euro which is about $5.20 US. What's up with that? The tax (included in the price) is a whopping 23% on most imported products here = stupid, but only 13% on this wine. So I don't really understand.
Then I am thinking, how did I get two bottles of it, and a liter of OJ, and a chocolate bar, and a pint of Spanish beer taxed at 23% for 13 euro? I looked at the receipt and the two bottles of Trapiche rang up as some local wine for 3,69 euro so the item was not entered correctly in the system.
But wine is heavy and expensive to ship in bottles. How can this be? Then I remembered that argie law allows the producer to prevent the retailer from discounting. But this did not appear to be a sale price. As an economist, I am puzzled but as a drunk I am happy. Super cheap to drink in Italy, Spain, and Portugal. Drinking age is 16 in Italy and in Portugal you can drink beer and wine, but not spirits, at 16 as well. 18 for everything in Spain.
Portuguese wine sucks though. I have had no refrigerator for eight days now so have been favoring wine over beer and wine is about half the price per unit of alcohol. Portuguese beer is not very good either so argie wine seems like a good alternative.
So what does the election results mean to the expats in Argentina? How will this effect the blue rate? Is this good or bad for us?
So what does the election results mean to the expats in Argentina? How will this effect the blue rate? Is this good or bad for us?For one thing, I think it's safe to assume that somehow the dollar will get stronger.
Jajajajajaja!
Jax
TejanoLibre
11-24-15, 10:48
The presidential candidate for the Lets Change (Cambiemos) coalition Mauricio Macri has told businessmen this afternoon that if he wins the October elections, he expects Central Bank Alejandro Vanoli to resign. Vanoli considered the statement a threat.
As President, I would want a steady trade rate. I would lower export taxes, which would boost agro exports and, in turn, lower inflation by increasing dollar reserves. In this scenario, I think the current Central Bank director should present his resignation, said Macri, considering Vanoli to be a different kind of Central Bank director than his presidency would need.
President Elect Macri told the Central Bank Boys to resign yesterday and will name a 6 person committee to head the economy today.
Seems like a good start to me.
Sunday night / Monday morning around 4am while we were at Excedra we watched the armored cars full of the votes driving down Macri's personal 9 de Julio Metro Bus line. Complete with police escorts.
It was a beautiful sight!
I was told that the opposition Did steal votes but not enough to win because that would have caused a riot. They did it to make sure that Macri would not win by more than 54%.
The honor still held by KFC.
Unreal.
TL.
Seems like we have a lot of smart economist on this site. Help me with a question. If our economy is growing at 2.5% why would we consider raising interest rates. Inflation doesn't seem a factor here. We need a little inflation. If we raise interest rates wouldn't this slow everything down? If our GDP drops below 2.5 This could be a problem.
In the past week, asphalt roofing shingles here in Buenos Aires have jumped 100 pesos a bundle. Currently selling at $750 pesos a bundle, up from $650 the week before. Prices in the states ( Using Home Depot pricing as a reference ) continue at $21.70 or there abouts. Using the current Blue price of around 15 to 1 they should cost around $320 pesos. What a privelage to live here and pay double for everything and at the same time you get to earn less!!!! :-).
Bobby Doerr
11-26-15, 14:52
In the past week, asphalt roofing shingles here in Buenos Aires have jumped 100 pesos a bundle. Currently selling at $750 pesos a bundle, up from $650 the week before. Prices in the states ( Using Home Depot pricing as a reference ) continue at $21.70 or there abouts. Using the current Blue price of around 15 to 1 they should cost around $320 pesos. What a privelage to live here and pay double for everything and at the same time you get to earn less!!!! :-).A few years ago, Cristina told the country that if inflation were truly 25% or more (like economists outside of her government believed), the country would explode and "disappear into thin air." Spending her days by bald ass lying about CPI and dangerously doing nothing to dampen inflation but doing everything wrong to inflame inflation, the Macri government will have its hands full confronting reality. While empirical evidence pointed to huge MONTHLY increases in inflation rates and after the IMF censured Argentina for its faked inflation statistics, the brown nose asshole Finance Minister Axel Kicillof launched a new metrics system, which he labeled the consumer price index NU (CPINu). Two years ago, the new index put one month's (Jan 2014) inflation at 3.7%--the highest monthly rate recorded by the government since 2002. If extrapolated, such a rate would mean annual inflation of 55%. But the newer and more current numbers are still lower than many private estimates. Think of what Macri is facing. His first job is to stem inflation. Here's some things Macri's Finance Minister must do IMMEDIATELY, (1) Get rid of the export tax, (2) Devalue the peso again, (3) settle old debts with Singer's group, (4) reestablish good relations with the USA, (5) and most of all - increase the number of tourists coming into the country by passing new cheap pussy laws. Thanks, Bobby Doerr.
In the past week, asphalt roofing shingles here in Buenos Aires have jumped 100 pesos a bundle. Currently selling at $750 pesos a bundle, up from $650 the week before. Prices in the states ( Using Home Depot pricing as a reference ) continue at $21.70 or there abouts. Using the current Blue price of around 15 to 1 they should cost around $320 pesos. What a privelage to live here and pay double for everything and at the same time you get to earn less!!!! :-).Much of the difference between the Argentine and the USA asphalt shingle prices can be attributed to Argentina's 100% tariff on imported goods and it's 21% "National Sales Tax" on retail sales.
Thanks,
Jax.
It looks as if AA got a bellyful of Argentine government game playing. CFK had a number of retaliatory actions. It will be interesting to see if she uses her last days in power to try and impose them. If Aerolineas were worth a shit and flew on time, AA would not sell so many tickets in Pesos, and maybe would keep accepting Pesos. First Venezuela, and now Argentina. I wonder which airline will be next, and I also wonder what Macri will do when he takes over.
http://finance.yahoo.com/news/american-airlines-stops-taking-payment-argentine-currency-192148757.html
Tres3.
Much of the difference between the Argentine and the USA asphalt shingle prices can be attributed to Argentina's 100% tariff on imported goods and it's 21% "National Sales Tax" on retail sales.
Thanks,
Jax.Does the "National Sales Tax" include the VAT? If not, that tax amount must also be included in the sales price.
Tres3.
Much of the difference between the Argentine and the USA asphalt shingle prices can be attributed to Argentina's 100% tariff on imported goods and it's 21% "National Sales Tax" on retail sales.
Thanks,
Jax.LOL!! You would think with 121% tax they would encourage imports!
It looks as if AA got a bellyful of Argentine government game playing. CFK had a number of retaliatory actions. It will be interesting to see if she uses her last days in power to try and impose them. If Aerolineas were worth a shit and flew on time, AA would not sell so many tickets in Pesos, and maybe would keep accepting Pesos. First Venezuela, and now Argentina. I wonder which airline will be next, and I also wonder what Macri will do when he takes over.
http://finance.yahoo.com/news/american-airlines-stops-taking-payment-argentine-currency-192148757.html
Tres3.Macri announced a replacement to run Aereolineas, maybe he can cut the 350 employees per plane to something closer to the norm of around 50. And while hes at it cut the 3.5 million dollars a day subsidy Aereolineas is costing the country.
LOL!! You would think with 121% tax they would encourage imports!Most intelligent heads of state long ago discarded the discredited "Import Substitution", but not CFK. In fact, she increased it for the average person who pays taxes. The well connected long ago learned that a well placed bribe could avoid paying the tax.
Tres3.
TejanoLibre
11-28-15, 11:21
So the Nazis had a coincidental fire at the Reichstag but it was for a good reason .
Blame the Red Pigs and gain support.
The new fire in The Ministry of Finance here in BA was obviously intended to cover up KFC's corruption.
http://www.zerohedge.com/news/2015-11-27/mysterious-fire-hits-argentine-ministry-finance-destroys-years-prior-regimes-files
Unbelievable.
TL.
Does the "National Sales Tax" include the VAT? If not, that tax amount must also be included in the sales price.
Tres3.The "National Sales Tax" I referred to is known by it's acronym "IVA".
It's not a Value Added Tax as it's not added on to the cost of a product at each step in the importing / manufacturing / distribution process.
The 21% IVA is added to and included in the final retail sales price, but it is not itemized on the sales receipt like sales taxes in the USA.
Nevertheless, the next time you are motivated to complain about the price of a retail product or service, first recognize that the retailer is only receiving 79% of the price you paid.
Thanks,
Jax.
Big Boss Man
12-17-15, 14:46
I am looking at exchange rates today just out of curiosity and it seems like it is reasonable to bring and use the ATM card again. Dolarblue.net site is down. I looked at a hotel site which I used before and they still have not converted. They are still quoting about 10 to 1. There appears to be some confusion. Look for deals now.
Daddy Rulz
12-17-15, 18:35
I am looking at exchange rates today just out of curiosity and it seems like it is reasonable to bring and use the ATM card again. Dolarblue.net site is down. I looked at a hotel site which I used before and they still have not converted. They are still quoting about 10 to 1. There appears to be some confusion. Look for deals now.I tried to talk somebody into making a test today for a couple hundred pesos and was unable to.
If it works, actually works, I would say probably. It remains Argentina, until somebody has proven that you're not getting raped on the backside (fees, funky exchange when clearing through the banks) I would maintain hope with healthy skepticism.
Daddy Rulz
12-17-15, 19:45
I tried to talk somebody into making a test today for a couple hundred pesos and was unable to.
If it works, actually works, I would say probably. It remains Argentina, until somebody has proven that you're not getting raped on the backside (fees, funky exchange when clearing through the banks) I would maintain hope with healthy skepticism.I'm on an expat FB group and a couple guys there ran a test today (small amounts) with ATM cards and got 9.5. One guy reported that his statement showed "transaction pending." I'm sure it will take a couple days to smooth out, and the residual 9.5 wasn't theft, pretty sure anyway, but lets see what happens. Though it wouldn't even be a stretch for me to see somebody report they questioned the bank about this and the bank said, "Yes, the exchange rate is indeed 14-1 except when you use your debit card to get money from a foreign bank, then it's 9.5-1."
PirateMorgan
12-18-15, 02:51
Declarations of Peso value STILL don't mean anything unless there is a sufficient supply of dollars to feed the needs of individuals and business in Argentina. The jury is completely out on this. If there isn't enough, oh my, the blue will go to unparalleled levels. It will not take long to shake out one way or the other.
Nevertheless, the next time you are motivated to complain about the price of a retail product or service, first recognize that the retailer is only receiving 79% of the price you paid.
Thanks,
Jax.Wouldn't it be 82.6% ?
Wouldn't it be 82.6% ?Yes, but I didn't want to get into the entire "Margin vs Markup" discussion, thanks.
TejanoLibre
01-16-16, 02:45
Inflation-stricken Argentina to issue higher denomination banknotes.
http://www.cnbc.com/2016/01/15/
I knew this was coming !
Beware of fakes.
TL.
Johnny Drama
01-16-16, 05:35
Inflation-stricken Argentina to issue higher denomination banknotes.
http://www.cnbc.com/2016/01/15/
I knew this was coming !
Beware of fakes.
TL.Here is the working link:
http://www.cnbc.com/2016/01/15/reuters-america-inflation-stricken-argentina-to-issue-higher-denomination-banknotes.html
TejanoLibre
01-21-16, 22:34
Good News.
http://www.businessinsider.com/r-coca-cola-to-invest-1-billion-in-argentina-over-next-four-years-2016-1
TL.
Spirit Rider
01-22-16, 18:16
They think only governments create economic growth and jobs are blown out of Christina's a$$.
They will surely view this as Yankee Imperialism.
Thomaso276
01-22-16, 19:12
http://www.clarin.com/politica/Davos-Mauricio_Macri-ingles_0_1508849387.html
Not KK, pretty sharp guy.
Daddy Rulz
01-22-16, 20:20
http://www.clarin.com/politica/Davos-Mauricio_Macri-ingles_0_1508849387.html
Not KK, pretty sharp guy.Build on what you have, being able to feed yourself is pretty huge.
Following is a link to this article.
http://finance.yahoo.com/news/mediator-argentinas-debt-battle-says-issue-significant-statement-213952527--sector.html
Tres3.
The below link is to a recent Bloomberg article about the defaulted Argentine bonds. It is the first time that I was aware that Argentina was foolish (or desperate) enough to issue floating rate bonds.
http://www.bloombergview.com/articles/2016-02-08/argentina-s-bond-fight-comes-down-to-its-worst-bonds?cmpid=yhoo.headline
Tres3.
The below link is to an article that appeared on the front page of Wednesday's Miami Herald.
http://www.miamiherald.com/news/nation-world/world/article62021447.html
Tres3.
The below link seems to indicate that the Argentina debt debacle is almost over -- if the Argentine Congress does not fuck it up.
http://finance.yahoo.com/news/argentina-us-creditors-reach-deal-160120062.html
Tres3.
I guess all of the sleepless nights endured by Singer's minions are going to finally pay off--if the Argentina Congress does not fuck it up.
http://finance.yahoo.com/news/hedge-funds-poised-massive-gains-144957191.html
Tres3.
Bobby Doerr
03-03-16, 10:32
I guess all of the sleepless nights endured by Singer's minions are going to finally pay off--if the Argentina Congress does not fuck it up.
http://finance.yahoo.com/news/hedge-funds-poised-massive-gains-144957191.html
Tres3.Jax, good post. I know one of the holdouts in Singer's group. He's Turan Group out of Boston. I wouldn't call him a "minion" but he has been down here for conferences on the defaults a number of times. He's brilliant and says he was small potatoes having invested only a half a million. These guys have so much dough that they don't lose sleep over bonds they know are eventually going to be retired. The only question was how much? With accumulated interest, I would guess the offer of 75% of face is going to pay much more than a hundred percent of face value. Good deal for the bond holders and a great day for Argentina. It's not a done deal yet, but I think Congress will approve. Enjoying my visit here. Thanks. Bobby Doerr.
Daddy Rulz
03-03-16, 11:26
Jax, good post. I know one of the holdouts in Singer's group. He's Turan Group out of Boston. I wouldn't call him a "minion" but he has been down here for conferences on the defaults a number of times. He's brilliant and says he was small potatoes having invested only a half a million. These guys have so much dough that they don't lose sleep over bonds they know are eventually going to be retired. The only question was how much? With accumulated interest, I would guess the offer of 75% of face is going to pay much more than a hundred percent of face value. Good deal for the bond holders and a great day for Argentina. It's not a done deal yet, but I think Congress will approve. Enjoying my visit here. Thanks. Bobby Doerr.I realize this is a very complicated issue but I'm confused about something.
I always through that Singers group had bought up the default bonds for pennies on the dollar. I assumed that for years until I was directed to some information that said they paid around 70 cents on the dollar. If that is true, how could the original debt have been 80 billion, Argentina will be paying I think the article said around 10 billion and Singers group will see nearly 400% on the original investment?
Not disputing, just curious.
I realize this is a very complicated issue but I'm confused about something.
I always through that Singers group had bought up the default bonds for pennies on the dollar. I assumed that for years until I was directed to some information that said they paid around 70 cents on the dollar. If that is true, how could the original debt have been 80 billion, Argentina will be paying I think the article said around 10 billion and Singers group will see nearly 400% on the original investment?
Not disputing, just curious.Singer's group bought mostly "floating rate" bonds. See my earlier post on Feb. 9 for more details.
Tres3.
If I have read the below linked article correctly, it looks as if the Argentina Government is robbing Peter to pay Paul.
http://finance.yahoo.com/news/argentina-creditors-agree-155-million-more-default-settlement-021942345--finance.html
Tres3.
It looks as if Argentina has once again proven that one cannot change the stripes on a zebra.
http://www.bloomberg.com/news/articles/2016-03-24/argentina-settlement-surprise-leaves-some-investors-in-the-cold?cmpid=yhoo.headline
Tres3.
The below article shows a surprising amount of common sense on the part of the Argentine Congress and a repudiation of CFK. The big question now is who will buy the new debt that Argentina plans to sell so that they can pay the old debt. I guess that Argentina believes that P.T. Barnum is alive and well.
http://news.yahoo.com/argentine-senate-debates-deal-end-210725713.html
Tres3.
The attached link names not only Macri, but a whole laundry list of worldwide politicians who set up offshore accounts using the Panama law firm. I speculate that this list is only the tip of the iceberg.
http://finance.yahoo.com/news/latest-australia-probe-possible-tax-062350554.html
Tres3.
The below link is to an article about the proposed Argentine bond issuance. Personally, I would not touch the bonds with a ten foot pole.
http://blogs.barrons.com/emergingmarketsdaily/2016/04/07/argentina-why-invest-in-largest-emerging-debtor-of-2016/?mod=yahoobarrons&ru=yahoo
Tres3.
Big Boss Man
06-19-16, 17:01
The guys in the Barron's Roundtable are not always right but they have been around the block a few times. Does anyone know how you actually do the following trade?
Have you other investment picks?
In the next year, there will be an investment opportunity in Argentina, where there has been a fundamental political change after 70 years of a combination of socialism, conservatism, nationalism, and corruption. This change could be as important as the Reagan presidency was to the U.S.
Mauricio Macri, Argentinas new president, is open-minded, with an international view. He has a great team of experts in place in finance and economics, and at the central bank. He lifted export sanctions and currency controls. Thats why the dollar/peso ratio shot up to almost 16 from nine. It pushed inflation rates up, but inflation is expected to decline next year as the impact of the one-time devaluation disappears. Argentina also has settled its problems with foreign creditors, and has come back to the capital markets. In addition, Macri has announced a tax amnesty that will bring in more tax revenue.
What is the best way to invest in Argentinas progress?
Im bullish on the Argentine peso. You can buy it against the dollar on a one-year forward basis. The interbank forward rate is 17.31 pesos to the dollar, versus the spot rate of 13.95 pesos. This gives you a carry of 19.4% for 12 months if the spot price stays unchanged.
Argentina has recently issued $16 billion of dollar-denominated bonds with maturities of three, five, 10, and 30 years. I bought the three-year, which carried a coupon of 6.25%. The yield has already fallen to 4.5%. If you are more adventurous, you can buy five-year debt.
In the near term, things arent easy in Argentina. The economy is in recession. The inflation rate is 40%. There are demonstrations and strikes. The next nine to 12 months is critical, until people see that inflation is normalizing. But Argentina has little government debt. It couldnt tap the capital markets for a long time.
I agree that Macri is a breath of fresh air, BUT the country is run by civil servants, and the majority of them are Peronistas. Since 1900 the country has defaulted on its foreign debt nine (9) times. They seem to always find another sucker to loan them more money. 6.5% is not much of a risk premium. A person might make some money on this ponzi scheme, if he cashes out early, and leaves someone else holding the bag. There is a reason that real estate in this country is traded in USD, and smart Argentines have most of their money in USD.
Tres3.
Saw BBC news report that there was a 24 hour general strike yesterday in BA? They showed some pictures of deserted main streets, Constitution and 9 de Julio. Says security forces had to use water cannon and tear gas to control protesters who blocked the main highway leading from the north to the capital. Report says inflation 40% last year and expected to be about 20 % this year and protesters were calling for increased wages.
PickCherry12
04-07-17, 19:44
Saw BBC news report that there was a 24 hour general strike yesterday in BA? They showed some pictures of deserted main streets, Constitution and 9 de Julio. Says security forces had to use water cannon and tear gas to control protesters who blocked the main highway leading from the north to the capital. Report says inflation 40% last year and expected to be about 20 % this year and protesters were calling for increased wages.That's terrible news. Well, 'sadly' bad times bring more chicas into the business.
There have been a lot of strikes lately. And why not? Under the world famous Argie system of nonsense, employees collect their wages while on strike! After all, where else in the world to people work for ten months a year (or less) and collect for thirteen months???? But only those employees in "blanco" of course.
where else in the world to people work for ten months a year (or less) and collect for thirteen months???? If you are referring to the aguinaldo, it's the norm in many other Latin countries. México, Chile, Brazil, Nicaragua, Colombia, and even the Philippines have this system. It's also common in France, although not mandatory.
If you are referring to the aguinaldo, it's the norm in many other Latin countries. Mxico, Chile, Brazil, Nicaragua, Colombia, and even the Philippines have this system. It's also common in France, although not mandatory.In the Latin countries that I have been to, Aguinaldo is only one month. For the other two months are you referring to vacations and holidays???? The Philippines is really a Latin country that happens to be located in Asia. Spain ruled for over 400 years, and until Mexican Independence, the Philippines were controlled by the Viceroy of Mexico. The strange thing is that even though the Filipinos love rice, beans never became a part of their diet, like in Hispanoamerica.
Tres3.
In the Latin countries that I have been to, Aguinaldo is only one month. For the other two months are you referring to vacations and holidays???? The Philippines is really a Latin country that happens to be located in Asia. Spain ruled for over 400 years, and until Mexican Independence, the Philippines were controlled by the Viceroy of Mexico. The strange thing is that even though the Filipinos love rice, beans never became a part of their diet, like in Hispanoamerica.
Tres3.Right, the aguinaldo is only one month, or fifteen days in the case of México. I do believe the other poster was referring to vacation time, sick leave, and the plethora of holidays in Argentina, when saying they work for ten months.
My guess would be that rice grows much better than beans in The Philippines. Of course, the original diet of the indigenous people in much of what is now Latin America was beans and corn, not beans and rice. And unfortunately for filipinos, beans are significantly more nutritious than rice. Sitting here in my apartment in the world's leading olive-producing country, I'm sure glad I don't have to live on rice and beans, but I could sure live on olives for a while.
Right, the aguinaldo is only one month, or fifteen days in the case of Mxico. I do believe the other poster was referring to vacation time, sick leave, and the plethora of holidays in Argentina, when saying they work for ten months.
My guess would be that rice grows much better than beans in The Philippines. Of course, the original diet of the indigenous people in much of what is now Latin America was beans and corn, not beans and rice. And unfortunately for filipinos, beans are significantly more nutritious than rice. Sitting here in my apartment in the world's leading olive-producing country, I'm sure glad I don't have to live on rice and beans, but I could sure live on olives for a while.You are very correct when you say that beans are far more nutritious than rice. I think that the scarcity of corn caused by slash and burn agricultural practices in Latin America combined with the discovery that rice and beans made a "super food" led to rice supplementing, but not completely replacing, corn in the Latin American diet. Dry land raised rice strains did not hurt either. The still perplexing thing is that there are many types of beans, and there is bound to be a type that grows reasonably well in the Philippines. For example most all of the black beans consumed by humans are grown in Minnesota. I can only speculate that most Filipinos simply have not acquired a taste for beans--too bad. BTW, I never ate an olive that I did not like.
Tres3.
Eszpresszo
05-11-18, 21:53
Anyone who keeps track of international news or just pays attention to the financial world, would know that Argentina is now in ANOTHER financial crisis. If you have been paying attention to those, you would know what I am talking about. If not, I won't try and sum it up for you. But for the purposes of the overseas monger, the exchange rate cannot be ignored. Just this week the Argentine Peso broke above 23 per USD and is just shy of 24. That's easily the highest point in the past decade. As a point of comparison, there was slightly over 3 ARS per $ this time 10 years ago. However the currency has slumped steadily against most all other currencies. In Feb. 2014 and Dec. 2015 the ARS plunged dramatically. Of course this is no surprise in a country with inflation running 26%. One could argue that the devaluation of the ARS isn't sufficient to compensate for the loss of buying power.
My question to those who travel to Argentina is, how much has inflation impacted P4P prices, and how has the devaluation worked for you? Are we seeing a rare chance for discounted mongerng with the fabled Argentine girls, or are they spiking their prices accordingly?
I am also curious how the economic calamity will effect impact the choices, as well. As has been noted on the Greece forum, the financial crisis in Greece, resulting in widespread unemployment among young people, saw more girls on the streets and selling their services at a deep discount by EU standards. I realize that this will take time to unfold, and the government has reached out to the IMF for help ( a very unpopular move, apparently), so they might get bailed out again. But, I realize this situation didn't happen overnight, nor is it the first for Argentina. Maybe some experience people who have watched the national economy over time, or some members on the ground can comment. Thanks.
Eszpresszo
05-11-18, 22:22
The guys in the Barron's Roundtable are not always right but they have been around the block a few times. Does anyone know how you actually do the following trade?
Well, if you have to ask how to do it, then you shouldn't even think about trying. Hopefully you didn't, but if you had taken Felix's advice you have been f*cked from the beginning. On the date that you made this post, just shy of two years ago, the exchange rate was just shy of 13.7 ARS per US$. A week later, it was 15.2 to the USD. Today its closed at 23.
The lesson? Well, as my economics professor told me back in 1980, you cannot realistically speculate on currency. You just cannot predict the direction of currency fluctuations. There are just too many moving parts. I liked to think it was possible and that my professor was being close minded. But, what did I know? I was a 22 year old student with big ideas and a blank resume of life experiences. In hindsight, he was right back then and he is right today (Thank you, Professor Behnke). Getting past my own education, the thing you must learn is that you must NEVER make a financial decision based on anything you read in the financial media. Its a good way to lose money that could better be spent on sex. If I can given any novice investor any advice, it would be to ignore investment advice by the touts in the financial media.
Big Boss Man
05-12-18, 14:56
Well, if you have to ask how to do it, then you shouldn't even think about trying. Hopefully you didn't, but if you had taken Felix's advice you have been f*cked from the beginning. On the date that you made this post, just shy of two years ago, the exchange rate was just shy of 13.7 ARS per US$. A week later, it was 15.2 to the USD. Today its closed at 23.
The lesson? Well, as my economics professor told me back in 1980, you cannot realistically speculate on currency. You just cannot predict the direction of currency fluctuations. There are just too many moving parts. I liked to think it was possible and that my professor was being close minded. But, what did I know? I was a 22 year old student with big ideas and a blank resume of life experiences. In hindsight, he was right back then and he is right today (Thank you, Professor Behnke). Getting past my own education, the thing you must learn is that you must NEVER make a financial decision based on anything you read in the financial media. Its a good way to lose money that could better be spent on sex. If I can given any novice investor any advice, it would be to ignore investment advice by the touts in the financial media.I did not take his advice at that time. One way to play the current situation is in hotel room prices. I paid $260 a night in November 2017 at the Alvear Art. I looked at their site today and you can book one week for $150 a night. However, I thought the quality was slipping back in November. They are starting to cater to tour groups. So the hotel lobby will be flooded with a hundred Germans or Chinese on any given morning.
My question to those who travel to Argentina is, how much has inflation impacted P4P prices, and how has the devaluation worked for you? Are we seeing a rare chance for discounted mongerng with the fabled Argentine girls, or are they spiking their prices accordingly?
The following chart shows the evolution of the real exchange rate Argentine Peso / US Dollar since the last really big crisis (end of 1 Arg Peso = 1 US Dollar currency board at the end of 2001/early 2002). "Real Exchange Rate" means adjusted for both Argentine and USA inflation.
What the chart shows is that we are not yet anywhere near the days of cheap Argentine prices (P4P included) that we had in 2002-2005, for example.
Also, unemployment (another major driver of good P4P prices) is relatively stable at 8%, high by current USA levels, but actually good for the local record over past years.
Bottom line: the crisis, if there is actually one, needs to get much deeper if we are going to see chica prices going into the bargain zone.
Eszpresszo
05-20-18, 10:47
What the chart shows is that we are not yet anywhere near the days of cheap Argentine prices (P4P included) that we had in 2002-2005, for example.
Also, unemployment (another major driver of good P4P prices) is relatively stable at 8%, high by current USA levels, but actually good for the local record over past years.
Bottom line: the crisis, if there is actually one, needs to get much deeper if we are going to see chica prices going into the bargain zone.Thanks for your input. Being old enough to recall double digit inflation in the US during the late 70's, I understand how it compounds over a modest amount of time.
While not on my immediate list of places to visit, BA has a reputation for some of the finest working girls in LA, but also the most expensive. Of course, it seems Argentina is always undergoing some financial crisis. This latest one probably is not the worst or will it be the last.
Wild Walleye
05-22-18, 12:12
Well, if you have to ask how to do it, then you shouldn't even think about trying. Hopefully you didn't, but if you had taken Felix's advice you have been f*cked from the beginning. On the date that you made this post, just shy of two years ago, the exchange rate was just shy of 13.7 ARS per US$. A week later, it was 15.2 to the USD. Today its closed at 23.
The lesson? Well, as my economics professor told me back in 1980, you cannot realistically speculate on currency. You just cannot predict the direction of currency fluctuations. There are just too many moving parts. I liked to think it was possible and that my professor was being close minded. But, what did I know? I was a 22 year old student with big ideas and a blank resume of life experiences. In hindsight, he was right back then and he is right today (Thank you, Professor Behnke). Getting past my own education, the thing you must learn is that you must NEVER make a financial decision based on anything you read in the financial media. Its a good way to lose money that could better be spent on sex. If I can given any novice investor any advice, it would be to ignore investment advice by the touts in the financial media.With all due respect, it's a good thing that your econ professor wasn't a currency trader.
I hope you don't mind, if I chime in with a few personal observations.
There is a huge global currency spot and futures market based, in large part, upon speculation.
Most currency speculation is based upon the expectation that certain future events will impact the (rather complex) equation, expressing equilibrium between the two currencies in question. That said the biggest single component of interest rate differentials is usually the relative interest rates, offered by the respective central banks. Most of the rest of the calculus is the art of estimating risk (sovereign risk, country risk, etc.). There are lots of rocket scientists who focus on far more esoteric elements of the equation and more complex transactions (like crosses of three or more currencies), but the basics are: you bet on expected interest rate differentials and events that will impact the risk equilibrium.
The period you cited, when the peso dropped to about 15:1 was when the currency controls came off. Argentina severely limited access to FOREX 2011-2015. I tracked the official and unofficial rates (blue rate) daily, throughout the entire period. I am simplifying events and roughly approximating the ratios from memory. So, please forgive the imprecision. The free-floating peso didn't trade at 13:1 for long (minutes?). It went from about 9:1 (official rate) to 15:1 (free-floating) almost overnight. The set govt rate was under 10:1, and the blue rate (unofficial black market rate) was maybe 13:1. We were looking at a large FOREX play involving Argentina (probably the only group looking to get into, as opposed to out of, Argentina at the time, during the currency controls). I arrived at 16:1 as our "safe case." When the controls came off in 2015, the rate immediately went to 15:1 and stayed there, plenty long enough for us to unwind the position in the open market.
Right now, Argentina faces an uphill climb, after doing so well for nearly two years, making the economy more attractive to foreign capital. They are caught in several large and powerful currents.
The biggest monkey wrench has been that the US Fed tightening is drawing money away from Argentina (and most developing economies). During periods of increasing US rates, the risk/reward pendulum usually swings away from developing economies. While the ROI on US govt securities sucks, all US debt securities are essentially priced off of those underlying rates (and LIBOR). Therefore, a 50 basis point (or .5%) uptick in Fed rates will get priced in across the entire spectrum of dollar-based debt securities, thereby offering higher returns at a wide variety of risk profiles. That draws money into the US dollar and out of foreign currencies, starting with those of developing economies. Therefore, the declining supply increases the cost FOREX to Argentina.
The next problem (a recurring nightmare for Argentina) is Argentina's economy, and in particular, its unsustainable domestic spending. Argentina, which was already addicted to handouts, went nuts under the Kirchner reign of terror increasing handouts to unsustainable levels. Given Argentina's legendary history of populism, the guy who pulls the plug on handouts runs the risk of quickly becoming unpopular. Unsustainable spending by a govt that has limited reserves and a checkered history in the international debt markets, raises the specter that they might have some future difficulties. Therefore, the risk to holders of Argentine debt rises. Investors demand higher returns for increased risk. Therefore, the cost of capital rises.
1) Risk = Cost.
2) If risk rises, so too must the compensation to the investor.
3) Therefore, interest rates must rise in order to attract capital.
However, rising interest rates increase inflation. Inflation increases risk.
1) Risk = Cost.
2) If risk rises, so too must the compensation to the investor.
3) Therefore, interest rates must rise in order to attract capital.
Lather, rinse, repeat...
Despite the forgoing, things in Argentina arent really cheap. Unfortunately, I believe that things are going to have to get cheap in Argentina in order to break the cycle. If the govt severely cuts back domestic spending and the currency goes to something like 30:1, it might do the trick. However, I doubt the govt will have the sack to do it. Therefore, the currency will need to sink further in order to compensate for that.
With all due respect, it's a good thing that your econ professor wasn't a currency trader.
I hope you don't mind, if I chime in with a few personal observations.
There is a huge global currency spot and futures market based, in large part, upon speculation.
Most currency speculation is based upon the expectation that certain future events will impact the (rather complex) equation, expressing equilibrium between the two currencies in question. That said the biggest single component of interest rate differentials is usually the relative interest rates, offered by the respective central banks. Most of the rest of the calculus is the art of estimating risk (sovereign risk, country risk, etc.). There are lots of rocket scientists who focus on far more esoteric elements of the equation and more complex transactions (like crosses of three or more currencies), but the basics are: you bet on expected interest rate differentials and events that will impact the risk equilibrium.
The period you cited, when the peso dropped to about 15:1 was when the currency controls came off. Argentina severely limited access to FOREX 2011-2015. I tracked the official and unofficial rates (blue rate) daily, throughout the entire period. I am simplifying events and roughly approximating the ratios from memory. So, please forgive the imprecision. The free-floating peso didn't trade at 13:1 for long (minutes?). It went from about 9:1 (official rate) to 15:1 (free-floating) almost overnight. The set govt rate was under 10:1, and the blue rate (unofficial black market rate) was maybe 13:1. We were looking at a large FOREX play involving Argentina (probably the only group looking to get into, as opposed to out of, Argentina at the time, during the currency controls). I arrived at 16:1 as our "safe case." When the controls came off in 2015, the rate immediately went to 15:1 and stayed there, plenty long enough for us to unwind the position in the open market.
Right now, Argentina faces an uphill climb, after doing so well for nearly two years, making the economy more attractive to foreign capital. They are caught in several large and powerful currents.
The biggest monkey wrench has been that the US Fed tightening is drawing money away from Argentina (and most developing economies). During periods of increasing US rates, the risk/reward pendulum usually swings away from developing economies. While the ROI on US govt securities sucks, all US debt securities are essentially priced off of those underlying rates (and LIBOR). Therefore, a 50 basis point (or .5%) uptick in Fed rates will get priced in across the entire spectrum of dollar-based debt securities, thereby offering higher returns at a wide variety of risk profiles. That draws money into the US dollar and out of foreign currencies, starting with those of developing economies. Therefore, the declining supply increases the cost FOREX to Argentina.
The next problem (a recurring nightmare for Argentina) is Argentina's economy, and in particular, its unsustainable domestic spending. Argentina, which was already addicted to handouts, went nuts under the Kirchner reign of terror increasing handouts to unsustainable levels. Given Argentina's legendary history of populism, the guy who pulls the plug on handouts runs the risk of quickly becoming unpopular. Unsustainable spending by a govt that has limited reserves and a checkered history in the international debt markets, raises the specter that they might have some future difficulties. Therefore, the risk to holders of Argentine debt rises. Investors demand higher returns for increased risk. Therefore, the cost of capital rises.
1) Risk = Cost.
2) If risk rises, so too must the compensation to the investor.
3) Therefore, interest rates must rise in order to attract capital.
However, rising interest rates increase inflation. Inflation increases risk.
1) Risk = Cost.
2) If risk rises, so too must the compensation to the investor.
3) Therefore, interest rates must rise in order to attract capital.
Lather, rinse, repeat...
Despite the forgoing, things in Argentina arent really cheap. Unfortunately, I believe that things are going to have to get cheap in Argentina in order to break the cycle. If the govt severely cuts back domestic spending and the currency goes to something like 30:1, it might do the trick. However, I doubt the govt will have the sack to do it. Therefore, the currency will need to sink further in order to compensate for that.LOL..... Argie land is rapidly approaching 30 to 1 !
TejanoLibre
05-22-18, 22:19
LOL..... Argie land is rapidly approaching 30 to 1 !Very Disappointed in Myself !
Sold a few items for $75,000.00 and I thought it was 21 to 1 !
Lost a little cash I guess.
TL.
Anybody need Pesos ? I can help you .
PirateMorgan
05-31-18, 09:31
I have a question. Have prices in Argentina shot up as the currency has crumbled? Have you guys on the ground really benefited by this drop? It seems as if you have received a windfall. I am happy for you!!!
I have a question. Have prices in Argentina shot up as the currency has crumbled? Have you guys on the ground really benefited by this drop? It seems as if you have received a windfall. I am happy for you!!!Inflation seems to be out pacing the decline of the peso. Most things are cheaper in the states where you are at least earning dollars and not pesos.
PirateMorgan
06-01-18, 09:22
If inflation is outpacing the peso...that is one xxxxload of inflation. Ouch.
Eszpresszo
06-08-18, 21:56
With all due respect, it's a good thing that your econ professor wasn't a currency trader.
I hope you don't mind, if I chime in with a few personal observations.
There is a huge global currency spot and futures market based, in large part, upon speculation.
Thanks for your detailed input. It was an informative read.
Yes, I was aware that there is an enormous amount of speculation in currency markets. But, I am grateful that my econ professor told me long ago, that I couldn't speculate on those things. Otherwise, I would have tried to do it at some point. As a result, I would have most certainly lost money like I have with any purely speculative investment I have attempted.
So, from the sound of things it, the situation will need to get much worse before young women are selling their bodies at discount prices, due to the lack of income or employment opportunities. But, Brazil is appearing to have a bit of a currency crisis, too. Maybe the pickings will be better there?
Wild Walleye
06-10-18, 18:04
Thanks for your detailed input. It was an informative read.
Yes, I was aware that there is an enormous amount of speculation in currency markets. But, I am grateful that my econ professor told me long ago, that I couldn't speculate on those things. Otherwise, I would have tried to do it at some point. As a result, I would have most certainly lost money like I have with any purely speculative investment I have attempted.
So, from the sound of things it, the situation will need to get much worse before young women are selling their bodies at discount prices, due to the lack of income or employment opportunities. But, Brazil is appearing to have a bit of a currency crisis, too. Maybe the pickings will be better there?Personally, I prefer Argentinian women to Brazilian women. I really like the old world feel of Bs As, the wine, the food and the culture. I'd be willing to pay a premium for those things.
However, I suspect that most of the developing economies, that are not currently rocking and rolling (from an economic perspective), are going to face an uphill battle, over the next six months and for the foreseeable future. The US Fed will raise rates at least another two times, this year. That probably means another .50% on the Fed Funds Rate. That will continue the "capital flight" mentioned in my previous post.
Despite the IMF life-line, things (from a currency perspective) are going to get worse in Argentina, before they get better. Additionally, as previously discussed, despite currency devaluation, the inflation of prices has offset much of the devaluations, therefore, things haven't actually become much cheaper. That means that the scales haven't been tipped in favor of the foreign investor (something that needs to happen in order to entice foreign investment).
Argentina is going to have to take some bitter medicine in order to break the cycle and turn the corner...a corner it had sort of turned with the election of Macri, but truncated by the moods of the markets (and Fed Rate hikes). However, these things take time and patience, two things voters tend to lack. If things go poorly, the Argies will fall back on electing Peronistas and the whole cycle will begin again. The biggest problem with that repugnant form of governance is the economic isolation that it comes with it. The IMF loan will be the last foreign money Argentina sees for the foreseeable future, if it starts to move back towards the Peronistas.
If the country falls back on old populist handout politics, the country will be plunged into an economic decline that will make 2001 look like a cakewalk. Conversely, if the country takes its medicine (eliminate many entitlements and what is effectively an economy-wide write-down of many assets and service in the country via further erosion to the peso) it will be able to begin anew climbing up the slope of economic recovery.
From AP and the local foros, I believe that thing are starting to get less expensive in Argentina, including chicas. However, prices still have a long way to go. IN 2007, I started spending a lot of time in Bs As. An hour romp at 1707 Ste Fe was $39. A similar romp, today is about $52. So, we'll need to see about a 24% drop in prices (AR$33:1USD) to get to back to what I consider the good ole days. The old timers here knew it when it was much better than that.
Wild Walleye
06-10-18, 18:07
If inflation is outpacing the peso...that is one xxxxload of inflation. Ouch....and in order for things to "normalize" the devaluation of the peso needs to exceed inflation...
...and in order for things to "normalize" the devaluation of the peso needs to exceed inflation...
Personally, I prefer Argentinian women to Brazilian women. I really like the old world feel of Bs As, the wine, the food and the culture. I'd be willing to pay a premium for those things.
Despite the IMF life-line, things (from a currency perspective) are going to get worse in Argentina, before they get better. Additionally, as previously discussed, despite currency devaluation, the inflation of prices has offset much of the devaluations, therefore, things haven't actually become much cheaper. That means that the scales haven't been tipped in favor of the foreign investor (something that needs to happen in order to entice foreign investment).
Plus bureaucratic and legal issues. I looked at taking a stake in a business down there about a year after Macri came in. Small deal, nothing like a forex play, but oh boy the fuckery. Lets just say the accounting was ... Artistic, and not because they were bad guys, but hiding money and greasing skids are accepted parts of competition.
I still dig around while I'm there, if only to make the trip a write off and get plugged into the city. But anything that matters involves significant inside baseball and most official interactions are an adaptation of "Esprando a Godot." Sorry Argentina, I'm not sophisticated enough to price that sort of risk.
That said, there are still strong underlying strengths, and by underlying, I mean deep in the bucket. Highest regional broadband penetration, a relatively educated population, a ton of unexploited minerals, oil, and gas. 50% of the country doesn't have a bank account, Still the most culturally significant country in South America. How they unlock all that I have no idea.
Wild Walleye
07-08-18, 17:46
Plus bureaucratic and legal issues. I looked at taking a stake in a business down there about a year after Macri came in. Small deal, nothing like a forex play, but oh boy the fuckery. Lets just say the accounting was ... Artistic, and not because they were bad guys, but hiding money and greasing skids are accepted parts of competition.
I still dig around while I'm there, if only to make the trip a write off and get plugged into the city. But anything that matters involves significant inside baseball and most official interactions are an adaptation of "Esprando a Godot." Sorry Argentina, I'm not sophisticated enough to price that sort of risk.
That said, there are still strong underlying strengths, and by underlying, I mean deep in the bucket. Highest regional broadband penetration, a relatively educated population, a ton of unexploited minerals, oil, and gas. 50% of the country doesn't have a bank account, Still the most culturally significant country in South America. How they unlock all that I have no idea.Let me know when you are going back to Bs As. Maybe we should meet up.
I bought and sold a company in Argentina in the late '00s. My local lawyers and accountants were excellent. We made a ton of money. I have looked at acquiring several businesses in Argentina, since Macri was elected, but I have a very strict discipline when evaluating ops. I think that this currency blow up is part of what I have been waiting for.
That said, there are still strong underlying strengths, and by underlying, I mean deep in the bucket. Highest regional broadband penetration, a relatively educated population, a ton of unexploited minerals, oil, and gas. 50% of the country doesn't have a bank account, Still the most culturally significant country in South America. How they unlock all that I have no idea.Except broadband, I think that’s been the issue with Argentina for the last 100 years.
Wild Walleye
07-23-18, 00:12
Plus bureaucratic and legal issues. I looked at taking a stake in a business down there about a year after Macri came in. Small deal, nothing like a forex play, but oh boy the fuckery. Lets just say the accounting was ... Artistic, and not because they were bad guys, but hiding money and greasing skids are accepted parts of competition.
I still dig around while I'm there, if only to make the trip a write off and get plugged into the city. But anything that matters involves significant inside baseball and most official interactions are an adaptation of "Esprando a Godot." Sorry Argentina, I'm not sophisticated enough to price that sort of risk.
That said, there are still strong underlying strengths, and by underlying, I mean deep in the bucket. Highest regional broadband penetration, a relatively educated population, a ton of unexploited minerals, oil, and gas. 50% of the country doesn't have a bank account, Still the most culturally significant country in South America. How they unlock all that I have no idea.Broadband is nice, but not the great equalizer it was promised to be.
As for natural resources, Brazil owns most of Argentina's.
Wild Walleye
08-30-18, 14:58
...and in order for things to "normalize" the devaluation of the peso needs to exceed inflation...I believe that we are starting to see this take place. The currency has been crushed, recently.
What is happening to prices? What are you guys paying for a cup of coffee, empenadsas and poontang?
Hey, W Squared .
I see that youre trying to get a handle on BsAs real-world inflation too.
What I do is get on the Coto Grocers website and look at the price of food staples (frequently updated). I then compare those prices to what I was paying during Dec of 17 (peso/us$ @ 19). For me, the price of domestic cheese, orange juice, milk, Coke/Pepsi is a good indication. I buy a lot of this during extended stays. Notwithstanding sales prices, I find that these items are pretty much the same as they were in Dec.
If you dont already have a price reference point, you can always start one. E.g. On day one note the Coto grocery item price, and compare it that price on, say, day 45.
Hope it helps!
I believe that we are starting to see this take place. The currency has been crushed, recently.
What is happening to prices? What are you guys paying for a cup of coffee, empenadsas and poontang?
Wild Walleye
08-30-18, 23:07
Hey, W Squared .
I see that youre trying to get a handle on BsAs real-world inflation too.
What I do is get on the Coto Grocers website and look at the price of food staples (frequently updated). I then compare those prices to what I was paying during Dec of 17 (peso/us$ @ 19). For me, the price of domestic cheese, orange juice, milk, Coke/Pepsi is a good indication. I buy a lot of this during extended stays. Notwithstanding sales prices, I find that these items are pretty much the same as they were in Dec.
If you dont already have a price reference point, you can always start one. E.g. On day one note the Coto grocery item price, and compare it that price on, say, day 45.
Hope it helps!Thanks. Yes, I am trying to get a grip on real prices. So, if I go to La Biela and am having my doble cortado and demi lunas, whilst contemplating getting some honey on my stinger, what are the prices? I have plenty of references from past time in Bs As. I am more curious to know if a cup of coffee is $0.50 or $2.00. How much is a pack of smokes? What is 30 mins at a privado?
Cheers.
Thanks. Yes, I am trying to get a grip on real prices. So, if I go to La Biela and am having my doble cortado and demi lunas, whilst contemplating getting some honey on my stinger, what are the prices? I have plenty of references from past time in Bs As. I am more curious to know if a cup of coffee is $0.50 or $2.00. How much is a pack of smokes? What is 30 mins at a privado?
Cheers.FYI -.
Of the three Independent girls I have seen recently, two have kept their price the same as 8 months ago and one increased her rates by about 15%, three months ago (she is high end). I did not question it, but would suspect it is due to the peso drop. And this was before the additional drop last week. I have also seen a few changes in restaurant prices, but to be honest, I don't pay that much attention to what each item costs.
Not sure if that helps you or not. Cheers!
Large normal coffee 70$.
Yuppie coffees as high a 335$.
Regular coffee with a ham and cheese on toast 145$.
Prices as of today, hope this helps.
I had a café con leche with two medialunas for $40 pesos yesterday at Once Station, the exchange rate was 37 pesos to the dollar or something like that so I guess that equates to $0.50 for a cup of coffee if you attribute half the cost to the medialunas. I see similar deals for two medialunas and a café con leche $70 everywhere which I guess equates to $1 for a cup of coffee. I did not check at Starbucks, Starbucks is selling a brand not just a coffee, probably prices will be much higher at tourist spots.
Large normal coffee 70$.
Yuppie coffees as high a 335$.
Regular coffee with a ham and cheese on toast 145$.
Prices as of today, hope this helps.
Wild Walleye
09-04-18, 10:36
Large normal coffee 70$.
Yuppie coffees as high a 335$.
Regular coffee with a ham and cheese on toast 145$.
Prices as of today, hope this helps.Thanks, that does help.
Bs As prices converted to USD:
Coffee: $1.82.
Yuppie coffee: $8.71 (yikes! Glad I am not a yuppie).
Reg coffee with ham/cheese/toast: $3.51.
For comparison, down the road, in the US (at Dunkin Donuts (their coffee sucks)):
Coffee: $1.89.
Yuppie coffee: $4.19.
Reg coffee with ham/cheese/toast: $5.89.
1 hour with a 6/7: $250.
I am guessing that Starbucks is only popular with foreigners and the wealthy.
The Argie Peso is starting to remind me of the Italian Lira, circa early 1980s. The key tipping point is when things get really cheap.
The price of pussy is not directly attached to the exchange rate, as the pussy is not used up like for example gasoline you can keep selling the same pussy over and over so the cost of pussy is imaginary and based entirely on the woman's immediate perceived needs for money or luxury items. The locals also have some limits of what they can pay for pussy, so it is not surprising that the cost pf pussy remains at a certain peso rate despite decrease in the value of the peso. Of course high end girls charging USD prices are just pulling a number out of a hat also. Just counter a USD price with a peso price reflecting an exchange rate of a year ago these chicas are often not math wizards they may go with a much lower peso price. Of course some will pull out their phone and do a calculation. But ultimately the price of pussy is largely imaginary so it won't always tack real prices.
FYI -.
Of the three Independent girls I have seen recently, two have kept their price the same as 8 months ago and one increased her rates by about 15%, three months ago (she is high end). I did not question it, but would suspect it is due to the peso drop. And this was before the additional drop last week. I have also seen a few changes in restaurant prices, but to be honest, I don't pay that much attention to what each item costs.
Not sure if that helps you or not. Cheers!.
Can you guys confirm that price listing?
https://www.expatistan.com/cost-of-living/buenos-aires
Wild Walleye
09-04-18, 14:12
Can you guys confirm that price listing?
https://www.expatistan.com/cost-of-living/buenos-airesGood reference. Thanks for posting.
Wild Walleye
03-05-23, 12:59
Argentina is saber-rattling over the Malvinas, again. This must mean that things on the domestic front are getting really bad. Any of you local's have opinions of the current state of affairs?
Argentina is saber-rattling over the Malvinas, again. This must mean that things on the domestic front are getting really bad. Any of you local's have opinions of the current state of affairs?You talking to me?
You are correct. Now that the World Cup is over some other distraction must come into play.
Although I do not live in Buenos Aires, I have been vacationing there since the $USD was at par with the peso. I spent all of January in BsAs and was appalled at what I saw. The downtown area is in shambles. Calle Reconquista ,which had many great restaurants and bars is almost completely vacant. Mattresses line the streets and doorways for the homeless.
Other areas have become equally as blighted. Very little seems to have recovered from the pandemic.
My prediction is that Argentina is no more than five years away from becoming the next Venezuela. Attitudes have very much changed. The formerly pleasant middle classes are now walking around in a foul mood. Petty crime is abundant. I witnessed purses and cellphones get snatched multiple times.
Before this decade is over, the residents of Recoleta and Palermo will be making asadas with their golden retrievers.
You can still have a good time for now, but be careful!
Frankols 70
03-11-23, 22:36
Before this decade is over, the residents of Recoleta and Palermo will be making asadas with their golden retrievers.
You can still have a good time for now, but be careful!The problem with socialism is that you eventually run out of other people's money.
https://www.youtube.com/watch?v=U-x2yEmUFXA
Seems like now would be a very favorable time to be wielding greenbacks in Argentina: https://www.cnbc.com/amp/2023/03/11/i-doubled-my-money-in-argentina-with-a-black-market-exchange-rate.html.
Wild Walleye
09-13-23, 23:29
Any of you old timer, expats want to share some info on the current environment on the streets of Bs As?
SimpleWrangler
10-23-23, 14:39
Any of you old timer, expats want to share some info on the current environment on the streets of Bs As?1 dollar = 1.000 or 1.500 ARS.
Have a nice dinner for 2, less than USD 50.
Don't go tourist, otherwise, could cost USD 200, may be more...
December it's a great time to go and have a great 2 to 3 week vacation.
Wild Walleye
11-20-23, 11:54
Cheers to Argentina for taking a big first step to recovery!
Cheers to Argentina for taking a big first step to recovery!I heard the plan is to switch to the US dollar for Argentina's legal currency. That would get rid of the worthless Argentine peso and help stop the outrageous inflation.
Cheers to Argentina for taking a big first step to recovery!How do you combat 50+ years of govt thievery, double digit inflation, unionists who have brainwashed the general public and an entire country of entitled fools who don't want to work very hard or very often.
Switching to Dollarization might not help as the $USD is in decline globally. I don't see how it helped Ecuador any.
Any ideas?
How do you combat 50+ years of govt thievery, double digit inflation, unionists who have brainwashed the general public and an entire country of entitled fools who don't want to work very hard or very often.
Switching to Dollarization might not help as the $USD is in decline globally. I don't see how it helped Ecuador any.
Any ideas?Just like the US.
Just like the US.So, in other words, just add to the problem then?
Just like the US.Double digit inflation. It hasn't averaged over 10% for a single decade in the last 50 years (https://inflationdata.com/Inflation/Inflation_Rate/Long_Term_Inflation.asp) and unionists who brainwash the population....in the land of union busters and very low union membership? I doubt it very much. I agree about the dollar being in terminal decline though.
Wild Walleye
12-07-23, 20:06
Double digit inflation. It hasn't averaged over 10% for a single decade in the last 50 years (https://inflationdata.com/Inflation/Inflation_Rate/Long_Term_Inflation.asp) and unionists who brainwash the population....in the land of union busters and very low union membership? I doubt it very much. I agree about the dollar being in terminal decline though.
I love Argentina. Not everything about the country but enough to visit more than 30 times (I also had financial interests in visiting). I love the food, wine, ladies (some of the most beautiful women in the world) and culture (excluding its love for leftist ideologies).
The dollar isn't going anywhere. There is a mountain of resistance to changing (not attitudes but hard cost and momentum).
Argentina's economy was the envy of the world circa 1916. Then, the leftists took over and it was skid row ever since. The "Dirty war" was between leftist factions not between decent people and the "Extreme right wing" as has been propagated in the media, press and literature.
Argentina would be fine if the people came to think that a hard day's work was worth working for...
Peter Sideburn
12-09-23, 03:03
IF 1 USD = 1500 ARS, then from what some have posted, independent friends are charging 300000 ARS (200USD)? This seems insane since the website listed below would indicate that one could rent 5 expensive furnished apartments for this amount. I am just trying to figure out the economy and am mostly interested in the Malbec, but this math seems way off. Curious what the Peso range would be if local. Writing a novel and need accurate info... ;).
1 dollar = 1.000 or 1.500 ARS.
Have a nice dinner for 2, less than USD 50.
Don't go tourist, otherwise, could cost USD 200, may be more...
December it's a great time to go and have a great 2 to 3 week vacation.
SimpleWrangler
12-10-23, 14:35
When in a crisis, you just need to calm down and look for opportunities.
Some girls are charging even more, because of the concentration of power of purchase.
However:
If you look for other sources (less expensive) you'll find cheaper prices.
IF 1 USD = 1500 ARS, then from what some have posted, independent friends are charging 300000 ARS (200USD)? This seems insane since the website listed below would indicate that one could rent 5 expensive furnished apartments for this amount. I am just trying to figure out the economy and am mostly interested in the Malbec, but this math seems way off. Curious what the Peso range would be if local. Writing a novel and need accurate info... ;).
Wild Walleye
12-10-23, 20:45
When in a crisis, you just need to calm down and look for opportunities.
Some girls are charging even more, because of the concentration of power of purchase.
However:
If you look for other sources (less expensive) you'll find cheaper prices.Agreed.
Always denominate your sport fucking activities in local currency. Never discuss USD in terms (until you have a deal in pesos and then you can offer the converted value in USD). This country is up the proverbial creek economically speaking. Commercial sex is commodity (i.e. There is lots and lots of it) and it is a "Luxury" (that is to say if you're starving you'll do without it). So, local impoverished mongers aren't buying.
In 2007 I could get a half hour with a great looking chica for about $27-35. The economic times back then were much better than they are today. So, inflation adjusted (US inflation not Argentinian) would make that about $40-50. I am willing to bet that there is plenty if good action at very reasonable prices. I hate to make it seem so mercenary-like but, the price of a commodity (in a free market) is the price the market (i.e. Customer) is willing to pay.
The local gentlemen are suffering and have no cash to lavish upon the ladies so what, exactly, is driving prices? What are their alternatives? Hold out for higher prices and go home penniless or bend over and bring home some cash?
There is an obvious disconnect when you find forum favorites and chicas that posses extra skills (like the ability to speak English). Those things will cost more.
I love Argentina. Not everything about the country but enough to visit more than 30 times (I also had financial interests in visiting). I love the food, wine, ladies (some of the most beautiful women in the world) and culture (excluding its love for leftist ideologies).
The dollar isn't going anywhere. There is a mountain of resistance to changing (not attitudes but hard cost and momentum).
Argentina's economy was the envy of the world circa 1916. Then, the leftists took over and it was skid't row ever since. The "Dirty war" was between leftist factions not between decent people and the "Extreme right wing" as has been propagated in the media, press and literature.
Argentina would be fine if the people came to think that a hard day's work was worth working for...Llll.
My quote you used was obviously referring to the US inflation (making the point the US inflation history was not as bad as Argentina's as claimed by another poster). Just for clarification.
As for your comments about Argentine history post 1916; the "leftists" did not "take over". Giving workers basic rights and a minimum wage isn't leftist, and the economy performed well until the depression of 1929. Where do you get your information from?
I was in BA recently. The blue rate exchange places on Florida and in Recoleta were giving 950:1 for $20US bills and 1000:1 for $100US bills. A $100 US bill would get you 100,000 pesos. Meanwhile the official rate was much lower. So converting blue was a no brainer.
For reference, most good quality escorts and massage (+options) chicas seemed to be in the 30000 - 50000 pesos range for an hour. Which is $30 to $50. There is also a small tranche at the $100 level. There are several cheaper and a few more expensive, but there is no need to go there.
I had dinner at one of the top parillas, with a bottle of wine it was about 40000 total for two people or $40. This would have been near $100 in the states.
Taxis and ubers were 3000 - 5000 pesos ($3-5 US) to cross multiple barrios. I remember 15-20 years ago the taxis being ridiculously cheap, like you didn't think twice about taking one. Then gradually over the years it became less and less of a deal. Well, those cheap taxi days are back.
The only boliche remaining in Recoleta is D'Lirio. It's not far from the old Madahos. It's nice but just "OK" by international standards. Asking price is $300US but $200US is readily accepted. While this is much higher than other options in town, it's the place with the highest quality chicas, and you get the night club experience of mingling with and choosing the one you like. For reference, rates at Madahos and Hippo in the 2010-13 era had risen approx. To the $150-$200 US range. All things considered and with the inflation in Argentina, the US price staying close to flat at the top club is not bad.
The craziest thing is that the largest bill is 1000 pesos. There is supposedly a 2000 peso note but I never saw one and it's uncommon. Remember 1000 pesos is the equivalent of $1 US. So to head out for a night of fun including a great dinner, drinks and a date from the top club you would need a stack of 1000 peso notes 3 inches thick. It was ridiculous. In addition to a bulging wallet, you need to stash some stacks of bills in your front pockets or get a money belt. Or pay in US.
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