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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.
[URL]http://www.bloomberg.com/news/articles/2015-08-25/oil-at-77-argentina-marches-to-a-different-drummer?cmpid=yhoo[/URL]
Tres3.
Argentina: Great Economists, Awful Economy.
By Noah Smith.
[URL]http://bv.ms/1SHmcwF[/URL]
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.
[URL]http://www.miamiherald.com/news/local/news-columns-blogs/andres-oppenheimer/article38452695.html[/URL]
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?
[QUOTE=HotRod11;446453]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?[/QUOTE]For one thing, I think it's safe to assume that somehow the dollar will get stronger.
Jajajajajaja!
Jax
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!!!! :-).
[QUOTE=Gandolf50;446473]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!!!! :-).[/QUOTE]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.
[QUOTE=Gandolf50;446473]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!!!! :-).[/QUOTE]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.
[URL]http://finance.yahoo.com/news/american-airlines-stops-taking-payment-argentine-currency-192148757.html[/URL]
Tres3.
[QUOTE=Jackson;446476]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.[/QUOTE]Does the "National Sales Tax" include the VAT? If not, that tax amount must also be included in the sales price.
Tres3.
[QUOTE=Jackson;446476]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.[/QUOTE]LOL!! You would think with 121% tax they would encourage imports!
[QUOTE=Tres3;446478]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.
[URL]http://finance.yahoo.com/news/american-airlines-stops-taking-payment-argentine-currency-192148757.html[/URL]
Tres3.[/QUOTE]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.