[QUOTE=Schmoj]quality clothing are as much if not more.[/QUOTE]I paid about 600 dollars for a Daniel Hector suit, tie, leather shoes and leather belt. I can't comment on the quality yet but the same would be about double in Europe.
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[QUOTE=Schmoj]quality clothing are as much if not more.[/QUOTE]I paid about 600 dollars for a Daniel Hector suit, tie, leather shoes and leather belt. I can't comment on the quality yet but the same would be about double in Europe.
[QUOTE=Sidney]''To prevent anything untoward from happening between now and 2011, K's need to stop inflation, acquire sufficient energy, placate the angry farmers, and change C's image. These seem impossible. K 's are so used to getting their way that they react negatively towards any opposition! There are never negotiations. How will they act if much of the country turns against them?''[/QUOTE]2011 is just a short time and if the world keep on favoring Argentina with high prices there will be little problems
Tuesday, May 20, 2008
Another Argentina Default?
Argentine President Cristina Fernandez visits a textile cooperative in Jujuy (top) recently and talks with her economy minister, Carlos Fernandez, on Monday (above) (Photos: Argentine President's Office)
Will Argentina default on its debt for the second time in a decade? Three experts share their insight.
BY LATIN AMERICA ADVISOR.
Inter-American Dialogue.
Since Argentine President Cristina Fernandez took office in December, Argentine bonds have fallen 19 percent, increasing speculation that the country could default on its debt for the second time in a decade. Do you think Argentina will default? What must Argentina do to minimize the risk of default?
Miguel Kiguel, Executive Director of EconViews and a former Undersecretary of Finance and Chief Advisor to the Minister of Economy in Argentina: In recent weeks investors have become more concerned about the possibility of a new Argentine default. One critical question is whether these concerns reflect a deterioration in the economic fundamentals, e. G. In the ability to pay, or if instead they are related to a perception that there is less willingness to pay. The financial requirements for this year are only $3.5 billion, a figure that the government can easily raise in the local market. Perhaps the concerns reflect the roughly $10 billion that the government needs for 2009. However, our estimates indicate that it can raise around $5 billion from domestic institutional investors and in a worse-case scenario there is room under current legislation to obtain around $2.5 billion in temporary advances from the Central Bank. Of course, one can get worried about 2010, but to be honest the problem is not the capacity to pay but the perceived willingness to pay. Using almost any measure of creditworthiness, Argentina should be able to meet its financial obligations in coming years. The risks appear in extreme scenarios where Argentina has no access whatsoever to the financial markets for a prolonged period. While the risk of default is not nil, the economic fundamentals are still in good shape, and the spreads appear to have overreacted. They are primarily driven by an intense negative mood that was generated by the manipulation of the official inflation rate and by the stubborn position that the government has taken in the negotiations with farmers. While the rigid attitude could prevail for some time, and hence the spreads could remain high during that period, we expect that the political system will eventually work and that the country will again access international financial markets. It's the politics this time, and the problem is that investors understand the evolution of economic crises much better than political ones.
Claudio Loser, Senior Fellow at the Inter-American Dialogue and former Head of the Western Hemisphere Department at the International Monetary Fund: Argentina's debt has been growing steadily since the country's authorities reached a deal with bondholders in 2005. At present, the debt of the public sector is at about the same level as before the 2001 default, at some $150 billion. Seen from that perspective, there may be serious questions about the sustainability of external indebtedness. However, circumstances are considerably different than they were seven years ago, even as there are serious problems of economic management in other areas. First and foremost, Argentina was able to restructure debt equivalent to about one-third of the total stock outstanding at very favorable terms, specifically a 40-year maturity and low interest rates. In addition, the country has reduced its debt obligations with international financial institutions, like the IMF and the World Bank, and has replaced them with expensive but long-term loans from Venezuela, and also with domestic issuances, that tend to be more stable. Furthermore, Argentina is still recording a trade surplus, reasonably strong (although weakening) public finances, and high levels of international reserves, while the debt burden as a proportion of GDP has been declining and is now at a level equivalent to 50 percent of GDP, well below the 150 percent observed in 2002. Under these conditions it is unlikely that the government considers itself in a situation close to default. Nonetheless, if conditions deteriorate the authorities may be tempted, against good judgment, to move in the direction of a default, although not in the near future.
Vladimir Werning, Vice President at JP Morgan Chase & Co.: The market is braced for a 35 percent probability of a default on hard currency debt considering the 620 basis point (bp) spread over swaps on five-year Argentine CDS contracts. And bonds are trading even cheaper: five-year dollar debt is priced at a spread of 950 bp above US Treasuries, and inflation-linked peso debt trades at a real spread of 1230 bp above US TIPs. While Argentina has ample capacity to pay its debt, market prices are reflecting investor doubts over its willingness to do so for good reasons. The market doubts arise because authorities have 1) hit a budget constraint but eluded the opportunities to reconcile differences over tax policy with farmers; 2) systematically postponed a conventional policy response to high and rising inflation; 3) discarded the use of reliable macro statistics in a way that suggests disinterest in confronting economic reality that entails political and financial costs; 4) repeatedly sacrificed economy ministers that offered ideas that moderately deviated from the policy status quo; and 5) increasingly regulated and segmented goods and financial markets with a mind to controlling the price discovery mechanism, to mention a few issues. The market is also concerned that authorities do not realize that their reliance on market financing is greater than acknowledged: for instance, in 2008 given $5.7 billion of amortizations to private creditors and $3 billion of issuance in the market alongside $6.5 billion of interest indexation and capitalization, Argentine risk held by investors is rising by about $4 billion on a net basis. While local pension fund capacity to fully absorb Treasury debt issuance in 2008 is comforting, higher issuance requirements in 2009 raise market concerns. Of course, with $50 billion in Central Bank reserves, a $12 billion trade surplus, and 3.8 percent of GDP primary surplus, Argentina has a lot of insurance it can tap in order to survive outside the market for a long period of time. Yet this is of limited comfort to investors who require that the credits they invest in not only have contingent strategies during times of financial stress but also an inclination and a strategy to come back to the market to secure minimum financing over a reasonable timeframe—which is what Argentina currently lacks.
[QUOTE=Sidney]Christina says that poverty is declining. INDEC+Christina say inflation is 8%! Other authoritative reports believe inflation is 30%! Who to believe?[/QUOTE]The government says it has an $869 million dollar budget surplus this year, as tax income rose by more than 50 percent. Also that the central bank holds about 50 billion US dollars in reserves. They spent about a billion holding the peso, so it probably 49 now.
With these large budget surpluses, why is the governments dept load going up? It make no sense. I agree with Sidney, this gov is lying about inflation, so it can pay less on inflation-protected bonds, thereby stealing money from people who brought those bonds. Its lying about the poverties figures, since the gov. Calculates the poverty figure using 8% inflation. If you assume 20% inflation, poverty is way up in Argentina. Inflation is more like 30%, anyone who been here a while can see it. so Poverty is Way up.
So if the gov has such a large surplus, why is the dept load going up where is the money going? Anyone know? Or is it a lie?
Also with the Farm strike, gov income going to go down. Does not look good as of today.
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This is from Bloomberg.
Soybeans Surge After Argentina Farm Talks End Without Tax Deal.
By Jeff Wilson.
May 23 (Bloomberg) -- Soybeans rose the most in two weeks after Argentine farm leaders said negotiations with the government failed to end a two-month dispute over export taxes, raising demand prospects for dwindling U. S. Inventories.
'The meeting went badly,'' Eduardo Buzzi, president of the Agrarian Federation, told reporters after the talks in Buenos Aires. Buzzi said the outcome of yesterday's meeting makes it harder to continue talks and he called for a strong showing at a rally this weekend. U. S. Inventories before the harvest are forecast to plunge 75 percent from a year earlier.
'The failure to resolve the ongoing dispute between Argentinean farmers and the government is likely to prove supportive for soybean prices,'' investment bank Barclays Capital said today in a report to clients. 'This was the second time since March that both parties have tried to resolve the crisis, but have arrived at no amicable solution.''
Soybean futures for July delivery rose 38.25 cents, or 2.9 percent, to $13.63 a bushel at 10:33 a. M. On the Chicago Board of Trade. A close at that price would be the biggest gain for a most-active contract since May 9. The contract is still down 1.1 percent for the week.
Most-active futures before today had risen 67 percent in the past year and touched a record $15.865 on March 3.
Roads Blocked.
The failure of the talks in Argentina threatens to worsen a dispute in which farmers blocked roads and withheld supplies, causing food shortages and halting grain exports. The country is the third-largest exporter of soybeans behind the U. S. And Brazil and the biggest shipper of vegetable oil and animal feed made from the oilseed.
Farmers and opposition leaders will rally in the agricultural city of Rosario on May 25, the same day President Cristina Fernandez de Kirchner holds a rally celebrating the anniversary of the revolution that led to Argentina's independence from Spain.
Argentine production of soybean pellets, used as animal feed, slipped 50 percent to about 904,700 tons in March from 1.82 million tons a year earlier, government data show. Soybean- oil production plunged 51 percent to about 225,800 tons from 457,200 tons a year earlier.
Soybean and soybean-product exports are rising because overseas buyers are shifting to U. S. Supplies rather than hope shipments from Argentina won't be disrupted, said Jerry Gidel, a market analyst for North American Risk Management Services Inc. In Chicago.
U. S. Exports.
U. S. Soybean-export sales from Sept. 1 to May 15 have climbed 3.6 percent to a record 29.47 million metric tons from a year earlier, USDA data show. Sales of U. S. Soybean oil from Oct. 1 to May 5 have doubled, and sales of animal feed made from soybeans are up 6.5 percent.
Soybean processors have converted 1.241 billion bushels of soybeans into animal feed and cooking oil since Sept. 1, up 2.7 percent from the same period a year earlier, Census data show. Soybean inventories at processing plants fell 13 percent at the end of April from a year earlier.
'People are worried the situation will get worse before it improves,'' Gidel said. 'There's a lot of uncertainty going into the weekend.''
Soybeans are the second-biggest U. S. Crop, valued last year at $26.8 billion, government figures show. Corn is the biggest, with a value of $52.1 billion in 2007.
To contact the reporter on this story: Jeff Wilson in Chicago at [email]jwilson29@bloomberg. Net[/email].
Last Updated: May 23, 2008 11:39 EDT
[url]http://www.bloomberg.com/apps/news?pid=20601086&sid=aUdZ0KdV7HGQ&refer=latin_america[/url]
[url]http://www.bloomberg.com/apps/news?pid=20601012&sid=a_fcE2S.MK2g&refer=commodities[/url]
Argentina set to lose IMF loan.
DEBT-WRACKED Argentina is unlikely to receive a financial bail-out from the International Monetary Fund, sources said, leaving the country facing a possible return to hyperinflation and economic chaos.
A delegation from the IMF has just arrived in Argentina to decide whether to grant the country fresh aid, but fund sources said the £7 billion remaining under an existing but frozen £15bn loan package would not be released.
Instead, Argentina would only receive enough financing to pay back what it already owes the Washington-based lender this year - about £3.5bn.
"What they have to do, they can do it alone," one source at the IMF said, "This is a case where what they need is adjustment, it is not financing. This is for their own good and they should understand that."
Before the IMF team arrived, hopes had been high in Argentina that the talks would lead to the resumption of international aid after the IMF froze funds in December after the country failed to keep spending in check.
But the IMF sources said the talks were more concerned with ways to build a foundation for a credible economic platform.
The toll of the economic crisis on Argentina has been heavy. Since December, the government has fallen after riots left 27 dead and the economy has ground to a standstill.
Mongers-
This article must be from late 2001, it is way outdated, this guy who posted this must be a jackass. Argentina paid off the IMF completely about two years ago so they would not have to answer to them anymore.
Suerte,
Rock Harders
[QUOTE=Posthaste]Argentina set to lose IMF loan.
DEBT-WRACKED Argentina is unlikely to receive a financial bail-out from the International Monetary Fund, sources said, leaving the country facing a possible return to hyperinflation and economic chaos.
A delegation from the IMF has just arrived in Argentina to decide whether to grant the country fresh aid, but fund sources said the £7 billion remaining under an existing but frozen £15bn loan package would not be released.
Instead, Argentina would only receive enough financing to pay back what it already owes the Washington-based lender this year - about £3.5bn.
"What they have to do, they can do it alone," one source at the IMF said, "This is a case where what they need is adjustment, it is not financing. This is for their own good and they should understand that."
Before the IMF team arrived, hopes had been high in Argentina that the talks would lead to the resumption of international aid after the IMF froze funds in December after the country failed to keep spending in check.
But the IMF sources said the talks were more concerned with ways to build a foundation for a credible economic platform.
The toll of the economic crisis on Argentina has been heavy. Since December, the government has fallen after riots left 27 dead and the economy has ground to a standstill.[/QUOTE]Found the article, it was on google news, as a new story. But if you go to the bottom of the page, it says Last Updated: 05 April 2002 12:00 AM. Think google fuck up. If this stuff where for real, there should be hundeds of articles on it, but this is the only one.
[url]http://edinburghnews.scotsman.com/business/Argentina-set-to-lose-IMF.2315839.jp[/url]
Tue, May 27 2008, 21:03 GMT.
[url]http://www.djnewswires.com/eu[/url]
Argentina Central Bank Firms Bonds, Peso; Stocks Down On Oil
By Drew Benson
Of DOW JONES NEWSWIRES
BUENOS AIRES (Dow Jones)--The Argentine Central Bank apparently intervened in local markets Tuesday to buy bonds and sell dollars in a bid to firm up the peso and debt prices as it was unclear what the next step would be regarding stalled farm talks, traders said.
A central bank spokesman said he wouldn't have information about the day's apparent intervention until later Tuesday.
[url]http://www.fxstreet.com/news/forex-news/article.aspx?StoryId=7ce59972-88b6-4b7c-9a73-77174702e247[/url]
May 28 (Bloomberg) -- Argentina's farmers will stop selling crops and livestock until next week in the third protest in two months over export taxes, after the government canceled talks.
Farmers will start withholding newly harvested corn and soybeans today, and livestock producers will stop sending cattle to slaughterhouses tomorrow, Mario Llambias, president of the Argentine Rural Confederation, said yesterday at a press conference in Buenos Aires. The sales disruptions are slated to end June 2, he said.
Protesters will also prevent trucks carrying grain to export terminals and disrupt domestic livestock and meat shipments, Llambias said. Blockades in March led to food shortages and increased consumer prices. The government called off talks May 26, a day after farm leaders threatened new protests during a rally by more than 300,000 supporters in the port town of Rosario, 300 kilometers (188 miles) north of Buenos Aires.
Full article
[url]http://www.bloomberg.com/apps/news?pid=20601086&sid=ah7tYabavqjg&refer=latin_america[/url]
Tessan,
Thank You for your posts.
They're very informative.
Exon