Argentine Economy

[QUOTE=Sidney]I would describe the recovery as ''a dead cat bounce''! It is not likely to be sustainable. The current inflation (much higher than reported) wage cost inflation, and price controls make a sustained recovery less likely. This is in addition to Kirchner's incredibly stupid economic policies, an undervaled peso, protectionist policies, anti-investment policies, no credit available, contracts are suspect, crooked courts, mafia, bureaucracy, difficulties to return capital to AR, high export taxes, anti-agrarian policies, coveting socialist countries and not capitalist countries, etc. Have I left out anything? Although the fall election seem like a sure thing for Kirchner, it all could fall apart with a rapid rise in inflation. Or rapid inflation after the election. Then what? Kirchner will become a ''lame duck''. And political and economic chaos could ensue.[/QUOTE]Has anyone ever heard the one about Chicken Little? I should've learned to use the ignore feature.

Referring to the previous quote by Sidney, I am in total agreement. This latest 'dead cat bounce' will lift the Argentine economy about to where it was in 1998. But it will not go much higher.

It is simply incredible that the present Argentine government can institute policy after policy that have the effect of putting a lid on economic growth.

Lavagna, who orchestrated the beginnings of this dead cat bounce before he was fired by the Kirschners, once said that the Kirschners think they understand economic models but in reality, Lavagna said, the Kirschners are clueless when it comes to understanding the economy

But Argentina does not have the worst economic model in the world. That award goes to Castro. In 1959 Argentina and Cuba had about the same average per capita income. Now, fifty years later, even though Argentina has not had anything near a stellar economic preformance, Cuba has one fourth the per capita income as Argentina.

The moral is, it could be worse.

From Bloomberg today. Not a pretty picture.

[url]http://www.bloomberg.com/apps/news?pid=20601086&sid=apR.I6Ia3ypE&refer=news[/url]

Maybe they fix all the old planes they have sitting on the ground. Those 737-200's are some really old planes, I am betting they are older than I am. Nobody even flies them anymore in the US.

That is 17 of the 29 planes in the fleet.

I wonder if the AR govt will be on the hook for the order that Grupo Marsans placed with Airbus last year.

After they get it up and running it will be sold to some politicians friend for a large bribe.

I hope this doesn't turn into a flame war between respondents.

With the slow disintegration of the Argentine economy of which the inflation is a part (whatever the correct rate) at what point does this begin to make itself manifest in the Dollar / Peso exchange? I understand that Argentina has or had a lot of foreign assets or bonds or money or whatever that they have been selling to maintain the 3-1 ratio. Further I understand that the dollar hasn't been doing that well worldwide over the last few years (with a recent bump up in the last month or so) but if the Argentine economy is doing worse than the EEUU economy it seems to me that at some point we should start getting more Pesos for Dollars.

Just wondering.