CB investigating currency traders trading volume 1/3 normal, volume down 66%.
Peso up today. Government might be trying to intimidate currency trader, with investigations into tax evasion. Volume was only 1/3 of normal. Dollar was down today across the board, Brazil real was up, so peso probably would have followed real, but government might be trying to intimidate the traders. Volume down 66%.
[quote]Taos Turner.
Of DOW JONES NEWSWIRES.
BUENOS AIRES (Dow Jones)--The Argentine peso had its biggest daily gain in at least six years Tuesday, after it strengthened to ARS3.296 in unusually low-volume trade, compared with ARS3.387 on Monday.
"This was an extremely big gain today," said Francisco Diaz Mayer, a trader at ABC Mercado de Cambios. "In six years of operating in this market I've never seen the peso gain 10 centavos in one day."
Diaz Mayer said his colleagues were scratching their heads trying to figure out what happened.
"Nobody saw the (Argentine) Central Bank operate in the market today," he said.
Still, volume was low at around $322 million, or about a third of what it is normally.
Diaz Mayer said a combination of factors could explain, at least in part, why the peso gained so much ground.
First, he said Argentine tax officials and Central Bank agents were visiting banks and exchange houses, making inquiries and getting information about transactions.
"That seems to have really limited trading," Diaz Mayer said. "Volume was very, very low today."
The head of Argentina's national tax agency, AFIP, confirmed Tuesday that agents from his organization had launched a sweep to investigate tax evasion via the foreign exchange operations of local banks and exchange houses.
In an answer to a question during a press conference held to announce the agency's October tax collection data, AFIP Director Claudio Moroni said the investigations were being coordinated with the central bank. Moroni said the investigations would continue for the rest of the week, and he didn't rule out announcements of sanctions.
Meanwhile, a move Monday by the Central Bank to impose a minimum three-day holding period on the purchase of stocks and bonds probably also limited trade, Diaz Mayer said.
"The Central Bank is trying to make it harder to carry out transactions in the market," Diaz Mayer said.
Investors had been buying foreign stocks and bonds and then immediately selling them in New York, where they could deposit the dollars obtained from the deal. This allowed them to get dollars quickly without having to deal with burdensome Central Bank regulations in Argentina.
Bank workers have threatened to strike Wednesday, one day ahead of a national bank workers holiday, meaning the exchange market could be closed until Friday.
Bonds rose Tuesday in what traders said was partially the result of a technical rebound and partly the consequence of a bet on Argentina's short-term financial stability.
"There was a rally from the minimal values we've seen recently," said Mayoral Bursatil trader Adrian Mayoral. "It also could be that some of what we saw today was arbitrage between short-term and long-term bonds. It's logical that people are buying short-term bonds while dropping longer-term debt because Argentina will have more difficulty meeting its long-term obligations."
The shorter-term Boden 2012 dollar-denominated bond rose 0.62% in price terms, selling for the dollar equivalent of 162 pesos, to yield 52.84%. The bond also may have risen on the peso's strong showing, which potentially makes it easier for the government to repay dollar-denominated debt.
The longer-term benchmark peso bond fell 2.91% in price terms to ARS50, yielding 20.4%. A stronger peso implies lower peso-related tax revenue from exports. That could mean less revenue to repay peso-denominated debt.
The Merval stock index rose 6.19% to 1,123.1, led by the strong performance of index heavyweights Tenaris (TS) and Brazilian oil giant Petrobras (APBR)
Petrobras rose 13% to ARS56.50 and Tenaris, which makes steel tubes used by oil industry companies, rose 11.48% to ARS44.15. Both companies were up at least partly because of higher oil prices.
"There was a rally today," said Mayoral. "This was a technical rebound but one that was accompanied by the rest of the world, by expectations that the U. S. Election will usher in better economic policies."
-By Taos Turner, Dow Jones Newswires; 54-11-4590-2421; [email]taos. Turner@dowjones. Com[/email][/quote]
Expect a New Tax on Argentine Milk Next
Argentine cow clones may help boost milk output, lead to higher taxes.
[quote]BUENOS AIRES (Reuters) – Argentine scientists have found a way to make cows produce more milk by injecting them with a bovine growth hormone produced by cloned and genetically modified dairy cows.
Synthetic bovine somatotropin, which is also called rbST, is already injected into cows to boost milk production, but Argentine researchers say their method is cheaper and produces a natural bovine hormone.
Andres Bercovich, head of research and development at biotechnology firm Bio Sidus, said that if a cow would normally produce 5.3 gallons (20 liters) of milk per day, it could produce more than 6 gallons (24 to 25 liters) when it is injected with the hormone.
"It's going to be a cheaper method because it requires far less equipment and the only costs are what the animal needs," he told Reuters on Wednesday.[/quote]There's no reason the government shouldn't get their cut of the action if the farmers find a way to increase productivity.
What's that you say? The government should just be content with the extra revenue from greater sales? That's such an American notion. Even America is abandoning that outdated economic precept with its new administration. Here's the full link if anyone's interested: [url]http://news.yahoo.com/s/nm/20081105/sc_nm/us_argentina_cows_1[/url]
Somehow I don't believe Mrs. K
Argentine unemployment falls to 7.8 pct- president.
Thu, Nov. 6 2008, 20:01 GMT.
[url]http://www.afxnews.com[/url]
BUENOS AIRES, Nov. 6 (Reuters) - Argentina's unemployment rate fell to 7.8 percent in the third quarter, down from 8.1 percent in the same period in 2007, President Cristina Fernandez said on Thursday.
Unemployment in Latin America's No. 3 economy was 8.0 percent in the second-quarter of this year.
(Reporting by Cesar Illiano; Writing by Helen Popper) Keywords: ECONOMY ARGENTINA / UNEMPLOYMENT.
(helen. Popper@thomsonreuters. Com; +54 11 4318-0655; Reuters Messaging: [email]helen. Popper. Reuters. Com@reuters. Net[/email])
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According to the K's, they have a Tax Surplus, which is growing. Inflation not very high, and now unemployment is dropping. Just too hard to believe.
There is a familiar stench in the air!
[QUOTE=Tessan]Sounds like Redondo is off is medication to me.[/QUOTE]He can run but can't hide!
Argento
