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I have heard from a couple clients of mine and a couple friends of a rumor that started in December. Well people are saying that the government might close the doors to the banks again in within the next month or 2. That means if you got cash in the banks you will NOT be able to get any of it.
The money grab from banks seems to recycle here roughly every ten years. I've been here twice when it happened (wouldn't put a nickle in anything here). They've reached the end of their rope and must now hang. Begged, borrowed and stolen everything available. The confiscation of private pension funds got them through last year. This "borrowing" (of course never to be paid back) of reserves was a sign of despiration.
My guess is the banks will be closed before another default, money seized, and replaced with more future worthless bonds. It's also time to issue a new currency. It will be called the Austral and will be exchaged at a rate of one Austral for every 100 pesos. For the purpose of paying foreign creditors it will be pegged to the dollar one for one.
Another sign of a desperate nation looking to divert the proletariate's attention from the forthcoming money grab, Argentina is again rattling sabers in Queen Elizabeth's court [url]http://www.dailymail.co.uk/news/article-1244325/Britain-hits-Argentina-launching-fresh-claim-Falkland-Islands.html?ITO=1490[/url]
This could be the last hurrah. My friends at the Circulo Militaire have been patiently waiting for their opportunity.
It sure does seem something is going on. See where Congress is going to evaluate the legitimacy of the country's debt / bonds.
WSJ:
[quote]Such an investigation would be reminiscent of a study carried out in Ecuador, which determined much of the country's debt was illegitimate and was used by President Rafael Correa as the evidence to default on much of the country's debts in late 2008.[/QUOTE][url]http://online.wsj.com/article/BT-CO-20100120-706381.html?mod=rss_Bonds[/url]
There's something very serious going on behind the scene or Christina would not have canceled her trip to China.
The Chinese are very important to the Argies. The Argies have resources the Chinese want and they have money, something the Argies don't.
Exon
[QUOTE=Exon123]There's something very serious going on behind the scene or Christina would not have canceled her trip to China.
The Chinese are very important to the Argies. The Argies have resources the Chinese want and they have money, something the Argies don't.
Exon[/QUOTE]Canceling the China trip was indeed a surprise. She is afraid to leave the country. Also cancelled trip to Uruguay for the inauguration of their new President. Sounds like the old girl is afraid of a Honduran coup.
[QUOTE=Damman]Canceling the China trip was indeed a surprise. She is afraid to leave the country. Also cancelled trip to Uruguay for the inauguration of their new President. Sounds like the old girl is afraid of a Honduran coup.[/QUOTE]New day, same old s--t.
Hard to imagine that the democratically elected president (regardless of one's like or dislike for her) of a nation of 40 million being afraid to leave the country for fear of being kicked out of office. However, considering the theft and subsequent spending of the citizens' retirement funds, she might be safer out of the country. A change in the front office to a more free market based philosophy would be a good thing.
Concerns over closing banks, restricting the movement of capital and devaluing the currency create further risk for investors. Add perpetual uncertainty and instability to anti-foreigner and anti-private enterprise biases and you can understand why foreign investors don't want to invest here and why Argentinians with any modicum of wealth keep it off shore.
That said, if this scenario unfolds in typical Argentine fashion, goods and services should be cheaper for dollar and euro denominated investors. That said, I suspect that chica prices will initially go up.
[QUOTE=BA Herald ]And what were the presidential reasons for shirking her place in the sun? No outburst of lofty patriotism in the bicentenary year or even a more narrow-minded nationalism but an explicit fear of leaving Vice-President Julio Cobos in charge, which is nothing more than a supreme confession of weakness.[/QUOTE]This quote form the BA Harold implies that the Vice President assumes temporary power, while the President is out of the country. Is this true? Why? In the USA the VP does not assume any power when the President is out of the country. With Modern communication there is no need.
[url]http://www.buenosairesherald.com/BreakingNews/View/23039[/url]
It is in the Articles of the Constitution I believe: absence VP assumes powers. Think she is afraid VP will call an emergency session of Congress.
[quote]Executive.
The Executive Branch is formed by the President (Art. 87) The Vice-president replaces the President in case of illness, absence from the capital, death, resignation, or removal.
The Vice-President doesn't belong to the executive branch. Curiously, it belongs to the legislative branch since he is also the president of the senate. (Art. 57)
The President promulgates the laws sanctioned by Congrees, and has veto power over them. The President directs international relations and is the Commander in Chief of the Army. In some cases, the President can issue emergency decrees.[/quote]
The Argentine Ambassador is lobbying the US Congress about the "Vulture Funds." The Vultures are not going to settle at the 2005 rate. The Vultures hold the keys to the kingdom for Argentina. They are pissed.
[url]http://www.diarioactualidad.com/noticias/14/61/articulo/32817/2010-01-20_denuncia_la_argentina_fondos_buitres_al_congreso_norteamericano.html[/url]
Google Translation:
[quote]The Argentine government has sent a letter to all U. S. Congressmen to raise the position of Argentina and denouncing the "vulture funds" that supposedly "boycotting" the solution to the problem of debt in Argentina.
Here are some key paragraphs of the text signed by the ambassador in Washington:
"Once again I turn to you (the Congress) to inform you about the status of negotiations to resolve the situation of the small group of investors in Argentine bonds that decided to reject the Argentine government's offer made in 2005. As you know, the 81% of all holders of bonds issued under U. S. Law their status resolved in agreement with our government. "
? Vulture funds conducted an intense lobbying in the U. S. Congress to pressure Argentina to pay off bonds that entered the Exchange 2005 and have been buying them for pennies after the default. Nevertheless, few hours after the Argentine government announced in December its intention to reopen negotiations with creditors who did not accept the swap, 2005, vulture funds did not agree. ".
Follow the letter: "After the Argentine Congress recently decided overwhelmingly to authorize the Executive to negotiate a new exchange with those who accepted the offer in 2005, the Economy Ministry presented all the documents immediately to the Security and Exchange Commission estimated to reach a final agreement in the coming weeks. With this important step, the Argentine people will have completed the sad story of a debt dating back to the dictatorial regime that hit Argentina between 1976 and 1983? "
"• One of the main arguments of vulture funds is to reject the acceptance rate of offers of 2005, but it reached three of every four bondholders, they consider inadequate. They know that the reopening of negotiations can give place at a rate of accessions nearly 90% of total debt that went into default in 2001, this level of agreement pulverize the argument that Argentina's offer is unacceptable? " continues the text.
Then the ambassador denounced the alleged practice of vulture funds "? Specialize in the use of aggressive tactics and harmful to good relations between our countries. These vulture funds have done so much damage in different countries in Africa, Latin America and Asia has led to a group of his colleagues to introduce the bill STOP THE VULTURES FUND ACT.
He concludes: "Mr. Representative, is my purpose in this letter to reiterate the firm intention of my government to move forward with policies to overcome the partial default state which is Argentina, which naturally includes complete negotiations with holdouts not benefited from the exchange in 2005. I also emphasized that the only way is to repeat the sustainability criteria that governed the supply of 2005 and enabled the payment of debt holders who trusted and contributed to Argentina's recovery. In light of this unheard of wanting to prevent a final solution to the question I ask is that you reject any attempt by vulture funds and their lobbyists to achieve their evil goal. "
In this way, Argentina rejects certain lobbies pressure, letter in which even referred to Senator Kennedy, and which provides a listing of vulture funds in question and which also speaks of the relationship bilateral between Argentina and the United States:
"With regard to our present and immediate future, our two countries are working together in Haiti and the G20. The President has invited Barack Obama President Cristina Fernandez de Kirchner a summit on nuclear security, while our labor minister Carlos Tomada will meet with Secretary of Labor, Hilda Solis to coordinate efforts in the fight against slave labor and advance the creation of decent work for our peoples, "finally closes Hector Timerman Ambassador his letter, dated today.[/quote]
[QUOTE=Damman]It is in the Articles of the Constitution I believe: absence VP assumes powers. Think she is afraid VP will call an emergency session of Congress.[/QUOTE]I believe that her major concerns are his ability to enact things (that she specifically opposes) in her absence. They both have different benefactors and she has certainly been punch a few well known benefactors in the nose. Perhaps, she is concerned that the VP would seek to right some of those perceived wrongs if she was out of the country.
[QUOTE=Wild Walleye]I believe that her major concerns are his ability to enact things (that she specifically opposes) in her absence.[/QUOTE]Yeah like, say, an order withdrawing the police from in front of the Central Bank so Redrado can get back to work. What a pathetic tactic. I read an article about this in today's paper, but is she really stooping to this level?
Nothing like bringing to bear your police power to effectively permit you to steal $6.5 billion from the Central Bank. I guess Chavez is tired of loaning them money, too. With inflation in Argentina being so low, the poor guy can't get a decent return on his investment.