Argentine Economy

[Tessan]

The NY Times has something in English on the nationalizing domestic and foreign grain trading.

TRIO DE JANEIRO — Argentine farmers, already suffering from their country's worst drought in more than a half-century, reacted angrily on Friday to reports that Argentina's president was contemplating nationalizing domestic and foreign grain trading.

Related.

In Parched Argentina, Worries Over Economy Grow (February 21, 2009)

Argentina's two main daily newspapers, La Nación and Clarín, reported on their front pages on Friday that the government of President Cristina Fernández de Kirchner was considering the move to effectively monopolize the country's most important export industry. They cited unnamed sources within the national tax agency.

Neither Mrs. Kirchner nor anyone else from her administration made any public statements on Friday, and government officials did not return calls seeking comment. Mrs. Kirchner will speak publicly on Sunday and has scheduled talks with farmers on Tuesday, according to Argentine news reports.

Analysts said an agricultural nationalization could be the latest move by Mrs. Kirchner to shore up fiscal accounts to ensure that Argentina could weather the global financial crisis and make payments on more than $18 billion in assorted debt obligations this year. In recent months she has nationalized the country's largest airline and taken over billions of dollars in private pension funds.

Farm groups characterized the possibility of nationalization as a move to pressure them to sell millions of tons of stored grain from previous harvests and thereby weaken their negotiating position with the government.

Nationalization could help Mrs. Kirchner obtain hard currency from export taxes on grain, which brought in $8 billion last year, 3 percent of Argentina's total revenues. Argentina has been struggling for dollars amid vast capital flight and has lost access to capital markets because of its history of economic mismanagement.

Farm industry leaders, who have been battling the government for a year now over the export taxes, said a nationalization would stiffen their opposition to the government. They want the government to lower export taxes to help them through the devastating drought, which economists estimate will reduce agricultural production by more than 15 percent this year. Falling grain prices are also taking their toll; wheat is worth less than half as much as it was last year.

While grain prices in Argentina were regulated as recently as 1991, nationalizing now, after a protracted boom, could be extremely difficult, industry officials said.

"I can't imagine how you could implement something like this," said Ricardo Forbes, the president of the Buenos Aires Cereals Exchange, in a televised interview on Friday night. He said just the talk of nationalization could further hurt the country's reputation as a reliable grain exporter. His organization issued a letter late Friday signed by numerous farm groups denouncing the idea of nationalization.

Since protracted strikes by farmers last year, they have been a thorn in the side of Mrs. Kirchner and her husband, Néstor Kirchner, the former president and current leader of the Peronist bloc. Mr. Kirchner in particular has tried to neutralize their growing political influence, accusing them of being greedy "coup plotters."

[Facundo]

There is talk by the government of "nationalizing wheat". This resulted in the peso closing today at 3.58 to US$1.

http://www.lanacion.com.ar/nota.asp?...15745&toi=6259

Also, today school teachers rejected a proposal to raise their annual salary by 20%. They want 36%. Therefore, primary schools will not open on Monday becasue teachers will be striking.

http://www.lanacion.com.ar/nota.asp?...15839&toi=6275

Also, construction permits for January and December fell 32% and 38% respectively.

http://www.lanacion.com.ar/nota.asp?...15745&toi=6256

The government is pissed with the USA because the CIA predicted violent uprisings will occur in Argentina due to the world-wide economic downturn.

By the way, ever since Gysel raised her prices she has been running specials at lower prices. She's definitely smarter than the school teachers and those in government.

[Tessan]

"Look, these cows are emaciated. They should be capable of four or five births, but I will need to sell them because there is no pasture. They won't be able to reproduce because they are too thin," he says.

"If I have to pay for food for them I won't make any profit. They will have to go for corned beef because they are in such bad condition," he adds.

There is no point to just leave them in the fields to die. My guess is they will sell them at any price, which mean next years herd will be down.

[Gato Hunter]

If that's the case I would never call that man a gentleman Sidney.

At least put the animal out of its misery at a rendering plant, corned beef or panceros. Some return is better than nothing.

I am not a member of PETA, and I eat lots of meat.

[MCSE]

When you say stopped feeding, do you mean he stopped feeding his herd and left them to die in the field?

Unfortunally yes. It happened during the 2001 / 2002 crisis even with the Falabella horses. Falabella horses are Unique. Smaller than Ponnies, you can still see a few on the Palermo Lakes, it was shocking seeing those horses (I've seen on TV) on the fields with no food at all. During the Menem presidence a place with chickens was abandoned, and chickens eaten each other. Those are cruel things about Argentina. I hope caws do not eat each other.

[Gato Hunter]

When you say stopped feeding, do you mean he stopped feeding his herd and left them to die in the field?

[Tessan]

Argentina in a few years down the line, may have to import meat, instead of exporting it, if the trend continues. The draught and the government policy, of limiting exports, to keep domestic prices low, are causing farmers to slaughter the cows that should have generated next year's herds. The fields are drying up, and if they buy food for the cows, they cannot make money.

http://news.bbc.co.uk/2/hi/americas/7905357.stm

[Facundo]

Based on the following article in the NYTimes, it appears the economic crisis and/or devaluation of the peso will occur rather sooner than later:

http://www.nytimes.com/2009/02/21/wo...nt&tntemail1=y

[MCSE]

Interesting breaking story in La Nacion regarding the controlled devaluation of the peso. Experts believe by year end the peso end will be around.

AR$4 -US$1.

http://www.lanacion.com.ar/nota.asp?...67456&toi=6264

I keep a spreadsheet with the evaluation and most of the time dollar go up on Fridays (not always) Mondays behavior are not predictable, and in general correction comes between Tuesdays and Wed. Of course, this is not every week, but in 3 years it's the most common.

High dollar it's good for me and for farmers, but a 1=1 would be ideal for those big corporations selling stuff to the local marketshare including gas co, water co, microsoftcore corporation, etc.

[Facundo]

Interesting breaking story in La Nacion regarding the controlled devaluation of the peso. Experts believe by year end the peso end will be around.

AR$4 -US$1.

http://www.lanacion.com.ar/nota.asp?...67456&toi=6264

[Tatshea Travel]

Come on guys.

Lets tone it down a bit. It's the " internets ", don't take is so serious.

Regards,

BM

That's what I'm saying.

Thank you Badman.

[BadMan]

Come on guys.

Lets tone it down a bit. It's the " internets ", don't take is so serious.

Regards,

BM

[Tatshea Travel]

It is my opinion that we must not let ourselves be carried away by this provokers like Marcelo Uribe.

The short time I spend in this forum showed me clearly that there are only two reasons for argies to join this forum: one is when they try to make business with us. The other is when they try to provoke us.

It is my experience when talking with this haughty nosed arrogant shit that call themselves argentinos that they despise us, specially we the monger type. You will see this shit dog Marcelo Uribe will not post any more. That's the fun for this poor brained silly people: to register, throw two or three posts like these ones, laugh about us with their fellow shit headed companions and never come back.

[Jackjack1]

Why do you come on to a site that obviously upsets your delicate little Argentino sensibilities so much?

Answer:

Your head is so far up your rear-end that you are well-hidden from the idiocies that go on here and will continue to be a government / idiocy apologist until you have nothing left.

We write about this stuff because it actually hurts a lot of us to watch a place that we otherwise enjoy and have sentimental feelings for tear itself apart. We can't understand how so many people can be so blind to how reality works and this is what is really being discussed.

Instead of displaying such an obvious bias against foreigners with no apparent reason, why don't you tell us where we are wrong and try to defend what we consider indefensible? At least then we could understand where your dislike stems from.

Guys, let's stop the bickering. We are all united in the fight against the torrent of global economic woes. It affects us all. Obviously Americans would not be living in Argentina or certainly wanting to visit there if not for the allure, the richness and the amazing culture that it has. The Argentinian economy is boosted by tourists and expatriots that are visiting or living there. The expats take advantage of a beautiful country that costs less to live in than many parts of the states. It's a win-win situation.

Jack

[El Queso]

The question is and I will give the answer,

Why do you keep on living in a place that disturbs you so much?

Answer:

Because you have been so dude all of your life that there is no other place in the world, at this point, where people could stand you so much as argentine people have already done.

Marcelo

Why do you come on to a site that obviously upsets your delicate little Argentino sensibilities so much?

Answer:

Your head is so far up your rear-end that you are well-hidden from the idiocies that go on here and will continue to be a government / idiocy apologist until you have nothing left.

We write about this stuff because it actually hurts a lot of us to watch a place that we otherwise enjoy and have sentimental feelings for tear itself apart. We can't understand how so many people can be so blind to how reality works and this is what is really being discussed.

Instead of displaying such an obvious bias against foreigners with no apparent reason, why don't you tell us where we are wrong and try to defend what we consider indefensible? At least then we could understand where your dislike stems from.