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Latam Investor – Argentines Macri Miracle Ends in Default

When Mauricio Macri was elected in 2015 it seemed to herald a new era for Argentina. Now it looks like being more of the same. In August Buenos Aires announced that it would reprofile its debt. In effect it’s another default, with investors having to take a write down for having lent to the Argentine government for the fourth time in the last 30 years and the ninth time since independence from Spain. It’s a sad culmination to a presidency that began with such hope. When Macri came to power his early moves,…

Argentina’s beleaguered government imposes capital controls

Fear of a return of the authoritarian and highly corrupt previous Kirchner government provokes a market crash, forcing the president’s hand When Maurico Marci was elected president of Argentina in 2015, one of his first acts was to abolish capital controls that restricted buying and selling of the peso. The move symbolised Argentina’s pivot back to open markets and liberal economic reforms under his rule. On September 1st, after weeks of market turmoil, Mr Macri was forced to issue a decree reimposing controls…

Economic Misery in Argentina as reforms are slow to take effect

Since taking office more than three years ago, President Mauricio Macri has broken with the budget-busting populism that has dominated Argentina for much of the past century causing crisis after crisis, embracing the grim arithmetic of economic orthodoxy. President Macri has turned away from left-wing populism. He vowed to shrink Argentina’s monumental deficits by diminishing the largess of the state. The trouble is that Argentines have yet to collect on the other element the president promised: the…

Argentina becomes a magnet for bargain hunters as assets collapse

Argentine assets have tumbled so far, so fast that a few stout-hearted investors say it might be time to buy. “Find me a high-yield sovereign country with an IMF program paying so generously,” said Jean-Dominique Butikofer, the Atlanta-based head of emerging-market fixed income at Voya Investment Management, which oversees about $205 billion. “We can agree on the growth outlook, inflation running unexpectedly out of control, the debt dynamic after currency depreciation and worrying technicals. But at…

Reasons For The Weakness Of The Argentine Economy

Argentina has been “printing money for the people” MMT-style for many years. Its wrongly-called “inclusive monetary policy” of the past – print money to finance massive government spending – has driven the country to massive inflation and depression. This is the main reason why a country with an excellent education, human capital, and high economic potential has third-world inflation rates. Argentina inflation rose to 54% annualized this week. Bonds spreads soared to 854 Bps, the two-year…

Argentina has the World’s Worst Currency: Shattering Home Buyers’ Dreams

Homes in Argentina are priced in U.S. dollars even though buyers can only take out mortgages in pesos, the world’s worst performing currency against the greenback. And that’s only where the pain begins. Argentina’s once thriving housing market — an example of its pro-business turnaround under President Mauricio Macri — has fallen victim to both the peso’s 50 percent plunge this year and soaring interest rates which exposed a convoluted property-buying process. Decades of economic booms and…

Argentina The here and now: towards a more competitive country

Today more than ever it is important to emphasize that achieving a competitive economy remains one of Argentina’s outstanding objectives. Given the fact that the most competitive countries in the world are the ones that are the most developed and, in most cases, have less inequity, only a significant leap in our competitiveness will allow us to go through a sustainable path of economic growth. Structurally, a country is competitive when under open market conditions it has created and maintained the conditions…
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