MERVAL Indice Merval

[profiterol]

Así nos ven: (Finantial Times)

Argentina: A profligate president
By Jude Webber

Published: February 18 2010 22:39 | Last updated: February 18 2010 22:39


The leading lady is both tough and glamorous; betrayal, back-stabbing and intrigue are rife – and there are plenty of instalments still to come.

This is a real-life drama unfolding in Argentina and starring the couple that runs the country. It revolves around a battle for control of the central bank and billions of dollars of its reserves waged by a government in default and virtually cut off from international credit.

The saga began in December when President Cristina Fernández – whose government faces litigation from unpaid creditors, almost a decade after Argentina defaulted on nearly $100bn – decreed the transfer of $6.5bn (€4.7bn, £4bn) of reserves to the government to pay off debt, unleashing an unprecedented political crisis that has exposed her desperation to find revenues without reducing spending.

The 2001 meltdown followed the collapse of the decade-long peg of the peso to the dollar at parity, which in turn pushed the country into what Ms Fernández’s husband, Néstor Kirchner, president from 2003 to 2007 and widely seen as the power behind his wife’s throne, simply calls “hell”.

As economic recovery spurs renewed enthusiasm for the emerging markets of Latin America, this latest crisis provides an uncomfortable reminder of the perils of a country without access to international markets spending beyond its means.

The story also has resonance elsewhere. Greece, struggling to stave off default a hemisphere away, is staring into a similar abyss. “The lesson for Greece is that you can’t have an expansionary fiscal policy with a fixed exchange rate,” says Martín Redrado, the central bank chief fired in February by Ms Fernández for refusing to hand over the reserves.

In Buenos Aires the fiscal situation does not look promising. In 2009 Ms Fernández’s government spending bill rose by about 30 per cent compared with 2008 and shows no sign of slowing, says Daniel Kerner of Eurasia, a consultancy. Heavy taxes on the farm sector, combined with economic recovery, have helped boost state coffers; tax revenues hit a record in January. But economist Luis Secco says spending grew twice as fast as revenues in 2009 once exceptional income was stripped out. Meanwhile the government has to find an estimated extra $7bn to ensure it meets its debt repayments this year.

Ms Fernández says it is “logical” to use reserves to pay off debt, since they offer the cheapest form of financing available. (The country managed to borrow from Venezuela for a while but rates were punitively high.)

Some economists agree that it can indeed make sense in certain circumstances. But in this case the use of presidential decree rather than congressional debate has raised questions about the government’s real motives for commandeering the central bank’s funds. “I think they want to use the reserves for current spending ... no one doubts that now,” says Luis María Corsiglia, a former director at the central bank.
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The contrasts with its neighbours are stark. Brazil, a fellow member of the Group of 20 leading nations, forms one of the four fast-growing emerging Bric economies along with Russia, India and China. Chile, just across the Andes, has recently joined the rich nations’ Organisation for Economic Co-operation and Development.

Argentina, whose largely European population is accustomed to looking down on its neighbours, has become a laggard. In 1993 its per capita gross domestic product in US dollar terms was twice that of Brazil and Chile, and its free-market reforms during the same decade made it a favourite of the pro-market Washington consensus. But within a dozen years, the other countries were streaking ahead. “Brazil’s economy is five times the size of Argentina’s and the financial system is 20 times in terms of credit,” says Guillermo Glattstein of Banco Santander Río, Argentina’s leading private sector bank. “We could have aspired to that if it hadn’t been for the last decade.”

The tragedy is that Argentina entered the 20th century as one of the world’s richest countries and left it an international financial pariah. For many, it has now quite simply become invisible or irrelevant. The country’s assets, once a core holding in emerging market portfolios, are considered rich fodder for speculators and vulture funds but too risky for many others. Even with the central bank crisis in full swing, bankers at January’s World Economic Forum in Davos had nothing to say. “There was no mention, no nothing,” says one delegate. “It’s the worst relationship when you are ignored.”

Ms Fernández’ government has made a speciality of surprising investors with unpredictable and unorthodox policy moves. Defeated in her attempt to raise taxes on farm exports in July 2008, she bounced back with the snap nationalisation of private pension funds in a move widely seen as a brazen asset grab to fund spending.


More of the same, then, is likely to mean more inflation. This is particularly worrying in a country with bitter recent memories of hyperinflation, and where accuracy of official consumer price data has been in doubt for the past three years, to the extent that the central bank under Mr Redrado stopped using them. The government says inflation was 7.7 per cent last year; private economists reckon it was nearer double that.

Argentina is seeking to revive its fortunes with its forthcoming debt swap, offering a new bond on terms similar to those made in the restructuring of 2005, when holders were paid 30 cents on the dollar. It insists the offer will not be derailed by the central bank struggle and should go ahead within weeks.

But the debate about using central bank reserves to help pay off debt has highlighted another issue that has incensed owners of defaulted bonds – known as “hold-outs” because they have been holding out for a better offer than was made in 2005. Argentina keeps a large chunk of its reserves at the Bank for International Settlements in Basel, the bank for central banks, with the aim of putting them beyond the reach of litigation by creditors, former officials have confirmed. Robert Shapiro, co-chair of American Task Force Argentina, a US lobby group representing hold-outs, says the country keeps 80 per cent of its reserves at the bank, about $38bn. A BIS official responds that the data are confidential but “the figures quoted by the media are grossly overstated”.

Ms Fernández may take heart from the distraction provided by an escalating diplomatic battle with the UK over oil and gas exploration around the Falkland Islands, over whose sovereignty they fought a brief war in 1982. British companies are due to start drilling next week, sparking Argentine outrage.

Meanwhile, she has sought to deflect attention from the central bank crisis this month, perching for cameras in stilettos on a quad bike after meeting Argentine winners in this year’s Dakar rally, an off-road endurance test held in Argentina and Chile for the past two years. During one speech in January, she urged consumers to eat more pork, saying it boosts your sex life and is more appetising than Viagra.

But she faces a tough time getting her reserves plan past congress and, the longer the soap opera continues, the more damaging it may prove to an already battered international image.

Its failure to pay creditors for so long saved Argentina money for a while, says Mr Shapiro. “But in the long term it’s an economically debilitating strategy ... Who wants an economy that looks like Argentina’s today?”

[Gramar]

Por favor gente, estoy por comer...

[martin]

Noto que hay varios fans de Cavallo.

[Ferchu]

http://www.cavallo.com.ar/

[martin]

[Shakespeare]

Ojo al parche con el reciente incremento de la tasa interbancaria de la Fed y en especial a los bancos americanos y europeos, que empieza, de a poquito, a terminàrseles el carry trade facilongo, de fondeo baratito a costo casi cero para hacerse de bonos al 2 o 3%. En eso consistiò buena parte de las ganancias de los bancos estos ùltimos meses, ya que la situaciòn de la economìa real sigue tan jodida como antes.

[Shakespeare]

Las perlas que te recomiendan estos tipos son como dòlares paraguayos.

[Shakespeare]

En El Cronista de hoy, en el capìtulo de Finanzas, los Gurùes de la Manzàn Cream, recomiendan las 4 perlas del Merval (Apbr, Ts, Bma y Teco). Los muchachos deben estar esperando algùn candidato para entregarles la novia......

[Dancity]

Según declaraciones de Domingo Cavallo en un programa de tv, dijo que si la nueva titular al frente del BCRA lleva adelante el pquete de medidas que quiere impulsar, saldríamos del estado de estancaflación y pasaríamos a un período de inflación lo que queneraría un espiral inflacionario que terminaría con una hiperinflación.

Además señaló que siempre están los maníacos devaluatorios como De Mendiguren, Duhalde, ect. que quieren imponer una devaluación en la que sólo hará que aumenteel gasto público y juegue en detrimento de los salarios reduciéndo significativamente el poder adquisitivo.

Espero que esto no ocurra, ya es archiconocido y sabemos en que desemboca todo esto.

[Ferchu]

de esto estoy hablando.....la inflacion no es culpa del gobierno que amedrenta a las empresas, las presiona, incumple continuamente leyes y contratos, extorciona, amenaza, regala plata (claro porque es facil regalar lo que no es de uno)
la culpa de la inflacion es de esos avariciosos y ventajeros empresarios....

Randazzo: "Es un disparate achacar al Gobierno la culpa de la inflación"
Según el Ministro del Interior, las subas en los precios son sólo producto de "muchos empresarios inescrupulosos".
http://www.perfil.com/contenidos/2010/0 ... _0004.html

:113: :113:

Si es un disparate achacar al Gobierno la inflación, creo que los peronistas deberían pedir disculpas publicas al radicalismo por achacarle la hiperinflacion al alfonsinismo.