Argentina Economy Quotes

Argentina’s economy is a textbook example, literally, of how political decisions can stymie even near-perfect geographic advantages. A unique, indigenous mix of nationalist-socialist-fascist policies have resulted in waves of massive inflation, capital flight, sovereign debt defaults . . . and yet, Argentina’s future remains bright.

Drafting conscript workers was one thing. But unless they were adequately fed they were useless. There was no industry in the 1940s in which the correlation between labour productivity and calorific input was more direct than in mining.91 But after 1939 the food supply in Western Europe was no less constrained than the supply of coal.92 As was true of Germany, the high-intensity dairy farms of France, the Netherlands and Denmark were dependent on imported animal feed. Grain imports in the late 1930s had run at the rate of more than 7 million tons per annum mostly from Argentina and Canada. These sources of supply were closed off by the British blockade. In addition Western Europe had imported more than 700,000 tons of oil seed.93 Of course, France was a major producer of grain in its own right. But French grain yields depended, as they did in Germany, on large quantities of nitrogen-based fertilizer, which could be supplied only at the expense of the production of explosives. And like German agriculture, the farms of Western Europe depended on huge herds of draught animals and on the daily labour of millions of farm workers. The removal of horses, manpower, fertilizer and animal feed that followed the outbreak of war set off a disastrous chain reaction in the delicate ecology of European peasant farming. By the summer of 1940, Germany was facing a Europe-wide agricultural crisis.

Over the next 300 years, the Afro-Asian giant swallowed up all the other worlds. It consumed the Mesoamerican World in 1521, when the Spanish conquered the Aztec Empire. It took its first bite out of the Oceanic World at the same time, during Ferdinand Magellan’s circumnavigation of the globe, and soon after that completed its conquest. The Andean World collapsed in 1532, when Spanish conquistadors crushed the Inca Empire. The first European landed on the Australian continent in 1606, and that pristine world came to an end when British colonisation began in earnest in 1788. Fifteen years later the Britons established their first settlement in Tasmania, thus bringing the last autonomous human world into the Afro-Asian sphere of influence. It took the Afro-Asian giant several centuries to digest all that it had swallowed, but the process was irreversible. Today almost all humans share the same geopolitical system (the entire planet is divided into internationally recognised states); the same economic system (capitalist market forces shape even the remotest corners of the globe); the same legal system (human rights and international law are valid everywhere, at least theoretically); and the same scientific system (experts in Iran, Israel, Australia and Argentina have exactly the same views about the structure of atoms or the treatment of tuberculosis). The single global culture is not homogeneous. Just as a single organic body contains many different kinds of organs and cells, so our single global culture contains many different types of lifestyles and people, from New York stockbrokers to Afghan shepherds. Yet they are all closely connected and they influence one another in myriad ways. They still argue and fight, but they argue using the same concepts and fight using the same weapons. A real ‘clash of civilisations’ is like the proverbial dialogue of the deaf. Nobody can grasp what the other is saying. Today when Iran and the United States rattle swords at one another, they both speak the language of nation states, capitalist economies, international rights and nuclear physics.

Like Argentina, China had incredibly restrictive rules about moving money into and out of the country. But in China, unlike Argentina, these rules were not a response to runaway inflation, but instead part of the government’s effort to keep tight control over the exchange rate of the yuan, in order to promote the export economy. The authoritarian government also wanted to keep a close check on what its citizens were doing. Each Chinese citizen could move only the equivalent of $50,000 out of the country each year. As a result, it became difficult for wealthy people, including government officials, to get their riches out of China and into more secure foreign bank accounts.

Throughout history, high inflation has often led to social upheaval. Hyperinflation, when prices rise by 50 percent or more per month, helped bring the Nazis to power in Germany and the communists in Russia and China, and topple both civilian and military governments in Argentina.

Greece is no longer a private-sector problem. In 2010 the private sector owned most of its debt. Today, 70-ish percent of that debt is held by the [European Central Bank], Greek banks, and then there's the IMF, which has a huge loan outstanding to Greece. If you think about what's transpired in the last five years, we've had a transformation. How do you see that shift? What does it change for the Greeks? Greece, in my mind, is part of the international grid. If you want to remain in the grid, you're going to have to ultimately conform. If they don't conform, they're going to become Argentina; they did things the global economies said were wrong, and now they have no access to capital from outside. If Greece walked away today, its banks would be bankrupt. Greece experienced a 26 percent decline in GDP from 2008 to now. If they walked away, I think they would fall another ungodly amount.

Argentina's impotence in finding adequate political responses to that most elemental of needs, survival. The Japanese work and save for years in order to be able to live one day like the Argentines, who neither work nor save. Memory is the chief enemy of the solitary tortured man. The same problem as Argentina, an unwillingness to be aware of one's own drama. Hope is synonymous with anxiety and anguish. Deliberately, I evaded conjecture on my own destiny, that of my family and the nation. I devoted myself simply to being consciously a solitary man entrusted with a specific task. Those slogans Argentines like to quote of themselves: "God is Argentine. Nothing will happen here.", "As long as bulls don't turn homosexual, the Argentine economy will flourish." The military has assumed power by dislodging elected governments in 1930, 1943, 1955, 1962, 1966 and now in 1976. The great silence, which appears in every civilized country that passively accepts the inevitability of violence and then the fear that suddenly befalls it. That silence which can transform any nation into an accomplice. Hatred toward the Jew needs no system, discipline or methodology. In every totalitarian mind, hatreds are transformed into fantasies and confirm to a view of the world that matches these fantasies and these very fantasies lead to the development of their operational tactics. The chief obsession of the totalitarian mind lies in its need for the world to be clearcut and orderly. Any subtlety, contradiction or complexity upsets and confuses this notion and becomes intolerable.

In February 2017, the Institute of International Finance reported that capital flows to emerging markets remained flat, at around US$680 billion, with high downside risks for FDI. Financial market expectations for interest rate hikes in the United States are a contributing factor to weakness in capital flows destined for the emerging markets, as investors look to gain from higher-interest-rate environments. However, the anemic economic growth conditions across the developing world also lower the opportunity for returns and hurt capital inflows. The softness in capital flows to emerging economies could prove more damaging in the long term as the prospects for economic growth continue to wane. Already the world’s largest and most strategically vital emerging nations—such as Argentina, Brazil, Colombia, India, Indonesia, Mexico, South Africa, and Turkey—are only growing at 3 percent or less a year. Ever more damning is the implication of the IMF’s October 2014 “World Economic Outlook” that the world will never again see the rates of growth witnessed prior to 2007.12 This weak economic backdrop comports with a weak capital inflow story. According to the Reserve Bank of Australia, the movement of money through the financial system has been stagnant over the past decade. In dollar terms, cross-border capital inflows among the G20 economies have fallen nearly 70 percent since mid-2007.13 Ultimately, slow economic growth leads to decreased investment, which in turns leads to even slower growth.

Breaking the bonds Juan Carlos Fábrega, the governor of Argentina’s Central Bank, resigned in the wake of a vituperative speech by President Cristina Fernández de Kirchner, in which she accused him of acting in concert with the banks to weaken the currency. Mr Fábrega was regarded as a pragmatist in an administration that is short of them; his successor, Alejandro Vanoli, is a loyalist. With reserves dwindling, inflation rising, the peso under pressure and foreign capital markets still out of reach after the default in July, the removal of Mr Fábrega adds to the sense of an economy adrift.

MMT helps us to see why countries that fix their exchange rates, like Argentina did until 2001, or that take on debt denominated in a foreign currency, like Venezuela has done, undermine their monetary sovereignty and subject themselves to the kinds of constraints faced by other currency users,

Traditionally the haven currency was the U.S. dollar, but since early 2018—from Greece to Venezuela, from Argentina to Zimbabwe—the haven has increasingly been bitcoin.