The American newspaper published an article pointing out that the president-elect’s plan could “work better on YouTube than in real life.”
The whole world looks at Argentina after the victory in the libertarian runoff Javier Milei, who met this Tuesday in Olivos with President Alberto Fernández. And, in that framework, the American newspaper specialized in economics Wall Street Journal published an article pointing out that the president-elect’s dollarization plan could “work better on YouTube than in real life.”
They analyzed the current economic context and warned about risks and challenges which represents: “In the emerging nationsmost of the inflation comes from currency exchange. The hyperinflation then erodes the ability of countries to collect taxes and leads to deficits and money printing.
The medium describes Milei as a anarcho-capitalist and an emerging figure on platforms such as YouTube and TikTok that captured the attention of the Argentine electorate with promises of a radical change in economic management. “You are right that the country desperately needs dollars. But their economic plan to obtain them could be the wrong one,” they point out.
Inflation and dollarization
Likewise, they compared the inflationary situation of the country with those of Ecuador, Panama and El Salvador and pointed out that “dollarization would certainly do the job.” And they indicated that inflation in those countries, which use the dollar, is at manageable levels..
The American newspaper also projects the political relations of the president-elect around the application of his measures: “The Argentine Congress may end up diluting Milei’s policies so that they are more similar to those of the pro-market leader Mauricio Macri, who governed between 2015 and 2019 and supported him after the first round of the elections.”
“But this is not very comforting, since Macri’s solution to obtain dollars was to borrow them without restrictions from foreign investors, which triggered a crisis when the economy collapsed in 2018,” he adds.
For him Wall Street Journal It is not the way
“The dollarization misses the point, if a stock can bring in enough dollars to be sustainable, “It’s better not to dollarize in the first place.”they concluded.
And they warned that choosing the wrong conversion rate can be fatal. Additionally, the dollars needed to redeem all holdings of pesos They probably exceed $9 billion, Capital Economics estimated in August, based on the peso exchange rate on the black market. And they added that borrowing this money, when the country cannot pay the foreign currency it already owes, seems impossible.
Source: Ambito
