Far from creating a campaign “against” Javier Milei, candidate for President for the Freedom Advancesdifferent voices of the financial sphereinternational community warned on several occasions about the impact of the “chainsaw” that a libertarian government could have.
Previously, it was the Financial Timeswho put the magnifying glass on the figure of “the millionaire” that supports Mileiin the middle of what the same English newspaper calls a “wave of skepticism” by the business elite towards the winner of the Primary, Open, Simultaneous and Mandatory (PASO) elections.
He too Institute of International Finance (IIF)which brings together 38 of the world’s main banks, published a report that questions Milei’s dollarization proposal and demystifies the result of the Ecuadorian experience.
“Argentina has been debating the merits of dollarization, which in reality It is just an extreme version of a peg to the dollar, since it increases the cost of devaluation, but does not eliminate it as a policy option. The persistent appeal of the dollar peg is somewhat disconcerting, given how many pegs have ended in explosive devaluations and deep recessions in recent years. This alone should make defenders of dollarization reflect,” says the report signed by Robin Brooks, Martin Castellano and Jonathan Fortune.
Mirabaud: the Swiss bank that warns about Milei
Now it is the turn of a financial institution based in Switzerland and one of the oldest in that countrywhich also highlighted that hedge founds are betting against Argentina.
In a report published by the banking group titled “Don’t Cry for Me Argentina”, and cited by the agency Bloombergit is highlighted that “although Milei has stated that he will substantially reduce public spending, “his position has raised concerns about the viability of its proposals”.
John Plassardauthor of the document, according to the aforementioned news agency, assured that investors believe that the most favorable candidate for the market is Patricia Bullrichwho, according to the expert, is a person “from the moderate right who also proposes a fiscal consolidation program.”
In his analysis, Plassard points out Milei’s inexperience in politics and maintains that “he is not a career politician who played in a tribute band of Rolling Stones before studying economics.”
The bet against Argentina
Likewise, the document states that “hedge funds are increasingly positioning themselves against the country’s sovereign bonds“, based on an article that the London City newspaper had published days ago, Financial Times.
“The hedge funds They increased their bets against Argentine bonds, as the emergence of radical right candidate Milei has led investors to fear that the country is about to elect a leader who will find it difficult to govern in the midst of an economic crisis,” the report maintains.
Likewise, Plassard indicated that the total value of “Argentine bonds lent by investors to bet on falling prices has increased by 65% since Milei, who describes himself as an anarcho-capitalistemerged victorious from the presidential primary elections.”
Finally, Plassard noted that, according to data from S&P Global Market Intelligence, the value of short positions in Argentine bonds lent by international custodian banks amounts to US$41 million as of the day of the report’s publication, a sharp increase compared to the $25 million that existed before the mid-August vote.
Source: Ambito
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