the disciple of Joseph Stiglitz applied heterodoxy and progressivism, used instruments, methodologies and knowledge opposed to neoclassical logic. He managed to renegotiate with private parties, obtained a rate cut, bought time and avoided default with the IMF. He supported the liquidation of the debt in pesos. It spent more than it raised, it issued, it deliberately made financing cheaper, well below inflation, it leveraged productive activity. He allocated funds for vaccines, sent for them by Aerolineas Argentinas, extended the double compensation, subsidized energy as much as he could, issued the food card, and helped SMEs. Lately, spending on social plans grew 45.8% year-on-year in real terms in the first half of 2022.
The economy recovered on the margin, after the macrista failure and the global debacle. All these blunders do not deny the indisputable naivety of academics and public officials from politics, regarding the dynamics of the private sector. The neglect of the rent of precautionary, the under-invoicing and the over-invoicing in foreign trade, made fun of both the minister and the former Secretary of Commerce. We would evaluate that Martin Guzman and the former Secretary of Commerce would not have left because they were hardly progressive.
“As if I had to secure a penalty on time, the voter who had been so wrong in 2015, now decided to kick hard and in the middle. It was the audacity to tune up Kirchnerism with a marked conservative bias”.(Diego Genoud, Cristina’s Peronism, p. 144, Siglo XXI ed., 2021). Identical strategy 2015.
A BRIEF MINISTER AS HER TEACHER AND A PYROMANIAC
Silvina Batakis had no political support, her substitution was spontaneous and surprising. She displaced while she was conferring in the US with Washington bureaucrats and Wall Street investors. “High degree of incompetence”
Batakis’s announcements succumbed in a fleeting time, lacking trust and credibility, immersed in the complex official sketch lottery.
A new outbreak of the psychotic libertarian quarry intimidated: “Recent history shows that the State financed itself expropriating private savings (BONEX, BODEN, AFJP) and emptying the BCRA”, he alerted. “Fears are well founded that populism is tempted to finance itself with the reserve requirements that back private deposits. Even private estimates already warn that it has started to do so”, he emphasized. “After the expropriations of 1990 (Bonex) and 2002 (Boden), distrust of politics still reigns and no citizen wants to be within range of the next expropriation of deposits,” he remarked. (Ramiro Castineira)
The truth is that the erosion of the friendly fire that began in January, plus Al Qaeda, offered the symbolic capital that neoclassical economics demands (credibility, trust). The intention did not seem to be, to turn to the right, although Argentine society has turned right and the 2023 tournament is played on that field. The twist today is evident.
Alfonsín was willing to lose elections if society turned to the right, but not Peronism. pure pragmatism. Since populism is a methodology and not an ideology (left or right), it responds to the demands of society. It was unthinkable to hear the vice president recognize herself as “high bourgeois” in a public exhibition. It is a good occasion to remember that Peronism is inclusive. Nothing to do with the class struggle-the Marxist approach. If in Peronism someone thinks that “it is right or wrong”, they commit an academic error of validation. “Wrong or right” are ethical validations, not political ones. Just as “cute or ugly” are aesthetic validations and “true or false”, scientific validations.
Markets have climbed without a record since October 2020, when the dollar was (corrected to $370). Although with the same variation criteria, the historical crisis peaks were: March 1976 ($630), June 1982 ($420), 1989 ($720). Today we are $291.
To add to the confusion, there were unexpected reinforcements, such as Grabois’ statement saying that “blood would flow” if the people’s hunger was not answered, and Aldo Rico’s calling for “saving the Homeland.”
Juan-Grabois-Lawyer
Ignatius Petunichi
As Cristina repeats “everything has to do with everything”. Phrase attributed to Anaxagoras. In Being everything is intertwined, “everything has to do with everything”… any aspect of life is related to another aspect: Anticipate Alberto Fernández who tried to install his re-election. Take advantage of the clear and tedious judicial persecution that seeks to ban his candidacy and; take advantage of the regional trend with the victories of Boric in Chile, Petro in Colombia and, probably, Lula in Brazil. It is possible that these three origins have been joining sequentially, marking the dynamic, always related to “everything has to do with everything”.
MASS
Massa’s appointment is an attempt to get closer to the US (his meeting with the US ambassador connects with the previous photo of the vice president and the same diplomat). The new economy minister has built strong ties and contacts in Washington and New York in recent years. Although he took over the ministry, the BCRA continued to sell dollars, in the face of the indifference of exporters who do not want to liquidate foreign currency, and keep 15 billion dollars in silo bagshoping to achieve more benefits than those offered in the “soybean dollar”, creating expectations with the devaluation club. In this way, inflation accelerated even more, due to the disorderly and confused process of redialing due to the presumed strong increase in replacement costs. However, at the BCRA, there were 300 million dollars more in net reserves than at the beginning of 2022, when the blue did not move from $200. The $20 billion Chinese swap is also available.
With the intention of obtaining reserves, the minister announced an export advance agreement for 5,000 million dollars from primary sectors; plus 750 million from the Andean Development Corporation, plus the income of 1,200 million dollars from international organizations, which would be added to the disbursements of the IMF. Jointly, He stated that there are four offers to execute repo operations in dollars with investment banks that would be used to repurchase securities in foreign currency.
In the financial field, the minister launched a successful voluntary swap (85%) for the maturities of the public debt in pesos for the next 90 days, which totaled more than 2 and a half billion pesos, through the placement of “bonds dual”, with which they were deferred until 2023, decompressing the maturities. Thus, the amortizations to be faced in the three adjoining months were decompressed to 480 million pesos. The reduction of the primary deficit to 2.5% of GDP was also ensured, strongly increasing rates, cooling the State plant and exercising more efficiency in social plans. And, he has expressed that the fiscal goal agreed with the IMF will be met. Committed to no longer using BCRA transfers to the National Treasury and deleveraging the balance of transitory advances by 10,000 million pesos, he sent a signal.
THE WORLD AND FOREIGN RELATIONS
While the ambassador to China considered the visit of Nancy Pelosi to Taiwan (speaker of the House of Representatives of the United States), Foreign Minister Cafiero disavowed him, although he did not ask for his resignation. Mercosur entered a crisis. The president of Uruguay wants a free trade agreement with China, Paraguay affected by the blunders of the former president (a friend of Macri), who was prevented from entering the US for being corrupt, added to the unacceptable absence of Bolsonaro, president of the most powerful member country of the association. Argentine foreign policy looks sinuous, not even a brief is seen to take advantage of a world that offers opportunities.
The US technically entered a recession, with GDP falling (-1.6%) and (-0.9%) consecutively in the first and second quarters of 2022, and inflation returned strongly in June. While the European allies expect a growth rate higher than that of the US, the European Central Bank faces a conflictive trance. The inflation rate in the euro zone went from 0.3% in January 2022 to 8.9% in July 2022 (it increased by almost 30 times the monthly variation = month against month, measured in the last 12 months).
Europe is about to face a contractionary monetary policy like that of its North American partner, but at the same time it needs to start buying PIGS (Portugal, Italy, Greece and Spain) debt securities, given the suspicion of an imminent debt crisis, having to arbitrate the increase in the rate spreads of these obligations.
If the risk of default in Italy growsthe eurozone would enter a more serious situation than in 2010, causing the European Union to nod. Strong inflation and recession underway that is perfected in the face of the northern cold, with the energy crisis and the terrible war in the East.
italy.jpg
Express.info
China is growing at a rate less than half of what it needs. In this context, the IMF continues to reduce the growth forecast for all these regions and countries, but paradoxically Argentina could grow 4%, despite the fact that soybeans and wheat increased only 10%, while gas doubled its value compared to 2021( The damage from energy prices has been 9 times higher than the benefit from the rise in international prices of the commodities we export).
Argentina’s GDP growth rate would prevail, over that of the GDP of the US, the Eurozone, Eastern Europe, Latin America, and countries such as Germany, France, Italy, Brazil, Mexico, Japan and China.
Stock indices in the first half of the year accumulated formidable falls (-15% Dow Jones), (21% S&P), (30% Nasdaq), (14% Eurotop), (20% DAX-Germany). In the US, 2-year bond rates rose 2.20%, 5-year 1.75% and 10-year 1.50%. Interest rates grew multiples of between 6 and 10 times with respect to the “aggregate demand stimulus times” -14 years-.
IN CONCLUSION
Argentina plays againstthe recession in the developed world and in our main trading partner -Brazil-, fortunatelyrenegotiated private debt before the extravagant rate hike, liquefying thanks to world inflation. That nailed it at the angle, as we anticipated in January 2020.
The true recklessness of the inmate of the Frente de Todos 2022 did not consist in imagining a new progressive alternative, but in accepting the fact that after the moral, institutional and economic degradation of the Macri administration there was no other option. The government of Alberto Fernandez was a permanent vicissitude emerging from BlackRock and the IMF. Three months after the pandemic and in 2022 war in Europe with multiples of 4 to 5 times the inflation of developed countries and an interest rate multiple of 7-times higher.
Gabriela Michetti in the Senate
Telam
He was right Gabriela Micheletti on the light at the end of the tunnel, it was the focus of a railroad train coming in the opposite direction from a devastated country. They made sure that from 2020 no one could afford the patriotism absent in 2018, when the historical moment would have been relevant.
Professor of Postgraduate UBA and Masters in private universities. Master in International Economic Policy, Doctor in Political Science, author of 6 books. @PabloTigani
Source: Ambito
