A snapshot of the economic situation
- The economy is contracting at an annual rate of about 2%;
- The peso depreciated more than 25% in August
- Inflation runs at 50% annually
- Poverty is estimated at almost 40% of the population and;
- The Church has just asked the president to declare a food emergency and to presumably freeze prices of food.
- Argentina’s century bonds lost 50% of their value
The role of the IMF is crucial. It lent enormous amounts of money to Greece. There is no reason why Latin America should be treated differently than Europe.
Argentina’s infernal cycle
By: Branko Milanovic – City University of New York
Why does Kirchnerism scare the market?
Mark Weisbrot is perplexed with the financial market’s reaction to a potential Alberto Fernandez and Cristina Fernández de Kirchner government, especially since, in his opinion, the governments of the Kirchner presidencies were among the most successful. In particular:
Independent estimates show a decline of 71 percent in poverty and an 81 percent decline in extreme poverty. The government instituted one of the biggest conditional cash transfer programs for the poor in Latin America. According to the International Monetary Fund, gross domestic product per person grew by 42 percent, almost three times the rate of Mexico. Unemployment fell by more than half, and income inequality also fell considerably. The 12 years the Kirchners held office resulted in large increases in living standards for a vast majority of Argentines, by any reasonable comparison.
Who is to blame for Argentina’s economic crisis?
By: Mark Weisbrot – Center for Economic and Policy Research
What went wrong in Latin America?
As a profession, we do not have the policy answers that would have guaranteed convergence of Latin America to the income level of the richest countries in the world. Coincidental with the periods of poor economic performance, however, countries in Latin America have been plagued by economic crises. The specific symptoms of each crisis have been very different: high inflation rates, balance of payments crises followed by large devaluations, banking crises, defaults on government debt, deposit confiscations, and so on.
A Framework for Studying the Monetary and Fiscal History of Latin America, 1960-2017
Authors: Timothy J. Kehoe, Juan Pablo Nicolini, and Thomas J. Sargent
From: Federal Reserve Bank of Minneapolis, New York University
