The Solution To Argentina's Banking Problems Is To Go Cashless 294
dkatana writes: There is no way back for Argentinian people to trust their own currency. Several governments have used the "Peso/Dollar" exchange to dig into people's savings, reward their friends and limit the freedom of citizens to use other currencies.
Short of Dollarizing the economy again, the only solution for the country is going cashless. People are desperate, and they're looking for alternatives such as mobile payments, Amazon gift cards and Bitcoin to store their savings away from government control. A digital currency could help curb black market exchanges, fight corruption and restore the country's image.
Short of Dollarizing the economy again, the only solution for the country is going cashless. People are desperate, and they're looking for alternatives such as mobile payments, Amazon gift cards and Bitcoin to store their savings away from government control. A digital currency could help curb black market exchanges, fight corruption and restore the country's image.
"Cashless" is meaningless (Score:5, Insightful)
Re:"Cashless" is meaningless (Score:5, Insightful)
It's not meaningless if your goal is to steal and that's what that 'article' proposes - theft.
1. Government steals by forcing people to declare all of their cash savings and to justify them to transfer them into the electronic form.
2. Government steals by creating inflation electronically, so it's cheaper and faster for the government to create vast amounts of virtual money and dilute existing savings, thus stealing (creating inflation).
3. Government can steal everything at any time by simply emptying your bank account and leaving you with nothing.
4. Government will steal by setting stupid exchange rates that are absolutely fake, like pegging the exchange say 1USD to 10Pesos while on the 'black market' you would get many times more pesos, for example 100 for 1.
5. Government can control you if you do not have access to your own money, and it can prevent you from doing anything they don't like and punish you for doing anything they don't approve of.
It's a gigantic con, don't fall for it, it doesn't matter what the name of the currency is if you are not even able to have it in your own hands.
Basically if you cannot hold your own money in your own hands but government holds it for you (directly or through proxy banks) you are fucked, you have nothing.
If you try to switch to gold and other currencies of your choice, you will be labeled a 'speculator' and 'enemy of the working class' etc., and you can be dealt with criminally.
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There are loopholes around that. Several towns (even in the US) have a barter economy based on hours of labor, so you could go volunteer time doing something for someone (like mowing lawns) in exchange for other services (like bicycle repair). Bonus for avoiding regulations and taxes.
e.g. http://ithacahours.info/ [ithacahours.info]
I wouldn't be surprised if some of what Argentina is doing is similar to that. And probably also similar to what Russians would do during the lean years.
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In the USA barter hours are taxable
http://www.irs.gov/taxtopics/t... [irs.gov]
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Great! Where do I mail the chicken?
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You don't. You sell it on the market, buy US Dollars, and send those with your tax return. Otherwise the IRS will not credit your account. They'll probably east the chicken, tho.
One thing Bitcoiners and gold bugs alike really have trouble understanding is that the reason the USD has value is that the US Economy is one of the best in the world, to participate you have to pay taxes, and the taxes can ONLY be paid in United States Dollars. Many people who do not participate in our economy (such as ex-pats whos
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5. Government can control you if you do not have access to your own money, and it can prevent you from doing anything they don't like and punish you for doing anything they don't approve of.
They already can do that, so I think it's important to clarify the distinction. Governments do not handle your money directly, but they restrict you to licensed entities, like banks, payment processors, etc. These entities are subject to broadly defined rules which make them responsible about not only identified crimes, but potential future crimes. On top of that, in many countries these entities are aligned to particular political groups, and in the case of multinational entities, foreign powers or interna
Re:"Cashless" is meaningless (Score:4, Insightful)
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Certainly possible. Ecuador had plans to do that, but I don't know how it went.
However, I think states around the world will prefer having an extra layer of protection in the form of licensed private entities, and this system is pretty much already established, particularly in favor of the western world.
Citizens are required to use one of these, they can still be made worthless but the bureaucrat(s) in your example will be shielded from any potential backlash.
You don't need to pass laws to change the world
Re:"Cashless" is meaningless (Score:4, Informative)
If you can't trust the local government, either because it's corrupt or because it doesn't exist, you're fucked anyway. Not only is your cash not safe from theft (or forgery - let's not forget that), but you also can't trade efficiently since there's no way to enforce deals.
If you can't trust the local government to enforce your claims of ownership, they're utterly meaningless.
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Liberty has been working very well for Americans, compared to Europe and the rest of the world. That's why we should continue in the direction of more individual liberties and less government intervention.
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Relatively speaking, the US is still doing a lot better than Europe.
America has been deteriorating, in large part because of an influx of bad European ideas about government and society. It's a trend we can reverse.
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Indeed. I fail to see what the difference between $1 electronically stored in a bank account or being transferred between two banks is measurably any better than a one dollar bill.
A unit of currency, whether digital or physical, is issued by a country's central bank and backed by the country's government. If Argentina burned all its physical currency tomorrow, everything would still be denominated in Argentinian pesos, whose value, by and large, would still be determined by the same mechanisms. I suppose ce
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I fail to see what the difference between $1 electronically stored in a bank account or being transferred between two banks is measurably any better than a one dollar bill.
Clearly you are not Argentine. The difference is that the government can seize bank accounts. Or forcibly convert them to another currency. The US dollar stuffed under your mattress is safer.
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And the main reason people don't have their money in banks is not because they're afraid of the government ( people tend to forget about the pain ), but because tax evasion and informal economy.
Re:"Cashless" is meaningless (Score:5, Informative)
You need a currency.
"1000 Quatloos for the newcomers!"
It will be interesting to see how Greece gets out of their mess, when they run out of Euros. Pundits are guessing that Greece will issue "scrips", which are a kind of government IOU, and pay government salaries and pensions with them.
The only problem with that is . . . who will want these scrips? Certainly not even the Greeks themselves. They want Euros. And they will try to get rid of their scrips as soon as they can, in exchange for something of value.
Car sales are up now in Greece by something like 40%, as people worry about if their bank accounts will get raided by the government. An automobile is considered as something "valuable". The cruel irony here, is that Greeks prefer to buy German cars . . . exactly the folks who Greeks blame for all their problems. So the Germans are actually benefiting the most from this.
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So, the Greeks are blaming the Germans because the Greek government couldn't pay its bills? Interesting....
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Hmm, by that logic, *I* can demand that the Greeks give me a metric buttload of money, and then insist in public that they're evil if they don't, right?
I bet that'll work well....
Re:"Cashless" is meaningless (Score:5, Interesting)
It's not a sideline, it's entirely the point. The German citizenry isn't willing to see their taxes go up again to pay Greek debt that was incurred buying votes. The again in that sentence is the important bit. Germany has already raised the taxes on their people to pay the original Greek bailout. They will NOT allow their government to do it again. And it infuriates them to no end that this happened because the Greek government lied about their spending and borrowing and used much of the proceeds to "buy votes" by raising minimum wages, increases pension plans and other electorate appeasing measures that require cash.
For example, the current Greek government refuses to lower the minimum wage. Most people don't even realize that the minimum wage in Greece is almost 50% higher than in Germany! This goes for almost all the items of the bailout under attack. The most galling thing to most Europeans is that the troika didn't even require the Greeks to cut their higher wage rates, higher pension payments and such to match their European neighbors, they only required that they reduce them partially and this is how the Greeks react?
Coming down to reality is hard, they built up a system with purchased votes that wasn't sustainable and it's a big impact to lower down to reasonable values. I personally don't agree with the austerity push, I think it's catastrophic policy with no historical backing and heavy counter demonstrations that it doesn't even work. But, I do agree with the rest of the Europeans that the EU and IMF have been extremely lenient with Greece and to have it thrown back in their face as asking too much is frankly stupid.
But that's the problem with Greece's current government. They should have attacked austerity, not the measures they are expected to undertake to re-balance their economy with the rest of Europe. Many of the Torika's requirements were real improvements that would have been long term very positive for the Greeks economy and some of those are the ones the Greeks are attacking the hardest, rather than attacking the real problem, which is this Austerity idea that you can succeed by cutting spending during a recession. The Greek economy was heavily damaged by the Austerity drive where the measures should have been more targeted towards competition and divestiture of state assets because it was those very state assets and the salaries they included that bankrupted the Greek government to begin with. And this dragging of the feet on everything and inexperience has just created an environment where everyone in the economy is running for cover. The cuts to the pensions and minimum wage levels should have been done with a permanent freeze to increases until inflation balanced them with the rest of Europe because of the direct and immediate damage a large cut would do. The biggest problem the greeks face is a general disrespect for tax collection, that's what government should be spending their time fixing.
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If I understand it right, Greece is an example of a country which gave up its own currency (and with it the power to play certain tricks to nudge the economy) without having the productivity to make it work without those tricks. So they ran into trouble, and asked the controllers of the currency for help, which was refused except on terms that minimized the helpfulness (austerity measures make sense for balancing a budget but do very little to increase the flow of currency in the economy - and "flow of curr
Re:"Cashless" is meaningless (Score:4, Interesting)
A slight correction. Greece has already received two bailouts worth billions in the last five years . . . with the condition that they will implement necessary structural reforms in their economy. For example, pensions in Greece are way to high for what the people paid in. And their are way too many civil servants.
Greece essentially "cooked the books" and hid state debt. This only works for a while. When this was discovered five years ago, Greece was shutout from the international capital markets: No one would lend to them anymore. However, a lot of private banks had too much exposure to Greece, which forced the Troika, the EU, the European Central Bank (ECB) and the International Monetary Fund, to arrange a bailout, to avoid financial contagion. The private banks received a "haircut", which means that they would only receive a smaller percentage of the money owed to them. Most of the debt now rests on EU taxpayers.
Greece dragged their feet on implementing reforms. So a second bailout was necessary. Things were getting better, as they now had GDP growth. Well, then the Greeks went off at the beginning of this year, and elected a new coalition of Radical Left Marxists, and Right Wingers. And since then, things have taken a major turn for the worse. The new government promised to:
Raise pensions
Hire more civil servants (to reduce unemployment)
Erase bailout debts
Sounds like a nice plan . . . but where do you get the money to finance this? Well, the EU should just give more Euros to Greece! Which is politically untenable for the rest of Europe. The only way this could work, is if Greece had their own currency to devalue. So, in the long run, Greece needs to leave the Euro. Except, a majority of Greeks want to stay in the Euro. Thus, the current Greek government wants to get kicked out, so they can blame the EU for it. But the EU does not want to take the blame, so they won't kick out Greece. What we have now, is a slow speed train wreck.
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So, in the long run, Greece needs to leave the Euro. Except, a majority of Greeks want to stay in the Euro. Thus, the current Greek government wants to get kicked out, so they can blame the EU for it. But the EU does not want to take the blame, so they won't kick out Greece. What we have now, is a slow speed train wreck.
The part of the story I find interesting, that nobody is talking about, is that there are no written procedures for either kicking Greece out of the Euro Zone, or for Greece to voluntarily leave the Euro. One side or the other would have to unilaterally declare their action, and then dare the other side to deal with it. There will be 8000 lawsuits in 30 different courts asking judges to essentially create the rules as they go. Those cases could drag on for years. The financial markets would hate that ki
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So, in the long run, Greece needs to leave the Euro. Except, a majority of Greeks want to stay in the Euro. Thus, the current Greek government wants to get kicked out, so they can blame the EU for it. But the EU does not want to take the blame, so they won't kick out Greece. What we have now, is a slow speed train wreck.
The part of the story I find interesting, that nobody is talking about, is that there are no written procedures for either kicking Greece out of the Euro Zone, or for Greece to voluntarily leave the Euro. One side or the other would have to unilaterally declare their action, and then dare the other side to deal with it. There will be 8000 lawsuits in 30 different courts asking judges to essentially create the rules as they go. Those cases could drag on for years. The financial markets would hate that kind of uncertainty.
Nah, the problem is more that leaving the Euro is effectively impossible unless your economy is stronger than the Eurozone average, whether they want to or not. Currently everybody in Greece have their income and accounts in Euros, and those with a choice would continue to keep it that way, as any new currency would only be introduced to be devaluated, so no one would WANT the new currency, and only the poorest could be forced to use it. If most of the economy would continue to operate in Euros because no o
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There are no "tricks" you can play to actually make people wealthier. All governments can do is redistribute money to gain some political advantage for themselves. Even that runs into natural limits as people simply pack up and leave sooner or later.
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No. It's the Greeks are blaming the Germans for pressing the Greek Goverment to bailout Greek PRIVATE Banks which owed money to German Banks.
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and the Germans still paid more then they would with a more generous early bailout because they had to repeat the process
A more generous early bailout would have meant that the Greeks spent it even faster.
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You need a currency.
"1000 Quatloos for the newcomers!"
It will be interesting to see how Greece gets out of their mess, when they run out of Euros. Pundits are guessing that Greece will issue "scrips", which are a kind of government IOU, and pay government salaries and pensions with them.
The only problem with that is . . . who will want these scrips? Certainly not even the Greeks themselves. They want Euros. And they will try to get rid of their scrips as soon as they can, in exchange for something of value.
Car sales are up now in Greece by something like 40%, as people worry about if their bank accounts will get raided by the government. An automobile is considered as something "valuable". The cruel irony here, is that Greeks prefer to buy German cars . . . exactly the folks who Greeks blame for all their problems. So the Germans are actually benefiting the most from this.
It's a non-problem. If a country cannot control the money supply they are left with few options to control their economy. Using interest rates and money supply a central bank can very strictly control all aspects of their economy (spiraling debt, runaway inflation, etc). Greece does not control their own money supply.
There will always be a weakest state in the EU; almost just by definition alone that weakest state will face trade deficits with the rest of the EU. With no way to control their own currency th
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If you owe your bank $100,000 and cannot settle it then you have a problem. If you owe your bank $100 million and cannot pay, then it's your bank that has a problem.
Actually, I have heard that quote was made by none other than John Maynard Keynes!
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At it's heart, the Euro is an attempt to institutionalize neoliberal economic ideas; as such, it lacks any way to deal with trade imbalances (since those should be automatically dealt with by the free market, according to the theory). And they are being dealt with, however this in practice means destroying the countries which can't compete and starving their population.
I thought the most basic function of the European Economic Community was to be a free trade zone. When combined with a shared currency, I'm not sure that the idea of a trade imbalance has the same meaning as it does between countries with trade barriers (taxes, tarrifs, etc) and differing currencies.
It's a little like saying that there's a trade imbalance between Elm Street and Main Street because all the shops and businesses are on Main Street and Elm Street has to import everything from Main Street becau
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... a convenience, especially to a government that wishes to dip into people's savings and tax every transaction.
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A digital currency could help curb black market exchanges, fight corruption and restore the country's image.
On one hand, the poster wants to create a black market of digital currency outside the reach of its government and outside the reach of its laws.
But on the other hand, he wants to curb black market exchanges and fight corruption. I'm having trouble seeing the difference. A government official will be just as happy stealing bitcoins and amazon gift cards as stealing cash.
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Great.
Gold and silver coins as money.
None of this electronic crap.
Alas...
Taking the very simplest definition, and only replacing all cash with precious metal equivalents.
There is currently around 4 trillion dollars worth of currency in the world.
There is - just about - enough gold totally mined ever - to do this at current gold prices, but only by a factor of two.
But replacing pocket change and what's in wallets is the tiniest, tiniest fraction of the total global money.
If you required a 1:1 gold backing fo
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they chose to make issuing paper money illegal - "No State shall ... make any Thing but gold and silver Coin a Tender in Payment of Debts;..."
the key word being "State". Whenever reading the Constitution, pay attention to whether it specifies "Congress" or "States". The item you've quoted specifies States may not, meaning the Congress may. Other items specify Congress may not, meaning States may. The terms "Congress" and "States" are not just interchangable, generic terms for "government" in the Constitution.
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Reread your Constitution. Article 1, Section 8, on the list of enumerated powers:
To coin Money, regulate the Value thereof, and of foreign Coin, and fix the Standard of Weights and Measures;
In 1819 McCulloch vs. Maryland established that printed paper money was valid due to this clause and the "necessary and proper clause." ie: the Courts ruled that it was both necessary and proper for the Feds to "coin" paper bank notes.
socialism's benefits (Score:3)
Re:socialism's benefits (Score:4, Funny)
It's all lies. Argentina has no reason to seek alternatives; they have a fair, equitable socialist government that would never manipulate its fiat currency to raid savings.
We must outlaw these robber baron digital schemes right away. These digital currencies are a threat to The Good and the Great's ability to provide the fair and just governance the people of the world deserve.
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Good thing the brilliant Great Leaders of Argentina banned gold trading almost three years ago. No wonder their economy is the pride of South America. They've applied their benevolent justice to thwart every scheme those dirty capitalists have attempted!
Re:socialism's benefits (Score:5, Insightful)
Currencies only work when everyone trusts them. People trust them when their governments and banks engage in responsible monetary policy. If monetary policy gets so out-of-whack that the people don't trust the currency then the government itself is in jeopardy the state-issued fiat currency is how it conducts business.
I expect that most Argentines don't want violent or protracted revolution, they want the system to be repaired. Most solutions that were offered last time were based on circumventing the government, which would bring about the downfall of anything resembling the status quo, rather than correcting minor to moderate problems.
This isn't Greece or Venezuela or Somalia, there's the ability to fix it if people are willing to commit themselves to it and to not syphon-off all of the gains for themselves.
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Maybe people are not desperate (Score:5, Interesting)
My wife is Argentinan, as well as all of her family, and a great deal of our friends. We live in Mexico, and travel to Argentina at least once a year.
The Argentinian exchange rate has dropped in the last year, although not as much as it happened 15 years ago — nor, by far, how it happened 30 years ago. And the local economy is far, far from hopeless— The standards of living in Argentina are quite high, most middle-class people travel outside the country regularly. As a Mexican travelling regularly to Argentina for the last five years, I have seen their life costs go from slightly cheaper to slightly more expensive — and today again slightly cheaper than ours.
My family has their savings partly in pesos, in local banks, and partly in US dollars, in the safe deposits in the bank — AFAICT, they don't have a dollarised bank account. And they have a very decent level of life. My in-laws, as an example, travelled last year one month in Europe, and came to visit for a month in Mexico, without compromising their finances.
This is the second post badmouthing Argentina in Slashdot in the past few weeks. I know I am answering with some (few) personal data points, but that's in the end how reality is: A huge collection of individual stories. And they are far from as dire as you portrait them.
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Mod up
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plus 3G barely exists outside Buenos Aires from what I've heard.
TFTFU
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Here's a coverage map - http://opensignal.com/coverage... [opensignal.com]
Most of the population centres, it seems.
I wonder if they have managed to produce any *decent*, affordable Android phones out of Tierra del Fuego yet. That silly electronics tax that just hikes up the prices of international brands, so I'd be curious if they have produced quality tech competitive of what's coming out of Asia. They have the same 240V wall sockets as here in Australia - so I could use my electrical devices there but allegedly the wirin
The IMF should be worried (Score:2)
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Re:The IMF should be worried (Score:4, Informative)
Seigniorage is the difference between the cost to produce currency and the face value of the currency. Hypothetically, a cashless system would eliminate this inefficiency. There will inevitably, though, be "service fees" or somesuch taken from each transaction for administering the system.
At the end of the day, though, seigniorage is chump change compared to the power to deficit spend. What the Argentinian government really wants is to have its population to use a currency that they can make more of. If citizens are only accepting a foreign currency, or some private credits, the state has to directly collect taxes, which can be problematic politically. Forcing citizens to accept the Banana Dollar or whatever is simply the formalization of the state consuming goods and services from the population without having to answer to a set revenue policy.
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once one country gets rid of cash, if it works, it'll avalanche. Goodbye to seignorage.
All of the alternatives involve seignorage or equivalent. Mobile payments and Amazon gift cards imply giving the telecom or Amazon an interest-free loan between the date the credit is paid for and the date it is redeemed - which is pretty much exactly the same as seignorage, which gives the government an interest free "float" to fill the gap between cumulative tax collections and cumulative government spending. Bitcoin involves continuous transaction fees (whether explicit or implicit in the mining rewards)
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I think it makes the most sense to use a central bank and government. It has its downsides, I will not deny that, but the downsides for all of the private methods are worse.
Except when they aren't, of course. Argentina sets a low bar.
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All of the alternatives involve seignorage or equivalent. Mobile payments and Amazon gift cards imply giving the telecom or Amazon an interest-free loan between the date the credit is paid for and the date it is redeemed - which is pretty much exactly the same as seignorage, which gives the government an interest free "float" to fill the gap between cumulative tax collections and cumulative government spending.
You have the concept of seigniorage slightly wrong. It has nothing to do with government tax collection and spending. Just as every Amazon gift card is a interest free loan to Amazon, every physical dollar is a interest free loan to the federal government. This is seigniorage.
That being said, I don't think we should spend much time with seigniorage. While it might be worth billions to the federal government, compared to the trillions that the government spends and borrows each year it is small change and ha
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cashless = no privacy and lots of govt control (Score:5, Insightful)
We've made very little progress in anonymising cashless transactions (and this proposal might rely on transactions never being anonymous).
This not only reduces people's privacy but also gives government officials a way to remotely block you from making any payments. That's severe.
Democracy (Score:3)
Argentina is a democracy. Vote the idiots out of power.
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The US has yet to have a huge problem like making the currency unusable. I bet if that happened elections in the US would be very different. By the way there are midterm elections as well so there are elections every 2 years.
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Remember this is the third voted Argentinian government that implements this line of policies. Last election (2011) was won by an overwhelming 58% (which, in a real multi-party country, is a landmark to achieve — Kirchner's government won with slightly over 20%. There is a presidental election for this year, and everything points at a fourth mandate.
So, do you really think they are bad economically or desperate?
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Welcome to Decision 2016.
Re:Democracy (Score:5, Insightful)
When 51% figure out that they can keep voting themselves resources by electing the right people, the end is near. Venezuela is an example of how this works. Once it was a thriving economic power house in south America, resource rich and hard working. Now, though the "reforms" of Chavez and his successor the country's economic engine has been running on sugared gasoline while the politicians poured fine sand in the crankcase and tried to floor the accelerator. Democracy voted itself out of existence as the popular "Let me make sure you get your share!" refrain echoed through the ever swelling ranks of the poor and dependent.
Revolution is at the door, because eventually the government and the politicians that run it won't be able to cash the checks they've written. And the people who voted out of greed, to get something now and a promise of more to come, and those who objected to the perversion of their government, will ALL pay along with their children, grand children and great grand children, many with their lives.
The sad part is that history clearly shows how this will progress, and even so, there are many countries on the same path...
Isn't cashless the problem most of SA has to begin (Score:2)
Just asking.
Whoa (Score:2)
You know it's bad when Bitcoin looks like a better alternative! O_O
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reopen harrads (Score:2)
if people will just keep spending money they will have more money to spend.
Too much technology (Score:2)
So no money can change hands without lots of technology and probably an internet connection.
How do you deal with small purchases from small vendors? An example would be a child's allowance.
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Scoreboard: Creativity 1, Curency Controls 0 (Score:2, Interesting)
You have no idea how creative the Argentine people are. Especially with inflation running about 30% per year. The official exchange rate is down to a little over eight pesos to the dollar while the "blue rate" is about 14 pesos to the dollar.
After a month in a Hotel in Mar del Plata, Argentina I paid not with cash or a credit card but with two cruise ship tickets that I bought online with my US credit card. The proprietor wanted to take the cruise after doing business in South Florida. He was heading to
Greetings from Argentina (Score:5, Insightful)
1 - We're nowhere near desperate. We've been desperate-ish in the past... not lately.
2 - We have a high but predictable inflation... it's impossible to save in Pesos, so it stimulates spending and the economy survives.
3 - Purchase of dollars is restricted but there's a "healthy" black market that sells at a higher but well know rate (it's published in the newspapers and there are websites that inform the black market rate as well). The government counts on the existance of this black market to keep peace.
4 - Going cashless solves nothing..!!! Your cashless bank account still lists an amount of pesos and if you want to convert them to dollars the normal restrictions apply. People taking advantage of bitcoin and other schemes are simply operating in the black market... it could be bitcoin, it could be bonds or stock.
Do not get fooled by Keynesian arguments (Score:2)
I have an issue with your item #2: inflation stimulates spending and that is how economy survives. This is a Keynesian theory, which, however, inaccurately switches cause and the outcome.
Lets assume, for the sake of the argument, that there is no inflation, there is a predictable interest rate and the people can save it.
If people can save it, there will be a market for deposits countered for the market to borrow the capital. People could expect predictable interest rate, and those who wanted to borrow could
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In #2 I state things as I see them... I am not saying it's good or desirable... just the way it's being going.
We've had a yearly 25-30% inflation for some years now. Prices rise steadily, so do salaries, and as long as they're in sync people get by. Business incorporate this percentage in their calculations... in contrast to hyperinflation scenarios where inflation is unpredictable and everything freezes for a while. Buying in installments (with "zero interest") is a big thing in Argentina and for the last
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This. Mod parent up. Few people commenting this thread have the slightest idea on how Argentina is.It's living among its best moments in decades.
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Tax fraud is rampant in Argentina. The government having a tight control on citizens cash flow would mean more taxes... so yes, of course nobody would accept this.
Also, Argentine people distrust banks... LOTS of well educated middle class people I know don't have bank accounts or credit cards and don't want to.
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We don't have wild currency value fluctuations. Go here
http://www.dolarsi.com/cotizac... [dolarsi.com]
That's a graph of conversion rate from 2009 to 2015. You'll see a steady increase with a single devaluatory hike after which the line continues steadly. It's a predictable rate in tune with inflation.
The price of the black market dollar has a bit more fluctuations... but that's the nature of the beast... just like the stock market it responds to news, scares, manipulations and such. Also, there's no official source for t
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As a side note: What's "normal" for us argentinians would probably be a crazy ride on the despair train for americans... although considering the whole world americans are the exception and not the norm. ... But we've had big economic crises in the near past (the last big one in 2001) and those are have:
- Political instability: Presidencies are toppled, ministers quit, vultures circle above.
- Social instability: Constant strikes, pickets, rallies and protests of all kinds.
- Credit absolutely dissapears... i
Why do we keep getting these Argentinian Economy " (Score:3)
1) There is no dollar outrun, there is a government that artificially keeps the dollar cheap for political / economic esoteric reasons. So it needs to prevent massive access to that cheap dollar market.
2) Most the population hardly reaches the end of month, so the "lack of dollars" issue directly affects less than 30% of it, because the rest don't even have pesos to exchange for dollars.
3) The real problem of the people is that we've no credit... No 20 years mortgages for buying a house, 6 years is the best you can get, and only in specially stable situations. So the little guy can't "invest" his little money in anything bigger than a car. That has the secondary effect that the little money you save, you need to spend it quick before the government eats it. That's good for the economy, good for the government, bad for the little guy.
All in all, this is a government that has "kept" unemployment rates low, sacrificing other economic variables. Yes, it's socialism, but that's better than what we had from previous governments. And yes, this is a corrupt government, but that doesn't really make our country a special enough to be news for nerds.
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Yes, you have a point — And specially in point #3. I live in Mexico, where few people can afford to buy a house as well. And there's a big difference favoring Argentina: The rental contracts. Legal rental contracts are always for two years or more, and with prices fixed in pesos (this means, you know how much you will pay for your rental two years from now). Although this won't allow you to buy a house, it does allow you to mid-term plan your finances better than in most of our continent.
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I can't and I won't ever trust a website that claims "they [the U.S. and Israel] must remain steadfast allies if they are to overcome the serious challenges threatening both nations in today’s world." This is an 'us vs. them' kind of bias. They can shove their economic freedom index up their a
Illogical (Score:2)
Any government that was willing to not abuse the currency could simply STOP ABUSING the currency. They would not need to go cashless.
Going cashless would at best be a meaningless symbol.
I'm Argentinian and you are wrong (Score:2)
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Apparently a helluva lot of Argentinians DO NOT agree with you, and just as importantly, or perhaps moreso, international markets do not agree with you.
Your economy and government are being horribly managed, and you're suffering for it. Quit blaming the rest of the world for your domestic problems.
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But the voices of people that reach other countries are from the upper classes. They should at least speak english, have internet access/be able to travel outside of the country, and give some shit on the international view of Argentina's economy.
This people are the same subset affected by the dollar restriction, so you get biased sample pool...
To give you an scale, this news looks to me like someone sayi
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The current Argentinian government has among the highest approval rates historically in their country. And everything points towards the same project winning this years' elections.
Argentinian economy fares way better and is way stabler than everything they had in most of our lifetimes. Until the early 1980s, the corrupt, inept, USA-backed military broke one of the strongest economies in the post-world-war era; in the 1980s, Alfonsín had to resign after having >1000% yearly deflation. During the 1990
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I, as an Argentinian, am NOT desperate in the way you claim. I, as an Argentinian, do NOT agree with you.
I, as an Argentinian, DO agree with him.
Bitcoins, Dogecoins, etc. (Score:2)
Even my signature is on-topic!
Bitcoin? Nonsense (Score:5, Insightful)
Hi from Buenos Aires.
No, the solution is not going cashless. We don't have a banking problem. We have a currency problem, because the government steals from us in the form of inflation. Going cashless is giving the government more power to screw us.
Also we know very well how to play this game. If you can save, you buy other currencies like dollars. Or houses, if you are rich.
If you need the money, you convert and spend as fast as possible. Inefficient and somewhat expensive, but possible.
Bitcoin is easier to transfer, but too volatile. You might as well save in pesos.
The real solution to Argentina's woes. (Score:3)
Is to kick out that crazy government and put in one that is good at running the country.
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put in one that is good at running the country.
Yeah, uhm, that's very difficult to accomplish, to say the least.
Never gonna happen under Kirchner Kleptocracy (Score:2)
Seriously.
She honestly doesn't give a shit about her people.
She just wants her percentage of whatever can be bilked out of the populace and world in general.
And her solution to every problem is to ignore its very existence. Entirely.
Basically Argentina needs a bloody revolution and then a general election.
Likely that'll never happen though.
If both are backed by the same entity.... (Score:2)
Really surprised to see this story (Score:2)
Argentina isn't desperate and is actually holding on their own, their biggest issue is inflation which is about 25%. So i am surprised to see this story being about Argentina and not Venezuela
Now we venezuelans are indeed in much trouble. The inflation is so high the government doesn't publish it anymore, but is expected to be near 200% per year. Every item you can think of it's scarse since most of them are being imported and the government ran out of dollars since oil price has gone down (and corruption g
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But is it really overvalued? Debt is only part of the equation. When the statement "the dollar is backed by the US Government", that means the whole thing; Executive (including the Federal Reserve, military, and so forth), the courts, and of course Congress, not to mention the collective will of the citizens of the United States. When you look at the greenback in that light, it's hard to imagine a currency in modern times as well backed.
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Since value is relative, then being the best currency means being the best currency, even with the shortcomings.
So far as I understand it the US has carried debt uninterrupted since the Civil War (maybe even before). Even in times of war and national emergency (including a few self-inflicted ones like the Tea Party trying to go kamikaze), the US Government has demonstrated its will to honor its debts and back the US dollar. It may be overvalued by some standards, but in general, I think the US dollar remain
Re:The solution for Argentina is competent governa (Score:4, Insightful)
Argentina, like most Latin American countries, would do well to toss the Presidential system. The US, by and large, has lucked out, in no small part to what Bagehot referred to as Americans' "genius for politics". But in other societies, where the legislative and judicial branches have remained stunted as compared to the US Congress, SCOTUS and the Federal Courts, all the Presidential system does is deliver near-dictatorial powers into the hands of the President. The checks and balances may exist on paper in countries like Argentina, but the reality is that legislative assemblies and courts become little more than rubber stamps.
A parliamentary system like the Westminster system would, I think, work far better. The titular head of state of a parliamentary state does hold some potent reserve powers, but is restricted from using them in all but the most extreme circumstances. The "effective" government, that is the governing Executive, only survives so long as the legislative assembly retains confidence in it, and ministers are normally chosen from among members of the legislature, and thus, at least in a nominal way, remain equals to every other person sitting in the legislature. In a parliamentary system, the titular head of state represents a sort of negative power; in that he or she deprives the effective executive of absolute control of reserve powers and prerogatives.
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You are proposing your innovative idea 15 years too late.
We had that here in Argentina, it was called "Cupones de Trueque" (Barter cupons)... We used those when people were desperate (because they had no work, no pesos and nothing to eat)... It's something we don't want to go back to.
This is an example http://en.wikipedia.org/wiki/C... [wikipedia.org]édito
Now people are "desperate" because they can't save their extra pesos at a rate they consider fair, It's a completely different s
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No shit. The one thing bit coin seems very good at is enabling black market exchanges and corruption. We all know how Silk Road was such a warrior against criminal and corrupt activities!
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Yes, instead you create an inflexible currency system based on assigning arbitrary value to a physical commodity.
Outside of its industrial uses, gold has no more intrinsic value than a lump of dog shit. I mean, why not peg your currency to Renaissance paintings?
Paintings? (Score:2, Funny)
Because the dang things get creases when I fold em up to put in my pocket.
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No one's ever thought "hey maybe the government and bankers are using fiat currency system is screwing us all and we should go back to the monetary system that we've had for most of recorded history"?
A lot of people will point out the short comings of a precious metal money supply but it has one big advantage: You can't create gold through quantitative easing or other manipulative accounting tricks. You actually have to trade goods and services in order to accumulate it.
That's the problem with gold and silver - you have to actively trade goods and services in order to accumulate it. What happens when technology and human innovation and efficiency proceeds at a rate several orders of magnitudes greater than the mining of gold and silver[1]? With gold/silver you cannot match value against currency in a stable and consistent manner. With fiat money you can.
[1]Like with the mass-production of the transistor, or the last two decades of efficiency improvements due to computers,