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Economics

Talking about Argentine Politics

October 28th, 2013 | 03:54 PM

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If you’re interested Argentine politics and economics, I’d highly suggest watching the Odisea Argentina.

Hosted by La Nacion columnist Carlos Pagni and economist Nicolas Dujovne, it’s heaven for political junkies. You can catch the show on Monday nights at 11pm on Canal Metro.

I was on the show recently talking about Argentina’s election and other things. My segment starts at 36:50″.

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Cristina’s Top Post-Election Quotes

August 15th, 2013 | 08:34 AM

CFK Tecno

President Cristina Kirchner gave a defiant speech Wednesday in which she blasted the media, banks, politicians and just about everyone else who has ever criticized her government.

The president downplayed her party’s thumping in Sunday’s primary election and claimed that the media lied and tried to cover up the party’s victory in places like Antarctica, where she got about 55% of the vote. Indeed, Mrs. Kirchner began her speech by saying the media had “covered up” her party’s victory in Antarctica.

In reality, only around 86 people, or 0.000002% of Argentina’s population, cast valid ballots in Antarctica, meaning the election results there were next to meaningless in terms of their relevance to the overall election.

The speech was full of colorful quotes. Here are the most interesting ones:

I’m not a benchwarmer for anybody. I’m the president of 40 million Argentines.” – Here the presidents was saying that opposition party candidates, who actually did very well in the election, were not worthy of being on the stage with her. She referred to them as “backup” or “second string” players. She said they were not valuable in and of themselves, but rather were merely means to an end sought by special interest groups such as banks. The truly important “first string” players are these special interests. Mrs. Kirchner said she would sit at the table and negotiate with these players but not with the benchwarmers. It was entirely unclear what this might mean, if anything, in practical terms.

In economics, when you give something to someone, it’s because you’re taking it away from someone else.” – Here Mrs. Kirchner was saying, essentially, that the economy is a zero-sum game, in which there are winners and losers. There are no win-win situations in economics, according to this view.

I don’t think there are good intentions there. I’d be a liar if I said there were.” – Here the president was referring to those who disagree with some of her policies. This is a fairly common view expressed by the president and members of her cabinet. Those who disagree with her are traitors, not patriots who simply have different viewpoints.

Above all, I’m a political militant who feels the obligation to tell people the truth.” – Mrs. Kirchner has been increasingly referring to her own honesty in recent speeches. This comes as more people appear to be questioning the president’s vision of reality.

When Wall Street becomes happy, muchachos, we should be worried. Whenever they’ve been happy, things have gone very badly for us.” – Here Mrs. Kirchner recalls the government’s view that markets should not be listened to or respected. Instead, markets should be managed and tamed so that they don’t lead the country into economic ruin. Paying too much attention to the demands of the market, the president has often said, leads to financial, economic and political trouble.

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Al Jazeera Video on Argentina’s Inflation Problem

May 18th, 2013 | 09:40 AM

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Argentina Bans Certain Newspaper Ads

February 14th, 2013 | 05:48 AM

Argentina’s government last week told leading supermarkets and electronics retailers to stop advertising in the country’s biggest newspapers. You can read all about it in my article for The Wall Street Journal here.

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Excel, AK47s and Argentine Oil

January 22nd, 2013 | 06:56 AM

Axel Kicillof, Argentina’s deputy economy minister, is said to wield considerable sway over President Cristina Kirchner, influencing her thoughts on everything from gasoline prices to trade and housing policy.

But the 41-year-old Keynesian economist is deeply unpopular in Argentina’s oil industry, which he oversees.

Kicillof requires oil and gas companies to submit excruciatingly detailed Microsoft Excel spreadsheets divulging information about sales, costs, investment plans and pricing strategies. Oil executives refer to him privately as “Excel” instead of Axel.

Given the industry assumption that he’s a Marxist – something his colleagues deny – executives also mock his initials and call him as “AK47″ – “because this kid is a lethal weapon; he destroys everything that gets near him,” says one executive. (more…)

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Argentina Moves to Nationalize YPF

April 16th, 2012 | 08:11 PM


President Kirchner said Monday she will send a bill to Congress to nationalize the oil and gas company, YPF. Kirchner blames the company for falling oil and gas output, as well as the government’s growing need to import expensive fuel.

But it’s unclear how nationalizing the company will solve Argentina’s energy problems. Critics say the government itself is responsible for declining production. They cite unpredictable government policies and price caps, among other things, for the problems.

Raising production will require billions of dollars of investment in exploration and extraction. Where will that money come from now that the government will own the company?

Kirchner didn’t say.

Meanwhile, YPF’s parent company, Spain’s Repsol YPF, said it will fight the government’s decision, ensuring a lengthy and messy legal, political and economic battle over how the government will compensate Repsol for expropriating its top asset.

Within hours of the announcement, government officials were already in YPF’s building, located in Puerto Madero, taking over management of the company.

My colleagues and I wrote about the issue here for The Wall Street Journal.

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Argentine Demand For US Tourist Visas Soars

April 11th, 2012 | 07:36 AM

More and more Argentines are traveling to the U.S.

Demand for U.S. tourist visas has soared by around 50% over the past year, according to the embassy.

“Last year the U.S. received more than 500,000 visitors from Argentina,” the embassy said.

Visa demand is so high that the Buenos Aires embassy now ranks among the top 10 worldwide in terms of tourist visa applications.

On average, the embassy handles more than 1,300 visa application a day. To meet the increased demand, the embassy has opened a new processing center and hired additional personnel.

About a year ago it took approximately four months to get a visa interview. Now “the visa interview can be be obtained in less than a week,” the embassy said in a statement.

To pay for the additional personnel and run the processing center, the embassy said it is raising the B1/B2 tourist visa application fee to US $160 from $140.

“The new amount faithfully reflects the costs our embassy needs to recover under US law through the visa application fee,” the embassy said.

The embassy didn’t say why visa demand is rising, but tourism sector officials say rising purchasing power is one factor making it easier for Argentines to travel. Another is the fact that Argentines can now pay for plane tickets in quotas spread out over months or years.

One interesting trend is the “viaje de quince” — more and more teenage girls are flying with their friends and families to the U.S. to celebrate their 15th birthday.

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Argentine Vice President Boudou uses an iPhone

April 3rd, 2012 | 06:23 PM

As you may know, Argentina bans iPhone imports because Apple won’t produce them in the country. I wrote about this for The Wall Street Journal here.

But as I’ve noted before, the import ban hasn’t stopped some of Argentina’s top officials from using the world’s most popular smartphone themselves. For previous evidence of that click here.

In today’s post you can see that even Argentina’s vice president, Amado Boudou, uses an iPhone. As you can see from the screen grab above, Boudou, a big Apple fan, used an iPhoto to post to Twitter. Ironically, the above Tweets are about imports. In one, he criticizes people for complaining about a “lack” of goods, saying that people who do this have political motives.

Says Boudou: “Argentina is open to the world but let’s not destroy the local industry” with imports.

HT to Facebook user Javier Mondini for catching this. You can follow Boudou on Twitter here.

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Argentina’s iPhone Problem

February 21st, 2012 | 07:11 AM

Many of you know that Argentina has banned the iPhone.

The government hasn’t prohibited its use but instead has blocked imports of the world’ most popular smartphone.

I wrote an article for The Wall Street Journal about the issue. You can read it here.

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Sean Penn Meets CFK on Haiti Promotion Tour

February 14th, 2012 | 06:20 AM

Sean Penn, the actor and newly-named Ambassador at Large for Haiti, came to Argentina as part of a broader trip to make sure people and governments in the region continue to help the disaster-stricken Caribbean nation.

Penn met with President Cristina Kirchner on Monday.

I met Penn and his J/P Haitian Relief Organization president Benjamin Krause at a dinner Monday night. Fernando Sulicin, producer extraordinaire and a mutual friend, Penn, Krause and others are doing absolutely amazing work in Haiti. They are literally making the world a better place day by day. These people are doing the kind of thing that most of us only think about.

Please check out J/P HRO here and donate to Haiti here.

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Some Argentine Officials are Big Apple Fans

January 25th, 2012 | 07:05 PM

Vice President Amado Boudou appears to be a big Apple fan.

In this photo you can see him meeting with Economy Minister Hernan Lorenzino.

But if you’re an Apple geek what you’ll notice about the picture is that Boudou’s desk is full of Apple products. He’s got 1) a big iMac 2) a wireless Apple keyboard 3) a wireless Apple touch mouse and 4) and iPhone 4 or 4S (bottom of the photo, implying it may belong to Lorenzino).

Boudou is also using a LaCie portable hard drive, which is made specifically for Apple computers.

These products are expensive and can be hard to find in Argentina. Indeed, the government banned iPhone imports a long time ago, forcing Argentines to get them from MercadoLibre or somewhere else.

The import restrictions have also made it hard for local Apple resellers to honor the company’s international AppleCare warranty. Dealers here can’t import the parts needed to fix Apple products. This has been very frustrating for some Apple owners, including many readers of this blog.

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Buenos Aires Subway Ticket Price More Than Doubles

January 6th, 2012 | 07:06 AM

Subway ticket prices more than doubled today to 2.50 pesos (58 US cents) from 1.10 previously.

The increase comes just days after the federal government turned over management of the subway system to the City of Buenos Aires.

The day-to-day administration of the subway is carried out by Metrovias, a private sector company which has had a concession to run the subway since 1994.

Prices had been frozen for years while the cost of just about everything else in Argentina has soared amid rampant inflation that economists say surpasses 20% annually.

The federal government had kept prices artificially low by dolling out millions of dollars in subsidies every year. But now that the subway is in the city’s hands, the federal government will stop paying for those subsidies entirely in 2013.

This year the federal government and the city will split the cost of paying for the subsidies, which total about $167 million annually.

The subway carries around 300 million passengers every year, according to Metrovias. That’s double what it carried when the company started its concession.

Metrovias has some 3,000 employees, unionized workers whose demands for higher salaries and better working conditions will undoubtedly put political pressure on the city government in the years ahead.

My colleagues, Matt Moffett, Ken Parks and I did a feature for the Wall Street Journal on the topic and the broader issues of utility rates and subsidies, which you can read here.

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