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.

Another iPhone fan appears to be Industry Minister Débora Giorgi, who has advocated the import restrictions, saying they help create local jobs. In the photo below, she is seen with four phones, one of which is an iPhone.

Former cabinet chief Aníbal Fernández, now a member of Congress, is also a big fan. He proudly used to take his iPad with him to testify before Congress.

Like many of Argentina’s policies, the iPhone ban is informal. It was never announced publicly and exists solely in de facto terms.

Telecommunications companies would love to sell the iPhone here.

But they haven’t been able to bring it into the country. Industry officials say the government hopes that by banning products, manufacturers will eventually make them here.

That appears to have been the case with Research in Motion, which decided to assemble Blackberries locally after the government banned their entry.

But it’s hard to imagine Apple deciding to make iPhones in Argentina. The NY Times had a great story about iPhone manufacturing here, and a great video here.

The iPhone ban is part of a much broader government crack-down on imports.

You can read more about all of this in a piece I did for The Wall Street Journal here.

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.

OK, maybe not.

Still, Argentina’s biggest oil and gas company, YPF, has found a massive amount of oil in the province of Neuquen.

YPF on Monday confirmed the existence of almost 1 billion barrels worth of oil equivalent in the province. That’s not enough to turn Argentina into Saudi Arabia or even Montana and North Dakota, which have become the new stars in the world’s race to produce more oil.

Saudi Arabia reportedly has hundreds of billions of barrels in oil reserves.

But if the discovery is proven, it is enough to roughly double Argentina’s oil reserves and potentially help turn around the country’s position as an increasingly voracious energy importer.

Argentina’s oil reserves have fallen by about 16% over the past decade amid rising demand and relatively scarce investment in exploration and production, according to the Argentine Energy Institute.

YPF’s discovery, which I wrote about here, could soon help change that trend. Moreover, YPF said it has also outlined another area in Neuqen, where even more oil might be found.

The find comes amid a global boom in unconventional oil and gas exploration and production.

In the U.S., the boom has radically transformed the country’s energy outlook, taking what many said was a doomed domestic industry and possibly putting the U.S. on path to becoming energy indepdendent.

Argentina is ranked third behind China and the U.S. in its potential to produce unconventional gas – gas that’s extracted from incredibly old shale formations – according to a report from the U.S. Energy Information Administration.

Link: My article on MarketWatch
And my colleagues at WSJ have another piece here.

Click here to view the embedded video.

Al Jazeera has a nice video here describing how the government has been persecuting economists in Argentina. For an in-depth look at the latest charges, check out my recent article here for The Wall Street Journal.

President Cristina Kirchner gave Economy Minister Amado Boudou the surprise of his life on Saturday, choosing him to be her vice presidential candidate in October’s election.

The 47-year-old Boudou appeared exceptionally pleased with the announcement, which took almost all 1,000 people in attendance by surprise.

Boudou’s nice-guy face filled with emotion as he heard Kirchner say he would be the No. 2 person on her ticket.

Boudou is arguably the most affable official in the Kirchner administration. A self-described rocker, he enjoys playing the guitar and singing. He likes to party and is a fan of Argentina’s nightlife.

On one occasion, while making an important announcement about Argentina’s sovereign debt problem, he invited a local rock star to accompany him in the press room.

Boudou is perhaps most famous, or infamous if you’re a critic, for denying that Argentina has an inflation problem. At one point he said not only that inflation didn’t exist in Argentina but that it could not exist given the country’s macroeconomic conditions.

The minister in fact knows this not to be the case, which has led critics to say he’s a Kirchner “soldier” whose loyalty is uncompromising.

Though dismissed by some as an intellectual lightweight with little technical knowledge of economic theory, Boudou’s influence on Argentina has been substantial.

It was Boudou who first proposed to Kirchner that she should nationalize Argentina’s 14-year-old private pension fund system.

It was a radical idea, but one that Cristina and former president Nestor Kirchner grew to appreciate enormously.

In naming Boudou as her VP on Saturday, Cristina praised him for bringing the idea to her. The decision to nationalize the pension fund system was the most important she has made as president, she said.

Argentina’s election is October 23. You can watch Cristina’s speech here.

Pretty much everyone knows by now that Argentina’s inflation statistics are controversial.

Virtually all private-sector economists, and even some within the Economy Ministry itself, say the statistics agency, Indec, is fudging the data to make inflation appear lower than it is in reality.

Indec and other government officials dispute such charges and say Indec’s data “have never been better.”

Whatever the case, fewer people are aware that economists also question other statistical data such as economic growth.

Though economists unanimously say the economy is expanding robustly, they don’t necessarily agree about the pace of growth. I looked at this issue in a bit more depth in an article Wednesday for my newswire. Here are a few paragraphs from it:

Gross domestic product grew a blistering 9.9% on the year in the first quarter, according to the statistics agency, Indec. That was much higher than the 8.6% gleaned from Indec’s monthly economic activity reports that capture most components of GDP.

“When you get a discrepancy that big it starts to raise questions,” said an economist at a prominent local research firm. The economist spoke on the condition of anonymity out of fear of government reprisals. Earlier this year, the government fined at least nine consulting firms about $125,000 each for publishing economic data that differed considerably from Indec’s numbers.

A broadly-respected estimate by Orlando J Ferreres & Asociados, or OJF, put first quarter growth at 7.2%.

Some economist say Indec exaggerates GDP by about one percentage point. Others say it’s closer to three points.”The overestimate is between two to three points on average,” said Gabriel Camano Gomez, an economist at Joaquin Ledesma y Asociados.

To read the article, click here. If that link doesn’t work, try this one. For more on the controversy over inflation, click here.

About two dozen journalists at the 135-year-old Buenos Aires Herald went on strike Monday, demanding higher wages and better working conditions.

As of late Wednesday, the journalists were still on strike, having rejected a 3% retroactive pay hike for 2010 and a 10% raise for 2011.

The Herald, Argentina’s only major English-language newspaper, gained international recognition for its courageous coverage of disappearances and other dastardly deeds during the country’s 1976-1983 military dictatorship.

“Unfortunately we haven’t been able to reach an agreement about salaries,” said Judith Rabinovich, a spokeswoman for the Buenos Aires Press Workers Union, or UTPBA. “We’ve had a lot of patience with these negotiations, which have been going on since January.”

Journalists at the Herald typically make somewhere between 2,300 (US $563) and 4,000 pesos a month, with the average likely being closer to 2,700 pesos.

“There’s a big difference between what Herald workers make and what reporters at other papers make,” Rabinovich said in a phone interview. “These salaries are very low. But these are very qualified reporters who speak two languages.”

Herald employees are seeking a 35% salary hike for 2011, putting the basic salary at the paper at around 4,100 pesos a month, she said.

The vast bulk of economists in Argentina estimate that inflation totals somewhere in the neighborhood of 25% annually. Most major unions have obtained annual salary hikes of between 20% and 30%, and often higher, in recent years.

“The company is very far from satisfying that request and making a deal,” he added.

The Herald is owned by the same publishing company that owns the financial daily Ambito Financiero. Despite the strike, Rabinovich said a reduced version of the paper is being published.

Union reps are set to meet with management Thursday at the Labor Ministry to try and reach a a settlement. A spokesman for the Herald’s management could not be reached immediately for comment.

UPDATE: The Herald workers on Thursday suspended the strike in hopes of reaching an agreement soon with management.

The Financial Times reported on Sunday that Netflix, the U.S. film and TV Internet streaming company, is close to launching its service in Argentina, Brazil, Chile and Mexico.

FT’s report comes about a month after La Nacion published similar information. Meanwhile, La Nacion’s article came several months after Uberbin.net said in December that Netflix would likely be coming to the region this year. Finally, Seeking Alpha reported last week that Netflix plans to launch in South America.

I spoke with a Netflix spokesman last month and he declined to comment on the company’s plans. So far, Netflix has only operated in countries where the rule of law limits pirated downloads and the use of illegal video streaming sites such as those common in Latin America.

So-called “pirate” video services are extremely popular in Argentina. The online streaming service Cuevana is a perfect example. Cuevana, created by three college-aged Argentines, has become a tremendous success. Cuevana claims to have around 450,000 registered users.

Cuevana offers an exceptionally good service and it does so for free. Its questionable legality doesn’t seem to deter Argentines from using it and it’s legitimate to ask how Netflix could ever compete with such a free service.

But in the U.S., at least, Netflix offers something that Cuevana and other services do not. Netflix provides high quality HD streaming directly to your TV. If Netflix can offer such a service in Argentina, it will likely have a good chance of being a success.

However, for that to happen, Argentina’s comparatively slow bandwidth speeds will first have to improve dramatically. High quality streaming requires a fast Internet connection.

Happily, higher download speeds may be coming our way soon. Cablevisión has already confirmed that it plans to offer a super-fast Internet service in the first half of 2011. The company plans to launch the so-called DOCSIS 3.0 modem technology, giving customers download speeds that are around 10x faster than current rates.

That would let online addicts and heavy downloaders obtain speeds of up to 30 Megabits or even faster this year, easily enough to stream HD movies and TV shows directly to household TV sets, or to iPhones and iPads, etc.

Click here to view the embedded video.

Argentine President Cristina Fernández on Tuesday presented a new animated cartoon series about the country’s sovereign debt history.

The series, called “Martians,” runs repeatedly on the government’s Encuentro channel.

Fernández, who has been a fierce critic of the way Argentina borrowed money in the past, hopes the series will help Argentines, and school children especially, learn about the debt program and draw lessons from it.

She said the series about martians is “very good because, in reality, it’s not them who are the martians, it’s we who have been the martians because we thought we could get ahead by following these kind of (debt) policies.”

In 2001 Argentina defaulted on around $100 billion in debt, setting off a massive financial and economic crisis.

Since then, and when measured as a percentage of its gross domestic product, Argentina has substantially reduced the amount of money it owes to other countries and its own people. It reduced that debt ratio largely by deciding not to pay back much of it’s debt, as well as by growing the size of it’s economy.

This decision not to pay its debt had both positive and negative consequences. On the upside Argentina now owes less money and can use its available funds to invest in infrastructure and healthcare, etc. On the downside, many people consider Argentina a pariah nation and refuse to lend it money or invest in it.

That has increased Argentina’s borrowing costs significantly. If Argentina needed to raise funds for something it would have to pay far higher interest rates than would its neighbors and most other countries.

Link: Argentina’s Debt Museum

Two notable events dominated the news here this week.

One entails what appears to be an effort by Argentine President Cristina Fernandez to silence economists who question the government’s inflation data.

As I wrote here in the Wall Street Journal:

“Argentina’s government has fined more economists for challenging official inflation estimates in what lawyers call a violation of freedom of speech.

On Tuesday, the government fined consulting firm Econviews 500,000 pesos ($123,442). It fined the consultancy abeceb.com an equal amount Monday for allegedly publishing inflation estimates that “lack scientific rigor.”

“This isn’t about methodology or truth in advertising, as the government claims. It’s really about silencing dissident voices,” economist and former finance undersecretary Miguel Kiguel said in a phone interview Tuesday.

The government has imposed similar fines against Estudio Bein & Asociados, Finsoport, MyS Consultores, GRA Consultoras and former Indec official Graciela Bevacqua, who used to oversee Indec’s consumer price index. Several other firms said they expect to be fined soon.”

By now pretty much everyone in Argentina knows inflation is rampant. Economists say inflation hovers around 25%, give or take a few points.

But government officials have long denied this to be the case. Instead, they say, the country is experiencing “price dispersion.” Just a few months ago officials said inflation didn’t even exist.

Economy Minister Amado Boudou even went as far as saying that given Argentina’s macroeconmic situation, inflation “could not exist.” He said people should “walk around” to find good prices. (If you’re gonna walk around, try Belgrano. Its tree-lined streets and classic homes are delightful.)

Whatever the case, prices are up. Even the government says officially that prices are up 10% from a year ago.

In just about any other country, an inflation rate of 10% would raise red flags and cause politicians to panic over ways to curb rising prices. Moreover, government officials in those countries would use the word “inflation” to describe what was happening to prices. But Argentina has never been “any other country” and its idiosyncrasies are sometimes so frequent that they cease to surprise.

The other notable piece of news was a move by the government to gain control over the decisions made by companies in which it has stakes. As I noted in a another WSJ piece:

“Argentina’s government increased its sway over dozens of companies through a presidential decree on Wednesday, a move that will grant the administration a larger influence in some of the key sectors of the economy ahead of presidential elections in the fall.

The decree lifts limits on the government to unilaterally name board members and expands its influence over other corporate decisions. Until Wednesday, the government’s voting rights were capped at a 5% equity stake even if its actual ownership in a firm exceeded that level.

Pension agency Anses owns stakes in 42 local companies after the government nationalized the private pension system at the peak of the 2008-09 financial crisis.

When Congress debated the pension nationalization bill in 2008, opponents agreed to pass the bill only after assurances that the state’s influence over corporate decisions would be limited by the 5% rule. But the decree published in the Official Bulletin abolished that limit, greatly enhancing the government’s influence.”

So there you have it. A quick and dirty round up of this week’s top news.

Have a great weekend!

Click here to view the embedded video.

Last week Argentina’s oil and gas giant YPF announced that it had found 4.5 trillion cubic feet of gas in the southern province of Neuquén.

You can see my article about it here.

While YPF’s unconventional gas find is the biggest of its kind in South American history, other companies already had beat YPF to the punch and found unconventional gas in the country.

Unconventional gas is akin to traditional gas, except that it’s twice as expensive to obtain because its harder to get out of the ground. Companies often have to drill down thousands of feet, and horizontally, to get the gas, which is embedded in rock or sand formations that can be hundreds of millions of years old.

To extract the gas, they use a new technique called hydraulic fracturing, or “fracking.” This allows for the extraction of gas from shale rock and deep sands. The process entails injecting fluids into deep rock or sand formations at very high pressures to break up the rock and free up the gas.

So-called “tight gas” is simply gas that is locked in largely impermeable tight rock or sand formations.

Fracking has revolutionized the gas industry in the U.S., where unconventional gas already accounts for more than a third of the total gas market. And many people are hoping it will similarly change the industry in Argentina, which has only about eight years left of natural proven gas reserves.

The lack of gas in Argentina, coupled with year after year of rising demand, has forced Argentina to import gas from Bolivia and Trinidad & Tobago.

Fracking, however, may soon make that unnecessary. The country is experiencing a boom in the exploration and production of unconventional gas.

But critics say there’s a catch.

The technique is not entirely safe, they claim. They say that injecting fluids – mostly water but also chemicals – into the ground can ruin nearby underground water reservoirs.

That’s where the documentary Gasland comes in.

As explained in the movie, critics say the new drilling technique can contaminate the water supply and cause serious health problems, including neurological damage.

Two weeks ago the New York State Assembly voted to place a moratorium on fracking until its effects could be fully studied. New York Governor David Patterson vetoed the bill.

No such legislation has been debated nationally in Argentina.

Argentina is a giant, sparsely population nation. This could mollify any possible negative side effects of fracking given that the drilling could take place in areas where few people end up drinking an affected water supply.

Still, given that Argentina’s unconventional gas boom is just beginning, it’s likely that the controversy too is only just starting to gain attention.

Twitter: @taos

Click here to view the embedded video.

This video was produced “tongue in cheek” by American Task Force Argentina, which is “an alliance of organizations united for a just and fair reconciliation of the Argentine government’s 2001 debt default and subsequent restructuring.”

Argentine officials say the group is basically comprised of malevolent “vulture funds” that are unhappy with the way Argentina defaulted on its debt and later repaid only a very small percentage of it.

Regardless of the video’s nature, it is true that Argentina is still largely considered a pariah by many investors.

Despite almost a decade of booming economic growth and a solid outlook for the near future, Argentine debt is still viewed cautiously.

Yields on Argentine bonds are extraordinarily high given the country’s comparatively strong fundamentals.

So while many people will consider this video to be a joke, the reality is that Argentina has a long way to go before it will inspire trust and be seen as a safe bet for international investors.

Twitter: @taos