He is the Minister of the Economy (aka has the power to do this) who is running for President with an election in a month, and Argentina just received $7.5 billion from the IMF as the first part of a bailout. No plans to cut spending at all for a country whose government spends ~38% of GDP. It’s totally a great long term move and not a desperate bribe for the voters!
I guess I have zero clue how the IMF works because I have zero idea where they get their money.
It can't be like the Federal Reserve and print money. I don't think they're like a bank and lending out deposits.
>It can't be like the Federal Reserve and print money. I don't think they're like a bank and lending out deposits.
Sort of both? They lend what other countries donate to the pool. Also, SDRs kind of like what central banks do, but limited.
Argentina wouldn’t sell itself to China; they’re too prideful of their lot and the country is a fully functional democracy after all.
China also isn’t all that big of a draw, at least not anymore.
They used 5% of their $7.5 billion IMF loan disbursement to pay off money they borrow through a currency swap line from China
≠
Literally selling yourself to China belt & road style
You got your facts a bit mixed up there, if you’re referring to this:
https://www.reuters.com/world/americas/argentina-use-imf-money-pay-back-part-currency-swap-with-china-sources-2023-08-23/
The yield is hot
https://www.reuters.com/markets/rates-bonds/argentina-looking-issue-up-12-bln-bonds-backed-by-world-bank-caf-ministry-source-2023-04-14/
>Argentine dollar bonds currently yield between 22% and 42% in the debt market.
IMF is just trying to save face for a previous botched loan, it's more like they are changing maturities than outright lending them money besides a minimum.
Unless Argentina just uncovered a fuck ton of oil then yeah... best case scenario is that it's just a lie... worst case scenario Argentina's trying to find a new low.
There are countries with no income tax that are very successful
Argentina is just about the last country on Earth that should consider trying to do this
I assume it only works in countries rich in natural resources? In which case Argentina has an abundance of bad presidential candidates they could export.
wow that is really slapping the good people of Island nation of Vanatu in the face. Frankly I their model of funding government via selling passports needs to be explored further.
also the uae has no income tax and they are one of the richest countries in the world per capita.
Even the VAT returns? Still, what disturbs me is that they went for the efficient taxes first, so removing the distorsive ones is going to be more costly.
Technically speaking the government could just print its own money for expenses without collecting taxes. This would result in inflation which means that every Argentine citizen would end up paying via a loss of purchasing power
"Argentina is simultaneously a world leader in exporting great economic minds and the world's foremost economic mental asylum" to paraphrase from twitter
And not the one you may have expected!
Just double checking in case things have changed: this makes literally no sense right?
He is the Minister of the Economy (aka has the power to do this) who is running for President with an election in a month, and Argentina just received $7.5 billion from the IMF as the first part of a bailout. No plans to cut spending at all for a country whose government spends ~38% of GDP. It’s totally a great long term move and not a desperate bribe for the voters!
Why the fuck is anybody still lending them money?!
I believe that the IMF is just paying Argentina vast sums of money so that Argentina doesn't sell itself to China.
I guess I have zero clue how the IMF works because I have zero idea where they get their money. It can't be like the Federal Reserve and print money. I don't think they're like a bank and lending out deposits.
[https://sgp.fas.org/crs/misc/IF10676.pdf](https://sgp.fas.org/crs/misc/IF10676.pdf) says that the US has given it a couple hundred billion.
Meanwhile, 60 billion for ukraine this year, how much have we donated to argentina last year?
>It can't be like the Federal Reserve and print money. I don't think they're like a bank and lending out deposits. Sort of both? They lend what other countries donate to the pool. Also, SDRs kind of like what central banks do, but limited.
Argentina wouldn’t sell itself to China; they’re too prideful of their lot and the country is a fully functional democracy after all. China also isn’t all that big of a draw, at least not anymore.
They just recently pays off an IMF loan with a Chinese loan Edit: Which they then payed of with an IMF loan
Lmao Argentina doing what every broke person does literally paying off credit cards with credit cards
If you figure out how to use the two week interest free period you basically have free unlimited money.
They used 5% of their $7.5 billion IMF loan disbursement to pay off money they borrow through a currency swap line from China ≠ Literally selling yourself to China belt & road style You got your facts a bit mixed up there, if you’re referring to this: https://www.reuters.com/world/americas/argentina-use-imf-money-pay-back-part-currency-swap-with-china-sources-2023-08-23/
And they used the currency swap to pay off the IMF. But your right, I didn't know that they then used another IMF loan to pay off the Chinese again.
The yield is hot https://www.reuters.com/markets/rates-bonds/argentina-looking-issue-up-12-bln-bonds-backed-by-world-bank-caf-ministry-source-2023-04-14/ >Argentine dollar bonds currently yield between 22% and 42% in the debt market.
...is there such a thing as an F-rated bond?
"D" stands for default, so no
It’s only worth that if they can pay.
They’ve been asking this for the last 100 years
I don't think they will be if this idiot wins.
Thankfully this idiot has basically 0 chances of winning.
IMF is just trying to save face for a previous botched loan, it's more like they are changing maturities than outright lending them money besides a minimum.
Okay cool, it sounds so dumb for a second I thought maybe I'm the dumb one.
Unless Argentina just uncovered a fuck ton of oil then yeah... best case scenario is that it's just a lie... worst case scenario Argentina's trying to find a new low.
There are countries with no income tax that are very successful Argentina is just about the last country on Earth that should consider trying to do this
I assume it only works in countries rich in natural resources? In which case Argentina has an abundance of bad presidential candidates they could export.
wow that is really slapping the good people of Island nation of Vanatu in the face. Frankly I their model of funding government via selling passports needs to be explored further. also the uae has no income tax and they are one of the richest countries in the world per capita.
Argentina is just moving to full seigniorage, no more half measures.
Completely insane. I’m sure his opponent has more sensible economic plans Right?
Yes, negative tax!
Someone could've say 'the only raised taxes would be sales for football's feet pics merchandise' and it would be far saner than this.
Man, when the "libertarian" candidate has a more sane tax policy, you gotta wonder what is going on.
The libertarian candidate voted for this one. Some people suspect he is baiting a hyperinflation to make dollarization cheaper afterwards.
The libertarian also proposed massive spending cuts to accompany this, not having your cake and eating it too
That may be happening next year at best. In between you have a big fiscal hole and no financing while in a high inflation regime.
These tax cuts mostly take effect next year. So if Milei wins he will have time to cut taxes accordingly.
Even the VAT returns? Still, what disturbs me is that they went for the efficient taxes first, so removing the distorsive ones is going to be more costly.
Hey! I've seen this before, this is a classic!
"read my lips, i dont have a brain"
Very serious people!
Technically speaking the government could just print its own money for expenses without collecting taxes. This would result in inflation which means that every Argentine citizen would end up paying via a loss of purchasing power
👑💩
By gawd, it's the ghost of HW Bush!
Nah Bush was at least reasonable
Someone please introduce the Libertarian guy to LVT
Don't they have absurd inflation?
Most economically literate Argentinian politician.
Lolberts licking their lips and buying a one way ticket to Argentina right now
"Argentina is simultaneously a world leader in exporting great economic minds and the world's foremost economic mental asylum" to paraphrase from twitter
I don't have a subscription so someone please tell me: did he actually say "read my lips" or is that WSJ drawing the Bush parallel?