1. Twenty years ago the inflation rate was about 5000 percent annually.
2. Argentina has been growing at nine percent for three years now.
3. By paying off its IMF debt, the central bank is trading in U.S. dollars for Argentina government bonds.
4. The current one-week repo rate is at 5 percent.
5. The price inflation rate is running about 12 percent.
6. Striking Buenos Aires subway workers asked for a 58 percent wage increase. They received a 22 percent boost but with the right to renegotiate in a few months’ time.
7. Nestor Kirchner, the President of Argentina, enjoys unprecedented approval ratings of 75 percent.
8. Kirchner has moved to build an alliance with Hugo Chavez.
9. Kirchner will not admit he has made any mistakes, and he is seeking greater control over judicial nominations, and perhaps over the media as well.
10. He is seeking to extend his emergency powers over this economy. Supermarkets had agreed to temporary price freezes, but these may be renewed and broader wage and price controls may be coming.
Would anyone care to guess the inflation rate in Argentina three years from now? On the positive side, the country is running a budget surplus (hey, maybe this would test the fiscal theory of the price level!?). For these facts, see The Wall Street Journal 22 December p.A12 and this excellent New York Times article.
You didn’t really think I was done blogging about this place, did you?