Remember I told you about how President De La Rua resigned after the huge pressure put on him by popular movements, unions, and political and economical sectors? Well, four presidents and four months later, here I am. Still alive. Poorer than before, but I've got broadband now. Curiosities of life, yeah.
I chose this article because it's clear enough to be read and understand the whole picture. We had these money withdrawal restrictions and deposit freezing since finance minister Cavallo set them on December.
For those not registered (although it's free) some excerpts:
quote:With Argentina's financial system on the verge of collapse, President Eduardo Duhalde proposed emergency legislation today to reduce the pressure on his government by forcibly converting billions of dollars in bank deposits into low-interest bonds to be paid off in 5 to 10 years.
The proposal came on the first day of an indefinite bank holiday that paralyzed economic activity in this nation of 37 million.
"The problem is that people want more money than what is in the banks," Mr. Duhalde explained this afternoon at a news conference that preceded a cabinet meeting. "Today the money simply does not exist."
quote:With no indication of how long the embargo on bank and foreign exchange transactions will last, economic activity was at a virtual standstill today, as even the stock market decided that there was no point in opening for business.
Fearful of running out of money now that banks and automatic tellers are no longer dispensing cash, anxious consumers were limiting their purchases to food, medicine, gasoline and a few other essential items.
A sweeping freeze on withdrawals from bank accounts was put into place in December, leading to protests, riots and the fall of four presidents in less than two weeks. But in recent days, dozens of rulings by judges have challenged the freeze, unleashing cash outflows of more than $100 million a day from the banking system and forcing the besieged government to decree the bank holiday late on Friday.
quote:"I don't have a Plan B," Mr. Duhalde said in an interview published on Sunday in the newspaper La Naci�n, "because the only plan is to solve the problems we have and obtain help from the I.M.F."
But today he took an opposite tack, at times seeming almost dismissive of the demands that industrialized nations and the monetary fund made of Argentina during their spring meetings in Washington over the weekend. An agreement with the fund is "not the only solution, just the one that is least painful," he said.
"More and more voices are heard in the political sector asking, why talk with the fund?" Mr. Duhalde said.
He added that the fund was mistaken to insist that Argentina allow the exchange value of the peso to fluctuate as a condition for negotiations. He said that demand had fueled inflation that could have been avoided under the policy Mr. Duhalde preferred of a fixed exchange rate tied to the dollar.
Other parts of the article include the unrest from people forced to change their halted money for bonds, tourists profiting from low prices and Duhalde's criticizing to foreign banks.
Opinions? Or is this a deadbeat horse already? (Capt. Mike, please spare me of those pics )
Posted by Vogon Poet (Member # 393) on :
Has there been any more on that alleged convoy which carried all the establishment's wealth out of the country prior to the freeze?
Posted by David Templar (Member # 580) on :
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