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Author Topic: Argentina defaults  (Read 1785 times)
Mobius
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August 02, 2014, 06:59:48 PM
 #21

...

Argentina has always been a place that fleeces foreigners, and for the past 100 years it has fleeced it own citizens.  100 years ago Argentina was about as rich (GDP / capita) as the USA or France...

An above poster is right about tough exchange controls.  A dollar brings (numbers approximate) some 13 pesos vs. the official rate of about eight.  Think about that, Americans.  Bring enough US dollars with you, change them right (quietly), and you pay for your trip.  Cheap great steaks and wine too.

A BTC guy I know goes Argentina somewhat regularly, including to meet-ups there.  He told me that among the technology-aware that BTC is growing strongly and fetches a HUGE premium vs. here.  Bring that flash drive, your laptop or your mobile phone w/ BTC...!  And Happy Trails!

 Cool

I've also read about the premium on Bitcoins in Argentina on the forum but had no idea someone could make such profit.  That is a really interesting idea to travel and use coins to pay for your trip, thanks for the tip!  How ironic that Argentina used to fleece foreigners and now finds itself in the same position.  I hope this is good for bitcoin and Argentinians of lesser means can acquire btc without being fleeced because they will be under the most pressure.
The premium is based on the peso price of bitcoins when converting pesos at the government controlled exchange rate. It is not usually feasible to convert pesos to dollars at this exchange rate due to currency controls, especially with any large amounts of money.

If you were to use the "blackmarket" exchange rate for peso/dollar then the preium is really not there anymore. I think this is simply people selling their  pesos for bitcoin so they would not need to experience additional massive inflation with the money they have saved.
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August 02, 2014, 08:00:49 PM
 #22

Excessive spending leads to default. But people still vote for politicians that promise things that they can't afford.

Perfect definition of what US is doing, but hey, they print the currency they owe everyone debt in, so that doesn't count Smiley

And the system would work even better, if there are countries like Argentina which can be safely looted by the IMF and the likes whenever there is an opportunity (by the way, I don't excuse or defend Argentina here).
The IMF really does not loot developing countries. They really do quite the opposite. They lend to countries that cannot otherwise borrow are very attractive rates and will often forgive debt that really should not be forgiven.

There are behind the scene deal which let international companies getting the country resources at huge discount.

Almost the same is happening in Ukraine right now. The IMF is trying to pave the way for Shell to get access to the resources in Eastern Ukraine (to the shale gas fields in particular).
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August 03, 2014, 07:27:18 AM
 #23

In breaking news, a US hedge fund has refused a deal with the Argentina Government thereby forcing them into a debt default. Consequences are that a handful of businessmen are forcing  several million people into a deeper recession.

I smell a chance for BTC to push ahead in a similar manner as to Cyprus.

http://www.news.com.au/finance/markets/argentina-in-selective-default-as-talks-fail-to-reach-a-resolution/story-e6frfm30-1227008204606

What is Argentina's credit rating? Anyone know how this will afftect their credit? I mean, its obvious it cant be good, but I'm just curious how bad it can get.
I believe that the major credit ratings firms have Argentina rated as "in default" as well because.....this really does not need to be explained.

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Mobius
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August 03, 2014, 11:02:59 PM
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In breaking news, a US hedge fund has refused a deal with the Argentina Government thereby forcing them into a debt default. Consequences are that a handful of businessmen are forcing  several million people into a deeper recession.

I smell a chance for BTC to push ahead in a similar manner as to Cyprus.

http://www.news.com.au/finance/markets/argentina-in-selective-default-as-talks-fail-to-reach-a-resolution/story-e6frfm30-1227008204606

What is Argentina's credit rating? Anyone know how this will afftect their credit? I mean, its obvious it cant be good, but I'm just curious how bad it can get.
I believe that the major credit ratings firms have Argentina rated as "in default" as well because.....this really does not need to be explained.
+1 This is true today, however it was never a secret that Argentina bonds were not exactly the safest investment. They had to give up certain rights that are normally given to sovereign nations because of their history of defaulting.
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