MILEI - March 2024

 
Famous Zionists?

https://www.ft.com/content/24b6e483-f972-4282-a1ce-3c2106cc50c8

Argentina -Javier Milei - 'a self-styled anarcho-capitalist with libertarian principles and a love of the free market.'

Out-of-control government spending and rampant corruption have bankrupted the state, destroyed the value of the peso and left the nation close to hyperinflation.

Given the depth of the crisis, the president’s first measures were not unreasonable: a drastic fiscal adjustment to balance the budget quickly, a big peso devaluation to correct a wildly overvalued official exchange rate, increases in food cards and child benefit to offset some of the pain felt by the most vulnerable. 

https://www.ft.com/content/24b6e483-f972-4282-a1ce-3c2106cc50c8

Thankfully, Milei seems to have backed off his pledge to dollarise the economy; the inflexible, commodity-based economy would struggle in the straitjacket of US monetary policy. 

Business, investors and the IMF have welcomed Milei’s steps so far. Inflation is heading down from a peak in December, the black-market peso rate has stabilised and unsustainable transport and fuel subsidies are being unwound. 

https://www.ft.com/content/24b6e483-f972-4282-a1ce-3c2106cc50c8

Yet the economy is heading into recession. 

It is unclear how long the population will tolerate the increasing pain caused by austerity. Falls in the real value of wages and pensions are not sustainable and could trigger mass protests. 

The IMF noted that Argentina needed market-oriented reforms but that “these should be designed and sequenced to ensure sustained and inclusive growth”. Milei also risks becoming a victim of his political tactics. The former TV economist has stuck in office to the strategy that served him well in the campaign: firing up supporters on social media by denouncing Argentina’s corrupt ruling “caste”, insisting that there are no alternatives, and hurling colourful insults at opponents. 

Milei is far short of a majority in Congress, even with the backing of the conservative PRO party of former president Mauricio Macri. None of the country’s 23 provincial governors are certain allies. The president has said he is ready to bypass hostile legislators and rely on decrees and other executive powers. But Milei has to win over centrists and some moderate opposition Peronists or risk his presidency being neutered by a broad coalition of the disaffected. 

https://www.ft.com/content/24b6e483-f972-4282-a1ce-3c2106cc50c8