Joined: May 26, 2004 Posts: 1190 Location: Zoorope
Posted: Thu Jul 01, 2004 4:14 am Post subject: THE Argentina Thread (merged)
It was Dec.2001. America was shocked for Enron. Europe was shocked for the Argentina bankruptcy. I think it's very interesting to see what happened there: if someone could predict it, he would be named "doomsayer". I also think it can be a "model" for the coming crisis.
Argentina was the richest of South America countries. There was a strong middle class, and a powerful agriculture providing (and exporting) food for 300 millions people per year!
Everything happened in few days, maybe weeks. The economy crashed. The industries closed, and the owners fled abroad leaving millions people jobless. The banks stopped working, and the people couldn't access their savings (there were long queues on the road waiting for the banks to open and give small amounts). Most people couldn't affort to pay mortgages, and simply left the houses because nobody was buying them.
There were riots against the police, when people assaulted the malls and supermarkets to find food.
People began bartering on the roads, exchanging what they can since the money was worthless. Middle class families went scavenging in the garbage. There was starving... guess where? Not in the city, but in the land!
There's a thing I want to point out: do you think that the politic and economic leaders in Argentina and around the world didn't know anything? The country crashed in few days. But the powerful were prepared to close everything and fly with amazing amouts of money. Nobody prepared people for what was coming, they were left on themselves facing something totally unexpected.
Any thoughts? _________________ **no english mothertongue**
--------
Objects in the rear view mirror
are closer than they appear.
Joined: May 17, 2004 Posts: 1969 Location: Democratic People's Republic of Washington
Posted: Thu Jul 01, 2004 4:38 am Post subject:
From what I saw on the PBS special about this crash shortly after it happened, it was because of the rapid deflation of Argentina's Peso. I do not renember what this was caused by, but I will assume it was brought on by a collapse of the debit bubble caused by the ever-increasing loans that the Argentinan govornment took out to stimulate its economy. This seems very familiar to what is happening now in the US. I just hope that we do not encounter the same situation.
What impacted me most about this broadcast was the image of thousands of people pounding on the bank walls with anything they could find. They were doing this as a form of protest, as they were not allowed access to thier money. If I would have been there, I would have found some C4, and blown the damn doors off of the place. Why they did not resort to this, I have no idea. Fortunatly, the banking system collapse already occured in the US during the Great Depression, which is exactly why the federal govornment started the FDIC. Because of the FDIC, my bank accounts are protected from loss, so I have very little worry as far as the banking system is concerned. _________________ Here Lies the United States Of America.
IIRC, they stopped the mass withdrawal of cash to prevent the banks crashing during rapid devaluation of the peso.
This was an emergency law known as "corralito" or "little fence".
So, in the event of economic meltdown in the US, what's to stop the US gov employing a similar tactic?
Let them eat cake, as it were? _________________ Burning the midnight oil, whilst I still can.
Joined: May 17, 2004 Posts: 1969 Location: Democratic People's Republic of Washington
Posted: Thu Jul 01, 2004 5:07 am Post subject:
OilBurner wrote:
IIRC, they stopped the mass withdrawal of cash to prevent the banks crashing during rapid devaluation of the peso.
This was an emergency law known as "corralito" or "little fence".
So, in the event of economic meltdown in the US, what's to stop the US gov employing a similar tactic?
Let them eat cake, as it were?
Thanks for letting me know why the banks closed. I did not know that. Also, in the event of economic meltdown in the US, my bank already has a limit of withdrawing $600.00 per day, or $3,000 per week, so I do not think that it would be much of a difference to me any how. Plus, if I really need the money, I can just go down to the grocery store, and write a check there for cash. The govornment may impose a limit on the amonut of cash able to be withdrawn per day, but as long as there is a grovery store that will cash my checks, I will have access to my money. If that fails, I suppose I could just buy a big ticket item such as a big screen TV with a check, and 1 day later, take it back and get a refund. Then I would be just getting my money, but in a more round-about way. It is good to be able to milk the system like that. If that fails, I guess it would be time to use the "ultimate force" to get my cash. _________________ Here Lies the United States Of America.
There was starving... guess where? Not in the city, but in the land!
Barbra,
Any talk of why this was? Were they in farms that specialized in one crop only? (like Soybeans etc.)
Cities would be the place to recieve government asistance, if that is what you are looking forward to recieving. So, many of the Sheeple (sheep people) would be better off in the city, than planting AFTER an economic crash and waiting for the watermelons to come up. Or trying to fish/ farm/ hunt etc. for the first time. _________________ Eickhorn Daggers!
www.pistolanddagger.com
What caused the devaluation of the Argentinian peso?
I remember hearing Naomi Klein talk about Argentina on Alternative Radio and how it was somehow a stepping stone for the mega-wealthy/multinational corporations whose next target turned out to be Iraq...for privatization of state owned industries and whatnot.
There was starving... guess where? Not in the city, but in the land!
IMO, immediately after a crash, while the govt. still has control/ability to move aid etc., the city would be the best place to be. If the situation continued to corrode, then those who were 'starving' on the land would be the lucky ones...
Is the Argentinian economic collapse from 2 years ago a symptom of peak oil? I don't know but I can see many first world countries becoming like this one as the oil pie keeps getting smaller and smaller and smaller. Print this article and show it to your friends. Argentina was at one time the sixth wealthiest nation in the world. You say it can't happen here? Just wait and see.
Joined: Dec 08, 2004 Posts: 1542 Location: Nez Perce Nation
Posted: Wed Dec 15, 2004 11:35 am Post subject:
It took Argentina some fifty years to get to this state.
After WW II the country was rather wealthy. Lots of things went very wrong. _________________ "Modern Agriculture is the use of land to convert petroleum into food."
-- Albert Bartlett
"It will be a dark time. But for those who survive, I suspect it will be rather exciting."
-- James Lovelock
Yea, what went wrong that turned Argentina from one of the wealthiest countries in the world to a hell hole was socialism, the preferred form of salvery for many of you advocates of government solutions on this site.
Yea, what went wrong that turned Argentina from one of the wealthiest countries in the world to a hell hole was socialism, the preferred form of salvery for many of you advocates of government solutions on this site.
You mean that socialism (quoted form the text):
Quote:
During the "dirty war" of the 1970s, military rulers arrested tens of thousands of people, 15,000 of whom never resurfaced. And when then-President Carlos Menem touted New Capitalism in the 1990s, the rich got richer -- many illegally -- while the poor got poorer.
It took Argentina some fifty years to get to this state. After WW II the country was rather wealthy. Lots of things went very wrong.
Perhaps. Some say it was George Soros and his currency speculation which is the underlying cause.
From the article: Statistically, it is easy to see why. Before 1999, when this country of 36 million inhabitants slipped into recession, Argentina's per capita income was $8,909 -- double Mexico's and three times that of Poland. Today, per capita income has sunk to $2,500, roughly on a par with Jamaica and Belarus.
Everybody's income shrank by a third in the matter of 3 years. In a perfect world we could have a not so bumpy transition towards alternatives to oil (liquified coal, solar, etc). Unfortunately, we don't live in a perfect world. The banks will NOT provide debt relief in the context of the shrinking economy of the future.
The soft-landing types assume that we'll have a transition period where we'll adjust our standard of living. How did we adjust to the 1930s economic crash? Germany elected Hitler. We fought WW2 and 50 million people died.
We solved the 1970s economic/energy crisis by introducing women in the workplace so that 2 breadwinners could maintain a household that had the same standard of living as the one that existed in the 1950s when the "man of the house" could sustain his family.
It's the coming "transition period" which scares the hell out of me. What adjustments will we have to make? Does everybody take a 40% paycut while the price of fuel doubles? We can't innovate, conserve or spend our way out of this mess.
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Or trying to fish/ farm/ hunt etc. for the first time.
