Argentina bans buying dollars
Monica Showalter of Investor’s Business Daily has the story (emphasis added):
Argentina Dollar Ban A Sign Of Failed Socialist Policies
Socialism: In the latest chapter of Argentina’s war on economic reality, President Cristina Fernandez has banned the buying of dollars in a bid to halt capital flight. It’s a market verdict on her policies, and it won’t stop dollarization.
Putting dollar-sniffing dogs on outbound ferries from Buenos Aires to Uruguay apparently didn’t halt Argentinians’ desire to get their money out of the country. After losing a billion dollars a month to capital flight by small investors in 2011’s fourth quarter, Argentina continues to lose about half that amount as citizens send assets out of the country.
And why shouldn’t they? In the last three years, Argentina’s government has seized private pensions to pay for pork barrel social programs, raising government spending to 38% of GDP.
It has been caught lying about its inflation statistics (officially around 30%), a sign it’s now printing money. It has started paying down its foreign debt with its central bank reserves — some $4 billion out of its $46 billion kitty. It has also just told banks they’ll have to lend $3 billion to politically favored businesses in an Obama-style effort to pick and choose winners and losers.
Once again, Argentina’s damaging, once-a-decade cycle of devaluations and defaults is kicking in.
This matters because so much of what Argentina’s leaders are doing is being justified with the sickly-sweet logic of the left. In reality, it’s about force.
Go read the whole thing.
I didn’t know she spoke Austrian.