Why is Argentina’s economy such a mess?

Rampant inflation, a booming black market for US dollars and crippling debt - welcome to Argentina, one of the world's most dysfunctional economies. How did it end up like this?

00:00 - Argentina’s economy is in crisis
01:21 - What is happening now?
04:16 - Why is this happening?
05:52 - Overspending
07:00 - Printing money
08:03 - Borrowing money
08:51 - Trade controls
11:06 - What are the solutions?

[Blinful]

A country that never misses an opportunity to miss an opportunity 😂

[gingerkilkus]

My greatest concern is how to recover from all these economic and global troubles and stay afloat especially with the political power tussle going on in Argentina.

[anilicoz]

I'm Turkish and I've known about Argentina for over a decade since me and my friends were using Argentinian websites to purchase online games and services because their regional prices have been cheaper than European prices. Recently Turkey has also fallen into the same inflation spiral as Argentina and the reasons are very similar: untrusted government, decades of bad monetary policies and printing more money etc. Its really depressing to be a part of such a system. I've met many amazing Argentinian friends and I hope Argentinians can recover from this eventually. much love <3

[ccccc-lprw]

“ Argentina is a country that never misses the opportunity to miss an opportunity”

[thelegend]

Nobody, ever, in the history of Argentina, has gone to prison for buying USD at Cuevas. It's the most legal illegal activity. It is literally done by everyone, including cops, judges, politicians.

[charo]

I'm argentinean and let me tell you NO ONE goes to jail for buying dollars in the black market, everyone knows about it and no one does anything against it. So there is no such "risk" as you said

[NicholasBall]

The system is failing as a result of both government and federal policy. In the next days, the banking crisis would have to be epic and gigantic for the FED to decide not to raise interest rates. This won't happen; an increase and a crash are coming. There will be more negative portfolios this 2nd half of 2024 with markets tumbling, soaring inflation, and banks going out of business. My concern is how can the rapid interest-rate hike be of favor to a value investor, or is it better avoiding stocks for a while?Read more

[LenaSchweizer-ffxy]

Treasury rates are rising quickly, the markets are collapsing, inflation is skyrocketing, and the Fed is imposing a significant interest rate hike—all of which will result in further losses for portfolios this quarter. How can I take advantage of the present market volatility? I'm still undecided about whether to sell my $125, 000 worth of bonds and stocks.

[Lahorca]

Listening this in English makes me think about how we normalized all this problems like it has been always like this. I'm 30 and I don't know how it's like to live without inflation. I really hope I get to live at least a couple of years of stability... Someday...

[mensrea]

There’s a saying in economics: there are four kinds of economies - developed, underdeveloped, Japan and Argentina. No one knows how Japan continued to grow. No one knows why Argentina can’t.

[BrendaLourdes]

Me and my whole family left argentina in 2001, it was one of the saddest days of my life . Me being 10 years old and leaving everything behind and now 2 decades later seeing my country worse than ever . Really breaks my heart 😢💔

[CameronFussner]

My greatest concern is how to recover from all these economic and global troubles and stay afloat especially with the political power tussle going on in US.

[quantumshadow]

As an Argentinian I would like to ad some more context.
1)We have a very big public jobs problem, most of the jobs in Argentina that are formal employment are public in dead end none productive work, (like having 15 secretaries for the manager of the counselor of the cousin of the politician in charge of some invented minister).
2) Most of the actual productive jobs are in the informal market due to different reasons like irrational amount of taxes not only to business also to workers (even cashiers need to give 50% of their salary in taxes), business exploitation, and in some cases the lack of proper schedules in colleges about students that also need to work.
3) We have some many taxes at nacional, estatal, regional and municipal level that even some workers from the tax administration unofficially support tax evasion in low income self employed workers.
4) Education gets worst each year, most student can't understand basic text even after secondary educational level, 50% of students fail the test entrance to engineering school (the test is about basic physics and math from secondary education) and from the other 50% that enters a 25% drops from college in 6 months, and this applies for most engineering and science careers resting a lot of aggregated value jobs.
5) Bureaucracy in Argentina make the German one blush, we have to much paper work, paying so many permit and waiting in some cases even years that a lot of people abandon projects and decide to invest outside.
6) Syndicates in Europe are a charm compare to Argentinians one, they force workers to join, paralice supplies chains, start riots and extortion both company and workers, they behave like an enforcers of some landlords.
7) People decide to buy dollars in the informal market due to a very 2 important reasons, first you can't draw a single dollar banknote from your account if you buy it legally, and second we have something call it "corralito" in which the government froze money draw from every bank account and can turn your dollar savings into peso savings make it "legally" without asking you first.

There are much more to mention, the problem is, it would take and entire semester of "what not to do meanwhile running and economy" subject

[thomask.]

I lived in Argentina on and off for decades and I can attest that Argentines have simply given up any hope of a future. The brightest and most ambitious of its young people are emigrating.

[rgcv]

Gosto muito da Argentina. País incrível. Aqui no Brasil por muitos anos sofremos uma situação muito parecida. Em 1994 veio o ajuste fiscal. Doeu mas hoje inflação não eh um problema. Desejo boa sorte!

[kitepipa]

Argentina's economy struggles with deep-rooted mismanagement, leading to hyperinflation, heavy debt, and a lack of trust in government and markets.

[agme]

I thinks it’s important to clarify that the 200 USD limit is actually only available for a very small number of people. There are dozens of ‘exceptions’ that make it almost impossible for anyone to have access to the acquisition of USD. For example, if your employer received any sort of financial aid from the government during the pandemic, then you are banned from buying dollars. The limit also includes any kind of digital subscription or service you may hire. Like Netflix or Disney plus (they all count towards your 200 usd limit) same if you want to buy a video game or a product from abroad (if you want to, say buy a pair of shoes or a pair of jeans from abroad, you have to pay over 50% in taxes (and that’s not including the almost 70% they charge you for using USDs)

[natkojurdana]

Greetings from Croatia! When I was a kid, during late 80-ties in Yugoslavia, I remember going with my dad to illegally exchange German marks for Yugoslav dinars. There was some dubious looking guy standing near a parking lot who was silently repeating – „Dinari, marke, dinari, marke…“ to passers by. This was common practice, couple of years later Yugoslavia became EX-Yugoslavia.

I hope Argentina manages to come out of this crisis!

[michaelgillett]

My fellow Americans: A glimpse of our future in 10-20 years if we don't get our spending under control. If the dollar wasn't the world's reserve currency we would already be seeing this. A growing deficit with a growing economy is a VERY bad signal.

[fenrirgg]

We had hyperinflation in Mexico for several years until the central bank got complete independence from the government. It was a nightmare for populist politicans but it worked surprisingly well until now.