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Argentina's Currency Black Market

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Re: Argentina's Currency Black Market

#101

Post by marquis »

dllthomas wrote: post #99
marquis wrote: post #97

Earlier quoted context omitted.

It's illegal to not declare if you have more than $10k USD when crossing borders. All the custom forms I have seen around the world have something along these lines, in various amounts and currencies.

That didn't really answer the question though. Is it a choice between "follow one law by confessing you broke another" vs. "break two laws and maybe not get caught"? Or is it a choice between "break one law" or "don't"?

It's legal to enter a country with cash within the limits of what it states on the Customs form, without saying anything about it, and if it's found on you the Customs agents cannot detain you (legally, anyway - be wary regardless). If you have more than the stated amount e.g. $10k USD then you must declare it, else if you are searched and it is found you will definitely be detained.

Re: Argentina's Currency Black Market

#102

Post by jamesaguilar »

jorgeortiz85 wrote: post #80
jamesaguilar wrote: post #74

Earlier quoted context omitted.

I still don't get it. Let's say the real price is 1 peso per mile for both services. You want to travel 100 miles. On the bus, you pay 100 pesos up front. In the taxi, the meter is set to one peso per mile. Then you pay 100 pesos at the end. Unless you are going to convert from some other good into pesos and then pay, the cost is still the same.

Inflation means that the value of 100 pesos in the future is less than the value of 100 pesos now. In countries under hyperinflation, supermarkets will raise their prices several times a day. "During the Brazilian inflation of the earl 1990s, for instance, supermarket workers reportedly spent half of their time replacing old price stickers with new ones." -- Essentials of Economics

I don't see how it matters if your asset position is identical in either trial.

Re: Argentina's Currency Black Market

#103

Post by chii »

marquis wrote: post #101
dllthomas wrote: post #99

Earlier quoted context omitted.

That didn't really answer the question though. Is it a choice between "follow one law by confessing you broke another" vs. "break two laws and maybe not get caught"? Or is it a choice between "break one law" or "don't"?

It's legal to enter a country with cash within the limits of what it states on the Customs form, without saying anything about it, and if it's found on you the Customs agents cannot detain you (legally, anyway - be wary regardless). If you have more than the stated amount e.g. $10k USD then you must declare it, else if you are searched and it is found you will definitely be detained.

so what happens if i have $10,001 and declare it?

My point is, what's the purpose of declaring, if it is illegal to enter the country (or leave the country) with more than $10,000 - does declaring it make it legal?

Re: Argentina's Currency Black Market

#104

Post by dasil003 »

bedhead wrote: post #89
dasil003 wrote: post #44

Earlier quoted context omitted.

You don't understand corruption then. High inflation and a low official exchange rate that no one can actually exchange at without insider connections are a way for those with control of the government and currency printing presses to slowly but steadily siphon the wealth of the masses directly to themselves.

You're getting the cause and effect mixed up. Is it probably disproportionately worse in Argentina compared to the US? Yeah. But it's not innate in Argentinians. Corruption, generally speaking, is a function of something else, usually something that's inherently unfair or unjust. Argentina's economic policies created these incentives to drive people increasingly towards corruption, not the other way around.

Where did I say that the state of affairs is innate to Argentina? In any case, that's a red herring.

You can't simply state that the economic policies unilaterally led to corruption as a self-evident truth without some supporting evidence. Clearly officials who have a history of corruption are more likely to institute new policies that benefit themselves as well. Economies are not so simple that causality is easily stated in an absolute manner, especially in so flippant a manner as "corruption […] is a function […] of something inherently unfair". That's probably the most hand-wavy statement about such a grand topic that I've ever read.

Re: Argentina's Currency Black Market

#105

Post by marquis »

chii wrote: post #103
marquis wrote: post #101

Earlier quoted context omitted.

It's legal to enter a country with cash within the limits of what it states on the Customs form, without saying anything about it, and if it's found on you the Customs agents cannot detain you (legally, anyway - be wary regardless). If you have more than the stated amount e.g. $10k USD then you must declare it, else if you are searched and it is found you will definitely be detained.

so what happens if i have $10,001 and declare it? My point is, what's the purpose of declaring, if it is illegal to enter the country (or leave the country) with more than $10,000 - does declaring it make it legal?

Customs will notify the authorities that you have more than the amount designated, to guard against money laundering.

Example: http://ec.europa.eu/taxation_customs/customs/customs_control...

Re: Argentina's Currency Black Market

#106

Post by marianov »

contingencies wrote: post #21
mikeash wrote: post #18

Earlier quoted context omitted.

That doesn't mean it makes sense. $47.5 million/day being the same as $8 million/hour implies that there are 5.9375 hours per day.

8 hours a day minus an hour for lunch is 7 hours .. perhaps exchange operations close an before the daily close of business? Wouldn't surprise me, and that's ~5.9375 (6 to be precise). Then of course there's bank holidays and weekends...

The goverment has declared an unprecedented number of holidays last year (i.e. moving holidays from weekends to mondays, declaring "bridge" holidays when a holiday happens on tuesday or thursday, 2012 had 5 more than 2011). 2013 will have 17 bank holidays.

Re: Argentina's Currency Black Market

#108

Post by Fargren »

chii wrote: post #95
JVIDEL wrote: post #81

This black market the arbolitos (literally "little trees", a joke on individuals selling "green bills" ergo leaves, you get the point) has existed for decades and comes and goes whether currency exchange controls go up. The real black market is the hidden one, the one where millions are moved every day. Just because members of government banned currency exchange doesn't means they and their friends can't buy dollars…

how does this happen? How can wealth be sapped like this over a few decades? is it because of true malice, or incompetenance? What would one do to try and prevent such from happening in one's country?

This has been going on since the sixties. Half a century is not "a few decades". The military regime got entangled with fights against the syndicates (which were a strong political force back then, and are mostly toothless now, with the exception of the truck-transport syndicate), and dismantling the national industries was used as a resource to weaken them. Also, they systematically killed and "disappeared" basically anyone who got into politics that didn't agreed with hem. So they destroyed both the economical and the political basis of the country. The people who took over after them came from what survived their culling: most of the people who could have grown with a different point of view were dead. In that light it isn't that surprising that Menem's government in the 90's followed a similar policy of dismantling the local industry. Under the pretense of amassing funds to fight inflation, he basically sold all what remained of the national industries, creating a nice but unsustainable period of wealth. Following that, De la Rua's government basically did nothing to address the issues, and that's how we got to the 2001 crisis.

This is obviously not a complete explanation, but it works as a highlight of some of the structural causes of Argentina's situation-

Re: Argentina's Currency Black Market

#109

Post by meerita »

zorked wrote: post #90
fennecfoxen wrote: post #47

Earlier quoted context omitted.

The self-infliction is electing politicians like Kirchner who don't try to spend time and effort improving their infrastructure and stability and attracting investment to build new things. Instead, they prefer to borrow money to deliver handouts to the populace, then when they can't repay the money, default on their debts and take over the local operations of foreign firms. (This is before we even get into the suppre…

False dichotomy. Brazil has been giving "handouts" - desperately needed aid for the poor - and is doing fine. In fact those "handouts" are one of the main reasons why it has been doing ok: they created a market where there was none.

The reality is far from what you say. What they give is nothing in that economy. Many people just spend that money in 2 days. What Argentina did is just print money without limits and offer many credit lines to anyone with possibilities. That's ok, but to a certain level, when you hide the real value of your coin you're losing investment from outside. Who will invest in Argentina when the money isn't on the real price?

Re: Argentina's Currency Black Market

#110

Post by meerita »

chii wrote: post #95
JVIDEL wrote: post #81

This black market the arbolitos (literally "little trees", a joke on individuals selling "green bills" ergo leaves, you get the point) has existed for decades and comes and goes whether currency exchange controls go up. The real black market is the hidden one, the one where millions are moved every day. Just because members of government banned currency exchange doesn't means they and their friends can't buy dollars…

how does this happen? How can wealth be sapped like this over a few decades? is it because of true malice, or incompetenance? What would one do to try and prevent such from happening in one's country?

> how does this happen?

It's called the new oligarchy.

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