Welcome to the PMBug forums - a watering hole for folks interested in gold, silver, precious metals, sound money, investing, market and economic news, central bank monetary policies, politics and more.
Why not register an account and join the discussions? When you register an account and log in, you may enjoy additional benefits including no Google ads, market data/charts, access to trade/barter with the community and much more. Registering an account is free - you have nothing to lose!
The mystery of Argentina’s gold: Milei admits that it was transferred abroad, without specifying the quantities or destination
Buenos Aires - JUL 28, 2024 - 00:05 EDT
Argentina’s reserves, held by its Central Bank, include almost two million troy ounces of gold, valued at about $4.5 billion. But lately, there’s a question that’s on everybody’s lips: where is it? Was it taken out of the country? Did some of it remain within Argentina, while the rest was transferred abroad? Well, the official information only offers partial answers.
The administration of far-right President Javier Milei admitted to the recent transfer of gold abroad, but didn’t specify quantities, the destination, or the purpose for this measure. Nor did the Central Bank provide any details. In a scenario of financial instability — and with the government facing the need to accumulate reserves — the decision generated suspicions and speculation. There are also fears that the gold could possibly be seized, due to long-standing legal cases that have been filed against Argentina by foreign creditors.
More:
The mystery of Argentina’s gold: Milei admits that it was transferred abroad, without specifying the quantities or destination
While the government acknowledges that gold reserves have been sent outside the country, there’s no official information available regarding the purpose of the operation. The gold is now exposed to the risk of being seized, due to long-standing claims against Argentina made by foreign creditorsenglish.elpais.com
I don't understand this move. The only place that gold should have been sent is to the mint to mint coins for the people to use.More:
Aaaand... its GONE: President Milei sends TONS of Argentina sovereign Gold to UK
Premiered 2 hours ago
11:40
There are few places in all of Argentina as poor as La Rioja, a sleepy, desolate province carved out of the red-clay highlands that form the country’s northwestern border with Chile.
And it is here, in La Rioja, that the financial toll of President Javier Milei’s shock economic therapy — a high-stakes bid to tame chronic inflation — can best be observed. When Milei slashed the monthly cash transfers from the federal government to the provinces, La Rioja went broke. In February, it fell into default. And soon the local economy had sunk into a deep recession.
So the governor, an outspoken critic of Milei by the name of Ricardo Quintela, dialed up a radical plan of his own. He created the province’s own currency, the chacho, had sheets of it printed up and started doling it out in wads of 50,000 to all government employees. It was a little bonus payment, Quintela said, to help people buy more of the essentials they’d been skimping on. Shop owners weren’t outright forced, but rather strongly encouraged, to accept chachos just like they would pesos. One chacho equals one peso.
...
Argentine President Javier Milei announced plans to shut down the country's tax collection agency, a bold step in his ongoing effort to slash government spending and bureaucracy.
On Monday, presidential spokesperson Manuel Adorni confirmed that the Administración Federal de Ingresos Públicos (AFIP), Argentina's tax bureau, will "cease to exist." It will be replaced by a newly formed agency, the Agencia de Recaudación y Control Aduanero (ARCA), which will assume some of its functions.
"Throughout its existence, this agency has functioned as a political cash box and, as we all know, many Argentines have been subjected to absolutely immoral persecutions," Adorni's statement reads. "No State bureaucrat should be delegated the power to tell an Argentinean what to do with his property."
The closure of AFIP is framed as "essential to dismantle the unnecessary bureaucracy that has hindered the economic and commercial freedom of Argentines." ARCA, the new agency, will embody a "simple, more efficient, less costly, and less bureaucratic" approach to tax collection and customs control.
ARCA "aims to reduce the State, eliminate unnecessary positions, professionalize the agency, dismantle corrupt networks, and improve the efficiency of revenue collection and customs control by removing privileges of the past and optimizing public management," the statement continues.
...
...
The Global X MSCI Argentina ETF, known by its ticker ARGT, absorbed $144 million of inflows for the week that ended on Nov. 22, with $88 million coming in on Friday alone, according to data compiled by Bloomberg. The fund, which is a vehicle for traders to pile into equity bets on a country where access to local markets is complicated by capital controls, saw assets jump roughly seven-fold from $104 million when Milei took office to some $750 million on Monday.
“Milei hasn’t just talked the talk, but is actually walking the walk,” Malcolm Dorson, senior portfolio manager at Global X Management, the firm that manages ARGT. “He has trade balances, he has built a fiscal surplus, inflation is ticking down, and economic activity is picking up.”
The inflows come against encouraging signs for South America’s second-largest economy, with month-over-month inflation shrinking to 2.7% in October, gains in real wages and some $20 billion rushing into the country thanks to a tax amnesty program. ...
Milei was also a member-in-good-standing of Klaus Schwab's little supper-club.That seems odd. Given Milei's Austrian school economic/monetary policy, what goal is being achieved by expatriating their gold reserves?
Argentina emerged from a brutal recession in the third quarter, boosting the odds that President Javier Milei heads into next year’s mid-term elections with growth on the rebound alongside cooling inflation.
Gross domestic product expanded 3.9% from July to September compared to the previous three-month period, better than analysts’ expectations for 3.4% growth. From a year ago, South America’s second-largest economy shrank 2.1% in the third quarter, according to government data published Monday. The median estimate of economists surveyed by Bloomberg was for a contraction of 2.6%.
...
Signs of recovery are underway heading into 2025. Beyond the third-quarter growth, wages have surpassed inflation since April, job growth is slowly picking up and private estimates indicated poverty is gradually declining after spiking once Milei took office. Argentines also deposited over $20 billion in the financial system this year as part of Milei’s tax amnesty program, a robust sign of confidence in the libertarian president.
...
Argentina is either going to suffer bigly and then thrive, or experience a revolution. I'm not sure which is more likely at this point.
We use cookies and similar technologies for the following purposes:
Do you accept cookies and these technologies?
We use cookies and similar technologies for the following purposes:
Do you accept cookies and these technologies?