New York Times article titled Big investors await windfall from trumps argintina bailout

[jbeas176]

this is a grreat article on the people involved and the type of bailout it is. its a currency swap for pesos not the bonds mentioned before. it looks a play for argentinas minerals. lithium and uranium. he is taking flack for his own government being shut down while he is bailing out another country. if anyone reading this can make a link to the article i would appreciate it.

 

[ElQueso]

It was a good article. All the USA is doing is helping their wealthy friends make even more money. The rare minerals will probably be heading to the USA in the future too but this is all about protecting rich friends.

https://archive.ph/HD0Ri

 

[Larry]

This is correct. Bessent bailed out his rich friends. This was not about helping Argentina at all. Milei's failed policies aren't working. Why does Argentina have to keep getting bail outs if things are going well? Very good piece from the Clarin and how this is a bail out for the rich.

Un premio Nobel de Economía, durísimo con el rescate de Trump a Milei: “Está salvando a los amigos de Bessent, no a la Argentina”

Paul Krugman criticó el swap de US$ 20.000 millones que Luis Caputo negocia en Washington. Sostiene que el dinero no busca ayudar al país sino rescatar las apuestas fallidas de los "hedge funds" cercanos al secretario del Tesoro, Scott Bessent.

www.clarin.com

 

[CraigM]

Krugman's a very smart guy and a great writer, but he's a committed lefty and like most professors he has a desperate need to be liked by the cool kids. It really clouds his judgment as an economist. He could be right here but it sounds very small-minded and conspiratorial.

 

[Larry]

Krugman's a very smart guy and a great writer, but he's a committed lefty and like most professors he has a desperate need to be liked by the cool kids. It really clouds his judgment as an economist. He could be right here but it sounds very small-minded and conspiratorial.

I understand he is on the left but do you agree with his points of who is benefitting the most here? @CraigM are you saying there is no truth to this?

 

[lemonade]

Krugman's a very smart guy and a great writer, but he's a committed lefty and like most professors he has a desperate need to be liked by the cool kids. It really clouds his judgment as an economist. He could be right here but it sounds very small-minded and conspiratorial.

Isn't Krugman the idiot that said the internet would have the same affect on business as the fax machine?

I understand he is on the left but do you agree with his points of who is benefitting the most here? @CraigM are you saying there is no truth to this?

Probably like many things in Argentina the truth is somewhere in the middle.

 

[CraigM]

I understand he is on the left but do you agree with his points of who is benefitting the most here? @CraigM are you saying there is no truth to this?

I think he's shooting arrows in the dark but his audience loves that kind of thing. Where was Krugman when Biden put $60 billion into the auto workers pension funds? Never was a huge pile of money so blatantly spent on a corrupt institution with the sole purpose of buying votes. In possibly the fiercest irony of the 2024 election, the auto union workers turned on Biden due to his wokeism.

 

[CraigM]

Isn't Krugman the idiot that said the internet would have the same affect on business as the fax machine?

Same guy. But he writes well so the left wing elites absolutely adore him.

 

[jbeas176]

just read an article about elisabeth warren asking for communications between hedge funds and the trump organization l. her belief is the 20 billion was going to help the funds pull out of their positions without losing alot of money because of the infusion of usa help. she is introducing legislation to cancel the deal. lets wait and see. besset is using santander to process the funds. i think she is too late.

 

[Finance Prof]

I think he's shooting arrows in the dark but his audience loves that kind of thing. Where was Krugman when Biden put $60 billion into the auto workers pension funds? Never was a huge pile of money so blatantly spent on a corrupt institution with the sole purpose of buying votes. In possibly the fiercest irony of the 2024 election, the auto union workers turned on Biden due to his wokeism.

I agree his audience loves that kind of thing. So corrupt.

Same guy. But he writes well so the left wing elites absolutely adore him.

Never heard of that and just looked it up. Boy was that totally wrong. Agree the guy can write.

 

[VINO]

just read an article about elisabeth warren asking for communications between hedge funds and the trump organization l. her belief is the 20 billion was going to help the funds pull out of their positions without losing alot of money because of the infusion of usa help. she is introducing legislation to cancel the deal. lets wait and see. besset is using santander to process the funds. i think she is too late.

I don't really understand how the US government can spend money like this when America is struggling with government shutdowns. I just saw this on CNN today.

https://www.cnn.com/2025/10/12/economy/argentina-america-bailout-currency

 

[CraigM]

I don't really understand how the US government can spend money like this when America is struggling with government shutdowns. I just saw this on CNN today.

https://www.cnn.com/2025/10/12/economy/argentina-america-bailout-currency

It's not like they wrote a $20 billion check to Argentina (not yet at least), and $20 billion is the US' daily budget spend so it's kind of a rounding error.

 

[Blockchain]

It's not like they wrote a $20 billion check to Argentina (not yet at least), and $20 billion is the US' daily budget spend so it's kind of a rounding error.

Yes agree it's not much but I wonder on the timing if this was a good move. I get they had to do it before the elections in a few weeks. Things look like they were imploding for Milei. But I wonder if buying pesos is a wise move?

 

[CraigM]

Yes agree it's not much but I wonder on the timing if this was a good move. I get they had to do it before the elections in a few weeks. Things look like they were imploding for Milei. But I wonder if buying pesos is a wise move?

Not sure, my amateur guess is the guarantee does most of the heavy lifting and they don't end up having to purchase that many pesos.

 

[Wally]

Not sure, my amateur guess is the guarantee does most of the heavy lifting and they don't end up having to purchase that many pesos.

Agree I don't think the US will actually have to purchase much at all. Just a warning to those shorting that they COULD and support Argentina. That is probably enough at least to get us through the elections.

 

[CraigM]

Agree I don't think the US will actually have to purchase much at all. Just a warning to those shorting that they COULD and support Argentina. That is probably enough at least to get us through the elections.

It's also important to understand that if the US does end up spending the whole amount, it doesn't mean the money is gone. Even if the peso falls 30% by the time the US is able to exit the trade, the cost to them is $6 billion not $20 billion. There's a big difference between "worth less" and "worthless". If they held onto the pesos indefinitely then there's a good chance it would become worthless, but not in a few months' time.

 

[Wally]

It's also important to understand that if the US does end up spending the whole amount, it doesn't mean the money is gone. Even if the peso falls 30% by the time the US is able to exit the trade, the cost to them is $6 billion not $20 billion. There's a big difference between "worth less" and "worthless". If they held onto the pesos indefinitely then there's a good chance it would become worthless, but not in a few months' time.

True but don't underestimate the worthlessness of the Argentine peso. In not too much time it has gone from reasonable levels to 1400 today. My kids would save money in a piggy bank and I remember my wife would always push them to spend it as soon as they got it. Most locals are the same unless you're dealing with USD. I laugh thinking if my kids saved all their money from Christmas or birthdays it would all be almost worthless compared to exchange rates now. 😱

 

[CraigM]

True but don't underestimate the worthlessness of the Argentine peso. In not too much time it has gone from reasonable levels to 1400 today. My kids would save money in a piggy bank and I remember my wife would always push them to spend it as soon as they got it. Most locals are the same unless you're dealing with USD. I laugh thinking if my kids saved all their money from Christmas or birthdays it would all be almost worthless compared to exchange rates now. 😱

No doubt, South America is where currencies go to die. Brazil's has been wiped out numerous times. But if Milei loses the election, I doubt the US will hang around waiting for hyperinflation to return.

 

[Betsy Ross]

True but don't underestimate the worthlessness of the Argentine peso. In not too much time it has gone from reasonable levels to 1400 today. My kids would save money in a piggy bank and I remember my wife would always push them to spend it as soon as they got it. Most locals are the same unless you're dealing with USD. I laugh thinking if my kids saved all their money from Christmas or birthdays it would all be almost worthless compared to exchange rates now. 😱

🤣 I've been here a while in Argentina and one lesson I learned is NEVER to save in pesos. I have always just kept savings in dollars and exchanged to pay bills each month and that is the best way here.

No doubt, South America is where currencies go to die. Brazil's has been wiped out numerous times. But if Milei loses the election, I doubt the US will hang around waiting for hyperinflation to return.

Even if Milei wins it will be difficult here. Milei has been saying since he won the dollar was going to fall like a piano. That has NOT happened. When people lose faith in the peso it can go quickly. I have never known anyone in Argentina to do well over long term investing in pesos vs. dollars.

 

[CraigM]

🤣 I've been here a while in Argentina and one lesson I learned is NEVER to save in pesos. I have always just kept savings in dollars and exchanged to pay bills each month and that is the best way here.


Even if Milei wins it will be difficult here. Milei has been saying since he won the dollar was going to fall like a piano. That has NOT happened. When people lose faith in the peso it can go quickly. I have never known anyone in Argentina to do well over long term investing in pesos vs. dollars.

I hear you but for illustration, let's say Milei loses the election and at that point Argentina has drawn $10 billion on the swap line. So the US now owns $10 billion of pesos at an exchange rate of around 1425. Then let's say that the instant Milei loses, the rate immediately pops to 1700 and the US decides to get out. So it starts selling pesos for dollars at 1700 and by the time they've fully sold out the peso has plummeted to 2200, all in the span of a month or two (quite a drop even for Argentina). So the average selling price for the US would be around 1950 which is about a 37% loss or $3.7 billion. Not a huge amount for the kind of influence the US will have if Milei wins.