Scott Bessent's $20 billion dollar gamble on Argentina

[CraigM]

https://www.npr.org/2025/11/14/nx-s1-5609382/argentina-loan-bessent-treasury-bailout

Title is a bit misleading as it mostly discusses the 1995 bailout of Mexico before transitioning to Argentina near the end, but it's a good overview of the ESF.

 

[Nasdaq]

Mexico has come a long long way since that bailout.

 

[Blockchain]

Mexico has come a long long way since that bailout.

Not sure you can accurately compare Mexico and Argentina. Honestly sounds like unless Milei is successful with his big push to reform taxes and other things it will be tough. Lots of corruption in both countries but things actually work in Mexico well and its proximity to the USA helps. It does not seem like things work well in Argentina.

 

[lemonade]

Interesting that the Exchange Stabilization Fund has never lost money.

 

[CraigM]

Interesting that the Exchange Stabilization Fund has never lost money.

Well it's only been used once before, and they have to be careful because it's not easy to replenish. I read somewhere that post-Mexico, the US Congress voted to place serious restrictions on its future use which then exacerbated the Asian crisis in 1997, because the US was unable to intervene in the early stages when it's most meaningful.

 

[Nasdaq]

Well it's only been used once before, and they have to be careful because it's not easy to replenish. I read somewhere that post-Mexico, the US Congress voted to place serious restrictions on its future use which then exacerbated the Asian crisis in 1997, because the US was unable to intervene in the early stages when it's most meaningful.

Interesting. You are right. I had no idea. Just assumed there was a huge balance and it says there is only about $43 billion in it. Surprising that they would earmark half of it for Argentina.