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Trump says Argentina assistance dependent on election results for ally Milei
I saw that on the news today. The blue dollar went up today after that. I am not sure how things will turn out as our polling here isn't too good. I guess we will have to wait to see what happens. I don't blame Trump for not wanting to spend money if communists are controlling the Congress and Senate.
Betsy Ross
Well-known member
He said out loud what many of us figured was the case. Still Trump is probably confused that Milei is not running in. few weeks. I heard him on the news a few weeks ago and he seems confused that these are mid term elections and Milei is not running. No sure if he knows. Have no idea how the election will turn out. Seems like several I know that were supporting Milei are having second thoughts.
But I ask them what the alternative is and it is a damned if they do and damned if they don't situation for many.
Agreed. It's crazy to think the US would support a socialist Argentina regardless of whether Trump is President. Even the IMF would be tough to convince.
Wally
Well-known member
I am not convinced that Bessent didn't just do this to help out his hedge fund friends exit out of positions. I would love to see a true turn around story in Argentina but from my experience living here the country is too screwed up. There is very little faith in the peso. Everyone I know is just stacking USD as usual. That is always the best move in the long term here.
Truth is that if the US didn't jump in when they did the peso might be at 2000 to $1 by now probably.
Finance Prof
Well-known member
We will know soon enough. Elections are on October 26.
Finance Prof
Well-known member
Even with a Milei party victory many are saying the peso will keep sliding.
Morgan Stanley outlined three post-election scenarios: If LLA gets between 35% and 40% of the vote: the dollar rate at $1,700 and 2.5% growth in 2026. If it gets 30% to 35%: the dollar between $1,800 and $2,000, with lower confidence. If it drops to 25% to 30%: a disorderly adjustment, the dollar above $2,000, and 1% growth.
Uncle Wong
Well-known member
Wow I guess that would make tourism much more affordable again! But inflation would skyrocket again. Crazy how volatile the peso is. I guess this is why no one there wants to save pesos and only dollars. I guess if the peso goes to 2,500 to $1 we will see prices in dollar terms fall again. Even at peso prices today my Argentine friends say everyone has cut back on spending and going out. I am not sure places can raise their prices higher. Seems like the locals are tapped out.
With all due respect to Morgan Stanley, they have no idea what the peso is going to do post election. There are so many variables not accounted for in this scenario analysis you'd be better off wiping your bum with it.
I don't think anyone knows. I have only been in town a few months and it has swung around violently. Most people tell me it is overvalued but I don't know by how much. All I hope is that the blue dollar keeps going up.
Saw this in NYT.
www.nytimes.com
Trump Dangles $20 Billion Lifeline for Argentina, With Strings Attached
President Trump said the economic support is contingent on whether his political ally, President Javier Milei of Argentina, remains in power.
US is working on doubling aid to Argentina to $40 billion by tapping private funding sources
The Trump administration is looking to provide an additional $20 billion in financing for Argentina.
apnews.com
Betsy Ross
Well-known member
Even with this incredible support from the USA buying pesos the peso is falling. I cannot imagine what the exchange rate would be if the USA wasn't doing all of this. Every day Bessent has been coming out trying to calm the markets but every local is buying dollars ahead of the elections. Most likely the currency will get devalued judging by all of the action. Everyone is rushing to buy dollars locally.
US is working on doubling aid to Argentina to $40 billion by tapping private funding sources
The Trump administration is looking to provide an additional $20 billion in financing for Argentina.
Me personally have never saved pesos. No one really likes pesos in Argentina and I am not sure that will change any time soon. Trump has met his match with the typical Argentine that wants to save I dollars and doesn't want pesos. It seems like Trump and Bessent are the only ones that want Argentine pesos. 🤣
Even you must admit that this all comes across as very desperate trying to save Milei. How does it come across to you @CraigM? $20 Billion doesn't work so they have to come out and announce another $20 Billion. I don't know about you but this smells very desperate to me. And it isn't working. Like Betsy mentioned the exchange rate actually went up today again for blue dollars. Hip hip hooray.US is working on doubling aid to Argentina to $40 billion by tapping private funding sources
The Trump administration is looking to provide an additional $20 billion in financing for Argentina.
Huge Hurry
Active member
Biden deserves a lot of things but the Nobel Peace prize is NOT one of them!
I don't think people that have not lived in Argentina really understand the country too well. Argentines probably never will trust in the peso long term. Real estate is all priced in dollars. No one saves pesos there. It always get devalued over time. You would have to be foolish to save in pesos. All the banks are saying the peso is overvalued.
Several recent financial reports and expert commentary further reinforce this expectation. Barclays noted in a weekly bulletin that “many think the adjustment is close at hand.” The government’s attempts to prop up the peso by spending over a billion dollars from reserves, combined with U.S. Treasury support, have only temporarily stabilized the currency and widened the gap between official and parallel rates. Political and fiscal uncertainty ahead of the October 26 election is fueling speculation of a post-election devaluation of around 20%, a figure widely cited by traders and analysts.
Blockchain
Well-known member
That would be good for tourism. All reports seem to be between 20% to 30% overvalued from these levels. I don't know if that is accurate or not but the rate would be astronomical for the blue dollar if the US didn't step in. That everyone agrees on.
I posted this in another thread but US obviously will want something from Argentina. Great article talking about what the US has to gain.
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