The Buck Doesn't Stop in Argentina

If you moved to Argentina to protect the strength of your USD, you made a good move. Currency traders have come to the conclusion that the Kirchner administration will not allow the dollar to buy much less than 3.10 pesos, according to today's Ambito Financiero.

They go on to mention how this helps Argentine competitiveness in the world markets in that the world would rather buy exports from here considering the going rate and that allows La República to pick-off customers from other countries. At the same time this keeps we locals from buying many imports... thus stimulating local producers to create Argentine "replacements" for the foreign stuff we would otherwise shell-out for.

Of course, this means lots of good hard foreign currencies flowing into the country and not as many pesos going out into the world. That combination makes for the inflation you may have been feeling... and also gives K some serious dough to experiment with price controls aimed at keeping inflation down and stimulate certain parts of the economy that he would like to see grow. Let's wish him better luck than Dick Nixon had.

That inflation (relatively minor, truth be told) means that your dollar doesn't actually feel as good in your pocket as the papers all say it does but there's no denying that we are living in an island of protection for the greenback.

Take a look at Brazil: it wasn't too very long ago that the dollar bought 3.00 Brazilian Reals... today $1 will get you 1.98 reals and nobody thinks that is going to reverse itself.

The Euro today came within 1¢ of its all time high against the US currency. If you and your bucks were living in that zone right now... well... let's not even think about it.

Life in England and Japan, with their pounds and yen, haven't been a good deal for we Yanqs for a while but right now I can't imagine how fast your wallet would empty trying to keep house there.

But that's not all. The Canadian Dollar is closing in on a 29 year high. That old yanqui quip, "How much is that in REAL money?" isn't as funny for americanos around Toronto as it used to be.

So enjoy it while it lasts... and it looks like it's gonna last for a while... in Argentina, at least.