To Stamp or Not to Stamp

I'm a bit obsessed, I guess, with this inflation issue. It follows me everywhere. Today I went out to get some photocopies done around the corner, and I saw something odd. Something that struck me as funny at first, but very sad when the laughter stopped.

One of the girls at the photocopy place was putting stamps on some mail ... you know, regular mail, snail-mail, old-fashioned post-office thing that doesn't come with a "Send" button ... you get the point. An envelope, address, stamp. The real thing. When you get collectible stamps, etc. I'm trying hard to be redundant because this was not a regular envelope: it was an inflation-stricken letter, created by Freddy Krueger ... aestethically inadequate. Ugly. Expensive-looking. A bastard child of inflationary economies.

See for yourself:

This deserves an explanation. Sending letters to the Province of Buenos Aires used to cost $ 6.50 (u$s 2 and a bit). Stamps were denominated in $0.75 and $0.25, some higher even. Now snail-mail - unlike its digital counterpart which cuts costs constantly - is increasing its prices. Sending a letter to the province now costs $11.50 or so (almost u$s 4). And stamp denomination was not automatically "increased", since they are printed and it takes time. So, they now have to use a crapload of stamps - filling 50/60% of the envelope, to put enough stamps ... God save us all from oblivion.

Snail-mail is dead. Long live snail-mail.

Hipocrisy 101: The Infamous Nineties

All of you Spanish Speakers will appreciate this ... a web-only video of President Kirchner (who never tires of demonizing the 90's as a lost decade and criticizes convertibility as the destroyer of local industry) and ex-President Menem. Kirchner speaks of Menem as a change agent in Argentina, who everybody should admire ... enough said!

Price Distortion

Today I found out first-hand about the real price distortion in Argentina. I had to go for the first time to a new graduate program where I began teaching and, since I had no clue how long it would take to get there, I went there by car. Since someone took the only empty space in front of the University, I had to look for a parking spot around.

Two blocks away, I found this horrid-dirty looking parking place ... $ 4.20 an hour (u$s 1.40). Fair enough, given the u$s 2 charged in mid-town. So I went to class - a nice enough group of lawyers doing a law/biz adm graduate program - and then went back to get the car. On my way back I prayed to God it would still be there, and it was. The problem was when I asked "how much?" and the guy took my ticket, put in a couple of numbers in the machine, and spat out "$ 11". I looked at the price list (yes, sue me, I am an accountant and work in pricing and planning) and said "it's wrong - 2 1/2 hours is $ 4.20 x 2 plus $ 2.10 - that's only $ 10.50". To which he replied "I gotta charge you what the machine says. It says $ 11." Faced with that undeniable logic, added to the fact my car was nowhere in sight, I payed up, asked for a receipt and as I climbed on my car mumbled "this is the first and last time I come here" - to which he replied "fine".

My conclusion: this was a description of economics of plentiness. What is that? Too many cars around, the parking lot was overflowing, and they still had room to increase prices before getting hassled by authorities. So, why care about me? I would be replaced instantaneously by another sucker. And then another. In a year of record car sales (300.000 during the first six months of the year), he might be right not to care. At least, ntil the next crisis and until he closes down the lot and puts up a 5 on 5 soccer court or paddle tennis or the next fad.

Sunday Headline News in Argentina

Nothing too interesting happened this weekend in the news. There was - as usual - at least one common denominator in the first-page news at Clarín and La Nación, the 2 most popular newspapers in the country. This was the imminent increase in ABL (property taxes - stands for lighting, sweeping and cleaning in Spanish) taxes everywhere around the city, looking to raise approx. U$S 50 million this year and U$S 200 extra million in 2008. The reason: property fiscal valuations have not been updated since 1993, and the new mayor needs some additional funding to cut the deficit that Telerman - actual mayor and 3rd place out of three in last election - promised to leave the city with breakeven finances.

Anyhow, the sad result of this untimely tax increase - amidst the President´s other set of economic measures all moving in the direction of increasing disposable income and thus prolonging the consumption boom that's fueling economic growth - is that we will all pay increases ranging from 50% tp 150%. Macri's PRO party will have to take some of the heat for the tax increase, even though the FpV (President's party) also approved it. There is a heated debate right now, that will spread over this last week of the month - whether this increase will be revoked or not.

Other headline news: La Nación mentions illegal aliens in the US, who left Argentina after the last crisis (totally irrelevant subject, if you ask me), and also shows evidence about how January's inflation was manipulated. This has been an ongoing topic and the national statistics organism (INdEC) has lost absolutely all credibility in the eyes of local and foreign - and may even generate important legal actions against the country since manipulating the inflation index directly lowers the yield on Gov't Bonds ties to inflation (CER adjusted) therefore newly affecting investors' rights. Seems we need to make our homework there, otherwise we'll just end uo selling all of our bonds to petrodollar-rich-neighborhood-friendly Chávez. At twice the rate the IMF used to lend to us, but hey, they bothered us with the talk about institutions that may actually force us to reconsider if our path to growth is something that can last over the long run or a short-lived fantasy. Heck, sometimes it seems like the 90's, except that it's a 3 to 1 convertibility instead of 1 to 1 and there are less trips to Miami!

Clarín talks about the most important and relevant news in the country: My beloved Independiente is leading the local champsionship. With a 3 point lead over the 2 challengers, we are playing historic rival Boca Juniors on Wednesday.

Fine, I was wrong, so what? (Speeding Ticket Part II)

Or at least I was semi-wrong. Yesterday morning the story started at 6.45am ... I had been told to be there at 7am, but a very kind family member helped me out and got there at 6.45 - and there were already 30 people waiting. She got the number 21, and as I arrived at 8.30am, she was already talking to the traffic controller secretary or whatever. She just printed out a page, gave us a new number which led us to wait in a large room full of people of every socio-economic level whose sole common denominator was having traffic tickets - everything from red lights to doing 200km/h or not having put on their seat-belts.

After another half hour, the noisy machine that showed what seemed like random undecypherable alphanumeric codes (beeping every time a new one was displayed), we were up (by the way, besides the beeping codes, traffic controllers also came about screaming people's names - I don't know who decided whether you got a beeping number or a screaming name-call, that's for newly-elected Mayor Macri to figure out). So, we get to the traffic-controller (for those expecting a fat gentleman in suit and tie, you are in for a disappointment): he was just a regular guy. One of forty-something traffic controllers. So we sit down, I explain to him why I had sped (I won't say why, I'll keep it a mistery) and he says I can either pay U$S 35 (minimum fine, he was being kind and lowering it from U$S 50) or wait to talk to the judge (who of course would get there in another half hour).

So, I went for the judge. And it took her an hour to get there and start imparting justice. Anyhow, we get called - this time by name (woo-hoo!) and go back to the same controller, who makes me sign some papers and explains the judge had bestowed upon me her divine benevolence because it was my first offense - and due to the by now very misterious situation I will not ever reveal. So, that was that: by 10am I was out and having won my small insignificant victory against the state. I felt U$S 50 richer, but I also felt there was something seriously wrong with the system.

And I had a great incentive to never speed again!

For those of you wanting to read more (albeit in Spanish): http://www.clarin.com/diario/2007/03/06/laciudad/h-04215.htm

A Culture of Protest

Argentina has a deep-rooted culture of protests. I am too young to know when it started, but old enough to know it has a horrible effect on a country's image. I remember watching TV a few years ago and seeing tourist walking to and from the airport (Ezeiza Int'l Airport), just because there was a protest and cars were not allowed to approach the airport. Old people carrying bags and complaninig. Spanish tourists saying they will never return. Then again, they might have come here just to do some cheap shopping, but that does not give us any reason to overhaul their security and basic rights.

Still, it seems we simply don't care. During 2006, protesters of all sorts bloqued roads 817 times. Almost 3 times a day (if you count weekends). Crazy. However, well below 2005, when roads were cut almost 1200 times during the year (by the way, almost half of the number of 2002, year of crisis in Argentina). And where are the rest of the people's rights? I mean, if you block the road and I want to cross it, you are manifesting your constitutional right to express yourself but I am not allowed "free transit" among Argentinean soil. However, after the 2002 incident which cost Eduardo Duhalde an early call to elections, during the portests which ended with some policemen killing youngsters Kosteki and Santillán, no one has had a taste for police repression. In fact, laissez-faire seems to be at the ordre du jour. Although it might buy Presidents time, it hurts the rest of the population a lot. We feel vulnerable. Unprotected. We are driven against the government by its own inaction. And that is never good for either side of the equation.

Any reason is a good reason to protest: lately, it has been higher salaries (the President's province has been "taken" by hords of people roaming the streets, and he has solved it ordering 3 salary increases in a year), it has also happened as result of a struggle for political control (UBA, Carlos Pellegrini school) and it continues as protests against certain government measures that minority groups dislike (i.e., Quebracho). It's not that I am totally against protest: I feel the cacerolazos (kitchen-pan) protests after the crisis should have been more widespread and far-reaching than they were, and so were protests against insecurity; but there is a limit to protest. When it becomes the standard way of asking for things, it might mean that there is something rotten in the way things work.

Worst of all is when people get results blocking roads and so on, it generates a belief that so doing is the only way of getting things done. And that is a dangerous road to go down, since we might end up going around the right way of protesting, which is carefully electing our representatives and removing them when they failed to keep their promises. So, I guess it's a matter of thinking with out heads and realizing that a careful, rational vote will take us further than a street protest which ultimately destroys country equity by making it a worse place to visit for tourists and to live in for locals.

We should keep this exceptional manner of protesting for times when it's really necessary. Otherwise, it becomes just like the story of the boy who always cried wolf ...

Speeding Ticket Citation: Has to be Fiction (Part 1)

About a month ago, at 10.30pm, I was returning home from a very long day at work, and as I was heading towards Libertador Av., I saw two consecutive flashes of light that were unmistakable: I was speeding (70km/h instead of the 60km/h limit). Since then, no news. Then all of a sudden, I receive a citation to go to the Traffic Controller and explaing what had happened (and if my explanation was satisfactory, I would be pardoned and receive no fine). If I did not go, I would automatically receive a fine (aprox. U$S 50).

So, I decided to go at noon today (they had cited me at that time) and, as I approached the municipal building, I prayed that all those horrible stories people had told me about going there were actually mistaken. They weren't. In fact, they fell short.

The place is absolute chaos. Dirty. Homeless people living outside, lying on the ground wrapped in dirty blankets. Has to be fiction, I thought. But it wasn't. Once inside, things got worse: a long queue of people waiting in the best Disneyland style - some sitting, some exhausted from the hours they had already spent there. So, I thought there were surely many lines, there had to be one for each different task (citation, paying a fine, general questions, etc.). No, one line for all. Once I figured out where it ended (it actually went outside the building onto the sidewalk), I asked approximately how long it would take to get to talk to someone who might pardon me. They said that in an hour they would hand out the numbers for the afternoon, and after that the real wait would start. In five hours I would be out, they said. All of this, of course, was being done during lunchtime. Now and only now I understood why the people who can prefer just paying for the fines instead of going through this humiliation. What happens then, to those who can't pay? I guess, like me, they must wait in line. To be continued this Friday, when I will go at 7am to do the number queue and then try to get out before 10am ...

Unlikely Bed-fellows ...

Who would have thought Hugo Chávez, Venezuela's democratically-elected-dictator-to-be, would prove to be our President's most faithful (and deep-pocketed) ally? Do not be fooled by any populist announcements: Mr. Chavez is no fool, as is not Mr. G. W. Bush who buys Chavez's oil. Chavez, somewhat contradictory to his populist-socialist speech, is a very good businessman.

Kirchner gets "easy" financing from Chávez, and thus skips IMF white-tape and those horrific "conditions" for their loans. God forbids, they might actually prove to be right about some of the things they say and it might confuse people ... anyhow, Mr. Kicrhner managed to construct a cycle to elude IMF dependency but we are all paying the price of that - paying as high as twice as much (11% vs IMF's 5.5%) as we would have had to pay the much-hated Bretton Woods creation. Then our lender of last resort Mr. Hugo goes home and sells those bonds in the secondary market, not retaining Argentinean risk for longer than it takes to say "gracias". But, hey, independency has its costs.

On a side note, I read today that we are Chavez's second favorite investment destination: only rivalled and surpassed by market-friendly Cuba! For those of you who wanted to be compared to the US or Europe, there you have it: as far away from it as you possibly can get. Oh, and by the way, FDI (Foreign Direct Investment) fell YoY for 2006 and is falling QoQ for 2007 1st quarter ... announced investments are small, multi-year and most "forceful" due to disappearing output gaps. But then again, it shouldn't be a surprise for us - we never really were market-friendly except for the (God-forbid-we-ever-return-to-the -scandalous) 90's, when FDI was knocking on our doorstep uninvited. Seeing how it all ended will never explain that investment is bad, no matter how you look at it. Genuine external investment will not return before price-mechanisms are restored in the markets (energy, transport, food, at least).

Now it all becomes more complex when a certain gentleman, who by the way was invited to fly on a private jet rented by ENARSA and tries to "smuggle" U$S 800.000 in a hand-bag. How did this happen? Has it happened before and did it go undetected then? why? why now? As everyone - including the FBI anytime now - tries to find Mr. Antonini Wilson, another corruption scandal hits the Government as it is about to embark on the last 3 months in power (Skanska, strike one; Miceli and the money-bag, strike two, Romina Piccolotti and her numerous family aides in the Ministry of Environment, miss, and this sounds like a 3rd strike). The Gov't did not need this, least of all now. Not when it has presented Cristina Kirchner, Senator and First Lady, as a firm succession candidate for her husband. If circumstances forced K to revisit his decision, these cases coming to light and devoured by the press might hurt him beyond return.

For the time being, and until this mess is sorted out, we will assume Mr Antonini Wilson wanted to buy a property in Argentina - and maybe lend Miceli (Argentina's ex-Economy Minister) some money to buy hers. Maybe he just didn't make it to her private bathroom ...

As Good a Place to Start as Any ...

Since every story has a starting point, I guess any time is a good time to start this kind of attention-seeking, tourist-alienating, semi-schizo blog. No, really, I have no clue where this english-spoken blog is going to take me [us?]. All I know is I don't feel I can express myself 100% in my spanish-speaking blog - and I seem to get very lost among many media analyses and academic constructions. I needed a space to just do what Mr. Rowe, my high-school English teacher, would have called "stream of consciousness". I will just lay it down as it enters my mind, and I hope it's worth something to the readers.


If anything, at least you'll gain some perspective on life in Argentina seen by a local, who has also lived in many different (and all richer) places and can (hopefully) have an enhanced point-of-view, neither overly-proud and protective nor too aloof and indifferent to care. I will discuss politics, economics, and every-day mundane commonalities - those that best depict our culture, probably. I would love to hear [read] your thoughts and have open discussions, as long as it is constructive and well-mannered.

Welcome!