Thursday, June 14, 2018

The canary don't chirp

The Argentine Peso Is Plunging... Again


The raie hike bumps the dollar, the cost to service dollar denominated debt in Argentina rises, more transactions for dollar less for peso.  For the peso that is fewer transactions chasing the same peso, dumping peso, peso inflationary.

Argentina is a known soflaw, in sandbox terms.  So it is our measure of interest charges needed  cover the losing tail of currency losses and gains. Finance uses Argentina to set bounds on losses.


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