Overview: The Shell Game

The extreme volatility across the various markets is similar to the blur of hands that accompany a shell game. Although onlookers try to stay abreast of the situation, the rate of change is so fast that they become disorientated and fail to keep up. The markets appear erratic, defying fundamental conditions and logic. Many people […]

Argentina: Martin Lousteau Resigning?

Word from Buenos Aires tonight is that Martin Lousteau, Argentina’s Minister of the Economy of just two months, may be about to resign his post. According to our information, Lousteau spent two hours this afternoon with his President, Cristina Fernandez de Kirchner, where he explained that he could not do his job correctly while other members of […]

Impressions from Spain: Prepare for a hard landing

Just coming back from a short holiday in Spain, I am now more confident than ever that the Iberian economy is heading for a nasty period of adjustment. Even though growth in Q4 of last year surprised on the upside (0.8 percent quarter-on-quarter compared to 0.4 percent in the euro area as a whole), it […]

Paraguay Calls, LatAm Responds

At the beginning of February, a yellow fever outbreak was reported in isolated areas of Paraguay. On 15th of this month, its government declared a 90 day national state of emergency as the population’s worries mounted as number of reported cases grew to over 30 in several areas of country that included the capital, Asuncion,, […]

Global Agflation, Energy Security and Bio-fuels

Neither capital flights and “sudden stops”, nor even – at least so far – disastrous export collapses: if one is to single out a major recent macroeconomic phenomenon brought by globalization to Latin America, I suggest “agflation” – as The Economist has called the process of sustained rise in world agriculture prices since last year […]

A New Dawn for Rent Seeking in the Pampas

I think it was Ronald Reagan who once said something along the lines that when business does well, the government taxes it, when it keeps doing well despite the higher taxes, the government regulates it, and when it finally starts to sputter, the government subsidizes it. Nowhere is this truism more, well … true, than […]

Happiness map

Things won’t be the same tomorrow as they were yesterday. The old will be still older. Migration? More intense. Relative prices? Determined in China and India. Inequality? Greater than ever, as will resistance to globalization. But, above all, the world will change due to global warming. Scientists are warning us that the point of no […]

Argentina 2008: Is the (already High) Inflation Rate Accelerating?

This is not a technical article. It just puts together some commonly known facts and asks some questions; it also includes some thoughts. Facts (or, shall I say, Problems?): Argentina’s “un-edited” (i.e. true) 2007 annual inflation rate is in the 20-25% range. Wage contract negotiations are presently taking place. It looks like unions are requesting […]

Beware the decoupling complacency

Current debate about the business cycle in Europe is exhibiting a relative complacency about the potential fallout from America’s current economic woes. The latest piece of evidence comes from Daniel Gros who has advocated that while the European economy might slow down as a result of a US recession but might actually escape negative sequential […]

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