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50 sats \ 6 replies \ @didiplaywell OP 15 Jun \ parent \ on: My Direct Account on the Situation in Argentina under Milei's Government Politics_And_Law
The IMF is a cute harmless baby compared to what our own soviet state did to us. They have actually been the lesser of evils. Milei despises structures as the IMF but never put any blame on them simply because our past government recurred to it to keep the welfare party on. The IMF has even being lessening the interest rate the more Milei keeps performing well. We put on our own chains ourselves. Milei broke that ill socialist hypnosis on the youth and snapped them back to reality (boomers and elders are terminally lost).
I disagree on the IMF being a cute harmless baby, even in comparison to what previous governments of Argentina did to Argentina- those previous governments took the mechanism of the IMF and placed the nation of Argentina under massive and extreme debt obligation to the IMF- that is a massive compromising of the sovereignty of Argentina by those governments and the IMF.
The IMF enables the corrupt and inept misgovernment of nations like Argentina and that enables the IMF to impose all sorts of rentseeking and injurious policies upon nations so indebted and obligated even long after those governments have changed.
Without the IMF those previous governments would not have been as able to entrap the nation in such chronic debt.
The IMF has imposed severe restrictions upon El Salvadors government program to implement Bitcoin as a MoE and Sovereign reserve. If as you say, Milei hopes to enable Bitcoin as a MoE in Argentina, be aware that the IMF will use its considerable leverage to obstruct such a policy...because allowing Bitcoin as a MoE would seriously undermine the IMFs entire model of global fiat debt power and leverage.
The IMF may be purring like a kitten now as Milei looks like improving the dire state of the Argentine economy and the probability of Argentinas debt being repaid, but they will not be accommodating of any plan to allow Bitcoin as a MoE. They will use all of their significant debt leverage over Argentina to prevent it.
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First, let me emphasize that I agree with you on the intrinsically corrupted and devilish nature of the IMF.
But, lets not fall in the "guns kill" fallacy. The gun is just there. It's up to you if you use it to blow your own foot off. And again, among the available devils, the IMF was and still is the lesser one. Of course, Milei aim's to get rid of it as soon as possible. We already did that before, so we will do it again.
Ironically, the chronic problem Argentina faced with the external debt is perfectly exemplified on how we got rid of the IMF the first time: the first time previous socialists regimes resorted to the IMF was to get easy and quick money to keep on the welfare state party to secure elections, BUT, the IMF did so under strict terms, limiting how much money the regime could emit and how much extra debt it could go into. Obviously, that was against the Kirchnerist regime plans when it came to power, so in 2005 the then president Nestor Kirchner used the record-high farming earning surplus to fully cancel the debt with the IMF, and once free from their limitations the regime resorted to the most infamous creditors to get us into all-time record-high external debt and expanded by more than x1.000 times the monetary base leading us towards 300% inter-annual inflation by the end of their regime.
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Wow interesting, and who are/were these most unfamous creditors, worse than the IMF?
And then presumably they (later governments) went back to the IMF later before Milei came to power?
My understanding was that Argentinas debt to the IMF has been continuous, deep and chronic for decades and that the IMF had limited prospect of getting much of it paid back until Milei came to power and began his reforms.
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- The main known debtors are:
- The Paris Club
- NML Capital Ltd.
- EM Ltd. Elliott Associates
- Dart management
- AFTA
All of them where old creditors with rolling debts with Argentina already. What the Kirchnerist regime did over and over was to "renegotiate" the debts, which implied to pass on the debt for a later term in exchange of ever increasing interest rates.
Freshly new from the Kirchnerist regime:
- Venezuela (yes, you can imagine).
- Internal debt (what they took from people via banks, to be re-paid to the banks by ever-increasing emission, or, in the case of funds expropriated to people directly, promised but never returned). Worse than the IMF in the sense that these sources (letting aside the intermediary banks, which largely profited) were simply helpless for it was composed by average citizens, defenseless against the state.
- Who came back to the IMF:
Right fresh from his assumption to power, and with all the above creditors fed up, the newly elected socialist president Mauricio Macri used his perceived greater confidence, gained from supposedly being an opposition to the Kirchnerist regime, to go back to the IMF to ask for financing to pay the other creditors, and to keep up public spending, resulting in another wave of net increment of the external debt. After Macri's lame posing as a fake alternative, the Kirchnerist regime got back again in power right after his term.
- "the IMF had limited prospect of getting much of it paid back until Milei came to power and began his reforms" this last part is true.
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Thank you for this detailed description of events.
I do not know anything about the creditors you mention but would suggest they are unlikely to have any agenda seeking to prevent Argentina from allowing Bitcoin to be used as a MoE- whereas the IMF clearly does.
I hope Milei and Argentina can be free of all external creditors and undue pressure, and can enable Bitcoin MoE and true prosperity and sovereignty.
It will take strength and an educated population.
Keep up the great work.
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Thank you Sr, will do!