One of our most recent video reports!
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Josh Sigurdson talks with author and economic analyst John Sneisen about the latest news out of Argentina as they follow Venezuela's path towards complete hyperinflation... Again...
Interest rates have skyrocketed in Argentina to 60%!
The interest rates are said to stay the same until December as the Argentina government and the central bank raise interest rates in order to restore confidence in the Argentinian Peso. Cue laughter...
This is obviously further evidence of turmoil in emerging market economies. The Argentinian Bank raised the cost of borrowing by 15% on Thursday the 30th of August.
Despite the bank's rate moves, the currency fell another 10% in value. This was the most severe drop for the currency since it was floated in 2015.
One US Dollar is now about 40 Argentinian Pesos.
On top of this, the IMF is saying they're considering Argentina's request to speed up disbursements from a 50 billion dollar credit line in order to restore investor confidence.
Macri falsely claimed that the IMF had already signed off on such a decision on TV. He thought it would help investor confidence, but instead it just resulted in more market confusion causing the Peso to further drop.
Argentina has been through countless inflationary events over the last century. Some hyperinflationary. In the 1980s, Argentina saw interest rates hit 1400% which is unthinkable. This is the result of massive central planning. When they keep the printing press running, the value inevitably falls and all fiat currencies eventually fail. They always have, they always will going back to 1024 AD in China. You would think 1000 years would teach people a lesson about how terrible centralization can be, but apparently not. Central banks have just learned how to centralize more so and get away with it, but they cannot put it off forever. The more they put off the inevitable crash, the worse it will fall.
Argentinians need to decentralize and be financially educated and responsible. Self sustainability is key.
Stay tuned for more from WAM!