Argentina’s inflation keeps soaring. Its worth noticing some of these events because there’s a good chance we’ll see some of these being similarly implemented elsewhere to a degree, if not downright done the exact same way.
One of the many problems with statistics and numbers in Argentina is that its hard to come by reliable data since the government controls the statistics institute known as INDEC and it refuses to publish any numbers or statistics that could be perceived as a failure of the ruling party. That’s how what should be the most accurate agency often shows inflation numbers that are ten times less of what independent agencies come up with. To make matters worse those independent agencies get fined or shut down by the government if they don’t play ball.
Still, there are many ways in which people can ballpark a general idea of how bad its getting. How much of your shopping cart you fill with a given amount of money would be one of them. The price of bread, milk, those are clear indicators of the cost of basic supplies linked to the cost of living.
Another interesting thing to observe is the feeling of irrelevancy of the $100 bill.
You see, a 100USD bill is considered a big bill to break down. Buying say 10c of candy with a 100USD bill may be frowned upon by most store clerks in USA. A 100 USD bill is still considered “big” money. 100USD buys you stuff. It buys you a pizza or meals for four in most fast food joints. 100USD is respectable money in the world of daily expenses and cash kept in wallets.
As prices keep soaring in Argentina, the 100 peso bill is seen more and used around more up to the point where lots of ordinary things bought on the average day cost 100 pesos. Its not considered “big” money any more. There’s been an increasing demand for a 500 peso bill, and this would no doubt help matters a lot, it sure would be used. But the government considers this a way of acknowledging inflation, so they refuse to make a 500 note. So what happens? A)You have to walk around with a big fat wallet full of bills. B) The government is printing 100 peso bills like crazy.
Here’s a chart showing in red, how many 100bills are in circulation today in comparison to the last 10 years.
Wacky / Nutty facts about the Argentine Economy
*Argentina has two, hour-based prices for bread. Scratching your head? Lost in translation? Nope. Here’s the deal: A kilo of bread sells for 10 pesos before 10 AM and it doubles in price after that. Insanity? Well, yes, for most people it is. But for the Argentine government it’s a way of saying bread costs only 10 pesos, while on realistic terms the price is at least 20. Good luck finding any bread before 10 am, most bakeries just happen to “run out” and don’t restock until 10 AM, or they have two qualities of bread. The before 10 AM one probably being mostly sawdust mixed with expired flour.
*A liter of gasoline in Argentina costs as much as a litter of the milk, about 1.49 per liter. This is for the cheapest milk you can find. Other than being white, it tastes just like water.