Confidence in Argentina's government, the judiciary, the currency
and the banking system has collapsed. The public sector, banks,
companies and individuals are nearly all bankrupt. Employment is
becoming even scarcer; currently one-quarter of the labor force has
no job. The provision of public services like health, education and
security is declining. Crime and poverty are spreading.
The government of President Eduardo Duhalde has tried to soften
the impact of the economic disaster by reorganizing the banking
system's balance sheet, rewriting bankruptcy laws, rationing access
to hard currency and imposing windfall taxes on oil exporters. But
all this manic meddling only adds to the disorder.
"It is one thing to default [and] devalue," says Juan
Bosch, head of asset management for the Compass Group in Argentina,
and quite another "to not respect the rule of law, to violate
property rights and arbitrarily [allocate] losses." He says that,
"Instead of allowing market forces to become the...
Already have an account?
Subscribe now for unlimited access to all current and archive news, data and market analysis.
Take a free two-week trial now for the latest news, data and market analysis.