National passion: Argentines have 200,000 million dollars in banknotes, 10% of the banknotes in circulation in the world

Argentinian savers have 200,000 million dollars in banknotes, which implies that the country owns 10% of the value of the banknotes in North American currency circulating in the world.. The weight of money in the economy is so important that in Argentina there are more dollars per capita than in the issuing country itself, the United States.

This is how the economist estimated it Nicolas gadano, based on figures provided by the President of the Central Bank Michelangelo Pesce in a presentation to the Argentine Federation of Professional Economic Sciences Councils. According to Gadano, the 200,000 million dollars held by savers represent 20% of the total dollars that are outside the country of origin of this currency.

This calculation occurs when one considers the balance of payments information released quarterly by INDEC and official data from the United States government, which, in a 2020 update, estimated that there was approximately $ 2,000 billion (millions of millions) of dollars in circulation. It means that one in ten dollars in the world is in the hands of our country’s savers.

The proportions coincide with a report by the US Federal Reserve, the US Central Bank, which, although it contains data up to 2006, shows how the two-monetary economy has been a constant in recent decades in Argentina, which appeared already as one of the main holders of the North American currency. At that time, the Fed estimated that there were about $ 50,000 million in Argentina and with Russia ($ 80,000 million and China ($ 50,000 million was on the podium of the economies with the largest dollar holdings outside the United States).

Argentina’s situation already stood out compared to other Latin American countries. Chile, for example, had savings equivalent to only $ 250 million, Brazil had $ 1,000 million, Colombia $ 2,000 million, Ecuador $ 1,000 million, Mexico and Peru $ 5,000. million dollars each and Paraguay only 100 million dollars.. Argentina, in turn, was number one in dollar holdings per capita, at a rate of $ 1,300 per capita, followed far behind by Panama ($ 648).

Gadano, who served as director general of the BCRA between September 2018 and December 2019, during the management of Guido Sandleris, he clarified on his Twitter account that currently Argentines “We have an average of $ 4,400 per capita, compared to $ 3,083 in the US”.

Argentinian savers have around $ 200,000 million in banknotes, which implies that the country owns 10% of the North American currency that circulates in the world and 20% of what is outside the United States.

Pesce, in turn, said Argentines have $ 400,000 million abroad and stressed the need to of “foreign investment, not only because it is a supplier of dollars for the deficit balance of payments, but because it contributes to technology and investment.” Argentina, he said, “generates strong economic surpluses: Argentinian residents own foreign assets for approximately $ 400,000 million and we have a positive balance of $ 150,000 million”. This was in a speech at the National Congress of the Argentine Federation of Professional Councils in Economics, which was held in Cordoba.

The head of the monetary authority referred to the stock of sterilization instruments available to the BCRA, of more than $ 4 trillion, or about $ 40,000 million, during an intervention in a panel entitled “The challenges of the Argentine economy “, in which he specified that in 2018, external assets were constituted for 23,000 million USD and in 2019 for 19,000 million USD. “What we need is a capital market that converts this surplus into investment and the way to solve it is that it is channeled to the financing of families and businesses through the financial and capital system. There is no other way to solve the problem than to put this money into activity, ”he noted.

During the interview, the head of the Centrale also declared that “the fundamental problem of the Argentine economy is the insufficient income of 40% of families and unemployment of 9.6%”. On the other hand, he estimated that this insufficiency of income and unemployment “should be filled, as happened, by the state, with subsidies. “This is not the basic solution, but it is the case for social peace,” he stressed.

The head of the power plant admitted that “due to his own credit history, Argentina finds it difficult to obtain international financing and that is why it must resort to exports”. The problem of the external sector “comes from the mid-1950s”, he added, estimating that about 90,000 million dollars per year are needed in exports “for the country to experience steady growth”.

“The process of dollarization of the Argentine economy will take a long time to reverse”, projected the head of the BCRA and declared that “when there is an investment decision, the first thing one thinks of is to buy We have to make ends meet, so that companies know the instruments and that those who have surpluses know them and can diversify their portfolios ”.

The official defended the postulate that inflation in Argentina is a “multi-causal phenomenon and argued that” to see its origin only in macroeconomics is a mistake. Argentina has experienced recent inflationary processes with few monetary problems. From 2018, it is a persistent problem ”. In addition to causes such as “the pressure that domestic savings puts to dollarize, we must pay attention to it as a very important component; the distributive offer between sectors also plays an important role ”, so these are aspects to be paid attention to, he suggested.

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