What happened Monday after STEP? | The supposed …

The political bet government and the speculative bet major players in the market they were not secret. Analysts and economists in the city have publicly described them as the most convenient strategy for the ruling party to compete with the chances of victory in elections and, at the same time, the most profitable for financiers. The move was to walk on the value of the dollar drop the inflation rate in order to generate a stability scenario to appeal to the electorate.

To this end, the Central Bank has placed the reference interest rate (that of Leliq) in a range of 60 to 75% per year, which, together with the exchange rate contained in the IMF's dollarshas facilitated fabulous speculative gains for the financial world.

It was the political system and exchange of the Macri government, in addition to putting its media spokespersons to the task of demonize the opposition and stir with the fear that if they win, the economy will become out of control as the country becomes Venezuela.

The surprise surprise in the elections by the macro-radical alliance showed that this strategy gave no result. The next day, that pressure cooker designed by the government exploded.

The outbreak took place on 12 August, but the same would happen on 28 October if the elections were decided in the first round or on 25 November by secret ballot. Whatever the winner, the dollar flew because it was artificially suppressed as the ruling party's election strategy..

The dimension of the rise was the decision of the central bank led by Guido Sandleris, which allows him to let the devaluation run for technical reasons. However, the former head of the BCRA, Martin Redrado, he said in radio statements Macri ordered not to intervene so that "the dollar goes where it must go and that the Argentineans learn to vote".

Sandleris can not admit it because, in this case, he would have serious legal problems. But the press conference of Macri dislocated, seconded by the candidate to the vice-presidency of the official government Miguel Ángel Pichetto, Monday afternoon, accusing the kirchnerismo of the race, corresponds to the complaint of Redrado. Sandleris will have to explain what he said at Casa Rosada Monday from 8:40 am to 9:40 pm before going to his office at the Central Bank to wait for the market opening at 10:00.

The structural responsibility for the collapse of the economy lies in the economic policy of market opening and deregulation applied from the first day of management. The immediate responsibility for this new round of mega-devaluation is evidenced by the lack of parity control the day after the STEP.

While the market is caught in deep instability by the shock Macri's political crisis, which may initially seem desirable to calm the waters, such as the statement of the most voted opposition candidate on the "reasonable" price of the dollar, may become a political failure with unnecessary costs. Without enough dollars available, try to define what your balance price is unwise.

The rising dollar does not respond to budgetary imbalances nor to the way external accounts are. The lack of control has its origin in which we know that the public sector does not have enough dollars to meet private demand, a deep imbalance between supply and demand for foreign exchange, further exacerbated by the current situation. emptiness of political power.

The Central bank reserves they then remain as the only dike to avoid the spiral of exchange parity on the way to hyperinflation.