Investors betting that Argentina had turned over a new leaf were given a nasty reminder of the country's past this week as a shock election result raised the worrying prospect that reformist president Mauricio Macri could lose out to his populist Peronist rival, Alberto Fernndez, in elections in October.
Asset prices in the country collapsed amid fears that a Fernndez-led government could default on its debt. Casualties included Michael Hasenstab, a star bond fund manager at US asset manager Franklin Templeton, who had made big bets on Argentina. His funds lost nearly $1.8bn in a single day as the peso fell hard against the US dollar and the yield on Argentina's sovereign bonds soared (and prices fell).
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