Features

Argentina: new face, old problems

Argentina elected left-winger Alberto Fernández as president. The previous business-friendly presidency ended in disaster. But Peronists have an equally calamitous record.

Argentina elected left-winger Alberto Fernndez as president on Sunday, with the Peronist triumphing over centre-right incumbent Mauricio Macri. Macri's term was dogged by an inflation crisis, which ended in a $56bn International Monetary Fund (IMF) bailout.

Macri's "business-friendly" presidency ended in disaster, says The Economist, but the Peronists who preceded him had an "equally calamitous" record. Cristina Fernndez de Kirchner, Argentina's deeply divisive, economically illiterate former leader, is the new vice-president. It remains to be seen how much influence she wields.

The new president inherits a government "saddled with more than $100bn in foreign debt", say Santiago Prez and Ryan Dube in The Wall Street Journal. The IMF rescue deal is conditional on the austerity measures that "Fernndez campaigned against". Fernndez has promised to end the crisis but has no access to external financing, says Benjamin Gedan of the Wilson Center. "Populism without money is impossible." But almost half of the IMF's current loans are thought to be owed by Argentina. So a period of hardball negotiating and debt restructuring seems inevitable.

That said, "broader Latin American markets have largely shrugged off" the drama, says William Watts on MarketWatch. Argentina's stocks make up less than 2% of the regional benchmark, which is weighted towards Brazil and Mexico.

Recommended

I wish I knew what contagion was, but I’m too embarrassed to ask
Too embarrassed to ask

I wish I knew what contagion was, but I’m too embarrassed to ask

Most of us probably know what “contagion” is in a biological sense. But it also crops up in financial markets. Here's what it means.
21 Sep 2021
Three strong Asian stocks trading at bargain prices
Share tips

Three strong Asian stocks trading at bargain prices

Professional investor Nitin Bajaj of the Fidelity Asian Values investment trust picks three stocks that dominate their industries, earn good returns o…
20 Sep 2021
The charts that matter: more pain for goldbugs
Economy

The charts that matter: more pain for goldbugs

Gold investors saw more disappointment this week as the yellow metal took a tumble. Here’s what’s happened to the charts that matter most to the globa…
18 Sep 2021
With the right political will, inflation can be defeated
Inflation

With the right political will, inflation can be defeated

Governments and central banks can easily control inflation, says Merryn Somerset Webb – they just need the will.
17 Sep 2021

Most Popular

The times may be changing, but don’t change how you invest
Small cap stocks

The times may be changing, but don’t change how you invest

We are living in strange times. But the basics of investing remain the same: buy fairly-priced stocks that can provide an income. And there are few be…
13 Sep 2021
Two shipping funds to buy for steady income
Investment trusts

Two shipping funds to buy for steady income

Returns from owning ships are volatile, but these two investment trusts are trying to make the sector less risky.
7 Sep 2021
How to stop recurring subscriptions becoming a drain on your money
Personal finance

How to stop recurring subscriptions becoming a drain on your money

Tracking and pruning subscriptions isn’t as easy as it sounds. Here's how to take charge.
14 Sep 2021