This is funny

[iyamwutiam]

Basically the PM wants to pay off the debt and the central bank says no -we want to sit on the reserves at 1 percent interest and keep paying 10 percent interest. A good example of why Central Banks should NEVER be independent.

The country -we have all been talking about --Argentina!!

http://news.yahoo.com/s/ap/20100108/...a_central_bank

[jpatter666]

Re: This is funny

Basically the PM wants to pay off the debt and the central bank says no -we want to sit on the reserves at 1 percent interest and keep paying 10 percent interest. A good example of why Central Banks should NEVER be independent.

The country -we have all been talking about --Argentina!!

http://news.yahoo.com/s/ap/20100108/...a_central_bank

Cute spin.

1 ) High suspicion that the PM would use the money as a slush fund
2 ) Such a request must by law be approved by the Congress which the PM did not do
3 ) This is the country that nationalized pension funds. Their leadership cannot be trusted. On my visits there friends basically spat when talking about the politicians.

From the article:
Analysts immediately questioned whether Fernandez could fire the head of the autonomous Central Bank, saying such a move must first go through Congress.
And Sarmiento agreed, ruling that under to the Central Bank's charter, the president has the power to remove its chief only with a previous recommendation from lawmakers — not by fiat.
In her other decision, on the government measure seeking control of the reserves, the judge found that since the economic effects of the debt payoffs would be medium- and long-term, Fernandez was not justified in bypassing Congress with an emergency decree.


Good for Argentina -- one of my favorite countries despite appalling leadership (almost as bad as here in the US!)

[iyamwutiam]

Re: This is funny

Also from the article -which you MUST have skipped:

Fernandez is seeking to tap about $6.6 billion in reserves to help cover $13 billion in international debt falling due this year. The plan would create a special debt-payment fund from Central Bank reserves currently totaling nearly $48 billion.
Fernandez defended the measure at a public appearance Friday, saying it would keep Argentina from paying "fat profits" to speculators.
"It's much better to use the reserves than to borrow at interest rates of 15 or 14 percent, when the reserves are barely earning 0.5 or 1 percent," she said.

Yeah REAL bad leadership- Not!!!