The latest actions confirm an issue: there is disorientation and few ideas in the Casa Rosada to curb inflation. The “monitoring” of the social movements in the gondolas was for the platform: only to pretend that the remarks are being fought.
Paula Spanish confirmed the absence of ideas with the harsh but repeated use of blaming the main food companies. The attack on the “multis” and the picketers in the supermarkets do not change anything in the background: it is cosmetic. In other words: sell smoke. The Secretary of Commerce negotiated and monitored the companies throughout the last year. It demanded the detail and did not authorize requests for increases. According to a secret COPAL memo, on average, companies had cost increases of 20% and only noted 6%.
But that vigilance by Spanish failed and the Secretary of Commerce could not prevent inflation. The rise in prices is due to more complex issues than the pursuit and assembly of a “story”.
For this reason, now -and when the potatoes are burned- the official used old recipes: accuse them of shortages to blame them for inflation.
They say that Español also acted to respond to internal intrigues. With his decision he threw an Exocet into the dialogue with the businessmen in the Casa Rosada. Many of the companies now accused by the Secretary of Commerce attended a week ago to support and applaud Martín Guzmán.
Although it is hard to believe, this endorsement of the minister did not please part of the Instituto Patria. In the Chamber of Commerce they affirm that Cristina’s harsher environment would have encouraged the actions of the Secretary of Commerce. To mark the court for the minister.
“Hard Christianity” was upset that Guzmán put rationality and affirm that inflation was the cause of macroeconomic imbalances. Also, to make sure that an agreement with the IMF will be closed.
For a long time, in turn, La Cámpora has questioned Español’s lack of political action. They accuse her of “light” and of having many contemplations with the companies.
About Máximo Kirchner they say: “Paula is serious. But he acts little ”. The Secretary of Commerce responds to Axel Kicillof, who has strong shorts with Maximum. Kicillof, in turn, disputes Guzmán and is upset by the accumulation of power of the head of the Palacio de Hacienda. Everything would have influenced the last action: the Secretary of Commerce became tougher and Guzmán’s commitments with the price makers were relativized. Among businessmen they say one thing: that it is the “Cristina effect”. They refer to the vice president’s “anti-entrepreneurial” conviction.
In the Industrial Union they insist that this issue was key in the last attack on private companies. The “bipolarity” of ideas that exists in the Frente de Todos only generates greater uncertainty. Among businessmen, there is more and more talk of the “Cristina effect”. In the UIA and the Association of Banks it is explained as follows: Casa Rosada and Guzmán make rational proposals and the Instituto Patria blocks them.
The “Cristina effect” is reflected in the doubts that exist about an agreement with the IMF. It would be key to clearing up doubts and the Government is careful to say that it will be a safe and successful agreement. But from the environment of the vice president the rapprochement is questioned and insists that, in an electoral year, it would be better to “live with what is ours” and moderate the adjustments -provided by the IMF- in rates.
Alberto and Cristina got over their year-end anger and now have a more fluid dialogue. But the political situation increases confusion in the face of overheating inflation.
Alberto today launches the Economic and Social Council, which Gustavo Beliz will lead – his trusted man. The official wants to seek consensus to face the Argentine crisis, but he has a cyclopean challenge: that the initiative does not turn into another loose electoral bullet. The President could not specify his original idea: that the Council be led by Roberto Lavagna or a figure like Alberto Barbieri, rector of the prestigious UBA.
The success of the initiative will also be measured by the participation of the opposition. Difficult in an election year. In the secret meeting between Mauricio Macri and Horacio Rodríguez Larreta, everything was discussed. There is still good harmony between the two, but a substantial difference has been cleared. Macri asked for “sticks” against Alberto and insisted on not letting the Casa Rosada pass one. His proposal is to radicalize.
Rodriguez Larreta said that no longer trusts the President and who believes the worst: that the Casa Rosada is not going to correct its wrong course. But he did not share the theory of “painting his face” and blowing up everything. Larreta will focus on his management and deepen the search for consensus. Capitalized the return of students to classes. Thus he told him: “You can win a presidency by one vote. But to govern later a consensus of 70% is needed ”.
Up to now, the Casa Rosada avoided having a stabilization plan and growth that allows a glimpse of a price reduction.
So it will be difficult to lower the index. The first projection of Orlando Ferreres says that February has a floor of 3.5%. Between the BCRA and the Palacio de Hacienda there is confusion and at least there was -in the last semester- three changes in monetary and exchange strategy. Miguel Pesce –first– defended a stable dollar to the letter. The demand for banknotes was brought to the Central Bank.
Martín Guzmán –after- took the baton, when he twisted the arm of the head of the monetary authority. The minister asked for his head and Pesce was about to resign. Alberto was the one who kept his faithful friend at the BCRA.
But since that September there have been at least three changes in the dollar’s strategy. Guzmán suggested – in the middle of the run – a fiscal and tariff adjustment with a dollar with variable fluctuations and unknown by the market.
Then Cristina appeared –with her letters and the act of La Plata- and things changed: general guidelines of 30% were announced and they stopped talking about great rates. Now there was another modification: the dollar is not going to adjust with inflation and is going to be delayed to be an anchor on costs. This strategy would have been influenced by Daniel Heymann. The renowned ministerial advisor was one of the authors of the Austral Plan and creator of the “drain.”
The “trial and error” put uncertainty and expectations of remarks. Now Guzmán works on that. But the empowerment of the minister opened up internal plots for him. This week was the measure of Paula Español. The “intrigues” also emerged from La Cámpora. Máximo’s soldiers accuse the Guzmán-Sergio Chodos duo of putting them into the mess of the YPF negotiation.
They also question Pesce’s initial attitude. The crisis began when the BCRA denied dollars in December, which in February approved to pay YPF’s debt.
The agreement saved the situation. He also avoided a bravado from Fidelity. The “wolf” of Wall Street – if there was no agreement – wanted to go deep and attack: he threatened to denounce in the courts of Manhattan the use of YPF funds to promote figures from the Frente de Todos.
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source https://pledgetimes.com/the-cristina-effect-and-the-intrigues-against-guzman-due-to-inflation/
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