International financial interests have launched an orchestrated campaign of capital flight and other forms of financial warfare against the South American nations of Argentina and Bolivia, to impose “shock therapy” and deadly austerity on the two nations. The City of London and Wall Street are intent on making bloody examples of those countries, and of any others that are considering working with the BRICS Plus and China’s Belt and Road Initiative – most emphatically Brazil. Argentina has already filed for membership in the BRICS, and Bolivia has extensive economic relations with both China and Russia and has also expressed interest in joining the BRICS.
In a report headlined “Argentina’s Economy Teeters on the Edge of Deeper Crisis as Market Anxiety Grows,” Reuters wrote yesterday: “A flight to the safe-haven U.S. dollar sped up this week after the failure of stopgap efforts to bolster exhausted international reserves rekindled fears about a possible devaluation of the heavily-regulated official exchange rate.”
Sources in Argentina report that not only is the peso devaluing against the dollar at the rate of 2-3% per day, as huge capital flows are being sucked out of the country by financial speculators, but consumer price inflation is accelerating so rapidly that there is effectively no price structure whatsoever in the country. Rumors abound of everything ranging from a major devaluation, to IMF “shock therapy” imposed as part of its current $45 billion Extended Fund Facility agreement with Argentina, and even a possible dollarization of the economy – along the lines of the disastrous “convertibility” plan imposed by then-Finance Minister Domingo Cavallo in the early 1990s.
Reuters was blunt: “The hemorrhage of the IMF’s aid is raising fears of a potential devaluation that would sink Latin America’s No. 3 economy into a crisis comparable to the chaotic periods of 1989-1990 and 2001-2002.”
