Photo: AP Images
We’ve been tracking how heated things have been getting between hedge fund manager Paul Singer and Argentina’s President Christina Fernandez de Kirchner since Singer impounded an Argentine naval vessel in Ghana last month.Now it looks like Fernandez de Kirchner may soon take on another powerful figure in global finance, IMF head Christine Lagarde.
This isn’t about Argentina owing the IMF money (as it is in Singer’s case), Lagarde’s beef with Argentina is that the country has reported inflation rates way below the rates independent analysts have reported for the past year or so, and she wants them to start being honest… ASAP.
In fact, according to Merco Press, she’s given Argentina an ultimatum. After an IMF executive board meeting last week she said Argentina had 90 days to fix its statistics or risked being “red carded” (expelled) from the IMF.
On December 17th, the executive board will meet to assess “quality of Argentine statistics, particularly those referred to inflation.”
Lagarde has used this language before, and President Fernandez de Kirchner has responded with vitrol. From Merco Press:
On September 25, President Cristina Fernandez addressing the UN General Assembly replied to the ‘red card’ football jargon saying Argentina was not a soccer team “it’s a sovereign country and accepts no threats or pressures” and in the game of comparing football with economics and politics, “let me say that the president of FIFA has been far more successful and satisfactory than that of the IMF Executive board”…
For the past two years the IMF has sent commissions to Argentina to the help the country improve its statistical measurement systems with no result.
As for any independent analysts within the country, they’re threatened with fines and prosecution if they report the true inflation rate. To get their figures to the public, they get their Congress’ Lower House Freedom of Information Committee with help from politicians opposing Fernandez de Kirchner.
So here’s what an Argentina reported last month and how it compares with independant stats (from Mercopress):
…Indec announced on Wednesday October’s official inflation rate, 0.8% cooling slightly from September’s 0.9%. In the twelve months to October inflation totalled 10.2%…
However these percentages differ dramatically from the so-called Argentine Congress Index, based in the analysis of nine private agencies, which showed a 1.82% increase in October and 24.62% in the last twelve months.
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