Argentine fantasy
28 October 2009
You know I have an interest in Argentinian affairs. This one is from the Financial Times.
In the short story Tlön, Uqbar, Orbis Tertius, Argentine writer Jorge Luis Borges tells of an imaginary world so minutely described that it actually comes to exist. Argentina’s government began a similar exercise when it first doctored the country’s economic statistics in 2007. The idea that flattered growth or inflation data might ultimately manifest itself as physical reality is something not even the country’s former military dictators attempted. The result today is an economic wonderland that cannot survive if the country is to return successfully to international capital markets, as it plans. The meddling began for obvious reasons: one-third of government spending is inflation-linked, so under-reporting price increases reduces its bills. But then the fantasy begat further fantasy. Unions now use the “housewives index” when negotiating wage increases as official data are so poor. Officially, the Argentine economy is some 10 per cent larger than in June 2007, just before Cristina Fernández became president. In fact, it is probably 5 per cent smaller, Capital Economics estimates. At the height of absurdity, computer-generated estimates of the economy’s size derived from the same supply or demand data no longer matched. The cumulative effect of these discrepancies is more than an arid statistical curiosity. It speaks to the country’s low economic credibility. Yet Argentina eventually needs the International Monetary Fund to sign off on its national accounts if the country is to restructure its $7bn of Paris Club debt with rich creditor nations. That would open the doors to bilateral trade finance. It would also help Argentina raise fresh money more cheaply from international markets, once its $29bn restructuring of defaulted bonds is complete. All governments make imaginative use of statistics. Few turn them into a Borgesian fable from which might hang the financial fate of a nation.
What were you thinking?
Being born under this sign determines many talents, as well as other characteristics that may not be so commendable. Rats are very lively and need a lot of mental and physical stimulation. They can be calm and perceptive, but sometimes their brains can cause a mental restlessness, tempting them to take on too much, only to discover they are unable to meet their commitments. Rats are blessed with one of the best intellects going. Add to their intelligence a curiosity and a bright imagination, and they seem as sharp as a needle.
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