Thanks to so many of you for your praises on the nearly daily articles! I see a second book coming from this.
I wanted to walk down the lane of yesteryear and relive a recent experience I "survived" while traveling in Transdniestria ( try to find that one in an atlas!) but there are so many
unbelievable stories to tell about daily life here in Buenos Aires that I feel compelled to relate them. For those of you in our nation's capital, well, I guess like us as all,we've become a bit numbed by them so that it's just another day in the "gran manzana" or the " big apple" as it's sometimes lovingly nicknamed. But for those of you reading this outside of the land of 1000 surprises, it is another unbelievable story which is our reality.
Sad to say, even those not very familiar with Argentina will have heard onetime in their life about the various phases of inflation or hyperinflation which the country has suffered and is experiencing to lesser extent now.Although this article isn't necessarily about inflation, I'll threw in a few cold facts. The worst period of hyperinflation which I can remember was in the late 1970s and early 1980s. In 1975, the highest demonination bill was 1,000 pesos;in 1981 it was 1,000,000. In a period of 9 years from 1983 until 1992 four different currencies were made legal tender, each time trimming the many zeros off the worthless currency. In the begining of 1977, one got for $1 USD 297 pesos; in 1983 for the same greenback one got 98,500pesos. Almost 100,000pesos for one American dollar! And people would scream about the high numbers of pre-euro Italy when the Lira was still in curculation. Imagine trying to use a calculator while decifering how much a higher-priced item might cost. The calcualtor couldn't do it...there were just too many numbers. I bought my very first apartment in 1983 here in Buenos Aires. I paid ONE BILLION, two hundred and fifty MILLION pesos! 1,250,000,000 pesos and it USD it was some $ 9,200 dollars ( half of which was the value of the telephone line which was priceless. I could have bought the same flat without a telephone for about $5,000 USD.)
I could go on with other surprising bits of the history of the many past currencies: peso ley, peso argentino, austral and peso.. as well as the patacon and the lecop, 2 non official currencies issued by the federal or provincial governments in 2002 which nearly nobody wanted and accepted but that is for another day.
What I want to talk more about today is the black market for money here. No, it's not like it was in the Iron Curtain days in the USSR, Poland or Czechoslovakia or even like in today's Cuba. But it's about the black market on which coins are sold here in Argentina.
Just as the previously mentioned countries suffered, and in the case of today's Cuba which still does experience many shortages of daily basics such as soap, toilet paper, cooking oil or razer blades, (not to mention North Korea which is a whole chapter of a book of which some excerpts of my observations in this hermite nation will at some later date be shared with you), in Argentina one can buy most everything but the problem is how to pay for it.
Am I refering to the ever-increasing lower income classes? Is it about people who can't pay off their debts? No to both and the latter is a disease which is more endemic in many "first-world "nations as the USA or Europe although also a cancer which grows ever more daily here .
Most recently in all medias here as well as abroad, the scandal of the lack of physical currency bills and coins is reaching another height. Over the Christmas and New Year period, many people had to do WITHOUT because there were no bills in the ATMs.The banks were closed due to the holidays and the machines couldn't give out money. This was not because so many people had withdrawn from these automatic cashiers but because the treasury did not and still does not have enough bills in circulation. Several reasons: 1 because they say that one of the bill-producing machine is out of order, quite like the country in general; 2 because we now have to have the bills printed in neighboring Brazil and then they must be transported by air to Buenos Aires. I wonder who delivers them? Maybe it is the same man, Rodolfo Stefanon, whose responsability it is to deliver the president's foreign trip money for her official presidential visits abroad and then is robbed on his way to leave it at his home since he doesn't trust the people over to whom he is to deliver such funds at the airport. Ah, if it was only that simple! Then at least we'd know why the money has disappeared .....again.
In a country with high inflation such as Argentina, we need to have higher denomination bills printed. The highest in circulation, which is also the most used by the nation, is that of 100 pesos ($1 USD = 4 pesos) thus the equivilent of $25USD. The treasury refuses to issue higher bills of 200 or 500 pesos as this would show that the inflation is problematic and must be confronted and is in reality threefold the official amount the government tells us of 10.9% annual where as all private consulting agencies agree that its is at 30% . And for many items, it surpasses 100%. A recent private study shows that the bag of groceries purchased this year for 100 pesos would have set the buyer back 36 pesos exactly 1 year ago.
Well, the bills have arrived from their samba to their new home. The Brazilian treasury presses produced very good, high quality bills ,however, they are not exactly like the hard-to-find domestically produced ones. In fact, many people are now complaining that they are very similar to high-quality counterfit ones and your new bill might not be even worth the paper on which it is printed.
Sure , we have counterfit coins , too!; mostly they are the 1 pesos coins whose value is .25US cents of a dollar. But that's not the problem here. The problem is that one just can't get coins, counterfit or not! Everywhere all over the city, there are signs at kiosks,in shops, newspaper stands, telephone call centers...EVERYWHERE.. that there is no change and items will be sold only for exact amounts. And what happens if you don't have the exact amount? Either the vendor will not sell you the goods or if he or she is feeling like doing so, will round out the amount, most of the time in their favor or give you a piece of gum or candy in return for the due change. Now supermarkets have figured out how not to give you change and make you feel good about it by asking if you'd like to contribute that small amount to this or that charity. 3 million people ONCE a week giving up their .10 cents of a pesos(0.025 US cents) equals 300,000 pesos ($75,000USD)x 52 weeks equals 15,600,000 pesos ($ 3,900,000USD) and I have never heard anywhere where any charity here receives almost 4 million USD annually!
Coins are an absolute must to take the city's buses.The metro, subte ,underground or subway ( see how one must be multilingual just to write this article!) can be taken using a magnetic card which is bought with bills but with the exception of a few bus lines which also have installed the card system, the only way to be able to travel is by inserting those coins. The minimum fare in the city is 1.10pesos so by dropping in 2 one peso coins, the machine must give you and everyone else .90 cents of a peso back in change and so forth but there is almost always at least one 1 peso coin involved. At the end of some hours, these traveling piggy banks are emptied and here is where the "viveza criolla" or native cunningness shows its true colors.
For a ten peso bill, in coins one has several options if coins were easily available: 200 .05 cent coins; 100 .10 cent coins; 40 .25 cent coins; 20 .50 cent coins or 10 1 pesos coins.
Which would you rather carry around in your pockets or purses? The one peso coins , of course! But to get those 10 one peso coins, it will cost you a 20% surcharge over the coin's value; 10 1peso coins for 12 pesos. And who sells them? The bus companies! Just ask your local canillita or local newpaper seller or a kiosk and many times they will tell you why they have change and how and from whom they got it. And imagine the amount of coins found in those fare boxes with a population of over 13 million people living and MANY working daily in the various bus lines' transportation realm taking these modes of transports at least 2 times per day( and the poorer the person, the further out of the city he or she must live requiring hours of commuting with 2,3 or 4 buses and trains)
If one has tons of free time, one can queue for coins at a bank or a train station for 1 or 2 hours in order to get 5 one peso coins; my bank now requires all who wish to get change not only to spend the time in line but also must produce a national ID card. NO ID, NO CHANGE!
So, what is one to do? Pay the surchage and get 10 or 20 one peso coins in order to be able to take the bus over the next few days so that you have some free time for life's pleasures such as cleaning, ironing, cooking and the essential evils of eating and sleeping!. And those bus companies selling the coins. Simple math.Let's be on the short side of the calculation. Of the 13,000,000 people in greater Buenos Aires, if 5,000,000 use the buses each twice daily putting in at least one 1 peso coin, that's 10,000,000 pesos and coins ($2,500,000 USD) sold at a 20% mark up equals 12,000,000 pesos ($3,000,000 USD) A PROFIT OF $500,000 USD DAILY!!!!over $2,500,000 USD weekly, over $10,000,000 monthly or $520,000,000 USD annually. And the buses, although I am a great user and give praise to their extensive routing and frequency,they are not air conditioned and on many "poorer" lines are in much more deplorable condition.
So now you see how to do math Argentine style: take 1+1= 2+20%. It's as simple as that!
Happy trails.
SES
No comments:
Post a Comment