The Economist Carlos Melconianone of the most listened to men in the city of Buenos Aires and adviser to the candidates of Together for Change on the matter, referred to the possibility of dollarize the economyan idea launched by the liberal Javier Milei, and opined that it is not possible.
“Dollarization is like being invited to eat noodles with tuco and there being no noodles, which would be the dollars. You have 3 pots of tuco, which are the liabilities of the Central Bank, and there are no noodles. You can’t dollarize, it’s not even ideological,” Melconian said, dismissing Milei’s ideas.
“You don’t have to set the Central Bank on fire. What you have to do is do things right (…) The problem is not the Central Bank, it’s that they smoke it,” he added. And then he added: “If you dollarized, and Brazil devalues, you put the products in the ortho (…) Brazil gains competitiveness by devaluing and you are dollarized.”
“This is a year of the short blanket, something after August, after October, it will pass. The drought hits not only for the dollars, but also in the collection for $1.5 million, also in prices and also in activity. Anything that means ‘forward’ complicates after August, be it outlays from the IMF or the soybean dollar. Every time you do something from 2024, you complicate the next government,” said the economist, in dialogue with radio Miter.
“They are underestimating the conflict and we are entering a new stage of inflationary character and airplane turbulence. This is getting complicated both politically and economically speaking,” Melconian pointed out. “The Government is devaluing and the probability that it will have to make an exchange jump has increased. Guard: the contexts where there is an exchange rate jump have to be accompanied by something that makes them feel that they maintain control of what they have done, “she warned.
What economic scenarios does Melconian see?
“For a devaluation jump it is necessary to see if they recompose political power. Giving up being a candidate is not giving up governing and deciding to be a candidate is not ceasing to be a minister. Continuing with the fiscal nominality with which you are, public spending continues to rise, but as inflation liquefies it, the political and economic scenario has been complicated. Yes, the possibility of a jump in the official exchange rate has increased. Everything ran a little”, defined he is president of Banco Nación.
Melconian: “Dollarization is like being invited to eat noodles with tuco and there are no noodles”
“I’m thinking about three scenariosone is the Híper, another is the Rodrigazo and another is very similar to when the Austral Plan began to deteriorate. You will feel more pleasant the third. The departure of the Austral Plan is something that goes from 1985 until the appearance of the Spring Plan, which was an electoral response to the deterioration, which begins to generate an additional jump in the inflation rate because you need not to delay the change and liquefy due to inflation. Now what was 5% you are at 7% and peak and you are close to double digits. For probability I see an additional deterioration like the post AustralMelconian anticipated.
“There was a model that was the Fabregazo of 2014, for the purpose of reaping the fruits of three or four months before the election. The whole idea was what is the last moment to launch a little program that two or three months makes you spit blood , but before the election it helps you win the election. The last date to release something like that was January or December: that eats you up until March and you get to show something for the August election. Ex post, they made the decision not to do it “, considered.
“To invent, there is not much. Then came that fog that confused them, then came the big one to announce 3% inflation for April and the drought hit comes. It is not a good government that caught the drought It is a bad government with malpractice that was seized by the drought. If the government does not define anything, this ordeal will continue until October,” Melconian opined.
Melconian and labor reform
On the other hand, in an extensive interview with the journalist Tomás Rebord, he defended the need for labor reform.
“There are eight million informals and six million people in the registered private sector. Since 2007, 0 registered jobs were created. There we have a mess, let’s fix it accordingly. You have to start looking for formats in a new employment relationship,” she said.
Who was the head of Banco Nación during the administration of Mauricio Macri, also referred to the period of government of the former president: “In 2015 it was common that you had to be very austere and very shock fiscally and lax in monetary matters. You had to cut the fiscal deficit but lubricate with monetary policy to alleviate and lower the interest rate. The opposite was done, it was lax in the fiscal aspect financed with foreign debt and very orthodox with the monetary, with which you end up killing the economy”.
Melconian also gave a few details of the meeting he had months ago with Vice President Cristina Fernández de Kirchner, a meeting that attracted great attention due to the crossover of political spaces. They were 3 hours that the economist described as a “very healthy” talk. “We talked for a long time about the present and the future,” he said.
