Tuesday, December 18, 2012

Oh that scary IMF

The IMF is threatening to kick out Argentine for—get this—fudging her statistical data.   (Ohhhhh!)

If that has now become a crime, we in USA are in real trouble.  I have been following the debate over how USA measures inflation and unemployment for decades and while the published figures tell us something, they don't tell us much.  Inflation numbers don't include food and energy—the two most important numbers there are.  The jobless numbers only include people who have been laid off and are receiving unemployments benefits—a tiny fraction of the jobless.

Mrs. Kirchner doesn't much care for IMF anyway and so may actually be provoking the IMF to kick her country out their front door.  Saves the trouble of quitting the organization her late husband believed (with ample reason) to be merely a tool of imperialist theft.

Tomorrow We'll Find Out If Argentina Is Getting Kicked Out Of The IMF

Linette Lopez | Dec. 16, 2012

Tomorrow the IMF will release a report on Argentina's inflation rate that could truly turn the country into a pariah of the global economic community, The Guardian reports.

Argentine officials report the country's inflation rate at about 10%, but independent analysts have the number somewhere between 25%-30%. Naturally, this has caught the attention of the international community, including IMF head Christine Lagarde, who said that she may give Argentina a "red card."

In soccer (or football) that means you're out of the game.

Of course, Argentina's President Cristina Fernandez de Kirchner will have none of this talk. She responded to Lagarde's colorful language with some of her own at the UN General Assembly in September:

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”...

This aggressive response should surprise no one. Argentina sees organizations like the IMF, in part, as the source of the country's problems and as a part of the oppressive economic system forced on them by hegemonic countries. Defying this regime has become part of the country's populist narrative.

For its part, the IMF has plenty of reasons to be concerned. The former director of consumer pricing at INDEC, Argentina's official statistical agency, Graciela Bevacqua was fired, fined, and charged with embezzlement after she spoke out about issues with the country's numbers and published her own. She claimed that her superiors asked her to do things like leave off entire decimals, turning a 1.9% inflation rate into 1% — over time, that makes a big difference.

According to The Economist, the American Statistical Associating has protested for its colleagues in Argentina as well. To get figures that look closer to reality, opposition party leaders in Argentina's lower legislative house use the Argentine Congress Index, a work by nine private agencies, and publish the numbers using the House Freedom of Information Committee.

If Lagarde's report shows that Argentina has been cooking the books in a serious manner, the result could be the countries expulsion not just from the IMF, but also from the G20 group of industrial nations. more

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