This is the central bank?
This is the central bank
Why does it look like this?
I don't know.
They are working on putting in better.
But...
The US dollar reserves
are really low right now.
Gas prices, groceries, paying rent.
It's felt a bit
harder lately around the world.
Inflation was seven and a half percent
last year in the U.S.,
the highest in 40 years.
But I've come to Argentina,
where inflation
was more than 50% last year.
Inflation started
because the government
just keeps printing money.
When you go to the supermarket,
you cannot know
how much you're going to spend.
And it's expected to be 50% again
this year.
Again,
we don't know what's
what's going to happen like tomorrow.
So how do people live
knowing the value of their currency
is going down rapidly?
We live in the present and we do
we do what we can to survive you know,
the value of the Pesos is so like.
Bad.
she's not exaggerating.
It's lost
99% of its value over the years.
Things have gotten so crazy here
that there is now multiple
exchange rates.
You have the official rate
and then you have what's called
the blue market exchange rate.
Let me explain this chicken
sandwich and lemonade
cost me about 1000 Argentinean pesos.
If I were to put that on my credit
card, that would cost me 23 U.S.
dollars. But I'm not going to do that.
I'm going to pay in cash.
And at the blue market exchange rate,
which I got, which is about 210
for every U.S. dollar.
This lunch cost me less than $5.
The currency here loses its value
so often
that the government
has taken away
13 zeros over the past 40 years.
And with such crazy inflation,
a lot of these smaller bank notes
don't mean much at all.
So 100
Argentinean pesos
is now equal to $0.50.
20 would be $0.10.
And these coins
hardly mean anything at all,
which means spending money in Argentina
can become a hassle.
But 100 Argentinean pesos
used to be worth $100
back in the 90s
So how did we get here? You don't know
how much of the cost of something is.
You don't know
whether it's
something expensive
or is it cheap
because in one place it would cost
20 more pesos and the other person
we would like 20 less pesos
nearly everyone here
I talked to
says that when they get paid,
they immediately buy
everything they need.
The money starts losing the power.
So it's not
when I get my salary,
I could buy ten packs of milk.
By the end of the week,
I would be able to buy only six.
Most people
try to buy things
from the grocery store
as soon as possible
because the prices are going to go up
within the month.
That's a way
to make it up with inflation.
So inflation doesn't get you
and if they have any money
left over
the rest of it, people will go
and buy US dollars.
Or nowadays, cryptocurrencies,
maybe it's very popular in Buenos Aires
but more about crypto later.
So apparently what happens here
is that when the currency
you're getting paid in is inflating
60% a year.
What's the first thing you do
You take that money
and you convert it
to a more stable currency like the U.S. dollar
So a lot of people,
the first thing they do
when they get paid,
they will go to a grocery store, buy
as many groceries
as they can
for the month,
because chances are those
prices will go up the next month.
Any extra money they have left,
they're going to try and convert
those to U.S. dollar.
Having U.S.
dollar is hugely popular
in Argentina as a form of savings.
They don't spend it.
They just save it.
And they literally take $100 bills,
put it under their mattress and save it
because so many people
here are stashing U.S.
dollars under their mattress.
It's believed that
this country
has one of the highest amounts
of $100 bills outside of the U.S.
So Argentina's government says the U.S.
dollar is equal to one thing,
but the market says it's equal
to a lot more.
But in an effort
to keep its power
and ensure
its people continue
using its own currency,
the government
here says that private citizens
can only buy $200 in foreign currency
on the official exchange market
every month,
and they must pay a steep tax
so that's
probably why
you see a lot of people
selling dollars
on the streets and the government here,
even those raids to crack down
on government exchanges happening.
But to fully understand this myself,
I head to a jewelry shop
in Buenos Aires.
And the reason
I'm exchanging money
in the back of a jewelry store
might be because in this country
it's illegal to publicly advertise
currency exchange services.
What's the best rate you can give?
we have only one rate 211
One year ago.
Yes.
How much what was the rate
you would offer for one?
I don't know.
I think that
it was 80 pesos
I think that was
four, four times less.
Wow.
Do you think that they're going to
cut the one the zeros again soon?
this will take time
And if in years, maybe they will
not not enough.
This is the biggest bank
note in Argentina.
Which is about $5 tomorrow.
This could be $3.
Yes, of course.
Inflation is so high
because the government
keeps printing money.
But if that's the problem,
why doesn't the government
just print less money?
Well, it's not that easy.
If you live here, you get free
health care, free university,
even insanely low
electricity prices,
like $3 for your bill each month.
That's because the government
is subsidizing
or even paying
for a lot of these things.
And no politician
wants to be the one to cut
some of these things off
in the perfect world
is is a very beautiful idea
that everything is for free.
Of course, health and education first.
It's wonderful.
That's why you need 60% inflation
to finance
all these subsidies and all
all, all this welfare
part of the Argentinean culture
just got used to inflation.
It's very sad to say that.
But Argentineans got used to live
like this,
Argentina spend more money all the time
and we don't produce more.
But some people I speak with say
the reason for inflation
isn't just about these
government services.
It's also because of corruption.
Inflation also comes because they spend
they say they would say
they spent
the payment of a
of a highway road
and they just keep it in their pocket.
All of this is causing
insane instability
of its currency
and people's salaries,
their monthly income for it.
And today's around 200, 250 U.S.
dollars.
It gets less
and less through the years.
And of course,
food and things get expensive
and mostly weekly or monthly
on your salary gets behind.
And some Argentineans have seen it all
one month
all the salary I earn was $15.
I would pay my rent $5
for a small apartment.
So everything was destroyed.
It was around $25,000.
So it was a lot of money
and the like in
something in one minute of my savings
account was confiscated
Years later,
my retirement account
also was confiscated in 2001 and 2008.
The IMF or International Monetary
Fund has bailed out Argentina 22 times.
The country
hasn't been able to pay back
its debt and owes billions of dollars.
In fact,
Argentina owes
more than any other country to the IMF.
When the IMF gives us money,
they are like
putting a debt on the shoulders
of generations to come,
and that's scrubbing.
They shouldn't do that.
That girl will
all we know some other people.
A lot of money.
I shouldn't even ask for that.
It absolutely amazes me
that despite such
a crazy economic situation, such crazy
consecutive inflation,
that Buenos Aires
feels very, very rich.
I mean, you see HSBC bank
you see
some of the biggest banks in the world
that have huge towers here.
Everything is clean, safe.
I mean,
this is really one of the most cleanest
and what appears from the outside
to be wealthiest cities.
I've seen in the Americas
in many places I visit,
there are insanely beautiful parks
beautiful architecture
and an overall feeling
that life is good.
But what I'm seeing does
not tell the full story.
I know there are a lot of people
who are making a lot of efforts
to get to the end of the month,
and they are having diets
like a lot of flour and pasta and rice,
very little food there,
very little beef.
It's frustrated.
Yes, because I see that poverty
growing.
When I was a kid, poverty was 7%.
Today the board is around 40-45%.
If you compare different cities
around Argentina,
it's like you have this part
where most people
it's really extremely poor,
even the poorest.
And some countries in the,
you know, inAfrica,
many of its young people are leaving
or trying to leave.
You can make a plan for the future.
You can’t basically plan at all.
Let's say you want to buy a house,
you want to buy a car.
It's hard for the local people.
I would say
I don't really like talking
like this about my country
I don't really see myself living here
because of the economy.
my goal is to live in United States.
Argentina is now
seeing more advertisements
and more adoption of cryptocurrencies.
If you talk with someone younger,
they are more into Bitcoin.
I learned about Bitcoin a long time ago
from my son.
They are trying to do something to play
with bitcoins
or cryptocurrency in some ways,
but if you told
someone in their thirties
or forties they are thinking
just about dollars
He was playing games,
I don't know what,
and he showed me
that whitepaper
and I was like, Oh my God,
this is freedom.
The more restrictions
on capital controls
you have, the more Bitcoin you need
and I think that we will be able
to keep that wealth
that we produce here in Argentina.
That would be very,
very important
and not let the government
like wasted and things
The government doesn't have a clue
how Bitcoin works in another world
So what is the solution here?
Don't spend
more than you make
is a say personal account money
or a country.
You don't need to be a great economist
to know that it's more simple
that the people say
I always say,
this should end.
But then you look at Venezuela
maybe 20 years of a lot more inflation.
You never know how this will stop
or how or when
we're going to have inflation
for a long, long time.
Can it get worse?
Yes, of course, always.
So can it get better?
I don't know people
in since two years ago, A lot of
young people
are going to Europe or the States
in search of a better
economic situation.
Probably will get worse
because the government you know,
they don't learn the lesson.
What's the right to
they just keep doing the same thing.
So if we're going to do the same things
and have the same problems,
where would you expect
a solution to that?
You know,
because of the economic situation,
both her daughter
and her son,
who were in their twenties,
moved abroad.
That made me very, very sad.
I had just like, oh,
I lost my children, I lost my children.
I mourned.
I really like decided
that I'm going to work
very hard, as hard
as I can as a citizen.
To make my country a better place.
So the one who's 14 now
doesn't want to leave
or be forced to leave when he's 24.
But despite her goal
even she doesn't know what's next.
I cannot tell
if we're going to make it,
but if we make it,
we are going to be very, very well
or very, very bad.
But Argentina
has been like this for a long time.
And if there's one thing
I've learned being here, it's
that people are expecting uncertainty.
They've just become used to it.
They've adapted.
So it kind of makes me wonder,
Can Argentina ever break the cycle?