The cost of truth

4 months ago Comments Off on The cost of truth

Looking reality in the face

DURING her eight years as Argentina’s president, Cristina Fernández de Kirchner had a way of dealing with nasty facts: denying them. When annual inflation reached 27%, she said the number was wrong. “If it were as high as they say it is,” she scoffed in September 2012, “the country would explode.” But truth will out: by the time she left office last year, a 100-peso note—the most valuable—fetched just $ 10, less than a third of its level when she took office. Unwilling to admit this plunge, Ms Fernández (whose assets have been frozen by a judge probing currency transactions) refused to issue bigger bills. Queues formed at ATMs; with a capacity of just 8,000 notes, some machines had to be refilled twice daily and repaired monthly.

Mauricio Macri, the country’s president since December, prefers to cast a colder eye on reality. On June 30th a 500-peso note appeared at his government’s behest. The central bank won praise for producing it, with a nice image of a jaguar, so fast. It will be a blow to armoured-truck operators, who did well by moving wads of cash around the country. This…Continue reading