And the Money Kept Rolling In (and Out) Wall Street, the IMF, and the Bankrupting of Argentina Prime – Bilb-weil.de

In the s, few countries were lionized than Argentina for its efforts to join the club of wealthy nations Argentina s policies drew enthusiastic applause from the IMF, the World Bank and Wall Street But the club has a disturbing propensity to turn its back on arrivistes and cast them out That was what happened in , when Argentina suffered one of the most spectacular crashes in modern history With it came appalling social and political chaos, a collapse of the peso, and a wrenching downturn that threw millions into poverty and left nearly one quarter of the workforce unemployed Paul Blustein, whose book about the IMF, The Chastening, was called gripping, often frightening by The Economist and lauded by the Wall Street Journal as a superbly reported and skillfully woven story, now gets right inside Argentina s rise and fall in a dramatic account based on hundreds of interviews with top policymakers and financial market players as well as reams of internal documents He shows how the IMF turned a blind eye to the vulnerabilities of its star pupil, and exposes the conduct of global financial market players in Argentina as redolent of the scandals like those at Enron, WorldCom and Global Crossing that rocked Wall Street in recent years By going behind the scenes of Argentina s debacle, Blustein shows with unmistakable clarity how sadly elusive the path of hope and progress remains to the great bulk of humanity still mired in poverty and underdevelopment


10 thoughts on “And the Money Kept Rolling In (and Out) Wall Street, the IMF, and the Bankrupting of Argentina

  1. Angela Angela says:

    This is a lively, even frisky account of the 2001 Argentine financial crash Written by a journalist with great passion and brio, it enlivens what can sometimes seem the most dull of disciplines macroeconomics reminding us that macro isn t just impenetrable dynamic stochastic general equilibrium models why, God, whyyy , it s people and money and market panic It s big, and it can have huge, rippling effects throughout countries and the world Indeed, I haven t seen dismal science humanized This is a lively, even frisky account of the 2001 Argentine financial crash Written by a journalist with great passion and brio, it enlivens what can sometimes seem the most dull of disciplines macroeconomics reminding us that macro isn t just impenetrable dynamic stochastic general equilibrium models why, God, whyyy , it s people and money and market panic It s big, and it can have huge, rippling effects throughout countries and the world Indeed, I haven t seen dismal science humanized this well since n 1 s excellent Diary of a Very Bad Year about the 2008 global financial crisis Blustein s pen is wide ranging, knowledgeable, sardonic and scathing it spares no one We get some great peeks into the inner workings, and culture, of the IMF We get a fairly damning critique of the IMF for being too circumspect in dealing with zombie countries countries with enormous foreign debt, floundering in a recession, unwilling to loosen their dollar peso currency peg Indeed, Blustein s main message is that Argentina should have cut the cord much sooner, letting the Argentine peso float and then, presumably, plummet The wings here are clearly burning, the best we can do is cushion the fall There are similarly damning portrayals of Wall Street emerging market traders and then vulture like rogue creditors , who hunt for the heavily indebted in order to buy the debt cheap and then sue the debtor for the full amount later, thereby reaping great profit Did you know the Styrofoam billionaire via inheritance, ahem , Kenneth Dart, is basically a vulture creditor on Argentina Suing them when they underwent this massive country level default, holding out for ten years , and trying to seize Argentine assets This blew my mind Blew My Mind Make a better little white crumbly cup, Kenneth, for the love of Jesus Stop capitalizing on the economic agony of millions This is not what capitalism is about My Lord Talk about parasite And no wonder Argentina doesn t like him and has called him enemy number one Blustein, indeed, uses Dart as an unsavory symbol for the collective action problem when creditors refuse to accept revised terms when a country is in free fall, unable to pay its bills And damn, Kenneth Just damn I still can t wrap my head around this complete moral vacuum, this incredible greed.Phew Shake it off Shake it off.ANYWAY So, as you can see, macro can be something which empassions, fellow microeconomists And what of ye, non economist people Will you like and enjoy this book I think yes, as long as you like me clarify early on what the difference between deficit and debt is hey, it s been YEARS since my last macro class But even then, Blustein is a journalist, and so he writes for the general reader And this is a great primer, and great fodder, on the big issues of macro, globalization, and our increasingly, crazily interconnected financial systems Recommended


  2. Frank Stein Frank Stein says:

    The Argentinian collapse of 2001 is an odd subject for someone looking to bash the international monetary system After all, unlike the Asian financial crisis of 1997, which the author, Paul Blustein, also wrote a book on, no one claimed the Argentinian crisis had at its root sudden hot money capital inflows to and outflows from the country, or that the crisis was exacerbated by a merciless austerity imposed by the IMF In fact, Blustein admits early on that the undoubted reason for the cras The Argentinian collapse of 2001 is an odd subject for someone looking to bash the international monetary system After all, unlike the Asian financial crisis of 1997, which the author, Paul Blustein, also wrote a book on, no one claimed the Argentinian crisis had at its root sudden hot money capital inflows to and outflows from the country, or that the crisis was exacerbated by a merciless austerity imposed by the IMF In fact, Blustein admits early on that the undoubted reason for the crash was that the IMF did not demand cutbacks in spending and higher taxes sooner, and that Argentina failed because it refused to rein in its deficits when times were good in the mid 1990s He also admits that the IMF for most of the period was opposed to the currency peg of the Argentine peso to the dollar, and that it was suspicious of attempts to retain it by deep spending cuts in the midst of the crisis.Still, Blustein makes a good case that all that does not make the IMF blameless Far from it The suspicions the IMF had about the Argentinian policies were kept inside the IMF, and it s the exposure of the once secret internal concerns of the IMF and the US Treasury that make this such a fascinating read As usual, the IMF was fighting the last war, and was scared of letting the Argentinian economy it had once celebrated as a model go bankrupt so soon after the Asian crisis So it extended every loan it could, long past the point when the everyone knew, including most of the IMF, that the odds were hopeless We see Stanley Fisher, as deputy manager and effective chief of the IMF, agree to a new loan in December 2001, even when his staff including economist Kenneth Rogoff put the odds of success at 0% Stanley Fisher is now deputy governor of the Federal Reserve We see the IMF invite the Argentinian President and reformer Carlos Menem to be the keynote speaker at their 1998 conference, even when privately many thought his country was headed for disaster.So Blustein makes a good case against the IMF, but it s not the typical one Mainly he argues that it didn t have the strength of its convictions to call in its loans before they became nothing but a burden for an already indebted economy His attempts, however, to tie the failure to the Enronization of financial analysts, and a growing bubble in emerging market debt look a little laughable in retrospect Since the book was published, emerging markets have enjoyed an unprecedented decade with almost no defaults The book therefore demonstrates the dangers of calling bubble whenever one sees financial upticks Yet the book does show the value of dedicated journalism for exposing the skullduggery going on in the highest chambers of power, even if it s not always what one would expect


  3. Michalyn Michalyn says:

    I never thought a book about financial crisis could read like a soap opera but Blustein manages just that in And the Money Kept Rolling in And Out Wall Street, the IMF, And the Bankrupting of Argentina With careful analysis, and an engaging writing style Blustein traces the events leading up to Argentina s financial crisis in 2001 It s a fascinating look inside the IMF as well as the Argentinian government Moral hazard, an imperfect financial system, the IMF s desire to use Argentina as an I never thought a book about financial crisis could read like a soap opera but Blustein manages just that in And the Money Kept Rolling in And Out Wall Street, the IMF, And the Bankrupting of Argentina With careful analysis, and an engaging writing style Blustein traces the events leading up to Argentina s financial crisis in 2001 It s a fascinating look inside the IMF as well as the Argentinian government Moral hazard, an imperfect financial system, the IMF s desire to use Argentina as an example of the success of economic liberalization and its fear of damaging its own reputation led it to keep pumping money into the country when it should have been pushing Argentina to restructure its debt or abandon the convertibility system.What makes this book so interesting is not just the way Blustein illuminates the inner workings of global institutions, but the cast of characters who parade through the book We re reminded time and time again that policy and politics are inseparable bedfellows I m not sure I m convinced by Blustein s assertion that something similar could happen to the US short of the dollar being displaced as the world s reserve currency but his point about not taking the availability of credit for granted is sound In the end what I liked best was that Blustein didn t content himself with pointing fingers and vilifying different actors as I m sure it would have been easy to do The final chapter which explores ways to improve the international financial system is particularly insightful


  4. Michael Michael says:

    Well written, manages to make macro really accessible and understandable Found this to be an informative quick read.


  5. Steven Truong Steven Truong says:

    Don t cry for me Argentina


  6. Ian Ian says:

    In honor of Argentina s current 2014 currency collapse and economic crisis, I figured now was as good a time as any to read about the previous economic tragedy there This book is an excellent work of financial journalism, and though I m not sure if it was the topic or the writing that made the difference, this book came out much better than Blustein s other book on the IMF The Chastening.Argentina has been a most important story in the debate between those for and against globalization, for an In honor of Argentina s current 2014 currency collapse and economic crisis, I figured now was as good a time as any to read about the previous economic tragedy there This book is an excellent work of financial journalism, and though I m not sure if it was the topic or the writing that made the difference, this book came out much better than Blustein s other book on the IMF The Chastening.Argentina has been a most important story in the debate between those for and against globalization, for and contra globally connected financial markets and free trade Blustein, as a generally pro markets guy with well placed caution about thehyperbolic claims from the pro markets side is a perfect author to take us through the IMF s handling of the situation.What went wrong The IMF fell in love with Argentina, as it was the best remaining example of the success of globalization after the failure of the Asian tigers in 98 This complacency led the IMF to give Argentina an overly long leash with which the country promptly hung itself.Important takeaways 1 There may be a place for capital controls in a free market capitalistic economy Note the commentary on Chile Vs Argentina in the conclusion of the book Chile, as an economy ranked freer than the U.S in economic competitiveness, is no shrinking violet when it comes to economic liberty, but they still felt the need to limit hot money coming into their country to prevent easy money bubbles of the sort that sunk Indonesia, Korea, and ultimately Argentina.2 Indexing is a grave hazard to financial markets The commentary on how index weighting forces managers to buyanddebt of the most heavily endebted EM countries is spine chillingly perverse


  7. Brian Brian says:

    This book seeks to understand how and why Argentina sank into financial chaos in the early 2000 s The book looks at the role of the IMF, US treasury, private markets, and the Argentinean government in the overall downfall of the country The author writes very well about his subject and has a good understanding of international economics The IMF is not completely vilified as it is in many of the current financial crisis s and although it shares a large amount of the blame the book hands it out This book seeks to understand how and why Argentina sank into financial chaos in the early 2000 s The book looks at the role of the IMF, US treasury, private markets, and the Argentinean government in the overall downfall of the country The author writes very well about his subject and has a good understanding of international economics The IMF is not completely vilified as it is in many of the current financial crisis s and although it shares a large amount of the blame the book hands it out equally There is quite a bit of conspiracy theory and engaging in theories behind the IMF and Wall Street as well as the Bush administration The author acknowledges in most cases that these are conspiracies but they did not really need to be discussed The most interesting part of the story has to do with the role that the markets played in Argentina It is an interesting foreshadow for the future of emerging markets and looking at the self fulfilling prophecies of debt and equity This book deserves its credit for focusing on real issues without engaging in much ideology or theory If you want to understand how financial markets are impacting areas overseas this is a great book to start with


  8. Alkek Library Alkek Library says:

    In the early 2000s, middle class Argentinians regularly awoke to find scavengers going through dumpsters looking for plastic bottles In many cases, these scavengers had once lived in the same neighborhood or one like it Looting, fires and civil disturbance were regular features on the evening news.The culprit Argentina s currency had collapsed and set loose a disastrous inflation rate that decimated the savings of normal people Read the book for the gory details of a too large government, na In the early 2000s, middle class Argentinians regularly awoke to find scavengers going through dumpsters looking for plastic bottles In many cases, these scavengers had once lived in the same neighborhood or one like it Looting, fires and civil disturbance were regular features on the evening news.The culprit Argentina s currency had collapsed and set loose a disastrous inflation rate that decimated the savings of normal people Read the book for the gory details of a too large government, national debt, and an ill thought basis for currency exchange.The situation is not completely analogous to the issues the United States faces now Argentina s problems were caused by pegging its weakening national currency to the dollar Nevertheless, the episode does show what lurks under the delicate threads of currency valuation, debt and ultimately savings and societal trust.And the Money Kept Rolling In is recommended as a lesson in national finance policy For any student of Latin American economic history, it s a must read


  9. Charles Allan Charles Allan says:

    In the early 2000s, middle class Argentinians regularly awoke to find scavengers going through dumpsters looking for plastic bottles In many cases, these scavengers had once lived in the same neighborhood or one like it Looting, fires and civil disturbance were regular features on the evening news.The culprit Argentina s currency had collapsed and set loose a disastrous inflation rate that decimated the savings of normal people Read the book for the gory details of a too large government, na In the early 2000s, middle class Argentinians regularly awoke to find scavengers going through dumpsters looking for plastic bottles In many cases, these scavengers had once lived in the same neighborhood or one like it Looting, fires and civil disturbance were regular features on the evening news.The culprit Argentina s currency had collapsed and set loose a disastrous inflation rate that decimated the savings of normal people Read the book for the gory details of a too large government, national debt, and an ill thought basis for currency exchange.The situation is not completely analogous to the issues the United States faces now Argentina s problems were caused by pegging its weakening national currency to the dollar Nevertheless, the episode does show what lurks under the delicate threads of currency valuation, debt and ultimately savings and societal trust.And the Money Kept Rolling In is recommended as a lesson in national finance policy For any student of Latin American economic history, it s a must read


  10. Lisa Lisa says:

    Interesting up close and well researched account of the financial scandals that caused the meltdown of the Argentine economy in the 1990 s Not a lot of personal details, as the writer is a financial reporter with the Washington Post and only sent to Argentina at the beginning of the scandal when the economy went bust However a fascinating overview of a recent, modern day financial collapse of our time.