Topic: Worried about inflation? In Argentina, it’s a way of life. - page 2. (Read 285 times)

They don't need to explain or teach anything about how to avoid or something but atleast our education system has to teach about money because that is why everyone is running throughout their life but they don't have any knowledge so their life end up with making money all the years still stuck into loan and middle class trap.

People should learn how to plant edible foods in case inflation kicks in it's always best than to hoard on every week. Just like what you said, mung beans is an alternative of rice so if you have a large backyard then start making a garden and plant more veggies but of course you have to really take care of it if you really want it to survive plus fruits that will grow fast in less than half a year or less is suitable for everyday meals. The idea here is to spend wisely while taking more to hoard than usual.

I'd say no. Honestly I was the same a few years back, I just had that period where I was into finance and stuff (mostly due to crypto) which made me look stuff up. I was in college by then already (Still am), and there's really nothing being taught about stuff like that. I don't think finance courses even teach it themselves, maybe touch upon the past inflation crisis issues but not the current one that is happening right now. Though it is quite obvious with what my parents told me about the purchasing power on their time and the current time.

The pandemic probably exacerbated these problems severely - I know it has in other places, though I don't know much about Argentinian economy, but it makes sense. Things will probably get worse before they get better, if they get better.

People should learn how to plant edible foods in case inflation kicks in it's always best than to hoard on every week. Just like what you said, mung beans is an alternative of rice so if you have a large backyard then start making a garden and plant more veggies but of course you have to really take care of it if you really want it to survive plus fruits that will grow fast in less than half a year or less is suitable for everyday meals. The idea here is to spend wisely while taking more to hoard than usual.

No one please don't be offended with my statement but I have to mention it, Does people really have the knowledge to understand about inflation to worry about it whether its US or Argentina?

I am talking about the majority who don't understand even people with master degree graduation because they think that finance is not their thing so they never really care about it, they are assuming that they are getting more salary every year but the reality is they are just getting compensated or even lesser salary than previous year depending on the money's purchasing power loss.

Have you tried the Mung Beans? They are good for long term storage, in history class I learned about them, they were used by revolutionary armies in our country way back 1800s. It is better alternative to rice as it cheap and you can store them longer. If ever inflation kicks in due to certain phenomenon, wars , economic crash, people would hoard rice and I would go for my secondary option of Mung Beans as few from the common people knew about this, so you would probably be able to afford it by the time of turmoil comes, just sharing the knowledge.

BUENOS AIRES — Taking out small loans. Renegotiating salaries. Buying groceries in bulk.

Inflation transforms the way people spend, save and think. That’s true now for some in the United States, where prices rose last year by 7 percent, the fastest rate in nearly 40 years.

But it’s been the reality in Argentina for decades, where inflation last year topped 50 percent — and is expected to be similarly high in 2022.



The long, stubborn march of rising prices in this South American nation has inspired a range of strategies to limit the damage.

Buy enough toothpaste for the entire year? Store as many cans as the cupboard will allow? Keep the freezer crammed with meat? Buying staples in bulk here can feel like saving money. Or better than saving money, because saving money means it just sits there while its value falls.

Agustina Caparulo says filling her gas tank “almost feels like investing,” because the next time she visits the pump the price will almost certainly be higher.

Beyond the monetary cost of rising prices, analysts here say, there’s also a psychological toll: a sense of becoming uncertain about what goods and services are worth — and a fear of overspending as a result.

“There is an inflationary process brewing in the United States, albeit from low levels,” economist Marina Dal Poggetto said. “In Argentina, we come from numerous years of high inflation, which winds up twisting your mind-set.”

Guillermo Oliveto, who runs the consumption consultancy W, speaks of an “inflationary culture.”

“It provokes a permanent free-for-all feeling,” he said. “Almost everyone loses to inflation, and people are on guard all the time.”

One major tactic here is stockpiling. “To the extent that I can, I try to stash as many goods as possible,” said Ana Vienny, a 63-year-old retiree. At one point, she says, she owned 48 cans of tuna and enough vinegar bottles to cook for months. “Eventually, I had to stop buying because there was simply no more space.”

Nonperishable goods are a popular target. “Whenever I see a discount, I buy,” says Nicolás Mónaco, a 32-year-old manager. “I might have eight toothpaste pots right now,” he says. “And enough shampoo for a year and a half. As long as there is no expiration date, I just pile up.”

Taking out loans can also be helpful, provided the interest rate is lower than expected inflation.

Then there’s paying in installments. Americans are familiar with making monthly payments on homes, cars and appliances. In Argentina, installments are applied to just about everything. Sergio González, a financial analyst, bought a single jar of peanut butter last month for 300 pesos — less than $3. He arranged to pay in installments, interest-free, over the next 12 months. It will work out to a quarter a month.

“Just about anything that you get interest-free, you grab it without hesitation,” he said. “The idea is that you take advantage of inflation as it will dilute future fixed payments.”

With inflation at 1 percent per week — typically more than deposit interest rates — money that sits in the bank loses value by the day. That’s strong incentive to spend what you’ve got as soon as you get it. “It stimulates a culture of consumption because the feeling is that today’s pesos will be worth less tomorrow,” Oliveto says.

Paychecks are typically spent swiftly, or pesos exchanged to foreign currency as quickly as possible. There’s a long tradition here of purchasing U.S. dollars as a hedge.

But in a high-inflation economy, the greatest challenge might be matching income to rising prices. Some workers here renegotiate salaries quarterly — and any increase below the inflation rate is effectively a pay cut.

It’s a struggle for many in a country with a large informal economy.

“A feeling of chaos and unpredictability are at the core of what inflation creates in the mind,” said Enrique de Rosa Alabaster, a psychiatrist who studies behavioral science. “It is a phenomenon that goes far beyond economics … and inevitably turns into something emotional.”

It was not always so here.

The idea behind Todo x 2 Pesos will be familiar to Americans. Everything in the chain store sold for two pesos. It was the Argentine equivalent of Five Below.

In the late 1990s, with inflation under control, the stores proliferated. And not only on the streets of the capital but in popular culture, inspiring jokes, song lyrics, even a television show.

Then consumer prices rose, fewer products could be profitably sold for 2 pesos, and the business model collapsed. Todo x 2 Pesos stores are long extinct.

One of the longest-lasting effects of chronic high inflation is the loss of a sense of value.

“In Argentina, prices do not exist anymore,” Vienny said. That means Argentines frequently pay more for less. When customers find a product at a price they perceive as cheap, they hoard it.

Businesses also adapt to survive. Price disorder can lead to profitable commercial tactics: permanent discounts, in which stores hike prices regularly only to offer markdowns afterward.

A supermarket might offer a 40 percent discount on wine on weekends; a credit card might grant 20 percent off on clothing on Wednesdays. That leaves Argentines marking the days in the calendar by the discounts that will be available.

“Everybody hikes prices a bit because they know they can offer a discount later if they’ve gone too far,” Oliveto said. “What is the actual price today for goods in Argentina? One could argue that no one knows for sure.”

Jorge Centeno is a U.S. citizen who has lived in Argentina for almost four decades. He has learned the tactics. Whatever money he saves, he exchanges for U.S. dollars. He stockpiles as much food as the freezer allows. He exerts his energy searching for the lowest prices.

“I literally live looking for deals and discounts all the time,” he said.

https://www.washingtonpost.com/world/2022/01/27/argentina-inflation-strategy-tactics/

Then there’s paying in installments. Americans are familiar with making monthly payments on homes, cars and appliances. In Argentina, installments are applied to just about everything. Sergio González, a financial analyst, bought a single jar of peanut butter last month for 300 pesos — less than $3. He arranged to pay in installments, interest-free, over the next 12 months. It will work out to a quarter a month.