Would You want to See a Corralón Type Economic Measure in Your Country? - page 2.

DrBeer

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Quote from: alastantiger on October 22, 2023, 09:42:35 AM

Quote

Corralón was the informal name for the economic measures taken in Argentina at the beginning of 2002 by President Eduardo Duhalde during a bank run in which deposits and debt in dollars were exchanged to local currency at 1.4 per dollar for deposits and 1.0 for debt (this was also called pesificación asimétrica). Previously, the withdrawal of dollars was limited to $250 per week. After the forced exchanged, people no longer had any dollars on the system and those who had savings in US dollars lost 65% of their deposited value.
https://en.m.wikipedia.org/wiki/Corral%C3%B3n

What are your thoughts on the quote above if your government implemented such economic measures? One thing is certain: those in debt would likely benefit, especially in times of economic hardship.

Perhaps one of the most idiotic ideas to "save the economy" is to take away people's PERSONAL savings in the currency that stabilized the economy....
Instead of a thousand words, history and facts:
In the early 1990s, the government pegged the national currency to the U.S. dollar, which kept inflation in check. Many state-owned enterprises were transferred to private ownership, and privatization proceeds were partially used to pay off the national debt.

And then began experiments, which, although they gave temporary relief, because a huge amount of private funds was withdrawn, and they were able to temporarily "plug the hole in the budget", but it did not solve the essence of the problem, and now we see what we see.... Private property - be it savings, cars, real estate, or other - is INCREDIBLE! This is what the entire Western, developed world is built on. Yes, there are exceptions - illegally or criminally earned assets, but this is a separate topic

Tytanowy Janusz

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Quote from: alastantiger on October 22, 2023, 09:42:35 AM

One thing is certain: those in debt would likely benefit, especially in times of economic hardship.

Short term they didn't. they've lost almost 30% because normal deposits were exchanged at a rate of 1.4 and debt at 1. They only made a "profit" in the long term, because this drastic measure did not help the peso.

What do I think about this? This is nothing new. When the mark collapsed in the Weimar Republic (Germany after WW1), citizens were forced to use the local currency to such an extent that the police went to pubs and looked into people's wallets to check whether they only had marks. Foreign currencies were confiscated. And both in the Weimar Republic and in Argentina, such efforts did not achieve anything, because it is impossible to force people to use and take seriously a currency that loses most of its value within one year.

Aanuoluwatofunmi

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stead.builders

Quote from: alastantiger on October 22, 2023, 09:42:35 AM

Quote

Corralón was the informal name for the economic measures taken in Argentina at the beginning of 2002 by President Eduardo Duhalde during a bank run in which deposits and debt in dollars were exchanged to local currency at 1.4 per dollar for deposits and 1.0 for debt (this was also called pesificación asimétrica). Previously, the withdrawal of dollars was limited to $250 per week. After the forced exchanged, people no longer had any dollars on the system and those who had savings in US dollars lost 65% of their deposited value.
https://en.m.wikipedia.org/wiki/Corral%C3%B3n

What are your thoughts on the quote above if your government implemented such economic measures? One thing is certain: those in debt would likely benefit, especially in times of economic hardship.

What is wrong with the normal exchange rate that we are using with the conversion os our local currency with the USD, it makes nothing different and a country like mine may not as well like to give adoption for this kind of economy exchange, this may be a perfect way of running the economy in Argentina by it's law makers but other countries also have their own way of making their economy a stable one without following same pattern others take, so in my country, this is not going to be an acceptable one when they are trying to work on balancing the economy.

kryptqnick

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I've read the article, but it's really short, and I couldn't find much beside it online to deepen my understanding of the matter. I haven't heard of this before, but I don't have debt, so I don't think I'd benefit from such a measure. What I find lacking from the article is the information about broad effects of the measure. Did that help stabilize the national currency, did that contribute to improvement of any economical features? Is it, in hindsight, considered a mistake or an effective move? Who lost the most from this practice, and what was it meant to achieve in the first place?

Faisal2202

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Quote from: alastantiger on October 22, 2023, 09:42:35 AM

Quote

Corralón was the informal name for the economic measures taken in Argentina at the beginning of 2002 by President Eduardo Duhalde during a bank run in which deposits and debt in dollars were exchanged to local currency at 1.4 per dollar for deposits and 1.0 for debt (this was also called pesificación asimétrica). Previously, the withdrawal of dollars was limited to $250 per week. After the forced exchanged, people no longer had any dollars on the system and those who had savings in US dollars lost 65% of their deposited value.

What are your thoughts on the quote above if your government implemented such economic measures? One thing is certain: those in debt would likely benefit, especially in times of economic hardship.

That is something new to me, I was not aware of it, I mean, that's a trap from banks, why would they do it, and why did the people of Argentina bore it, why did they not protest, why it still implemented after protests? This really sucks. I mean, they even set the withdrawal limit to $250 per week. Useless policies for the customers but not for the banks. Where did the profit go? Which they made out of this.

I believe this is the 2nd best example I have found to teach someone or give an example of why BTC is better than Banks, in terms of holding. Like, those if they were had holdings in BTC, would be saved now, but they trusted banks and banks fucked them. (sorry for the lingu).

We don't have the facility to store dollars in Banks, even if we have, (of which I am not aware of), I don't think if anyone would care to save their dollars in the local or national banks. People prefer to hold them in person, and recently in an operation more than 900 million dollars were caught, which was not in the books of our governments, which means they were smuggled into the country without paying tax.

alastantiger

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Quote

Corralón was the informal name for the economic measures taken in Argentina at the beginning of 2002 by President Eduardo Duhalde during a bank run in which deposits and debt in dollars were exchanged to local currency at 1.4 per dollar for deposits and 1.0 for debt (this was also called pesificación asimétrica). Previously, the withdrawal of dollars was limited to $250 per week. After the forced exchanged, people no longer had any dollars on the system and those who had savings in US dollars lost 65% of their deposited value.
https://en.m.wikipedia.org/wiki/Corral%C3%B3n

What are your thoughts on the quote above if your government implemented such economic measures? One thing is certain: those in debt would likely benefit, especially in times of economic hardship.

Topic: Would You want to See a Corralón Type Economic Measure in Your Country? - page 2. (Read 280 times)