Economy

Most Argentine administrations - since even before the days of the populist Juan Perón (1945-55) - have responded to inflation with:

· price controls
· increased supply requirements
· higher/lower tariffs and export/import controls
· exchange rate manipulation (when they could) - and other command economy policies.

Suffice it to say, they mostly failed.

They failed mostly because of that one variable command economy policies can't control: private-sector retaliation - and its subset, hoarding.

Wholesalers would often hoard and/or order steep mark-ups days before the new "anti-inflation" policy was announced - thereby dooming the announcement to failure from day one.

Often, they (and their RW media surrogates) would add to the problem further by spreading rumors of "shortages" - not unlike the U.S. TP crisis in March/April 2020.

Consumers themselves would drive the last nail in, by actually acting on said rumors - thus creating a self-fulfilling prophecy.

But nor was price/supply/currency deregulation the answer.

The mere specter of an upcoming such change, would often create a very similar dynamic.

Most recently, after Milei's election in November 2023, when inflation shot up from 8% a month in October, to over 25% in December - knowing a sharp devaluation and market deregulation was coming.

The moral of the story, if any, is that, once markets become accustomed to aggressive government meddling (beyond common-sense regulation), they enter into this speculative spiral - waiting for the cyclical wild swings in policy from left to right, in a bid to cash in each time.

And with consumers - and the economy - their inevitable victims.