“The U.S. Treasury is prepared, immediately, to take whatever exceptional measures are warranted to provide stability to markets [by buying Argentine pesos],” Treasury Secretary Scott Bessen announced on Truth Social Thursday.
Along with intervening to prop up the sagging peso, which has lost more than 27 percent of its value against the dollar this year, the U.S. has also finalized a $20 billion currency swap arrangement with Argentina’s central bank. The agreement, essentially a loan of $20 billion in dollars, followed what Bessent called four days of “intensive meetings” with Argentine Economy Minister Luis Caputo in Washington…
The administration’s bold move represented just the fourth time since 1996 that the United States has purchased another nation’s currency in the open market, according to the Federal Reserve Bank of New York.
According to the WSJ, President Trump is exploring $10,000,000,000 to $14,000,000,000 in aid to farmers who are losing in his trade war. China normally buys the bulk of US soybeans. Now China has turned to Brazil, as it did in 2018 during Trump’s prior trade war.
But guess what. Argentina is also selling soybeans to China. So we’re supporting a country that’s taking part of our soybeans market.
Moreover, economist Brad Setser, now a senior fellow at the Council on Foreign Relations, warned: “Lending money to Argentina is easy; getting repaid is what is hard.”
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