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The Solution To Argentina's Banking Problems Is To Go Cashless

Posted by Soulskill on from the why-would-you-carry-around-slips-of-paper-and-shards-of-metal-anyway dept.

dkatana writes: There is no way back for Argentinian people to trust their own currency. Several governments have used the "Peso/Dollar" exchange to dig into people's savings, reward their friends and limit the freedom of citizens to use other currencies.

Short of Dollarizing the economy again, the only solution for the country is going cashless. People are desperate, and they're looking for alternatives such as mobile payments, Amazon gift cards and Bitcoin to store their savings away from government control. A digital currency could help curb black market exchanges, fight corruption and restore the country's image.

7 of 294 comments (clear)

  1. "Cashless" is meaningless by jodido · · Score: 5, Insightful

    Cashless is a convenience. You need a currency. And once there is one, you're in the dollar world again.

    1. Re:"Cashless" is meaningless by roman_mir · · Score: 5, Insightful

      It's not meaningless if your goal is to steal and that's what that 'article' proposes - theft.

      1. Government steals by forcing people to declare all of their cash savings and to justify them to transfer them into the electronic form.

      2. Government steals by creating inflation electronically, so it's cheaper and faster for the government to create vast amounts of virtual money and dilute existing savings, thus stealing (creating inflation).

      3. Government can steal everything at any time by simply emptying your bank account and leaving you with nothing.

      4. Government will steal by setting stupid exchange rates that are absolutely fake, like pegging the exchange say 1USD to 10Pesos while on the 'black market' you would get many times more pesos, for example 100 for 1.

      5. Government can control you if you do not have access to your own money, and it can prevent you from doing anything they don't like and punish you for doing anything they don't approve of.

      It's a gigantic con, don't fall for it, it doesn't matter what the name of the currency is if you are not even able to have it in your own hands.

      Basically if you cannot hold your own money in your own hands but government holds it for you (directly or through proxy banks) you are fucked, you have nothing.

      If you try to switch to gold and other currencies of your choice, you will be labeled a 'speculator' and 'enemy of the working class' etc., and you can be dealt with criminally.

      --
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    2. Re:"Cashless" is meaningless by PolygamousRanchKid+ · · Score: 5, Informative

      You need a currency.

      "1000 Quatloos for the newcomers!"

      It will be interesting to see how Greece gets out of their mess, when they run out of Euros. Pundits are guessing that Greece will issue "scrips", which are a kind of government IOU, and pay government salaries and pensions with them.

      The only problem with that is . . . who will want these scrips? Certainly not even the Greeks themselves. They want Euros. And they will try to get rid of their scrips as soon as they can, in exchange for something of value.

      Car sales are up now in Greece by something like 40%, as people worry about if their bank accounts will get raided by the government. An automobile is considered as something "valuable". The cruel irony here, is that Greeks prefer to buy German cars . . . exactly the folks who Greeks blame for all their problems. So the Germans are actually benefiting the most from this.

      --
      Schroedinger's Brexit: The UK is both in and out of the EU at the same time!
  2. cashless = no privacy and lots of govt control by ciaran2014 · · Score: 5, Insightful

    We've made very little progress in anonymising cashless transactions (and this proposal might rely on transactions never being anonymous).

    This not only reduces people's privacy but also gives government officials a way to remotely block you from making any payments. That's severe.

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  3. Greetings from Argentina by ericlondaits · · Score: 5, Insightful

    1 - We're nowhere near desperate. We've been desperate-ish in the past... not lately.

    2 - We have a high but predictable inflation... it's impossible to save in Pesos, so it stimulates spending and the economy survives.

    3 - Purchase of dollars is restricted but there's a "healthy" black market that sells at a higher but well know rate (it's published in the newspapers and there are websites that inform the black market rate as well). The government counts on the existance of this black market to keep peace.

    4 - Going cashless solves nothing..!!! Your cashless bank account still lists an amount of pesos and if you want to convert them to dollars the normal restrictions apply. People taking advantage of bitcoin and other schemes are simply operating in the black market... it could be bitcoin, it could be bonds or stock.

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    As a Slashdot discussion grows longer, the probability of an analogy involving cars approaches one.
  4. Bitcoin? Nonsense by cachimaster · · Score: 5, Insightful

    Hi from Buenos Aires.

    No, the solution is not going cashless. We don't have a banking problem. We have a currency problem, because the government steals from us in the form of inflation. Going cashless is giving the government more power to screw us.

    Also we know very well how to play this game. If you can save, you buy other currencies like dollars. Or houses, if you are rich.
    If you need the money, you convert and spend as fast as possible. Inefficient and somewhat expensive, but possible.

    Bitcoin is easier to transfer, but too volatile. You might as well save in pesos.

  5. Maybe people are not desperate by gwolf · · Score: 5, Interesting

    My wife is Argentinan, as well as all of her family, and a great deal of our friends. We live in Mexico, and travel to Argentina at least once a year.

    The Argentinian exchange rate has dropped in the last year, although not as much as it happened 15 years ago — nor, by far, how it happened 30 years ago. And the local economy is far, far from hopeless— The standards of living in Argentina are quite high, most middle-class people travel outside the country regularly. As a Mexican travelling regularly to Argentina for the last five years, I have seen their life costs go from slightly cheaper to slightly more expensive — and today again slightly cheaper than ours.

    My family has their savings partly in pesos, in local banks, and partly in US dollars, in the safe deposits in the bank — AFAICT, they don't have a dollarised bank account. And they have a very decent level of life. My in-laws, as an example, travelled last year one month in Europe, and came to visit for a month in Mexico, without compromising their finances.

    This is the second post badmouthing Argentina in Slashdot in the past few weeks. I know I am answering with some (few) personal data points, but that's in the end how reality is: A huge collection of individual stories. And they are far from as dire as you portrait them.