Comments on: Dólar Blue

Dólar Blue

zarq — Thu, 23 Apr 2015 10:14:00 -0800

Inside Argentina's Blue Dollar Market.

For years, Argentines have been stockpiling US dollars as a more secure currency (and far safer investment) than their own volatile peso. "So it seems safe to say that today Argentines hold probably well more than $50 billion [USD], and well more than one in every 15 dollars. (This is why the government of Cristina Kirchner is so furiously digging at the country's undeclared wealth. Not to bring home what Argentines hold abroad, but to uncover some of those dollars Argentines have—literally—at home.)"
Argentina has stringent monitoring and controls regarding the exchange of pesos for foreign currencies, including the US dollar. Since they limit how many dollars anyone within the country may obtain, an informal black market: the dólar blue or "Blue Dollar," has developed, where people can exchange pesos for dollars at an unofficial, better rate. In the last year, tourists to Argentina have been encouraged to bring hard cash with them to take advantage of the black market. Even though the trade is illegal in Argentina, exchange rates are published in newspapers and on websites like dolarblue.com.

By: benito.strauss

benito.strauss — Thu, 23 Apr 2015 10:18:32 -0800

I could swear we (i.e. my Dad) did something similar with US dollars in Israel when we visited in the 1970s. I was pretty young though, so I could be mis-remembering.

By: ssg

ssg — Thu, 23 Apr 2015 10:33:41 -0800

Such a weird tone in the article. The question of how the rate is determined is clearly answered by market forces, but the author spends much of the article making this sound like some strange, shadowy mystery. Of course, black markets for currency exchange have been around for ages and pop up any time there are currency controls.

By: ocschwar

ocschwar — Thu, 23 Apr 2015 10:52:04 -0800

Like Israel in the early 80's.

By: Blackanvil

Blackanvil — Thu, 23 Apr 2015 10:56:39 -0800

Like Russia during the cold war, too. The official exchange rate sucked, could only be used to get a strange type of tourist currency that could only be used in certain stores and restaurants, and everyone who was actually looking to buy stuff would find many entrepreneurs in alleyways and cabs who had a much better exchange rate for real rubles.

By: Bee'sWing

Bee'sWing — Thu, 23 Apr 2015 11:44:28 -0800

This is why 80% of US dollars in circulation are $100 bills. The resulting seigniorage is quite profitable for the US treasury.

By: fatbird

fatbird — Thu, 23 Apr 2015 12:08:57 -0800

The question of how the rate is determined is clearly answered by market forces Howso? "Market forces" is an opaque term here--you have no idea if some entity is co-ordinating the rate and responses to it, which would likely be a criminal organization. This could be, in part, a massive money laundering operation. It seems implausible that all these money exchangers are independent entities.

By: BrotherCaine

BrotherCaine — Thu, 23 Apr 2015 13:03:20 -0800

I knew a guy who claimed he got into black market currency exchange while a US State Department employee in the 1980s. He said he was standing around in an ill-lit parking garage with a suitcase full of thousands of dollars in cash and realized he was going to get robbed if he kept at it.