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Days After Freezing Prices, Argentina Bans All Advertising

Tyler Durden's picture


"We are from the government and we are here to help you"

- Anonymous government worker

A week after Argentina resorted to every failing authoritarian government's last ditch measure to (briefly) control inflation before runaway prices flood the nation and result in political and social upheaval, namely freezing retail prices - a decision which never has a happy ending, the country is pressing on through the rabbit hole and in the latest stunner of a government decree (which like Venezuela yesterday is merely a harbinger of what is coming everywhere else), has banned advertising in the Argentina's newspapers in an attempt to weaken what's left of a private, independent media, and to punish those who don't comply with the government's propaganda.

From the WSJ:

Supermarkets and electronics retailers say Argentina's government has ordered them to stop advertising in the country's top newspapers, in a bid to weaken independent media companies as President Cristina Kirchner turns to increasingly unorthodox policies to prevent inflation from derailing an ailing economy.


The order, confirmed by retailers and newspapers but denied by government officials, comes after retail executives say price-control czar Guillermo Moreno pressured them earlier this week to agree to freeze prices for two months. Executives say Mr. Moreno then told them to pull all newspaper sales ads in hopes this would somehow curb inflation. "This was an imposition, not a request. He simply decided that nobody should publish any ads. It's not sustainable and will be hard to comply with," said one retail-sector executive.

And yes, a light bulb just went on over the president's head when he read the word "price-control czar."

Why is Argentina resorting to this dictatorial measure? Simple - to stifle the independent press for one simple reason - "misreporting" inflation, or at least reporting inflation numbers which are orders of magnitude higher than the official government numbers.

Mrs. Kirchner played down inflation for years, refusing even to say the word in public. But with economists estimating annual inflation at around 26%, she has been calling on consumers to prevent companies from raising prices. A sluggish economy and Mrs. Kirchner's confrontational political style have also taken a toll on her popularity.


The Buenos Aires Newspaper Editors Association said the order was a reprisal against those who publish independent inflation estimates. "This is another display of how far authoritarianism can go in a context that is dominated by discretional policies and bullying," the group said in a harshly worded newspaper ad Friday.


The controversy comes as Mrs. Kirchner attempts to implement a three-year-old media law that would overhaul Argentina's media industry and dismantle media giant Grupo Clarín SA, which publishes Argentina's bestselling newspaper, Clarín, and runs a profitable cable-TV and Internet network.


"This aims to inflict economic damage on all independent media companies," Clarín spokesman Martin Etchevers said. "On the one hand, it's another attempt to weaken media that don't depend on government money. On the other, it's an attempt to keep people in the dark about inflation."

Two birds with one dictatorial decree stone. However, while the motive is quite clear it shows the danger of having a truly independent media, and one which is not aligned with the government's propaganda: report the truth and we will starve you by banning all your advertising. Ad revenues in the US must be soaring...

Mrs. Kirchner accuses Clarín of using its sway to undermine her government. Clarín officials say the government started targeting it in 2007, when it began reporting that the government was underestimating inflation.

Just as notably, with the witch hunt against anyone whose inflation numbers differ from the government's official lies, it is likely that the organizers of the Argentinian equivalent of the Billion Dollar Price project would get the death penalty.

In 2011, the government started fining economists for publishing their own inflation estimates. To protect them, a group of opposition legislators began publishing the economists' monthly inflation estimates anonymously.

What is most ironic is that it is the same US-based IMF who recently punished Argentina for its inflationary misreporting.

The International Monetary Fund has weighed in on the matter and recently censured Argentina over questions around its economic data. The IMF warned that it could eventually expel Argentina from the organization if the matter isn't resolved.

But perhaps Argentina is not massaging its inflation numbers - perhaps it is merely doing what the US and every other IMF member nation does: ignore those prices which are soaring, and hedonically adjust everything else far lower, to give the general public the impression that the horsemeat lasagna which went up in price... it didn't really go up in price.

At the end of the day, this like every other idiotic measure taken by a government in its last throes is just to preserve power one more month, or week, or day:

Gabriel Gómez, an economist at the research firm Consultora Ledesma, said the government is imposing short-term price controls and advertising limits ahead of a key mid-term election in October.


"The only thing the government wants now is to decelerate inflation before October," he said. "Everyone knows that price controls are counterproductive in the long-run, so that's the only way to understand the logic behind this."


Top government officials have called on Mrs. Kirchner to amend the constitution so she can seek re-election in 2015. To do so, her coalition would need to win more congressional seats in October.

Or, as is the case everywhere: when the government's self preservation is the bottom line, screw the people. Alas, that is the case now in every "developed world" nation, whose status quo is clinging on to dear life as the legacy socioeconomic and financial system implodes.

Keep an eye on just how far Kirchner will go to keep her place in power - that will be a useful indicator of what is coming to every banana republic next, and quite soon.

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Sat, 02/09/2013 - 12:21 | 3228669 kliguy38
kliguy38's picture

Hear no evil ..... see no evil........

Sat, 02/09/2013 - 12:22 | 3228672 goldfish1
goldfish1's picture


Sat, 02/09/2013 - 13:22 | 3228686 MrX
MrX's picture

we should just make hardship illegal.  see here:


with enough power, basic economic principles are null and void.  Liberty is the enemy of "progress".

Get off ma land or someone from the government will eventually show up and put you through a highly inconvenient legal process....unless you are outside our boders.  In that case, you are probably already dead......and all your neighbors.  Well, it is a war I guess and stuff occsionally(every day all day) happens.  At least I am pretty sure we declared war.  We did didn't we?  I thought we did.

Sat, 02/09/2013 - 13:24 | 3228770 AlaricBalth
AlaricBalth's picture

Ben Bernanke has created the U.S.'s greatest export: inflation.
Gracias pendejo!

"When the Fed prints money it is just creating inflation in emerging economies. But when the inflation in the EM gets high enough, it will bounce back, it will become inflation in the US." Andy Xie


Sat, 02/09/2013 - 13:30 | 3228781 francis_sawyer
francis_sawyer's picture

We are a banana republic... & YES ~ We have no bananas...

Sat, 02/09/2013 - 13:45 | 3228812 SafelyGraze
SafelyGraze's picture

the first sentence has 105 words

Sat, 02/09/2013 - 13:54 | 3228826 DavidC
DavidC's picture

And a Flesch reading ease 0.0, Flesch Kincaid Grade Level 46.1.



Sat, 02/09/2013 - 14:05 | 3228847 a growing concern
a growing concern's picture

Faulkner would scoff at that.

Sat, 02/09/2013 - 14:06 | 3228849 SafelyGraze
Sat, 02/09/2013 - 14:09 | 3228852 Vegamma
Vegamma's picture

You may have hit on something here. Why would the average voter with an 8th grade reading level struggle with an article like this when Dancing With the Stars comes on in a few hours?

Sun, 02/10/2013 - 04:27 | 3230171 MisterMousePotato
MisterMousePotato's picture

I had no problem reading it. Or understanding it. (Indeed, I rather enjoy Tyler's snarky writing.) And I'm not very bright. (My stepfather [whom I miss terribly, God rest his soul] pointed that out on a daily basis for years.)

Sun, 02/10/2013 - 03:24 | 3230127 CompassionateFascist
CompassionateFascist's picture

@ Sawyer: lotsa banana-noses in power tho. 

Sat, 02/09/2013 - 14:23 | 3228872 Never One Roach
Never One Roach's picture

I'm gonna miss the ads, guys, especially the TV ads.  In fact, it's bothersome when those 25 minutes of commercials are interrupted by 5 minutes of the regularly scheduled programming. 

Sat, 02/09/2013 - 15:40 | 3229051 wee-weed up
wee-weed up's picture

Don't anyone tell Nanny Bloomberg about this, whatever you do!

Sat, 02/09/2013 - 17:41 | 3229302 caconhma
caconhma's picture

After all, Mrs. Kirchner was twice “democratically” elected by Argentina people as their President.

It tells me that people are indeed very stupid and lazy and deserve their destiny. It is always irresistibly appealing to get lots for nothing.

It also tells me that when every imbecile has a right to vote it is not good for anybody including imbeciles. Eventually, even imbeciles understand this simple fact. Then they are starting to look for another slave-master.



Sat, 02/09/2013 - 14:39 | 3228915 disabledvet
disabledvet's picture

Venezuela had a shortage of dollars...that's why it devalued. That is OIL rich Venezuela. We are having problems with FALLING prices in the USA. What hasn't happened yet is a rash of bankruptcies...especially in companies that "cannot fail" because of "an expected inflation that does not arrive." My understanding in Argentina is that they've had a crop failure of some sort. http://seekingalpha.com/article/1169461-wasde-brazil-to-produce-record-s...
Argentina's "depleting weather and crops" was the part that stood out to me. That sounded very ominous...ironically enough at the same time that Brazil is producing all time record harvests. (did someone say sound economic plans from Brazil but not Argentina?) The USA is keeping energy prices high IN THE USA via "massive exports of cheap energy." this used to be very hard to do...but not anymore. What can't be exported very easily is ethanol...of which the USA went from "barely a mention" to "largest in the world" in just a couple of years. That's how big the USA's capital and energy markets are. Now the rest of the world has an "internal development problem." In short outside of Europe and the USA and to some extent (barely) China "they don't have one." Brazil is still my the best candidate for "developing its interior" as it actually has one to develop and since it has the Amazon river it already has a "superhighway" that comes with it. Can they summon the political will to do so however? So far their interest rates have fallen with the rest of the world's...and should the rest of Latin America follow Venezuela's "lead" save Brazil then that will make Brazil into a true economic super-power on the Continent. I'll believe it when i see it though. "no one wants to be told their Apartment isn't worth 500,000 US but 5,000 actually."

Sat, 02/09/2013 - 17:46 | 3229300 TheGardener
TheGardener's picture

Disabledvet, I lived in Brasil for some time and
the running joke was "Brasil was always the land of the future and it will ever be !"

Another joke from those days : How to be worth a million dollars in Brasil within 6 months? Become a permanent resident with 2 million to start with !

Sun, 02/10/2013 - 03:29 | 3230130 CompassionateFascist
CompassionateFascist's picture

Evidently someone else does Disabled Vet's grocery shopping. And for about everything else as well. It's all a debt-bubble now...

Sat, 02/09/2013 - 13:55 | 3228821 redpill
redpill's picture

There was the greatest generation, then the boomers, then gen x, then gen y, and now we have the Horsemeat Lasagna Generation.

I dont often eat horsemeat lasagna, but when I do... hmm, no actually I never eat it. Stay thirsty my friends.

Sat, 02/09/2013 - 15:42 | 3229038 FEDbuster
FEDbuster's picture

I heard they served the Bernak's favorite, Unicorn meat, at Tim Geithner's going away dinner at the White House.


Sat, 02/09/2013 - 16:06 | 3229100 Wile-E-Coyote
Wile-E-Coyote's picture

Yeah horse meat found to have "Bute" in it, this story gets better by the day.

Won't be long before funeral parlours will become meat processing plants!

Sat, 02/09/2013 - 16:17 | 3229125 FEDbuster
FEDbuster's picture

"Soylent Green is people!!"

Sun, 02/10/2013 - 03:34 | 3230132 CompassionateFascist
CompassionateFascist's picture

read Jack Vance's great anti-Socialist Utopia, Wyst: soon we'll all be eating "gruff and deedle, with a bit of wobbly to fill in the chinks..."

Sat, 02/09/2013 - 12:58 | 3228740 kliguy38
kliguy38's picture

Could have gone with "first" but its Saturday and I thought my critical thinking may be suffering from a hazy friday night of booze and pot....besides your "wow" highlights a "critical" post....

Sat, 02/09/2013 - 13:12 | 3228756 MrX
MrX's picture

don't hate the player, hate the game, and hate the score, and hate the post-game wrap-up

Sat, 02/09/2013 - 13:30 | 3228784 kliguy38
kliguy38's picture

friend of mine sent me this today, knowing it was Saturday...keep your eyes on the cross thats the only rule


Sat, 02/09/2013 - 14:29 | 3228886 Silver Bug
Silver Bug's picture

The currency wars are just getting started baby!



Sun, 02/10/2013 - 00:47 | 3229931 sun tzu
sun tzu's picture

Obozo won't have to worry about the media in the US since they already toss his salad on a daily basis

Sat, 02/09/2013 - 12:21 | 3228670 Ignatius
Ignatius's picture

It won't work.

Sat, 02/09/2013 - 12:48 | 3228721 OpenEyes
OpenEyes's picture

Exactly it won't work.  Neither will Venezuala devaluing their currency.  Or, was it Italy that banned all cash transactions a few months back?  

Doesn't it seem that things are beginning to come apart more quickly?  And that these controls are becoming more blatant, more severe and more frequent?

Sat, 02/09/2013 - 13:00 | 3228743 DeadFred
DeadFred's picture

It sems to me that people have a hard time learning. Argentina has been down this path before and it ended poorly. Thousands of people 'disappearing', doctors spending their days scavenging cardboard from the dump, roving bands of thieves raping and stealing through the countryside, wars to claim sheep covered rocks in the middle of the ocean. Maybe I should ammend the part about ending because the country only seems to get brief lulls in the chaos. Maybe I should also ammend the part about learning as well. Their .GOV hasn't learned anything but the people and businesses seem understand they're being lied to, unlike a country I know of that hears BLS statists and thinks "This a great time to buy stocks and re-elect some Kenyan guy"

Sat, 02/09/2013 - 13:14 | 3228758 Karlus
Karlus's picture

Kenyan guy got re-elected because of multiple voting, he is the cool candidate that people idolize, and no one would vote against Santa and his bag of food stamps.

We will go down the price control and rationing route because a large number of our populace is dumb as hammers and can vote.

Just wait until we get involved in a real conflict and that selective service card comes in handy.

Sat, 02/09/2013 - 20:34 | 3229600 ebworthen
ebworthen's picture

+1 for "dumb as hammers"

And the one's with PhD's use a hammer on screws (Ben?  Ben Bernanke?).

Sat, 02/09/2013 - 21:18 | 3229667 Parrotile
Parrotile's picture

If the screw's rusted-in, a quick tap with a hammer (before, or after "help" from WD-40) can work quite a miracle.

Ask anyone who owns (or has owned) a boat . . . . .

Sat, 02/09/2013 - 21:29 | 3229684 Midas
Midas's picture

I use PB Blaster.  I am on a one man crusade against WD-40.  They claim 100s of uses and I say for each of those uses there is something better.

Down arrows to anyone who uses it as a lubricant....

Sun, 02/10/2013 - 04:07 | 3230151 Tijuana Donkey Show
Tijuana Donkey Show's picture

WD-40 is good for rust prevention, that's it. (Also what it was deisgned for, they used it to keep nukes fresh and ready.) PB is the shit for anything stuck....


Sat, 02/09/2013 - 14:35 | 3228906 css1971
css1971's picture

No that was an authoritarian Fascist state. This is going to be socialist.

Sat, 02/09/2013 - 18:13 | 3229355 TheGardener
TheGardener's picture

Just go there. See the beauty of Buenos Aires.

Most beautiful capital city left on earth.

In Europe, those cities got either bombed out of existence or neglected or disfigured by commercial interests.

And on decadence , there is no better school.

Go to Chile and you wish Pinochet were the evil dictator he was blamed to be and many more would have disappeared
as alleged in Argentina. Nice places again after the next real dictator.

Sun, 02/10/2013 - 03:39 | 3230135 CompassionateFascist
CompassionateFascist's picture

...aaaaaaaaaaaaaand that's also why the desperate gun-grab. The ZOG knows it won't be able to buy consent with debt for much longer. Next comes the Gulag, and they don't want anybody shooting back.  

Sat, 02/09/2013 - 16:28 | 3229161 DosZap
DosZap's picture

 We are having problems with FALLING prices in the USA.

WHERE and in what?????????????.

We have 10%+Inflation, and we have a 23% UE rate.Also 6.6 Million Americans still looking for work.

Everything I NEED to live, has gone thru the roof,maybe you can elablorate??

Sat, 02/09/2013 - 21:03 | 3229643 Overfed
Overfed's picture

"We are having problems with FALLING prices in the USA.

WHERE and in what?????????????."


Sure as fuck ain't ammo, gas, food, or building supplies.

Sat, 02/09/2013 - 21:18 | 3229668 FEDbuster
FEDbuster's picture

or popcorn.  Went to buy another 50lb bag at Sam's Club, it went from $20 to $28 in the past month.  I know it's from the drought, but come on 40% rise in a month?

Sat, 02/09/2013 - 12:24 | 3228676 Stockmonger
Stockmonger's picture

Argentina shall now be known as Krugmania.

Sat, 02/09/2013 - 12:34 | 3228695 Tyler Durden
Tyler Durden's picture

More humor

From Paul Krugman, May 2012

Down Argentina Way

Matt Yglesias, who just spent time in Argentina, writes about the lessons of that country’s recovery following its exit from the one-peso-one-dollar “convertibility law”. As he says, it’s a remarkable success story, one that arguably holds lessons for the euro zone.

I’d just add something else: press coverage of Argentina is another one of those examples of how conventional wisdom can apparently make it impossible to get basic facts right. We keep getting stories about Ireland’s recovery when there is, in fact, no recovery — but there should be, darn it, because they’ve done the “right” thing, so that’s what we’ll report.

And conversely, articles about Argentina are almost always very negative in tone — they’re irresponsible, they’re renationalizing some industries, they talk populist, so they must be going very badly. Never mind this:

Just to be clear, I think Brazil is going pretty well, and has had good leadership. But why exactly is Brazil an impressive “BRIC” while Argentina is always disparaged? Actually, we know why — but it doesn’t speak well for the state of economics reporting.

Sat, 02/09/2013 - 12:41 | 3228709 Rubicon
Rubicon's picture

Dont fuck with Freddy Krugman!

Sat, 02/09/2013 - 12:43 | 3228715 andrewp111
andrewp111's picture

Is that graph of "real GDP" based on real inflation numbers or government massaged fantasy numbers? Argentina wouldn't need to take extreme measures if things were going so swimmingly, would they?

Unless of course Kirchner is diverting the country's entire GDP growth to a nuclear weapons program so she can take the Falklands back from the British.

Sat, 02/09/2013 - 16:32 | 3229176 machineh
machineh's picture

Real GDP is calculated as (nominal GDP - inflation).

So of course, if inflation is too low, then real GDP comes out too high.

Argentina was growing, but the growth likely was exaggerated.

Sat, 02/09/2013 - 21:23 | 3229677 Parrotile
Parrotile's picture

Joking aside, you'd be quite surprised to know how many UK RN submariners were keen on "trying out" a few Polaris SLBMs on a "certain Country" during a "certain war".

That's why there were NO strategic boats anywhere near the Falklands - just in case someone with a big grudge decided to take a pot-shot (as has happened in the past!)

Sun, 02/10/2013 - 17:48 | 3231278 smiler03
smiler03's picture

What a stupid comment. Note that the UK is not in the habit of dislosing the whereabouts of their Nuclear Missile armed subs.

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