Should We Cry for Argentina Case Study Example | Topics and Well Written Essays - 250 words

Should We Cry for Argentina - Case Study ExampleThe peso had initially been pegged to the dollar to increase the popularity of the domestic currency following a hyperinflation that had guide to demand of payments in dollars back in the 1990s.Local companies blamed their defaults on new requirements that all currency sent abroad had to have the central lingos authorization, a process that proved to be too slow. Increased taxes on exporters and cash-rich firms, and inability to obtain money to pay foreign suppliers intensified the local anesthetic companies struggles. International companies faced rising debts and losses from their Argentine operations as the peso continued its decline. Aerolineas Argentinas, an Argentine airline company, was forced to cancel all of its external flights due to the economical crisis that saw it barely escape bankruptcy in 2002.The rising inflation resulted in a significant increase in trade good prices thus making lives of ordinary difficult. People opted to spend on much cheaper goods than before. It is however reported that the inflation prompted the Argentines to spend rather than save and see their money depreciate in value (Agren). Rates of unemployment soared and poverty ensued too and by the 2012 purchasing power was at an all time