As countries around the world struggle to cope with rising prices, perhaps no major economy understands how to deal with inflation better than Argentina.
The country has struggled with rapidly rising prices over the past 50 years. During a chaotic trajectory in the late 1980s, inflation reached an almost unbelievable 3,000 percent and residents rushed to get groceries before clerks with prize guns could make their rounds. Now high inflation is back, more than 30 percent a year since 2018.
To understand how Argentinians deal with it, we spent two weeks in and around Buenos Aires talking to economists, politicians, farmers, restaurateurs, real estate agents, hairdressers, taxi drivers, money changers, street performers, street vendors and the unemployed.
The economy isn’t always the best conversationalist, but in Argentina it got just about everyone going, provoking curses, deep sighs and informed opinions about monetary policy. One woman happily showed her hiding place for a wad of US dollars (an old ski jacket), another explained how she put money in her bra to buy an apartment, and a Venezuelan waitress wondered if she was going to the right place. country had emigrated.
One thing became strikingly clear: Argentines have developed a highly unusual relationship with their money.
They spend their pesos as quickly as they get them. They buy everything on installment, from TVs to potato peelers. They don’t trust banks. They hardly use credit. And after years of constant price increases, they have little idea of how much things should cost.
Argentina shows that people will find a way to adapt to years of high inflation, in an economy that is hard to fathom anywhere else in the world. Life is especially manageable for those with the resources to make the reverse system work. But all those striking solutions mean that few who have held political power during years of economic hardship have paid a real price.