US buys Argentine pesos, finalizes $20 billion currency swap

[peppertree]

Source: AP

The U.S. directly purchased Argentine pesos on Thursday and finalized a $20 billion currency swap framework with Argentina’s central bank, Treasury Secretary Scott Bessent said in a social media post.

“U.S. Treasury is prepared, immediately, to take whatever exceptional measures are warranted to provide stability to markets,” Bessent said, adding that the Treasury Department conducted four days of meetings with Argentinian Finance Minister Luis Caputo in Washington D.C. to come up with the deal.

Bessent has insisted that the Argentina credit swap is not a bailout. Last month, President Donald Trump stopped short of promising Argentina’s President Javier Milei a financial bailout from the Latin American country’s economic turmoil.

Still, U.S. farmers and Democratic lawmakers have criticized the deal as a bailout of a country that has benefited from sales of soybeans to China, to the detriment of U.S. farmers.

Read more: https://apnews.com/article/trump-bessent-argentina-milei-currency-swap-7432a188e57264f0e5f6c753ddc40879

---

Argentine President Javier Milei regales supporters with a rock performance Monday night in Buenos Aires.

The concert - which was held to promote the far-right president's latest book, and whose US$300,000 financing has not been explained - came hours after Milei concluded negotiations for a US$20 billion U.S. taxpayer-funded swap with Treasury Secretary Scott Bessent.

The swap would commit the U.S. Treasury to purchase up to US$20 billion in Argentine pesos - a currency that has lost an average of 26% of its value annually since 2001, and 28% so far this year.

Swap negotiations began after President Donald Trump had declared his “complete and total endorsement for [Milei's] re-election as president” - though Milei is facing midterms.

[speak easy]

1. "a country that has benefited from sales of soybeans to China"

China is not going to buy soybeans from the U.S. again. Evah. They want more reliable suppliers.

[peppertree]

7. True - but even then, it's not doing Argentina any good (and there's the matter of Argentina's Congress approving this)

Since Milei decreed currency deregulation - like all right-wing governments in Argentina have over the last 50 years - Argentine exporters simply offshore their dollars as soon as they earn them.

Plus - MIlei's tax holiday last week cost Argentine coffers US$1.6 billion. For nothing - because, again, they offshore any hard currency earned.

Milei and Bessent are both very well aware that El Cheeto doesn't understand any of this. There's every reason to believe, in fact, that they hoodwinked Diaper Don into believing Milei "was facing a tough re-election fight" (when it's just midterms).

In any case - even if Milei finds a way to get around Congress (as he often has - but much less so lately), his electoral fate is sealed:

His pseudo-fascist coalition (many of them, dictatorship apologists) is already bracing for a double-digit seat loss in the House, and a few in the Senate.

As it is, all they can count on anymore is around 70 of the 257 House members, and 7 of the 72 Senators - having pissed off every last one of their allies by now.

And as mentally unstable as he is, many now expect Milei to simply resign and flee to Miami (where he owns a condo) after the October 26th midterms. And even right-wing executives - who a year ago thought he was a "flawed genius" - are hoping he does so.

[Delphinus]

2. What?

The actual eff?

[peppertree]

8. Well - we wouldn't want Scotty Bessent and his pal Robbie Citrone to take a loss on their Argentine gambles, would we?

America Last.

[no_hypocrisy]

3. Argentina is accepting a dollar that is declining daily in value?

[IbogaProject]

5. Declining more slowly than their own

Not that I'm happy with this whatsoever.

[peppertree]

9. The problem is that we're accepting pesos which shrivel in value by the week (sometimes, hourly)

The move is designed as a confidence trick meant to bolster Milei's approval - because U.S. dollars are worshipped in Argentina.

Businesses set their prices by how many they can get on the black market with their (projected) earnings. It's that bad.

In any case, as I was telling Speak Easy, this won't do them (or Milei's electoral chances) any good because Milei (like all RW presidents down there), decreed currency deregulation - thus ensuring that any spare dollars will be offshored like there's no tomorrow (as has been the case since June - which is why they're in this crisis to begin with).

Cry for Argentina - and for Mr. and Mrs. U.S. Taxpayer (which will now be the proud owner of $20 billion in Monopoly money).

[James48]

25. The Peso is declining more rapidly than the dollar.

[JoseBalow]

4. Pelotudos

[eringer]

6. Unbelievable

They would impeach Biden for doing this.

[peppertree]

10. Hear, hear

The move is designed as a confidence trick meant to bolster Milei's approval - because U.S. dollars are worshipped in Argentina.

Businesses set their prices by how many they can get on the black market with their (projected) earnings. It's that bad.

In any case, as I was telling the others, this won't do them (or Milei's electoral chances) any good because Milei (like all RW presidents down there), decreed currency deregulation - thus ensuring that any spare dollars will be offshored like there's no tomorrow (as has been the case since June - which is why they're in this crisis to begin with).

Cry for Argentina - and for Mr. and Mrs. U.S. Taxpayer (which will now be the proud owner of $20 billion in Monopoly money).

[Buddyzbuddy]

11. It absolutely is NOT a bailout, except, it is.

Our surplus from all of those tariffs.

[peppertree]

12. AND it won't do them (or Milei) any good

Because Milei (like all RW presidents down there), decreed currency deregulation in May - thus ensuring that any spare dollars will be offshored like there's no tomorrow.

As has been the case since June - which is why they're in this crisis to begin with.

Cry for Argentina - and for Mr. and Mrs. U.S. Taxpayer (which will now be the proud owner of $20 billion in Monopoly money).

[Nigrum Cattus]

13. How the fuck is this legal ?

How can any single person in our government spend
20,000,000,000 dollars on shit ?

[peppertree]

14. Exactly - PLUS it's illegal in Argentina itself, where such an agreement needs congressional approval

Milei has gotten used to circumventing Congress - and during his "honeymoon" period, they largely let him get away with it.

But because the rabid Chucky doll has done everything imaginable to piss off every single center-right ally his far-right party had, he can now only count on, oh, around 70 of Argentina's 257 House members and 7 of its 72 senators.

The rest are unlikely to back this boondoggle.

Right now, Argentina already has an US$18 billion swap with China - which Milei himself renewed in April.

That was approved by Argentina's Congress at the time (2014 - at the depths of the vulture fund blockade against Argentine credit abroad) - and, moreover, has been flexible enough to help finance Argentina's US$9 billion annual trade deficit with China.

And while Trump's and Milei's clowns have both been very secretive about this swap, it's clearly conditioned on Argentina's using it to cancel the China swap - and replacing it with not only a more costly and less flexible one...but one also subject to Trump's notoriously childish whims (he could recall it in a snap - thus bankrupting Argentina on the spot, since they can't easily come up with US$20 billion).

Cry for Argentina -and a little for Mr and Mrs. U.S. Taxpayer too.

[ashredux]

15. WTF'. Somebody is making a lot of money on this, and it ain't the American public.

[peppertree]

16. You ain't whistling Dixie...

https://www.democraticunderground.com/113352536

Two to tango: Far-right Argentine President Javier Milei with U.S. hedge fund manager Rob Citrone in happier days last year.

Citrone's big bets on Argentina contributed to his Discovery Capital’s 52% return in 2024 - but a sharp crash in both Argentine stocks and bonds this year has reportedly cost his hedge fund hundreds of millions.

[PSPS]

17. Gotta help his Argentinian MAGA clone by gifting him our taxpayer dollars

The treasury has become trump's slush fund

[peppertree]

19. Sad - but true

Not that this will help Argentina itself either - because Milei's currency deregulation means that any spare dollars will simply go to finance offshoring by local elites and foreign speculators (leaving the country the unpayable tab).

As has been the case in Argentina during every single right-wing government for the last 50 years - which is why they are as bankrupt as they are.

Right-wing Argentine presidents and their finance ministers since 1976: Borrow...dollarize...offshore...bankrupt...repeat...

[mdbl]

18. Giving them 20 billion and taking away our healthcare

Fuckers.

[peppertree]

21. Exactamente

Why are Democrats not screaming this on every news channel - like Ginggrinch did when Clinton bailed out Mexico (and that was a proper, justified bailout that actually made the Treasury a small profit - -unlike this one!).

[slightlv]

20. Give the money to another dictator to buy his favor,

while letting his own people starve and die from lack of healthcare.

Yippers... isn't this what Maga thinks a president should do?

[peppertree]

22. Eso!

Why are Democrats not screaming that on every news channel - like Ginggrinch did when Clinton bailed out Mexico (and that was a proper, justified bailout that actually made the Treasury a small profit - -unlike this one).

[Yo_Mama_Been_Loggin]

23. Don't give up your day job Milei

[peppertree]

24. You're not kidding. He spends most of his days in his underpants, rage tweeting and web surfing as it is!

Luckily for him, he still has that condo in Miami.

The refuge for so many Latin miscreants.

[area51]

26. "U.S. Treasury is prepared, immediately, to take whatever ...

taxpayer money we can and grift it & throw it at our 'friends'."

There, fixed it for you, Bessent.

[SunSeeker]

27. Sickening.

[Old Crank]

28. Bessent bailed out his friends

In the finance industry.
This won't help the troubles in Argentina.

[peppertree]

32. Absolutely - just like with Trump's bailout of his old sex party pal, Mauricio Macri, in 2018

Argentina's (mostly right-wing) elites and foreign speculators will just use the borrowed dollars to dollarize and offshore their peso assets - which is why they're in the mess they're in to begin with.

Except this time - the fat bastard's using our tax dollars.

[2naSalit]

29. WTF?

I think it's waaay past pitchfork time, folks.

[Mr. Sparkle]

30. This is not just to bail out Milei, but also the GOP donors who invested in Argentine since Milei took over

[peppertree]

33. Exactly - just like with Trump's bailout of his old pal Mauricio Macri in 2018

Argentina's (mostly right-wing) elites and foreign speculators will just use the borrowed dollars to dollarize and offshore their peso assets - as they've always done for the past 45 years.

Except this time - the fat bastard's using our tax dollars.

[IronLionZion]

31. These libertarian job creators sure love socialist handouts

it's as if their economic policies are complete BS

[pfitz59]

34. Saving a US investor

who bet big on Argentina. Time for a hearing on massive corruption.

[peppertree]

35. Absolutely. Democrats should be shouting this to the four winds

Every news network, every press conference, every town hall.

We'll never see that money again (they'll just use it to finance offshoring - just like Trump's pal Macri did when he bailed him out in 2018).

While our seniors are being kicked out of nursing homes, our families are having to drop their health insurance, and our young people are being forced to drop out of college - thereby condemning most of them to a burger-flipper's life (or chronic unemployment).

This is high treason.

[PerceptionManagement]

36. Paul Krugman says this is pure corruption. Every US taxpaer dollar is going not to Argentine, but straight...

into hedge fund bank accounts.

"So while millions of children must die to save a few billion dollars, taxpayers are on the hook for billions more to bail out Bessent’s hedge fund buddies in a predictably futile attempt to save the Elon Musk of the South."
https://paulkrugman.substack.com/p/bailing-out-bessents-buddies-bets

[Pachamama]

37. Look at that face America - in addition to the soon arriving Trump $1 coin - this guy Milei is too

The value of USD is a joke