We lead off this weekend with news that the Argentines are still pissed off about Spain winning the World Cup last year, and by golly, finally doing something about it. . Last week the Argentine government moved to nationalise the country’s biggest oil company, YPF, by seizing the majority ownership (now formerly) held by Spain’s own national oil company, Repsol. The Spaniards won’t take this lying down though. This from the BBC:
YPF Oil: Spain Threatens Retaliation Against Argentina
Spain has threatened retaliation against Argentina over the forced nationalisation of oil firm YPF, raising the prospects of a trade war between the nations.
YPF’s controlling stake, owned by Spain’s Repsol, was seized by President Cristina Fernandez’s government.
Spain’s Industry Minister Jose Manuel Soria said it was considering unspecified action on diplomacy, trade, industry and energy.
The article continues, or might have continued in similar fashiuon if I had written the copy:
The specter of a retaliatory tapas embargo looms large over relations between the two economically incompetent countries.
Spaniards rioted in the streets over this latest display of Argentine gall, vowing to boycott all future Boca Junior-River Plate
garbage-throwingfutbol matches. The threat seems serious. Interviewed during the riot, 20-year old Pepe Ignacio exclaimed with passion that “Argentine futbol is total crap, and besides, you can’t even see the game on the field with all the smoke. We have their best players, and maybe we’ll just nationalize them. Barcelona striker Lionel Messi could not be reached for comment.
I’m being just a little flippant because it seems there’s precious little that Spain can do about this. The days of the Armada are long gone.
Meantime, Argentina is making noises about British companies exploring for oil off the Falklands.
The Falklands, remember them? A few windswept islands good for raising sheep and little else. Argentines call the the Malvinas, and damned if they still don’t want them back.
Peaceful terms for now (“Argentina Will Sue Over Falkslands Oil Exploration”), maybe escalating into more intense penalty shootouts later on. Argentines would be best advised to tread lightly. The Brits still do have an Armada, and they may just ship a couple battalions of battle-hardened soccer hooligans down there to crack a few heards and show them what’s what (not that aforementioned exploration is delivering quite stellar returns for explorers).
Governments nationalizing vital resources for their own political ends. A familiar story in South America (and around the world really… General Motors?)
Venezuela’s Hugo Chavez has gone a similar path with PDVSA, driving those evil gringos and their capital out of the country, and in parallel’s nosediving the country’s oil production from a high of some 3.2 million barrels per day to a present estimated 2.2 million b/d. Around half of this production is sold at a steep discount to Chavez’ pals around the Caribbean, buying influence and support. The rest is sold to those evil gringos in the U.S. at market prices.
And in the meantime, the people can’t get in a day’s decent food shopping:
With Venezuelan Food Shortages, Some Blame Price Controls
CARACAS, Venezuela — By 6:30 a.m., a full hour and a half before the store would open, about two dozen people were already in line. They waited patiently, not for the latest iPhone, but for something far more basic: groceries.
“Whatever I can get,” said Katherine Huga, 23, a mother of two, describing her shopping list. She gave a shrug of resignation. “You buy what they have.”
Well done, Senor El Presidente Chavez. Senora Presidente Eva Peron Cristina Fernandez, please take heed.
For more on Government idiocy at little closer to home, Darwin’s Money, takes a hard look at the US Senate’s deliberations on income taxes, with Senate Rejects Buffett Rule – Fighting Stupidity with Logic
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Gardening and More Gardening…
Spring is in the air, and what better way to observe Earth day than to do a little digging?
To forget how to dig the earth and tend the soil is to forget ourselves. ~Mohandas K. Gandhi (1869-1948)
Corey from 20′s Finances is starting a garden, and doing it the hardcore way, by starting seedlings inside My Vegetable Garden: Transplanting,
Jefferson and Michelle over at See Debt Run are also starting out strong, with Garden of Seedin’
This from Grist.com, 15 Ways to Celebrate Agriculture on Earth Day. I don’t agree with all the sentiments put forward (no one has a “right to food” anymore than the have a “right” to air conditioning), but it’s a nice crunchy read.
Mike from Mike and Molly’s House makes a dirt sifter. Useful for sifting compost, too.
Farming looks mighty easy when your plow is a pencil, and you’re a thousand miles from the corn field. — Dwight D. Eisenhower
Enough with blogging. Off to the garden… planting green beans (Provider) and more zucchini (Dark Star) today.
Thanks for the inclusion and the great tips on gardening. I will be using them when I transplant the next set of plants. Soon I will be moving tomatos and cucumbers outside and this time I will protect them from wind and direct sunlight.
20′s Finances recently posted..Financial Carnival for Young Adults – 9th Edition
Hey Corey – looking forward to a follow-up post!
I’m crying for Argentina and Argentines on this stupid move. Governments that nationalize assets also tend to impoverish their citizens. Just ask the people of Venezuela.
The Biz of Life recently posted..Economic Trivia: Visualizing Ocean Shipping and Trade 1750-1850
Hi Grouch – I work with a couple of Venezuelan emigres. The stories I hear really do make you want to cry. Growing crime. Small farms that that have been in the family for generations, now “nationalized” by the government. And yet, so much wealth and potential, both in natural and human resources.
I was very surprised by Argentina’s move to nationalize YPF. I always think of Argentina as more European than the rest of South America. It’s a shame to think of how they once had a GDP equivalent to the U.S. and are now acting like Venezuella. It’s such a beautiful country.
Bret @ Hope to Prosper recently posted..Should you Prepare your own Taxes?
Hi Bret – Argentina was indeed the “silvered one” at one time. And now, it’s turning to crap. Although capitalism is famously said to spread wealth unequally, socialism does a good job of spreading poverty and misery quite equally. The national ironworkers union just got a 25% cost of living raise. Sounds nice, right? But foreign investors in response will do what they can to avoid manufacturing in Argentina. Twenty five percent of nothing is still nothing.
Thought of you yesterday when I actually did a little gardening myself. Moved my rhubarb plants to the other side of the garden where shade from nearby trees is less intrusive. Took pictures and everything, but hesitant to post about it on my blog.
Matt @ RamblingFever Money recently posted..Keeping Your Golden Eggs In One Sturdy Basket
Hi Matt, I’ve added you to the list of PF Gardeners. Sometime next month, I’m going to solicit pictures for another mini-carnival of PF Gardeners.
I haven’t tried rhubarb yet. Do you and the Mrs. make pies from it?
Thanks for the mention!
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Here’s a pretty good summation of the YPF situation from Scott Grannis along with some general political commentary:
“Here’s the YPF story in a nutshell: after privatizing YPF in the late 1990s, the government imposed a price ceiling on the oil that YPF sold that ended up being way below the world price; that price ceiling greatly reduced YPF’s incentive to find and produce more oil; finally, the government decided that since YPF was not finding and producing enough oil, it deserved to be once again nationalized. One suspects, thought there’s no proof, that lots of money changed hands behind the scenes, and not in ways that disadvantaged Ms. K.
Most Argentines never hear this side of the story, however, and end up believing the government’s spin—that YPF was a greedy multinational that only wanted to milk Argentina’s resources for all they were worth, with no thought for the well-being of the country.
After a series of conversations with friends these past few days, in which I relate to them what has been happening in the U.S. under Obama, I have been struck by their almost universal response: Obama is doing the same things as the Kirchner administration! Rig the rules of the game, give handouts to favored industries, financial backers, and unions, blame the rich and the big corporations for the failures, pit the rich against the poor, make every attempt to tax the rich and redistribute the wealth, avoid all mention of the disastrous financial results (e.g., trillion dollar deficits in the case of the U.S., and capital flight and double-digit inflation in the case of Argentina), and meanwhile live like a King (or Queen in the case of Cristina).
We can’t afford much more of this, and neither can Argentina.”
The Biz of Life recently posted..Cartoon of the Day:Cat Scratch Fever
Nice post, Biz. I came across a telling sentiment the other day. A foreign buyer in an oil and gas firm preferred to source from Europe rather than the US. The comment was that European exporters are “more open for business”. Just an opinion, but still…
I barely understand the oil thing that’s going on, but I can say this, if it helps the citizens, then rock on. If it hurts the citizens, then they’re being jackoffs. I think that pretty much sums it all up.
TB at BlueCollarWorkman recently posted..Adding Vomit to a Crawlspace
Hi TB – jackoffs is right.
Glad you enjoyed my trying way too hard on that article! Much obliged.
PK recently posted..Predicting S&P 500 Closing Prices – April 2012 Edition
Trying too hard? I think you wrote that with one hand tied behind your back.
Thank you for the mention!
I taught my kids not to take other kids toys when they were 3 years old. You’d think a leader of a nation could figure out that when you don’t play nice, no one wants to play with you.
Wayne @ Young Family Finance recently posted..5 Tips to Save Money on Your Grocery Bill
Basic kindergarten rules, aren’t they? Clean up after yourself, share your lunch, and take afternoon nap time. Not too hard…
Wasn’t it actually Cliff on Cheers who told us that alcohol was good for your brain? Something about thinning out the herd?
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