Why You Should Get Ready for Capital Controls in America
by Bill Bonner
March 23, 2013
“Can you by legislation add one farthing to the wealth of the country?” The great classical-liberal thinker Richard Cobden asked the House of Commons on Feb. 27, 1846.
The Argentines think so. So do the Europeans. And of course, the Americans.
But first let us continue with Cobden’s remarks:
“You may, by legislation, in one evening, destroy the fruits and accumulations of a century of labour; but I defy you to show me how, by the legislation of this House, you can add one farthing to the wealth of the country.”
Two news items yesterday reminded us how vain and treacherous the politicians can be.
First, from the Argentine press came a story with the following headline: “Kirchner Government to Tighten Capital Controls.”
Uh oh! It’s already a pain in the neck to try to keep the lights on south of the Rio de la Plata. If you move money into the country officially, you will take about a beating. Officially, the exchange rate is under six pesos to the dollar. But guys will come up to you on the street and offer you eight pesos to the dollar – and more.
In Salta, for example, you pull up in front of a bank at the corner of the central square. You beckon to one of the many money changers standing on the sidewalk. You don’t get out of your car.