inflation

[from V. S. Naipaul's The Return of Eva Perón, André Deutsch Limited, 1980]

The peso has gone to hell: from 5 to the dollar in 1947, to 16 in 1949, 250 in 1966, 400 in 1970, 420 in June [1971], 960 in April [1972], 1100 in May. Inflation, which has been running at a steady 25 percent since the Perón days, has now jumped to 60 percent. The banks are offering 24 percent interest.

. . . it is a nightmare. It is almost impossible to put together capital; and even then, if you are thinking of buying a flat, a delay of a week can cost you two or three hundred U.S. dollars (many business people prefer to deal in dollars). Salaries, prices, the exchange rate: everyone talks money, everyone who can afford it buys dollars on the black market. And soon even the visitor is touched by the hysteria. In two months a hotel room rises from 7000 pesos to 9000, a tin of tobacco from 630 to 820. Money has to be changed in small amounts; the market has to be watched. The peso drops one day to 1250 to the dollar. Is this a freak, or the beginning of a new decline? To hesitate that day was to lose: the peso bounced back to 1100. "You begin to feel," says Norman Thomas di Giovanni, the translator of Borges, who has come to the end of his three-year stint in Buenos Aires, "that you are spending the best years of your life at the moneychanger's. I go there some afternoons the way other people go shopping. Just to see what's being offered."

The blanket wage rises that the government decrees from time to time – 15 percent in May, and another 15 percent promised soon – cannot keep pace with prices. "We've got to the stage," the ambassador's wife says, "when we can calculate the time between the increase in wages and the increase in prices." People take a second job and sometimes a third. Everyone is obsessed with the need to make more money and at the same time to spend quickly. People gamble. Even in the conservative Andean town of Mendoza the casino is full; the patrons are mainly workpeople, whose average wage is the equivalent of fifty dollars. The queues that form all over Buenos Aires on a Thursday are of people waiting to hand in their football-pool coupons. The announcement of the pool results is a weekly national event.