Argentineans' dollar love affair heated up in the 1990s, during the one-for-one exchange rate initiated by then-President Carlos Menem. The middle classes flocked to Miami, buying up the latest niceties to furnish their apartments. As the economy crashed, the dollar became the de rigueur saving currency — often stored under beds or in safety deposit boxes, away from the unreliable banks — when faced with an inflationary peso.
"Argentina has seen a significant amount of money leaving the system over the last five years, some $80 billion," says Gabriela Nudel, head economist at Fundacion Capital, a financial consulting firm in Buenos Aires, referring to the dollar savings Argentineans tend to keep out of the banks.
"This made the government decide to tackle the issue in a questionable manner — by closing off the ability for the money to leave the system. This, of course, has created a parallel, or informal, market."
Today an unofficial inflation rate of 25 percent and fears of another economic crash make Argentineans very uneasy. Even though they cannot buy legally, those with the ability to save — the middle class and above — are prepared to pay poor black market rates to have their precious dollars.
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