a) An influential Saudi Prince calls for greater use of hybrid cars
b) French President Jacques Chirac calls for six month moratorium on wine exports
c) George Bush urges Americans to limit meals at McDonald’s to once a week
d) Argentina’s President Nestor Kirchner imposes a 180 day ban on exports of Argentine beef
And the answer is….D!
Yes, afraid of inflation that’s running as fast as a Pamplona bull (and the fastest in the region last quarter at 2.9%), the administration of Argentine President Kirchner has imposed a near total ban on beef exports. What?!? Why clobber a leading sector? In a bizarre piece of macroeconomic reasoning, the theory driving this decision holds that redirecting the beef exports will flood the domestic market with beef and bring prices down. Prices fell almost 15 percent after the news on March 8, but the sector is hurting and cattle farmers and processors may lay off 10,000 workers, lose $1 billion, and continue a switch to soybeans…(Economist, Bloomberg)
Let’s hope he doesn’t think about an export ban on wine!
Photo credit: AP