As countries across the world try to cope with rising prices, there is perhaps no major economy that understands how to live with inflation better than Argentina.
The country has struggled with rapidly rising prices for much of the past 50 years. During a chaotic stretch in the late 1980s, inflation hit a nearly unbelievable 3,000 percent and residents rushed to snatch up groceries before clerks with price guns could make their rounds. Now high inflation is back, exceeding 30 percent every year since 2018.
To understand how Argentines cope, we spent two weeks in and around Buenos Aires, talking to economists, politicians, farmers, restaurateurs, realtors, barbers, taxi drivers, money changers, street performers, street vendors and the unemployed.
The economy is not always the best conversation starter, but in Argentina, it animated just about everyone, eliciting curses, deep sighs and informed opinions about monetary policy. One woman happily showed off her hiding spot for a wad of U.S. dollars (an old ski jacket), another explained how she stuffed cash into her bra to buy a condo, and a Venezuelan waitress wondered whether she had immigrated to the right country.
One thing became strikingly clear: Argentines have developed a highly unusual relationship with their money.
They spend their pesos as quickly as they get them. They buy everything from TVs to potato peelers in installments. They don’t trust banks. They hardly use credit. And after years of constant price hikes, they are left with little idea of how much things should cost.
Argentina shows that people will find a way to adapt to years of high inflation, living in an economy that is impossible to fathom almost anywhere else in the world. Life is especially manageable for those with the means to make the upside-down system work. But all those striking workarounds mean that few who have held political power during years of economic distress have found themselves paying a real price.