History Blog 2
Buenos Aires Travel Blog› entry 1 of 2 › view all entries
A decade ago, Argentina was a rising economic power. Many people were investing in the economy. Billions of dollars came into Argentina in the form of bonds. Because Argentina was a new economic power, people were rapidly investing into Argentina. At one point, Argentina was rated the best growing economy. However, the economy crashed in 2001 causing masses amounts of inflation. Not only was the Argentina economy in turmoil, but they owed billions of dollars in debt. The Buenos Aires Harald had an article that related to the Argentina debt issue.
Part of the assets that Argentina currently has in the United States have been frozen and bondholders hope to retain Argentina assets overseas. “Argentina has been locked out of international debt markets since 2002 sovereign default and bondholders have fought in court to recover assets they have already won in judgments.” Recently, with all the debt problems in Argentina, the country’s treasury has been relying on the state-run pensions. These pensions have quite a bit of money after the government nationalized private pension fund assets in late 2008. The total debt that Argentina had in late 2008 was US$146 billion. In addition to the debt, there is some US$28 billion in obligations due in 2009.
Though Kirschner got Argentina out of debt with the IMF, there are still many problems that Argentina’s economy needs to overcome. United States courts are already ruling in favor of the bond holders. On a visit to the Argentina Central Bank, economists were open about this problem and say that they are keeping their money out of the United States and in international banks. This is a problem that will be around for many years, regardless of the economic situation that the country finds itself in.
Initially, all I knew about the Argentine culture was what was depicted by the Argentina National soccer team. They represented the epitome of what I thought Argentina was, and looked like. To my surprise, Buenos Aires, Argentina is like a mini United States with vast diversity and immigration from all over Europe. If I were asked what Argentines looked like before my arrival to Buenos Aires, I would say that they were tan and showed signs of Hispanic background. However, Argentina has many immigrants of Jewish, German, French, Italian, and Spanish background, making Argentina one of the most European South American Countries. When talking to a local taxi driver about how European Buenos Aires looks, he simply chuckled and stated that it was Brazil’s “European” escape without actually going overseas. Initially I would not have expected it to be so Europeanized, but there are many things that still resemble and take after their mother countries in Europe. The architecture that is revered the most in Buenos Aires by tour guides and cab drivers are the columns in the center of the city inspired by the Romans and Greeks, and the French Architects’ water cleansing facility. Both are beautiful features, but I would have expected to have seen old huts and Aztec like buildings, assuming I did not spend any time researching the history of Argentina. In fact, there is little influence from any of the indigenous people from Argentina. The natives are looked down upon as a lower level of society; therefore, the European influences dominate the Argentine culture. After my initial reaction of the country, I am excited to see how Argentina’s history plays a role in forming the country the way that it is remembered.
Argentina is a vast field of talented soccer players. There are currently many institutions that are put in place to develop the next soccer phenomenon. One of the best soccer clubs in doing this is Boca Juniors. But how are programs funded to build up the soccer program and where does most of the income come from?
Flipping through the Buenos Aires Herald, an article was strikingly appealing to me about trades that Boca Juniors hopes to make. The article summarizes hopes in replacing current coach, Carlos Ischia, with Mariano Pavone and Clemente Rodriguez. Not only them, but hopes to retrieve Mexican forward, Federico Insua. The article states that Pavone could be a part of Boca as early as July. This is about the time final negotiations on the loan of defender Fabiam Monzon to Spanish club team Betis. Betis was said to pay the Boca club team around 6 million Euros to keep Monzon.
This brings up a very interesting form of income. Club teams can build up money to fund soccer programs and stadiums by loaning out players. Loaning the player is an investment for clubs. Not only are they given a monetary compensation for the loan, but they can advertise their players to the rest of the world, or to the other club’s fans. If successful, like in Monzon’s case, a club like Boca could profit with a lump sum of cash or with another trade with the club.
April 2009 soccer magazine Four Four Two demonstrates exactly how Boca Juniors hit the jackpot with their club. Previous CEO of a car factory, Mauricio Macri, wanted to develop a youth program in the Boca Juniors club to prevent large spending on player recruits. This allowed for Boca to reach its highest level of success. Boca has now sold hundreds of developed players to dozens of countries all over the world. This has allowed the club to expand and build up the Boca program. Boca is one of the most profitable club teams in Argentina and is currently still growing. With players like Carlos Tevez, Fernando Gago, and Ever Banega coming from the Boca soccer school, it is easy to see why Boca Juniors has just begun its success story.
The identity of Argentina can simply be described in one word, futbol. Futbol originated in Europe and was brought over to Argentina in the early 19th century. Futbol, soccer in English, has one of the strongest economic and social impacts to Argentina. I was lucky enough to go to a Ferro game and see the intensity and the passion involved in a soccer game. I grew up playing soccer, but I have never seen a crowd cheer the way that they did; “…dale dale dale… Ferro.” You feel prideful for the team, even if you were not a fan. I do not know, however, how prideful some of these people are with the sport, or simply with the violence involved with competition. You hear it everywhere of the murders and beatings that happen from soccer teams. Ultimately, being the cause of why in second division teams both fans of opposing teams cannot attend the match. The stadium was half full, which is sad because the stadium would have been a near sell out if both teams’ fans attended. This must be a burden on the financial situation of these smaller club teams. Neither team can raise enough to pay their players a great amount of money, so most leave to other clubs, if good enough. Financially, Argentina’s soccer teams should be in a state where they can have clean soccer stadiums, and decent money for players. It seems otherwise. Even though I love the game, part of the reason why I do is because in the United States there is not as much competition and violence involved. I would definitely love the attention of fans, but it is not worth the lives of the opposing teams’ fans. Argentina definitely revolves around soccer, and if you put the numbers in perspective, there may be about 500,000 people on a given weekend at a game. The numbers would be higher if stadiums allowed fans from both teams to attend. The GA Dome fits about 71,500 seats. Futbol has a major role in who and what an Argentine represents. I hope to further improve my understanding of soccer and the economic effects.