00:00There are media outlets reporting that Scott Bessent, the U.S. Treasury Secretary, has outlined financial aid to that country that would total $40 billion.
00:08For more, let's bring in Bloomberg's Mike McKee. Mike, from what we understand, are there conditions tied to this?
00:14Are there strings attached to up to $40 billion of aid from the United States to Argentina?
00:20Well, the administration hasn't made a whole lot clear about any of this yet, Scarlett.
00:24We don't even know about the original $20 billion, whether it's a true swap line where they give us pesos and we lend them dollars and then we exchange them back eventually.
00:32And now Scott Bessent is talking about a $20 billion private fund made up of individual investors and, he says, sovereign wealth funds that would be interested in buying Argentine debt or making investments in Argentina.
00:48That's all we know at this point. And of course, the idea of somebody spending $20 billion to buy bonds in Argentina, given Argentina's track record of paying it back, they already owe billions, tens of billions to the IMF, seems a little fanciful.
01:05So we're not exactly sure how all of this is going to work.
01:08And I'm so glad you bring up Argentina's track record of paying back loans or perhaps its spotty track record here.
01:17Why is the U.S. under President Trump, who of course has put forward this America First mandate, so invested in Argentina and its economy?
01:25It's a real mystery to an awful lot of people because the Argentines have had a very bad track record, as you note, in paying back loans.
01:36They've defaulted any number of times. And there's some thought that they're not on the right path right now.
01:42They've got an election coming up. And if President Mille's party doesn't get a big enough vote in the legislative elections, then he's not going to be able to push through his reforms.
01:52And the president says, of course, then we're not going to give him any aid at all.
01:56That sent the peso back lower. And the U.S. intervened in currency markets again today, Scott Besson said.
02:04But why? That's a really good question. A lot of Americans are asking that question, particularly farmers, because China has been buying Argentine soybeans instead of U.S.
02:14soybeans, and that's one of the reasons the soybean farmers are in trouble. So we don't really know.
02:18There's some speculation that what's happened is a lot of U.S. hedge fund managers who are friends with Scott Besson bought up Argentine debt on the cheap,
02:28anticipating that maybe there would be a turnaround there and they could make some money on it. And this is an effort to try to get them whole.
02:37The problem with that, of course, is that would be kind of illegal and it certainly would reflect very badly on the administration.
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