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BBVA Banco Franc Message Board

  • dasamaru40 dasamaru40 Dec 27, 2012 12:54 PM Flag

    improvisation in the Argentine economy

    To repair the damage caused by the government's policy of equal value of imports for equal value of exports, the business paradigm is now changing in Argentina and without contradicting the opponents of the government's policy, the new business approach to survival and prosperity may actually be a very positive development. In the U.S.A., prior to the late 1960s and early 1970s, the conglomerate form of business was fashionable; afterwards, it changed into the congeneric form of a business model. The term' congeneric' is rarely if ever, mentioned or referred to any longer. I have not seen the term in print for decades. For Wall Street analysts, they preferred the congeneric form because it was much easier to understand and took less time to write-up the research reports , particularly when they were required to follow so many companies and to grind-out the research reports for institutions and for the retail network. In Argentina, under rampaging inflation, the conglomerate form of business was much safer than the congeneric form because multiple lines of different businesses insulated the holding company from the shock or implosion of any one or more businesses.Critics of the present government of Argentina should show patience and delay passing a negative judgment on the new economic policy. This new policy , coupled with the great abilities of the Argentinian business leadership may in fact, make the economy stronger and less vulnerable to risk over a longer period of time, even though the ROE may be lower, as companies enter new lines of business that are basically unfamiliar to them.

    Sentiment: Buy

 
BFR
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