One piece of evidence is what has happened to Argentina’s country risk since he was elected.
The above chart comes from a Bloomberg report authored by David Feliba. Here are some excerpts.
A key measure of Argentina’s sovereign risk fell to its lowest level in seven years as policy changes by President Javier Milei’s administration left the nation closer to a return to international debt markets. The extra yield investors demand to hold Argentina’s sovereign debt over US Treasuries with similar maturity fell below 559 basis points on Friday, according to a JPMorgan index. The spread, which is now at the lowest since July 2018, has almost halved since Argentina’s midterm elections in late October when Milei’s party won by more than expected and more than doubled its seats in Congress.
I also think a recent editorial from the Washington Post makes a key point about Milei delivering results rather than mere rhetoric.
Since his surprise win in December 2023, the economist-turned-president has made it his mission at Davos to make an unabashed and optimistic case for capitalism. This year was no exception. …He speaks from experience. When he entered the Casa Rosada, inflation was running at 25 percent month-on-month. The resource-rich country had fallen into abject poverty. Milei’s relentless pursuit of free market reforms is working. He turned a fiscal deficit of 15 percent of his gross domestic product into a small fiscal surplus, slowing the inflation rate to 2.8 percent, and reducing poverty levels from nearly 60 percent to around 30 percent. …he’s made 13,500 reforms since taking office to make the economy more dynamic. …Trump is often credited with delivering hard truths to Davos attendees, but it’s Milei’s policies that are actually upending the status quo. Unlike Trump, the self-proclaimed anarcho-capitalist has been working to eradicate trade barriers… But what truly sets the Argentine president apart from other leaders is his desire to reduce his own power and control.
Authored by Jeremy Mckeown, it highlights some of Milei’s achievements.
Argentinians have lived through a high-stakes experiment in fiscal discipline and deregulation. For investors looking on, there has been a remarkable macroeconomic stabilisation with plummeting inflation amid early signs of robust economic growth. …Milei has added valuable extra time. His success matters beyond Argentina. Milei’s overarching achievement so far has been to strangle the hyperinflation that threatened to consume the nation in 2023. He inherited an economy on the brink of collapse, with an annualised inflation rate of 15,000%, a fiscal deficit equivalent to 15% of GDP, and no borrowing capacity. His response was immediate and uncompromising. In the words of his British political hero, there was no alternative. Milei slashed public spending, cutting the number of government ministries by more than half and laying off tens of thousands of public workers. By March 2024, Argentina recorded its first fiscal surplus in a generation. The effect on prices was dramatic. …for Argentinians, …with Milei, they have a man honest enough to tell them the truth and survive.
Some of the numbers are repetitive, though I can never get enough of good news.
But I mostly wanted to share his final story because of the observation that Milei is unique, not just because of his support for good policy, but also because he tells the truth (and wins elections).
