Argentina Peso Plunge Becomes Art for Dumpster-Diving CEOCamila Russo
To see the effect of Argentina’s peso devaluation, head to the country’s most popular art show.
Alberto Echegaray, a former adviser to the economy minister who pegged the peso to the dollar at 1-to-1 in 1991, is making his debut at ArteBA with an installation featuring 11 basketball-size glass spheres, each stuffed with 1 million pesos of shredded, out-of-circulation notes. Next to them is a slightly-larger orb filled with $1 million in cut-up dollars, its circumference girded by a metal band labeled “U.S. Fed.”
The idea was to highlight the peso’s drop to 11 per dollar in black-market trading since the peg ended in 2002. Now with the peso at 12 per dollar, Echegaray says he may add another sphere.
The artist, now chief executive officer of a biotech company and formerly an analyst at the Inter-American Development Bank, said he spent two months tailing security trucks leaving the central bank bound for a Buenos Aires dump to scavenge bags of shredded peso bills. Echegaray estimates Argentina destroys as much as 400 million pesos of worn-out cash a week, since the plummeting peso and inflation at more than 30 percent means it takes at least 6 bills to buy a basket of basic goods, up from four bills in 2012. The 100-peso bill ($12) has been Argentina’s biggest denomination for 22 years.
“Destroyed bills are kind of a taboo topic for Argentina,” he said from his office, 10 blocks from the monetary authority. “This is what’s going out the back door of the central bank. It’s the backstage, a reflection of Argentina’s biggest problems: rampant money printing and inflation.”
The piece sits just inside the entrance to the ArteBA venue, La Rural, a revamped 19th-century livestock-fair pavilion. The show, which ends today, draws 100,000 visitors annually, making it Latin America’s largest contemporary art fair. This year 82 galleries are participating in ArteBA from 16 countries including Mexico, the U.S. and Israel. Sponsors include the Brazilian state oil producer Petroleo Brasileiro SA along with McDonald’s Corp. franchisee Arcos Dorados SA and German automaker Mercedes-Benz AG.
On May 21, at a preview two days before the show’s official opening, Echegaray’s exhibit was surrounded by spectators eager to take pictures.
“It’s brilliant,” said Ana Lavarello, a 38-year-old housewife. “I’m seeing the Argentine reality before me. This is a visual manifestation of the loss of value of the peso.”
Two decades ago, Economy Minister Domingo Cavallo fixed the number of pesos to Argentina’s dollar reserves at 1-to-1, squashing hyperinflation of 1,300 percent. The system also contributed to Argentina’s record default on $95 billion of debt in 2001 as the country’s exports became expensive relative to peers.
Following the default, Argentina restricted access to bank accounts, a measure dubbed the “corralito.” Early the next year, the country ended the peg with the U.S. currency and cut dollar savings by one-third by converting them into pesos.
Echegaray, who uses the nom d’artiste Cayman, says he became interested in governments’ currency policies after he helped Cavallo found Accion por la Republica party, under which the former economy minister unsuccessfully ran for president in 1999.
He has also collected worn out euros, Swiss francs and Brazilian reais as he considers other art projects. Argentina’s pesos were the hardest to obtain because the country’s central bank was the only one that didn’t cooperate, he said.
A central bank official, who asked not to be identified citing internal policy, said the bank doesn’t keep records of destroyed bills and money gone out of circulation. He declined to comment on the exhibit.
Argentina devalued the peso 19 percent in January to 8 per dollar, and it has since slid to 8.06 per dollar in the official market. In the illegal street market, where Argentines go to avoid controls on buying foreign currency, it takes 11.9 pesos to purchase a dollar.
Echegaray says he’s received offers from buyers in Russia, the U.S. and Latin America for individual spheres as well as the entire installation.
“It shows how Argentines think, how we view the dollar as the strong currency,” said fellow artist Elisabeth Verdugo, 52. “It makes it even worse to see all of those dollars destroyed like that.”