Argentina economy crisis - part II

Following advice from the IMF, political decisions lead to a law which restored the peso instead of austral, keeping the value fixed at one dollar equaling one peso and both currencies easily convertible. The convertibility law resulted with a sharp drop in inflation, restored price stability and preserved the value of the national currency. During the 1990's Argentina economic boom was considered a great success. But in 2001, the Argentina was no longer able to meet the debt payments. The government declared a default on the larger part of the public debt, in total of more than $132 billion. People began to fear the worst and started withdrawing large amounts of money from their bank accounts, simultaneously turning pesos into dollars. Most of the money was sent abroad, while many more bank runs took place in homeland. Read more about the Argentina economic crisis...