Raiding a “cave”: who puts the price on blue and how it works

They say that the blue dollar belongs to a small, “marginal” market, where black money circulates and there is little information. And while these last two points are true, characteristics that all informal transactions share, Since the government tightened the conditions to access official dollars, the little trees and caves saw business flourish again.

The illegal US foreign exchange market is not new. It was not born with the arrival of the exchange stock at the end of 2019, nor during the second presidency of Cristina Kirchner, when the blue became relevant again. The first records date back almost a century, when the buying and selling of dollars in the informal sector became part of the functioning of the Argentine economy.

In some cases, they mark the beginning in 1931, when the Government of José E. Uriburu implemented an exchange control due to the crisis of the year 29. Since then, the relevance in this market has changed according to the measures implemented by the different governments. . Today, the caves are once again part of the daily life of Argentines.

Do you know since when the little tree exists, our work? Since 1919. At that time foreign silver was exchanged for gold, for pesos, for food. Argentina is a country that is mentally dollarized, since I was little, my father wanted to buy dollars and he was a worker. Now I’m about to leave the business, I’ve been working on the street for almost 40 years,” added a little tree from downtown Buenos Aires.

In the caves they admit that today “this is no man’s land”. On Florida Street, a nerve center for currency exchange, between one small tree and another there are only a few meters apart. They yell “change, change”, even when the police are prowling the streets. Perhaps for this reason, and due to requests made in July by the ruling party itself to reinforce controls, this Tuesday the Agricultural Security Police (PSA) together with the Central Bank (BCRA) raided a cave in the city Buenos Aires for infraction of the Penal Exchange Regime.

Little trees from Buenos Aires receive minute-by-minute quotes via WhatApp Gerardo Viercovich

From the Government they say that it is a “marginal, very small” business, according to the statements issued by the Government spokesperson, Gabriela Cerruti, a month ago. Inside doors they deny it and say that even today, there are days when operations of up to US$50,000 per head are carried out. That large companies change, especially after the restrictions to import. “If the Argentine cannot go to the bank, where else will he buy?” ironically one of the sellers of the green ticket.

But, who decides how much the blue dollar is worth? The little trees, which are the street vendors that circulate throughout Florida, are just the last link in the chain. They usually work on commission, and each one has a different status inside the cave, the parallel window of the exchange houses. They are receiving the update of the price of the selling and buying points by WhatsApp, that their brokers or brokers pass them.

“It is not that it is defined by speculation. It is defined by expectations. The same ones that operate in black are the ones that operate in white, so they make decisions for both markets because they understand their connection”, he explained to THE NATION a former finance specialist who asked that his name be withheld.

The variables that determine the minute-by-minute price of the dollar are multiple. The intervention of the Central Bank, tightening of the exchange rate and Treasury issuance, usually make the price rise. On the other hand, when “helping hands” appear and flood the market with dollars, the price calms down.

Those who work in this illegal market They take it for granted that the big players in the industry have regular dialogue with governments. Today the blue is sold at $292, $3 less than yesterday. The value was far from the $338 in July (a difference of $46), the highest price on record.

According to experienced brokers, contrary to popular belief, the price of the dollar is not defined on Florida Street or by supply and demand. “Yes, it is true that the price of blue is from Buenos Aires and has an impact throughout the country, although there are price differences. The only ones who really know how the market works are the money changers. senior and the red circle of stock companies that operate on the left”, assured a veteran of the field.

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