The Argentine economy not only leaves its mark on the pocket, but also weighs on the mind. After decades marked by constant inflation, confiscations, defaults and changing course without warning, what remains is not just a tenuous relationship with money. It is an economic identity built, first and foremost, on mistrust. This mistrust is passed on from generation to generation. There are those who have never experienced Rodriguez and are not familiar with Bonnix’s plan, but they act as if they have. You don’t have to have lost your savings in 2001 to feel like the system might collapse again, without warning. For this reason, the reaction of many Argentines becomes almost automatic: If there are doubts, it is best to protect yourself. Whether in dollars, real estate, or even inaction. Sometimes, you don’t even want to win. The goal is to avoid the next hit. This defensive approach extends across generations and income levels. The phrase “I’d rather sleep in peace” It is repeated everywhere. But that calmness that gives a certain tranquility in the short term (saving without investing, not taking risks, not trusting) is also Also what ends up weakening Heritage over time. In today’s column we will delve deeper into this “silver” shock and offer potential solutions for those who suffer from it. Let’s get started!
Behavioral economics and the Argentine financial shock
Behavioral economics studies how emotions, mental biases, and habits influence our decisions about money. In contrast to the traditional view (which assumes that people always act rationally), this trend is based on a more realistic idea: people make decisions not with a spreadsheet, but with their memories and experiences. In Argentina, those have histories and names; Like Rodriguez, stocks, and hyperinflation in 1989 or Corralito in 2001. Each of these events left deep emotional marks, which continue to exist and influence financial behavior, even many years later. In this context, there are two particularly strong psychological biases in the mind of the Argentine saver or investor:1. Loss aversion: Losing a million pesos hurts more than the joy that comes with winning it. The mind magnifies the risks and minimizes the benefits. Therefore, when faced with an opportunity, the most common reaction is to avoid the strike, not to exploit the opportunity. The priority is not growth, but not losing.2. Availability: The most powerful memories, especially negative ones, remain closer to memory. Thus, despite the passing years, the 2001 default or the 2018 exchange rate run are still present and the mind uses them as an immediate reference every time a new sign of uncertainty appears. Although the context has changed, fear is still reinvigorated. These two biases combine into an emotional defense pattern. The person who has lost his savings in the Australs, or who has not been able to withdraw his money from the bank for twenty years, has learned an emotional thought that is difficult to unpack.: “If I trust the Argentine financial system, I will lose“. This idea was passed down orally, and over time it ended up coming true. The greater the distrust, the less investment. The less investment, the greater the recession. Thus was born a culture of asylum: dollars in bills, safe deposit boxes, empty apartments, and foreign accounts with no return. These are not financial strategies, but rather forms of control in the face of a seemingly unpredictable environment. but This control has a very high cost, because by not moving capital you lose power in the face of inflation, you lose opportunity in the face of technological changes, and you are excluded from the global financial system that is developing very rapidly. As the world adapts to new forms of investment (tokenized assets, decentralized finance, international index funds), much of Argentina continues to measure its stability by the number of physical banknotes they can count. This does not indicate deficiency, but rather shock. Shocks are repaired with time and trust. When the day comes when more people can see a market decline without panic, or a jump in the dollar without running to the bank, then on that day we will have made a huge leap as a society. Because learning about finances not only improves investments, it is also the most direct way to reduce knee-jerk reactions that the country’s economic history has left us.
Fear of Winning: When success makes you uncomfortable
More than two decades ago, an Argentine president said:We are destined to succeed“This phrase, instead of arousing enthusiasm, aroused doubts. Rather, a bitter smile. Because the problem actually seemed to be something else: the fear of winning. In local culture, failure is not surprising, but expected. Success, on the other hand, is uncomfortable. To say things are going well seems foolhardy. Displaying personal or financial stability can generate discomfort, as if enjoying accomplishments is a cause for doubt. After many years of inflation, instability and losses, progress began to be seen as risky. In Argentina, this pattern appears all the time: Someone invests in cryptocurrencies, but withdraws with minimal profit “in case it goes down”. Another buys shares and Sell before it starts to rise. There are those who have accumulated dollars for years, and when they have the possibility of using them to buy a property, they stop for fear of losing them. Thus a strong contradiction arises: we talk about money all the time, but when it is earned, discomfort appears. Thus the frequently heard phrase is reinforced: “You can’t here“This phrase, because it is repeated so often, becomes a limit. Even stronger than any real economic barrier.
conclusion
Perhaps the real challenge facing Argentina is psychological, not economic. We have become experts at spotting signs of crisis, but not at anticipating good times. So, when something starts going wrong, the first thing that appears is doubt. “This won’t last“This reflex, which once helped us protect ourselves, today acts as a brake. It is no longer the context that limits, but the way we think about what is to come. The solution is not only to achieve economic stability.”. Something deeper is needed: emotional education for success. Learn how to accept positive results without fear. Perhaps the phrase “We are destined to succeed” was not just a slogan, but rather a way to name the contradiction. We have the capabilities, talent and creativity. What we lack is the shared trust to maintain what we achieve. The day we can sustain success without thinking that it interrupts our history, something will truly change. Next week we will continue with more material on personal finance and investments.
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