Distributed Confidence and Monetary Value: Notes from Argentina

The value of a currency is quite often inextricably linked to questions of political legitimacy. Nowhere has this cliché been more true than in Argentina between 2011 and 2015. During that period, public life was marked by vociferous debates among experts and lay people alike about the nature of inflation, currency controls, and the dólar blue, an illegal but highly visible market for U.S. dollars. This paper examines the discourses and practices that made up dólar blue in order to sketch the folk theories of monetary value that animated those debates. In particular, I draw out the antinomy between state and market theories of monetary value and the everyday practices of arbitrage that antinomy made possible. I show that these practices of arbitrage articulated formal and informal currency markets with one another such that various monetary functions were priced and performed differentially. This distribution of monetary functions produced a paradoxical financial system, capable of forestalling outright economic crisis, but only at the cost of its own popular legitimacy. In this context of generalized, small-scale arbitrage, trust—in the usual sense of an open-ended and unspoken confidence in the stability of the value of a currency—was, quite simply, not at issue. Situating this dynamic within the longer-term history of Argentine currency regimes and the contemporary reality of the U.S. dollar as a global reserve currency, I argue that the particular case of dólar blue highlights a more general paradox that lies at the heart of the sort of trust that undergirds monetary value and political legitimacy.