Argentina

A Country at the Floor

Argentina in January 2023 had been in a slow-motion crisis for years: serial defaults, triple-digit inflation, capital controls, a currency in freefall. By 2023, the bad news was fully priced in — and then some. When an asset has been sold down to reflect maximum pessimism, the only question is what the catalyst for mean reversion looks like.

The Milei Bet

Javier Milei was not yet president in January 2023 — but the political trajectory was visible. A radical libertarian economist running on a platform of dollarization, massive government spending cuts, and deregulation was gaining ground in a country where the population had lived through the consequences of statist economics for decades.

The thesis: if Milei wins, Argentine companies gain from reduced government intervention, lower public sector debt, and the credibility that comes with a genuine reform mandate. Less government spending means safer debt. Safer debt means investable country. Investable country means capital inflows. Milei won in November 2023. The market priced the certainty.

The Exit

January 2024. +51.9%. Argentina was no longer undervalued. The narrative had been priced, the reform story was known, and better opportunities had emerged. The discipline of asset reallocation is knowing when a thesis is complete.

Argentina became a fairly priced country. The capital moved to the next mispriced one.