Xi’s Not Alone: From Mexico With Distrust

China isn’t the only country actively resisting the “stimulus” certainties which go for inarguable wisdom around most of the rest of the world. Xi Jinping has stated his case very plainly, only no one wants to listen to the dictator; or at least take him literally. People would rather believe there’s only the one way to respond to big economic and financial challenges and furthermore that there aren’t any doubts as to its success.

What the Chinese have asked since 2014 is, what’s the point? If the rest of the world, the formerly globalizing economy, isn’t going to get its act together anytime soon, if ever, then there’s really no need to continue pumping up the financial sector at the same time fiscal authorities waste trillions.

More debt, absolutely, but not more economy.

This is scenario that Mexico and its President Andrés Manuel López Obrador knows only too well. Having been around during the decadent eighties and nineties, surrendering sound currency to the Latin Debt Crisis in one decade only to be devastated again in the next by the so-called Tequila Crisis, AMLO (as Obrador is known) would prefer the more restrained approach.

Mexico’s response to the COVID crisis, or what everyone has been told is directly a result of COVID alone, is among the slimmest. Compared to the rest of the G-20, the Mexican government is by itself at the bottom of the “stimulus” pile-on. When contrasting Latin America’s largest economy, Brazil, with its number two, Mexico, the latter has undertaken one-eighth the fiscal depth of the former.

As you might imagine, Economists worldwide are howling mad. The IMF criticized AMLO’s handling of the economy back in October and has done so again just this month. Its Director of the Western Hemisphere, Alejandro Werner, said recently, “We think they could have done more.”

Sure, they could have done more, but to what end?

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Disclosure: This material has been distributed for informational purposes only. It is the opinion of the author and should not be considered as investment advice or a recommendation of any ...

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