Re: Argentina 
Over the last two years, Fernandez's government has resorted to paying private
 creditors with central bank reserves left over after what the bank needs
 to back up cash in the economy. Those excess reserves have shrunk to near zero
, prompting Fernandez to request a change in the "convertibility" law.
 "We have to know that the central bank is functioning for the good of the real 
economy," the charismatic 59-year-old leader said during the speech.
 The bank has about $46.9 billion in total foreign currency reserves. 
"This is a negative development," said Alberto Ramos, co-head of Latin America
 research at Goldman Sachs, who pointed out the risk that the new policy could 
stoke already high inflation.
 "Reserve transfers to the Treasury are debasing the balance sheet of the central 
bank and contributing to financing an admittedly expansionary and pro-cyclical 
fiscal stance, which jointly with an extraordinarily accommodative monetary stance, 
continues to stoke high inflationary pressures," he said.
 Fernandez, beloved by voters who benefit from her generous welfare spending,
 won a second term last year despite rankling Wall Street with policies such as
 raiding central bank reserves and publishing official economic data widely
 seen as unreliable. "Today's announcement shows Argentina has very weak resolve
 in terms of fighting inflation," said Boris Segura, who covers the country for
 Nomura Securities. "Over time this is going to make people less comfortable
 holding Argentine pesos."