ABSTRACT
The productive and financial sides of the economy are of course closely interrelated. Argentina's fiscal and monetary chaos must be sorted out if the country is to negotiate payment of the foreign debt on terms compatible with its economic sovereignty. The fall of the economy's rate of monétisation and the disproportionate growth of financial institutions and allied companies have led to dealers' costs that amount to approximately 20 per cent of every peso lent. The 1976-83 military regimes bequeathed an insolvent economy and a disastrous economic and social situation to the constitutional government. One of the measures needed is a realistic approach to the foreign-debt service payment. This will help Argentina out of its current insolvency and will reestablish the conditions for the Argentine economy's international viability. In an economy where monetary assets represent only a small proportion of the total capital stock and of private savings, the public sector borrowing requirement cannot be met by purchasing private monetary assets.
