For several decades now, economics has been related much more to a social science, such as psychology or sociology, than to mathematics. In this sense, there was a “divorce” between the exact sciences and the assumption of the rationality of economic agents, the basis of the postulates of classical economics that governed the theory from the late eighteenth century to the first half of the twentieth century.
What makes the study of economics so exciting is the fact that it is related to human behavior, and this does not always link with the specific data of the macro or of each sector in particular.
In this change of roles, previously unthinkable situations occur, such as the Nobel Prize in Economics awarded in 2002 to Daniel Kahneman (a psychologist) for his theory on economic behavior in contexts of uncertainty. or even the one awarded in 2006 to the prestigious economist Edmund Phelps for his studies related to expectation dynamics as an explanation of the inflationary phenomenon.
The sum of the millions of micro-decisions (take vacations, change an appliance, buy new clothes, pay for a course, promote a venture, or buy new equipment for my company) are those that move the gears of economic activity, and each and every one of these resolutions is based on a single determining element: EXPECTATIONS
What’s happening in Argentina?
These factors imply a “cycle transition” in the Argentine economy, which is still influenced by a number of factors. In this sense, these six months of electoral political definitions are fundamental, although there are contextual conditions, such as the profound changes in international geopolitics that have put the most important countries in Latin America back in the focus of powers such as China, the United States, and the European Union, and the change underway in the export matrix of our country, which are explanatory of the change.
In the middle of last year, the trend break in terms of growth of positive expectations related to improvements in the economic situation for the coming years was striking. This trend, accompanied by a decreasing negative expectation, has been accelerating since the last quarter of 2022.
According to data from the consulting firm Analogas, by May of this year and more markedly in June, some of the main surveys related to expectations even marked a “crossing of curves,” where the positive perspectives exceeded the negative ones, something that has not occurred since December 2019.
The demystification of the official formula has led to a significant increase in listed financial assets (mainly corporate stocks and public and private bonds), but what about pricing in other sectors?
In the case of real estate, a relevant asset for the common investor due to its use as a store of wealth and a source of profit, prices stabilized in the fourth quarter of 2022, reversing the four-year drop that began in 2018. This tendency began to turn gradually in the first quarter of this year and is still continuing.
