San Carlos de Bariloche

The blue dollar market

The blue dollar market is, at a very basic level, an illegal currency exchange. Beginning in 2010 to the end of 2015, the Argentinian president set a pesos-to-dollars exchange rate that was, more-or-less, fake. Argentinians could not buy US dollars at the “official” rate. For example, the exchange rate was 8 pesos to 1 US dollar. Argentinians believed that the dollar was worth more, say 15 pesos to 1 US dollar.

Out of this, a black currency exchange market emerged known as the “dolar [sic] blue” or Blue Dollar Market. For tourists, their foreign currency was suddenly going much further when exchanged on the “blue dollar market” than when exchanged at a bank or formal currency exchange kiosk and in return, Argentinian pockets were being filled with stable currencies such as the US dollar and Euro.

In December 2015, a new president assumed office and the financial restrictions were lifted, thus mostly killing the blue dollar market. We were skeptical of the blue dollar market for many reasons and for the first few days in Argentina, we withdrew pesos via ATMs. There was one big problem with withdrawing from ATMs: Withdrawal fees.

The maximum withdrawal amount varied from ATM to ATM. The highest withdrawal amount we encountered was 2,400 pesos (~$160). Regardless of the amount withdrawn, we were being hit with a 90 peso (~$6) ATM withdrawal fee plus a foreign withdrawal fee from our bank in the US. Argentina is cash-heavy society so cash was flying out of our pockets and the withdrawal fees were adding up quickly. We we were constantly withdrawing cash and really started to consider tapping into the blue dollar market, knowing that the blue dollar market rate was likely close or equal to the floating “official” rate (at the time of visiting, the “official” exchange rate hovered around 15 pesos to one US dollar).

Bored to tears on our one full, rainy day in San Carlos de Bariloche, we found ourselves walking down the main shopping street when suddenly men started yelling at us, “Cambio! Cambio! Dollars! Euros! Cambio!” We ignored the first couple hecklers but then Peter made the decision that we should, at a minimum, find out what the blue dollar market rate was, so we randomly chose an “arbolito” (literally translated into “little tree”, because they stay in one place for hours and exchange green paper) and he swiftly and quietly led us down a narrow corridor and to the door of a fake perfume shop tucked away in the back of an indoor strip mall (as best I can describe it).

He unlocked the door to the perfume shop and invited us inside. We were followed into the shop by a second man who seemingly came out of nowhere. The second man shut the door. I looked around and noted two shelving units, similar to jewelry cases, filled with empty perfume bottles. There was no cash register, no signage, nothing. Just a bunch of empty perfume bottles in jewelry cases.

The arbolito asked Peter what currency he would like to exchange and Peter answered, “US dollars” and the arbolito said that he would pay 15 pesos to one dollar. This was the “official” exchange rate but we would not incur any ATM withdrawal fees, so a win for us. The arbolito then asked how many dollars we would like to exchange and Peter responded, “$160 dollars” and pulled out a wad of cash and I thought, “Oh god. This is how we die! In a fake perfume shop!”

The arbolito reached behind one of the jewelry cases and picked up a plastic grocery bag filled with rolls and rolls and rolls of Argentinian pesos. I think my eyeballs temporarily fell out of my head when he started pulling cash out of the grocery bag. He calculated the amount, they exchanged currencies and the four of us left the fake shop and walked out to the street and went our separate ways. It was a surreal experience.

The next step was to test the currency to see if it was real or counterfeit. We went to lunch and paid with the currency and it worked! We immediately regretted not exchanging more money with our arbolito and became determined to find him again except we could not find him and we did not want to take another chance with another arbolito (looking back, we should have taken that chance) so on we went and quickly ran out of cash again and had to revert back to withdrawing money from ATMs.

So there you have it. The blue dollar market still exists and though you likely will not be able to exchange foreign currencies for more pesos than the “official” rate, you will be able to escape the grips of ATMs fees and maximum withdrawal restrictions.

Exchange at your own risk.

0 comments on “The blue dollar market

What's on your mind?

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

This site uses Akismet to reduce spam. Learn how your comment data is processed.