BUENOS AIRES, ARGENTINA, MAY 13, 2012: It is said that the three most important things to Argentinians are tango, football and steak. While this observation is a bit tongue in cheek, it does hit the mark in describing the breezy side of the Argentinian national character.

Four years ago, my wife and I spent a month in Buenos Aires on our first trip around the planet. This is my third solo adventure around our wonderful world, and I just arrived in Buenos Aires where nothing seems to have changed in the “Paris of South America”.

There are still protests/demonstrations of some kind practically every day. Counterfeit Argentinian currency is prevalent and, now, being dispensed from bank ATM machines. The government is still getting in arguments with Britain over the Falkland or should I say Malvinas Islands.

Public/private corruption is still pervasive and an accepted way of governing with the consequences that public officials are corrupted, critical public services are often inadequately provided and economic development is impeded.

While the country has one of the healthier economies in Latin America, about 30% of Argentinians still live in poverty. There is extreme poverty in the countryside. I have witnessed Buenos Aires shanty towns where destitute souls live under terrible conditions.

One of the curious aspects of the Argentinian economy is that it benefits from being rich in natural resources, a very well educated population, a major export-driven agricultural sector and a diverse manufacturing base. Yet, given these pluses, the Argentinian economy still lurches from boom to bust which results in increased poverty and greater wealth disparities between the rich and poor.

The Argentinian unions, especially the public employee unions, still have very generous contracts some of which guarantee 15%+ annual salary increases. These compensation packages are so generous that local governments are now borrowing funds to pay the workers.

While Argentina’s inflation rate has been a whopping 20/25%, its 2011 GDP grew about 8.9%. This year, GDP growth is anticipated to be in the range of 6 to 7%. Even with this solid growth rate, more and more people are falling below the poverty line mainly because of the brutal inflation and “print more money” policies of the government. Needless to say, if you are a saver, poor or old living on a fixed income/fixed assets, inflation is your worst nightmare.

Argentina is a good example to show the correlation between “excessive printing/creating more money” and increased inflation. Federal Reserve Chairman Ben Bernanke has assured Americans that the Fed’s policy of creating more money (aka devaluing the dollar) has no direct detrimental affect on the rate of inflation.

As with Argentinian politicians, to support his claim, Bernanke sights the unrealistically low core inflation government statistics while totally disregarding private sources which put the US’ true inflation rate at a much higher level.

Incredibly, like the Argentinian government, Bernanke’s policies benefit the US’ financial elite and crush the middle class savers/investors, the elderly and other vulnerable populations, Bernanke even has enough hutzpah to assert that these people should be willing to make sacrifices to save the country’s economy.

As we have learned from Argentina, long term, Bernanke’s policies will not work. If the US Federal Reserve continues its policies of excessively creating more money and pegging interest rates at ridiculously low levels, “real world” inflation will ultimately destroy America’s investors/savers, lower the average citizen’s standard of living and force many into terminal poverty just as it has done in Argentina.