Martín Redrado
Encyclopedia
Hernán Martín Pérez Redrado (born September 10, 1961) is an Argentine economist and policy-maker. He served as President of the Central Bank of Argentina between September 2004 and January 2010.
in 1961, he enrolled at the University of Buenos Aires
and received a degree in Economics
. He joined U.S. economist Jeffrey Sachs
as part of his advisory board, which had been invited by Bolivia
n President Víctor Paz Estenssoro
in 1985 to implement a restructuring of the Bolivian economy, then in crisis.
He earned a Master's Degree in Public Administration
from Harvard University
, and was brought on by the Wall Street
investment firm Salomon Brothers
, where he served as adviser on their handling of the privatization
s of British Airways
, British Gas plc
and the French Compagnie Financière de Suez, during the late 1980s. He worked for Los Angeles
-based Security Pacific Bank
until 1991, in which capacity he oversaw the profit sharing
plan for Enersis
employees, and advised on the privatization of Telmex
.
Returning to Argentina in 1991, Redrado was appointed President of the National Securities Commission (CNV) by Economy Minister Domingo Cavallo
, who had just implemented his Convertibility Plan
and a far-reaching deregulation
program. Coupled with the 1990 launch of an ambitious privatization policy by President Carlos Menem
, these measures found Redrado overseeing a Buenos Aires Stock Exchange
whose daily trading volume had risen around 20-fold within months. His tenure earned him the designation as Emerging Markets
Committee President of the International Organization of Securities Commissions
, in 1992. Differences with Cavallo over the 1993 privatization of the state oil concern, YPF, whose handling by Merrill Lynch
and First Boston
Redrado termed a "rip-off," led to his removal from the CNV in March 1994, however, and he established Fundación Capital, a think tank
.
Redrado was selected as one of the "100 Leaders for the Next Millennium" by Time Magazine's International Edition in 1995, and he returned to public service as Secretary of Technological Education (a sub-cabinet level post), in 1996. He was asked to run for a seat in the newly-created Buenos Aires City Legislature
in 1997, but was unsuccessful, and he left the secretariat in 1998 to lead Trident Investment Group, a local venture capital
firm specializing in health care.
The advent of the dot-com boom led Redrado to launch of InvertirOnline.com (only the third online brokerage started in Argentina) in June 2000; the fledgling firm prospered despite the ensuing local financial crisis
, and handled over 20,000 accounts by 2003. Redrado was named Secretary of Commerce (sub-cabinet) by President Eduardo Duhalde
in 2002, and he was retained in the post by Duhalde's successor, President Néstor Kirchner
.
Redrado has also had three books published on the subject of contemporary economics: Tiempos de desafíos (Challenging Times, 1995), Cómo sobrevivir a la globalización (How to Survive Globalization, 1999), and Exportar para crecer (Exporting for Growth, 2003).
to help bolster export
competitiveness, while foreign exchange reserves soared to nearly US$50 billion. Confirmed by President Cristina Fernández de Kirchner
upon her December 10, 2007, inaugural, Redrado, by 2009, had become the third-longest serving Argentine Central Bank President since the institution's formal establishment in 1935.
Fallout from the international, 2008 financial crisis later forced the Argentine government to seek domestic financing for growing public spending, as well as for foreign debt service obligations. The president ordered a US$6.7 billion account opened at the Central Bank for the latter purpose in December 2009, implying the use of foreign exchange reserves, and drawing direct opposition from Redrado. Following an impasse, he was dismissed by presidential decree on January 7, 2010, prior to which Economy Minister Amado Boudou
had announced that Mario Blejer
(who had expressed support for the measure) would be appointed in his stead.
, who, citing the need to preserve the Central Bank's nominal autarky
, expressed doubts as to the decree's legality.
Redrado refused to abide by the initial decree removing him from the presidency of the Central Bank, and petitioned for a judicial power to keep him in office, at least until the Congress decides on the issue. Accordingly, the president enacted another decree for his dismissal. The legitimacy of this new decree was questioned as well, however, on the grounds of the aforementioned autarky of the Central Bank, and for the lack of a prerequisite impeachment trial. Congress was at a recess period at the time, but most of its members considered returning to override the decrees through an extraordinary session.
The legitimacy of President Cristina Kirchner's policy decision to set aside a portion of the Central Bank's reserves through a Necessity and Urgency Decree
was itself questioned by several opposition figures, who argued that the reserves can be only used to keep the value of currency and not for commercial purposes, that the Central Bank is independent, and that only Congress can bypass it through a law. The decree, moreover, may not meet a threshold of "necessity" and "urgency" required by the Constitution of Argentina
for its enactment.
Judge María José Sarmiento
handed down a ruling preventing said use of reserves. The ruling did not decide on the constitutional legitimacy of the decree itself, but instead placed the measure on hold until Congress can legisilate on the issue; the Government reacted by appealing the ruling. Judge Sarmiento then annulled the decree that removed Redrado and reinstated him as President of the Central Bank the following day, due to the lack of a Congressional bill mandating his removal (which is a step required by the laws that govern the Central Bank). The ruling also refuted claims of mis-conduct cited by President Cristina Kirchner to justify his removal.
Following an appeals court ruling on January 22, however, Redrado was suspended, and Central Bank Vice President Miguel Ángel Pesce named in his stead on a provisional basis; though the injunction against the proposed use of reserves was upheld, Redrado's suspension stands pending a resolution on the matter from a committee in Congress. The impasse prompted Redrado to resign on January 30, and he was formally replaced by Mercedes Marcó del Pont
, President of the National Bank
, on February 3.
Early life and career
Born Hernán Martín Pérez Redrado in Buenos AiresBuenos Aires
Buenos Aires is the capital and largest city of Argentina, and the second-largest metropolitan area in South America, after São Paulo. It is located on the western shore of the estuary of the Río de la Plata, on the southeastern coast of the South American continent...
in 1961, he enrolled at the University of Buenos Aires
University of Buenos Aires
The University of Buenos Aires is the largest university in Argentina and the largest university by enrollment in Latin America. Founded on August 12, 1821 in the city of Buenos Aires, it consists of 13 faculties, 6 hospitals, 10 museums and is linked to 4 high schools: Colegio Nacional de Buenos...
and received a degree in Economics
Economics
Economics is the social science that analyzes the production, distribution, and consumption of goods and services. The term economics comes from the Ancient Greek from + , hence "rules of the house"...
. He joined U.S. economist Jeffrey Sachs
Jeffrey Sachs
Jeffrey David Sachs is an American economist and Director of The Earth Institute at Columbia University. One of the youngest economics professors in the history of Harvard University, Sachs became known for his role as an adviser to Eastern European and developing country governments in the...
as part of his advisory board, which had been invited by Bolivia
Bolivia
Bolivia officially known as Plurinational State of Bolivia , is a landlocked country in central South America. It is the poorest country in South America...
n President Víctor Paz Estenssoro
Víctor Paz Estenssoro
Ángel Víctor Paz Estenssoro was a politician and president of Bolivia. He ran for president 8 times , winning in 1951, 1960, 1964, and 1985....
in 1985 to implement a restructuring of the Bolivian economy, then in crisis.
He earned a Master's Degree in Public Administration
Public administration
Public Administration houses the implementation of government policy and an academic discipline that studies this implementation and that prepares civil servants for this work. As a "field of inquiry with a diverse scope" its "fundamental goal.....
from Harvard University
Harvard University
Harvard University is a private Ivy League university located in Cambridge, Massachusetts, United States, established in 1636 by the Massachusetts legislature. Harvard is the oldest institution of higher learning in the United States and the first corporation chartered in the country...
, and was brought on by the Wall Street
Wall Street
Wall Street refers to the financial district of New York City, named after and centered on the eight-block-long street running from Broadway to South Street on the East River in Lower Manhattan. Over time, the term has become a metonym for the financial markets of the United States as a whole, or...
investment firm Salomon Brothers
Salomon Brothers
Salomon Brothers was a bulge bracket, Wall Street investment bank. Founded in 1910 by three brothers along with a clerk named Ben Levy, it remained a partnership until the early 1980s, when it was acquired by the commodity trading firm Phibro Corporation and then became Salomon Inc. Eventually...
, where he served as adviser on their handling of the privatization
Privatization
Privatization is the incidence or process of transferring ownership of a business, enterprise, agency or public service from the public sector to the private sector or to private non-profit organizations...
s of British Airways
British Airways
British Airways is the flag carrier airline of the United Kingdom, based in Waterside, near its main hub at London Heathrow Airport. British Airways is the largest airline in the UK based on fleet size, international flights and international destinations...
, British Gas plc
British Gas plc
British Gas plc was formerly the monopoly gas supplier and is a private sector in the United Kingdom.- History :In the early 1900s the gas market in the United Kingdom was mainly run by county councils and small private firms...
and the French Compagnie Financière de Suez, during the late 1980s. He worked for Los Angeles
Los Ángeles
Los Ángeles is the capital of the province of Biobío, in the commune of the same name, in Region VIII , in the center-south of Chile. It is located between the Laja and Biobío rivers. The population is 123,445 inhabitants...
-based Security Pacific Bank
Security Pacific Bank
Security Pacific National Bank was a large US bank headquartered in Los Angeles, California. In 1992 Bank of America acquired SPNB.-History:...
until 1991, in which capacity he oversaw the profit sharing
Profit sharing
Profit sharing, when used as a special term, refers to various incentive plans introduced by businesses that provide direct or indirect payments to employees that depend on company's profitability in addition to employees' regular salary and bonuses...
plan for Enersis
Enersis
Enersis is one of the main privately-owned multinational electric power corporations in Latin America. It currently holds direct and indirect participation in electric power generation, transmission, and distribution businesses...
employees, and advised on the privatization of Telmex
Telmex
Telmex is a telecommunications company headquartered in Mexico City that provides telecommunication products and services in Mexico, Argentina, Colombia, Brazil and other countries in Latin America. In addition to traditional fixed-line telephone service, Telmex also offers Internet access, data,...
.
Returning to Argentina in 1991, Redrado was appointed President of the National Securities Commission (CNV) by Economy Minister Domingo Cavallo
Domingo Cavallo
Domingo Felipe "Mingo" Cavallo is an Argentine economist and politician. He has a long history of public service and is known for implementing the Convertibilidad plan, which fixed the dollar-peso exchange rate at 1:1 between 1991 and 2001, which brought the Argentine inflation rate down from over...
, who had just implemented his Convertibility Plan
Argentine Currency Board
The Argentine Currency Board pegged the Argentine peso to the U.S. dollar between 1991 and 2002 in an attempt to eliminate hyperinflation and stimulate economic growth. While it initially met with considerable success, the board's actions ultimately failed. In contrast of what most people think,...
and a far-reaching deregulation
Deregulation
Deregulation is the removal or simplification of government rules and regulations that constrain the operation of market forces.Deregulation is the removal or simplification of government rules and regulations that constrain the operation of market forces.Deregulation is the removal or...
program. Coupled with the 1990 launch of an ambitious privatization policy by President Carlos Menem
Carlos Menem
Carlos Saúl Menem is an Argentine politician who was President of Argentina from 1989 to 1999. He is currently an Argentine National Senator for La Rioja Province.-Early life:...
, these measures found Redrado overseeing a Buenos Aires Stock Exchange
Buenos Aires Stock Exchange
The Buenos Aires Stock Exchange is the organization responsible for the operation of Argentina's primary stock exchange located at Buenos Aires CBD. Founded in 1854, is the successor of the Banco Mercantil, created in 1822 by Bernardino Rivadavia.Citing BCBA's self definition: "It is a...
whose daily trading volume had risen around 20-fold within months. His tenure earned him the designation as Emerging Markets
Emerging markets
Emerging markets are nations with social or business activity in the process of rapid growth and industrialization. Based on data from 2006, there are around 28 emerging markets in the world . The economies of China and India are considered to be the largest...
Committee President of the International Organization of Securities Commissions
International Organization of Securities Commissions
The International Organization of Securities Commissions is an association of organisations that regulate the world’s securities and futures markets....
, in 1992. Differences with Cavallo over the 1993 privatization of the state oil concern, YPF, whose handling by Merrill Lynch
Merrill Lynch
Merrill Lynch is the wealth management division of Bank of America. With over 15,000 financial advisors and $2.2 trillion in client assets it is the world's largest brokerage. Formerly known as Merrill Lynch & Co., Inc., prior to 2009 the firm was publicly owned and traded on the New York...
and First Boston
First Boston
First Boston Corporation was a New York-based, bulge bracket, investment bank, founded in 1932 and acquired by Credit Suisse in 1990. Together with its sister investment banks, it was referred to as CS First Boston after 1993 and part of Credit Suisse First Boston after 1996, the First Boston part...
Redrado termed a "rip-off," led to his removal from the CNV in March 1994, however, and he established Fundación Capital, a think tank
Think tank
A think tank is an organization that conducts research and engages in advocacy in areas such as social policy, political strategy, economics, military, and technology issues. Most think tanks are non-profit organizations, which some countries such as the United States and Canada provide with tax...
.
Redrado was selected as one of the "100 Leaders for the Next Millennium" by Time Magazine's International Edition in 1995, and he returned to public service as Secretary of Technological Education (a sub-cabinet level post), in 1996. He was asked to run for a seat in the newly-created Buenos Aires City Legislature
Buenos Aires City Legislature
The Buenos Aires City Legislature is a central part of the Government of the City of Buenos Aires, as well as an architectural landmark in the city's Montserrat section.-History:...
in 1997, but was unsuccessful, and he left the secretariat in 1998 to lead Trident Investment Group, a local venture capital
Venture capital
Venture capital is financial capital provided to early-stage, high-potential, high risk, growth startup companies. The venture capital fund makes money by owning equity in the companies it invests in, which usually have a novel technology or business model in high technology industries, such as...
firm specializing in health care.
The advent of the dot-com boom led Redrado to launch of InvertirOnline.com (only the third online brokerage started in Argentina) in June 2000; the fledgling firm prospered despite the ensuing local financial crisis
Argentine economic crisis (1999-2002)
The Argentine economic crisis was a financial situation, tied to poilitical unrest, that affected Argentina's economy during the late 1990s and early 2000s...
, and handled over 20,000 accounts by 2003. Redrado was named Secretary of Commerce (sub-cabinet) by President Eduardo Duhalde
Eduardo Duhalde
-External links:...
in 2002, and he was retained in the post by Duhalde's successor, President Néstor Kirchner
Néstor Kirchner
Néstor Carlos Kirchner was an Argentine politician who served as the 54th President of Argentina from 25 May 2003 until 10 December 2007. Previously, he was Governor of Santa Cruz Province since 10 December 1991. He briefly served as Secretary General of the Union of South American Nations ...
.
Redrado has also had three books published on the subject of contemporary economics: Tiempos de desafíos (Challenging Times, 1995), Cómo sobrevivir a la globalización (How to Survive Globalization, 1999), and Exportar para crecer (Exporting for Growth, 2003).
Central Bank presidency
Kirchner appointed Redrado President of the Central Bank of Argentina on September 24, 2004, and the new central banker implemented the administration's policy of keeping a relatively undervalued Argentine pesoArgentine peso
The peso is the currency of Argentina, identified by the symbol $ preceding the amount in the same way as many countries using dollar currencies. It is subdivided into 100 centavos. Its ISO 4217 code is ARS...
to help bolster export
Export
The term export is derived from the conceptual meaning as to ship the goods and services out of the port of a country. The seller of such goods and services is referred to as an "exporter" who is based in the country of export whereas the overseas based buyer is referred to as an "importer"...
competitiveness, while foreign exchange reserves soared to nearly US$50 billion. Confirmed by President Cristina Fernández de Kirchner
Cristina Fernández de Kirchner
Cristina Elisabet Fernández de Kirchner , commonly known as Cristina Fernández or Cristina Kirchner is the 55th and current President of Argentina and the widow of former President Néstor Kirchner. She is Argentina's first elected female president, and the second female president ever to serve...
upon her December 10, 2007, inaugural, Redrado, by 2009, had become the third-longest serving Argentine Central Bank President since the institution's formal establishment in 1935.
Fallout from the international, 2008 financial crisis later forced the Argentine government to seek domestic financing for growing public spending, as well as for foreign debt service obligations. The president ordered a US$6.7 billion account opened at the Central Bank for the latter purpose in December 2009, implying the use of foreign exchange reserves, and drawing direct opposition from Redrado. Following an impasse, he was dismissed by presidential decree on January 7, 2010, prior to which Economy Minister Amado Boudou
Amado Boudou
Amado Boudou is an Argentine businessman and government policy maker who serves as Minister of the Economy since 2009. He was elected Vice President of Argentina as running mate of Cristina Fernández de Kirchner in the 2011 general election.-Early life and career:Amado Boudou was born in Mar del...
had announced that Mario Blejer
Mario Blejer
Mario Blejer is an Argentine economist and Central Bank official.-Life and times:Blejer was born in Córdoba, Argentina, in 1948. He enrolled at the Hebrew University of Jerusalem, and graduated cum laude with degrees in Economics and Jewish History in 1970, as well as with a Master's Degree in...
(who had expressed support for the measure) would be appointed in his stead.
Removal and controversy
Central Bank Vice President Miguel Ángel Pesce became the institution's interim head. Redrado's removal, however, triggered a vocal rebuke from opposition figures in CongressArgentine National Congress
The Congress of the Argentine Nation is the legislative branch of the government of Argentina. Its composition is bicameral, constituted by a 72-seat Senate and a 257-seat Chamber of Deputies....
, who, citing the need to preserve the Central Bank's nominal autarky
Autarky
Autarky is the quality of being self-sufficient. Usually the term is applied to political states or their economic policies. Autarky exists whenever an entity can survive or continue its activities without external assistance. Autarky is not necessarily economic. For example, a military autarky...
, expressed doubts as to the decree's legality.
Redrado refused to abide by the initial decree removing him from the presidency of the Central Bank, and petitioned for a judicial power to keep him in office, at least until the Congress decides on the issue. Accordingly, the president enacted another decree for his dismissal. The legitimacy of this new decree was questioned as well, however, on the grounds of the aforementioned autarky of the Central Bank, and for the lack of a prerequisite impeachment trial. Congress was at a recess period at the time, but most of its members considered returning to override the decrees through an extraordinary session.
The legitimacy of President Cristina Kirchner's policy decision to set aside a portion of the Central Bank's reserves through a Necessity and Urgency Decree
Necessity and Urgency Decree
A Necessity and Urgency Decree is a special kind of order issued by the President of Argentina. Unlike regular decrees, which are used in Argentina for rulemaking, a DNU has the force of law...
was itself questioned by several opposition figures, who argued that the reserves can be only used to keep the value of currency and not for commercial purposes, that the Central Bank is independent, and that only Congress can bypass it through a law. The decree, moreover, may not meet a threshold of "necessity" and "urgency" required by the Constitution of Argentina
Constitution of Argentina
The constitution of Argentina is one of the primary sources of existing law in Argentina. Its first version was written in 1853 by a Constitutional Assembly gathered in Santa Fe, and the doctrinal basis was taken in part from the United States Constitution...
for its enactment.
Judge María José Sarmiento
María José Sarmiento
María José Sarmiento is an Argentine judge, with a record of taking part in many known trials.In 1997, during the government of Carlos Menem, she ruled against a raise of taxes for telephones. Other judges made similar rulings, which were ratified afterwards....
handed down a ruling preventing said use of reserves. The ruling did not decide on the constitutional legitimacy of the decree itself, but instead placed the measure on hold until Congress can legisilate on the issue; the Government reacted by appealing the ruling. Judge Sarmiento then annulled the decree that removed Redrado and reinstated him as President of the Central Bank the following day, due to the lack of a Congressional bill mandating his removal (which is a step required by the laws that govern the Central Bank). The ruling also refuted claims of mis-conduct cited by President Cristina Kirchner to justify his removal.
Following an appeals court ruling on January 22, however, Redrado was suspended, and Central Bank Vice President Miguel Ángel Pesce named in his stead on a provisional basis; though the injunction against the proposed use of reserves was upheld, Redrado's suspension stands pending a resolution on the matter from a committee in Congress. The impasse prompted Redrado to resign on January 30, and he was formally replaced by Mercedes Marcó del Pont
Mercedes Marcó del Pont
Mercedes Marcó del Pont is an Argentine economist and lawmaker appointed President of the Central Bank of Argentina on February 3, 2010.-Life and times:...
, President of the National Bank
Banco de la Nación Argentina
Banco de la Nación Argentina is a state-owned bank in Argentina, and the largest in the country's banking sector.-Overview:The bank was founded on October 18, 1891, by President Carlos Pellegrini by way of stabilizing the nation's finances following the Panic of 1890; its first director was...
, on February 3.