MW Washington bought an election. Argentina got a president. You got the bill.

By Charlie Garcia

The U.S. Treasury's $43 billion slush fund just bailed out Argentina President Javier Milei - and some big investors. Central banks paid attention - and you should too.

Argentina's President Javier Milei, pictured here on replica U.S. $100 bills, looked certain to lose support for his policies in October's midterm election. But then his fortunes changed.

The Trump administration saved Milei. It pushed out China. It made the markets happy for six months. And Washington taught the world that dollar dependence is a political liability.

Argentina went broke again in September 2025. I know - it's like saying Congress spent money it doesn't have. But this time, the libertarian was losing.

Argentina President Javier Milei, the chainsaw-wielding anarcho-capitalist who promised to burn down Argentina's bloated government, was getting whooped by the Peronists - the same economic arsonists who'd spent 70 years proving you can't print your way to prosperity. In September, Milei's La Libertad Avanza party lost the Buenos Aires provincial elections by 13 points.

Financial markets panicked accordingly. In Argentina, the peso dropped 5%. Stocks cratered 10%. Bonds posted their worst day since the country's 2020 default. Congressional elections were slated for Oct. 26, and political analysts gave Milei's reforms a coin-flip chance of survival.

How to buy an election (First, promise $40 billion)

On Sept. 22, U.S. Treasury Secretary Scott Bessent publicly promised Argentina "large and forceful" American support.

One week later, the Treasury announced a $20 billion currency swap financed through America's Exchange Stabilization Fund, which Argentina used to make its Nov. 1 IMF debt payment. The U.S. Treasury drew $900 million from America's SDR account; Argentina's holdings rose by the same amount.

Over subsequent weeks, the Treasury spent $400 million propping up the Argentine peso.

On Oct. 14, Bessent announced plans for an additional $20 billion private-debt facility, bringing the total package to a potential $40 billion.

U.S. President Donald Trump explicitly tied the bailout to Argentina's election - widely viewed as a referendum on Milei. Said Trump: "If he wins, we're staying with him, and if he doesn't win, we're gone."

On Oct. 26, Milei's party won decisively with 41% of the vote versus 31% for the Peronists. In Buenos Aires province, where the libertarians lost by 13 points in September, they won by a half point. Milei's coalition tripled its congressional representation.

Most people think this is a story about Milei's comeback. It's not. It's a story about America turning its financial fire hose into a gun. And every time you point a gun at someone, you'd better remember they're watching and learning.

Why Argentina matters - and why you're paying for it

Argentina controls the world's second-largest lithium reserves - critical for EV batteries and defense systems.

Argentina controls the world's second-largest lithium reserves - critical for electric-vehicle batteries and defense systems. China has been expanding its presence through mining operations, space facilities and port access.

America's $40 billion promise came with conditions: Argentina must exclude China from ports and military installations and potentially replace its $18 billion yuan swap line with U.S. support.

Translation: Washington is using your money to buy geopolitical real estate in its own hemisphere.

Inside the $43 billion fund that just bought an election

For the first time, the Exchange Stabilization Fund was deployed not to prevent systemic financial contagion but to directly manipulate electoral outcomes in a sovereign nation.

The Exchange Stabilization Fund (ESF) is a $43 billion pot of money created in 1934 that gives the U.S. Treasury secretary nearly unlimited power to move dollars around the world with minimal congressional oversight. Think of it as a sovereign-wealth fund, except the sovereign is one guy with a title and no term limits.

The fund allegedly financed WWII covert operations and CIA activities for decades. Post-1970s reforms added quarterly reporting, but side agreements can still be withheld on national-security grounds.

The Treasury won't disclose how much of the $20 billion swap Argentina has drawn. Brad Setser, former assistant Treasury secretary under President Barack Obama, told the Wall Street Journal there is "essentially no information on how that money is being used," calling it "unusual given this is taxpayer money."

The ESF holds $43 billion in net assets, with $22 billion in liquid dollars. For the first time, the ESF was deployed not to prevent systemic financial contagion but to directly manipulate electoral outcomes in a sovereign nation.

When intervention becomes kingmaking

ESF money stabilized the peso just long enough for sophisticated investors to exit at more favorable prices.

In September, Milei's party lost by 13 points. In October, with Bessent committing $40 billion in a combination of U.S. taxpayer and private-market support, Milei's party won. This wasn't stabilization. This was intervention.

Argentina's usable reserves totaled less than $10 billion. The country's external debt - with stakes held by BlackRock, Fidelity, Pimco and other major institutional investors - exceeded $300 billion, with $8.5 billion in payments due by July 2026.

According to the New York Times, Bessent's former Wall Street colleagues, including hedge fund billionaire Robert Citrone, who worked with Bessent at George Soros's fund, held large Argentine bond positions.

The ESF money stabilized the peso just long enough for sophisticated investors to exit at more favorable prices. Argentine bonds rallied 15%-20%. Investors who sold during that window locked in gains.

Now reports say that the additional $20 billion bank facility isn't happening. JPMorgan, Bank of America and Citigroup all passed - even with Treasury sweeteners. The banks are instead discussing a $5 billion band-aid to get Argentina past January. After the election, the banks remembered they work for shareholders, not Treasury secretaries.

But the government's private-facility announcement kept the markets calm long enough for the right people to exit. Those hedge-fund bond investors could have sold in October - and if you think sophisticated investors sat around waiting to see how the election played out, I have some Argentine bonds to sell you. Meanwhile, American taxpayers get what's left - which is the bag.

Bessent claims U.S. taxpayers have already profited from interest payments and fees on the currency swap. That may be technically true today. But Argentina's reserves remain under $10 billion, with $8.5 billion in debt payments due by July 2026. When Argentina restructures again (and it will), those "profits" disappear.

The paradox that destroys the dollar's dominance

Every time the Treasury weaponizes the U.S. dollar DXY to achieve a geopolitical objective, it accelerates the development of alternative financial systems that other countries are designing to escape American coercion.

Since the 2022 freeze of Russian reserves, the world's central banks have dramatically shifted strategy. European officials are considering pooling dollars to reduce Fed swap-line dependence. Brics nations are expanding facilities for yuan and ruble settlement. China is issuing U.S. dollar-denominated bonds at yields on a par with what Washington pays.

The dollar's share of global reserves has fallen from 60% in 2021 to below 58% today - at triple the historical rate.

Bessent justified the intervention as "mission-critical" for "national security." American financial power is now openly political. It's not a neutral platform for international commerce. It's a tool for advancing the Trump administration's objectives.

When central banks see the ESF used to influence elections and bail out hedge funds, they stop trusting the dollar as a store of value. They buy gold. They build alternatives. They reduce exposure to the U.S.

What this means for your portfolio

When alternatives become viable, the dollar's 'exorbitant privilege' - America's ability to borrow cheaply and export inflation-disappears.

1. Your emerging-market bond funds just got riskier: If you own a fund that holds sovereign debt from developing countries, and most diversified portfolios do, you probably own a slice of Argentina's bonds. When Argentina restructures, and current reserve burn rates suggest this will happen early in 2026, those holdings get written down. Your fund takes the loss. You won't get a call from Bessent first.

Every other emerging market now faces ESF intervention risk. Will Turkey get a swap if it aligns with Washington? Will Brazil face denial if it doesn't? Political conditionality just became a pricing factor in sovereign-debt markets. That means greater volatility and wider credit spreads.

2. De-dollarization isn't a 2030 problem anymore: China just issued U.S. dollar bonds at yields comparable to U.S. Treasurys. European officials are considering pooling dollars to reduce their dependence on the Federal Reserve. When alternatives become viable, the dollar's "exorbitant privilege" - America's ability to borrow cheaply and export inflation-disappears. That means Americans will face higher interest rates, lower real wages and reduced purchasing power.

The bottom line: The ESF just turned sovereign-debt investing into a political handicapping game. If you can't predict which governments Washington will support, you can't price emerging market risk. That's not an investment environment; it's a casino.

How to destroy the dollar in three easy steps

The dollar worked because central banks believed it was neutral, something they could hold without worrying Washington would point it at their head.

MW Washington bought an election. Argentina got a president. You got the bill.

By Charlie Garcia

The U.S. Treasury's $43 billion slush fund just bailed out Argentina President Javier Milei - and some big investors. Central banks paid attention - and you should too.

Argentina's President Javier Milei, pictured here on replica U.S. $100 bills, looked certain to lose support for his policies in October's midterm election. But then his fortunes changed.

The Trump administration saved Milei. It pushed out China. It made the markets happy for six months. And Washington taught the world that dollar dependence is a political liability.

Argentina went broke again in September 2025. I know - it's like saying Congress spent money it doesn't have. But this time, the libertarian was losing.

Argentina President Javier Milei, the chainsaw-wielding anarcho-capitalist who promised to burn down Argentina's bloated government, was getting whooped by the Peronists - the same economic arsonists who'd spent 70 years proving you can't print your way to prosperity. In September, Milei's La Libertad Avanza party lost the Buenos Aires provincial elections by 13 points.

Financial markets panicked accordingly. In Argentina, the peso dropped 5%. Stocks cratered 10%. Bonds posted their worst day since the country's 2020 default. Congressional elections were slated for Oct. 26, and political analysts gave Milei's reforms a coin-flip chance of survival.

How to buy an election (First, promise $40 billion)

On Sept. 22, U.S. Treasury Secretary Scott Bessent publicly promised Argentina "large and forceful" American support.

One week later, the Treasury announced a $20 billion currency swap financed through America's Exchange Stabilization Fund, which Argentina used to make its Nov. 1 IMF debt payment. The U.S. Treasury drew $900 million from America's SDR account; Argentina's holdings rose by the same amount.

Over subsequent weeks, the Treasury spent $400 million propping up the Argentine peso.

On Oct. 14, Bessent announced plans for an additional $20 billion private-debt facility, bringing the total package to a potential $40 billion.

U.S. President Donald Trump explicitly tied the bailout to Argentina's election - widely viewed as a referendum on Milei. Said Trump: "If he wins, we're staying with him, and if he doesn't win, we're gone."

On Oct. 26, Milei's party won decisively with 41% of the vote versus 31% for the Peronists. In Buenos Aires province, where the libertarians lost by 13 points in September, they won by a half point. Milei's coalition tripled its congressional representation.

Most people think this is a story about Milei's comeback. It's not. It's a story about America turning its financial fire hose into a gun. And every time you point a gun at someone, you'd better remember they're watching and learning.

Why Argentina matters - and why you're paying for it

Argentina controls the world's second-largest lithium reserves - critical for EV batteries and defense systems.

Argentina controls the world's second-largest lithium reserves - critical for electric-vehicle batteries and defense systems. China has been expanding its presence through mining operations, space facilities and port access.

America's $40 billion promise came with conditions: Argentina must exclude China from ports and military installations and potentially replace its $18 billion yuan swap line with U.S. support.

Translation: Washington is using your money to buy geopolitical real estate in its own hemisphere.

Inside the $43 billion fund that just bought an election

For the first time, the Exchange Stabilization Fund was deployed not to prevent systemic financial contagion but to directly manipulate electoral outcomes in a sovereign nation.

The Exchange Stabilization Fund (ESF) is a $43 billion pot of money created in 1934 that gives the U.S. Treasury secretary nearly unlimited power to move dollars around the world with minimal congressional oversight. Think of it as a sovereign-wealth fund, except the sovereign is one guy with a title and no term limits.

The fund allegedly financed WWII covert operations and CIA activities for decades. Post-1970s reforms added quarterly reporting, but side agreements can still be withheld on national-security grounds.

The Treasury won't disclose how much of the $20 billion swap Argentina has drawn. Brad Setser, former assistant Treasury secretary under President Barack Obama, told the Wall Street Journal there is "essentially no information on how that money is being used," calling it "unusual given this is taxpayer money."

The ESF holds $43 billion in net assets, with $22 billion in liquid dollars. For the first time, the ESF was deployed not to prevent systemic financial contagion but to directly manipulate electoral outcomes in a sovereign nation.

When intervention becomes kingmaking

ESF money stabilized the peso just long enough for sophisticated investors to exit at more favorable prices.

In September, Milei's party lost by 13 points. In October, with Bessent committing $40 billion in a combination of U.S. taxpayer and private-market support, Milei's party won. This wasn't stabilization. This was intervention.

Argentina's usable reserves totaled less than $10 billion. The country's external debt - with stakes held by BlackRock, Fidelity, Pimco and other major institutional investors - exceeded $300 billion, with $8.5 billion in payments due by July 2026.

According to the New York Times, Bessent's former Wall Street colleagues, including hedge fund billionaire Robert Citrone, who worked with Bessent at George Soros's fund, held large Argentine bond positions.

The ESF money stabilized the peso just long enough for sophisticated investors to exit at more favorable prices. Argentine bonds rallied 15%-20%. Investors who sold during that window locked in gains.

Now reports say that the additional $20 billion bank facility isn't happening. JPMorgan, Bank of America and Citigroup all passed - even with Treasury sweeteners. The banks are instead discussing a $5 billion band-aid to get Argentina past January. After the election, the banks remembered they work for shareholders, not Treasury secretaries.

But the government's private-facility announcement kept the markets calm long enough for the right people to exit. Those hedge-fund bond investors could have sold in October - and if you think sophisticated investors sat around waiting to see how the election played out, I have some Argentine bonds to sell you. Meanwhile, American taxpayers get what's left - which is the bag.

Bessent claims U.S. taxpayers have already profited from interest payments and fees on the currency swap. That may be technically true today. But Argentina's reserves remain under $10 billion, with $8.5 billion in debt payments due by July 2026. When Argentina restructures again (and it will), those "profits" disappear.

The paradox that destroys the dollar's dominance

Every time the Treasury weaponizes the U.S. dollar DXY to achieve a geopolitical objective, it accelerates the development of alternative financial systems that other countries are designing to escape American coercion.

Since the 2022 freeze of Russian reserves, the world's central banks have dramatically shifted strategy. European officials are considering pooling dollars to reduce Fed swap-line dependence. Brics nations are expanding facilities for yuan and ruble settlement. China is issuing U.S. dollar-denominated bonds at yields on a par with what Washington pays.

The dollar's share of global reserves has fallen from 60% in 2021 to below 58% today - at triple the historical rate.

Bessent justified the intervention as "mission-critical" for "national security." American financial power is now openly political. It's not a neutral platform for international commerce. It's a tool for advancing the Trump administration's objectives.

When central banks see the ESF used to influence elections and bail out hedge funds, they stop trusting the dollar as a store of value. They buy gold. They build alternatives. They reduce exposure to the U.S.

What this means for your portfolio

When alternatives become viable, the dollar's 'exorbitant privilege' - America's ability to borrow cheaply and export inflation-disappears.

1. Your emerging-market bond funds just got riskier: If you own a fund that holds sovereign debt from developing countries, and most diversified portfolios do, you probably own a slice of Argentina's bonds. When Argentina restructures, and current reserve burn rates suggest this will happen early in 2026, those holdings get written down. Your fund takes the loss. You won't get a call from Bessent first.

Every other emerging market now faces ESF intervention risk. Will Turkey get a swap if it aligns with Washington? Will Brazil face denial if it doesn't? Political conditionality just became a pricing factor in sovereign-debt markets. That means greater volatility and wider credit spreads.

2. De-dollarization isn't a 2030 problem anymore: China just issued U.S. dollar bonds at yields comparable to U.S. Treasurys. European officials are considering pooling dollars to reduce their dependence on the Federal Reserve. When alternatives become viable, the dollar's "exorbitant privilege" - America's ability to borrow cheaply and export inflation-disappears. That means Americans will face higher interest rates, lower real wages and reduced purchasing power.

The bottom line: The ESF just turned sovereign-debt investing into a political handicapping game. If you can't predict which governments Washington will support, you can't price emerging market risk. That's not an investment environment; it's a casino.

How to destroy the dollar in three easy steps

The dollar worked because central banks believed it was neutral, something they could hold without worrying Washington would point it at their head.

(MORE TO FOLLOW) Dow Jones Newswires

November 25, 2025 07:50 ET (12:50 GMT)

MW Washington bought an election. Argentina got a -2-

When Argentina collapses in 2026 - not if, but when - there will be hearings. Bessent's Wall Street friends will be questioned. The words "national security" will be repeated until they lose all meaning. Then everyone will go home and nothing will change.

Because they'll all be asking the wrong question. They'll ask whether the U.S. bought Milei's election. It did.

The right question is what it cost America. Here's what it took: one U.S. Treasury secretary, a 90-year-old law and $43 billion with no oversight.

Step one: Weaponize the ESF. Make it obvious. Make it political. Make sure everyone knows the dollar is a tool for Washington's agenda, not a neutral platform.

Step two: Watch trust evaporate. The dollar worked because central banks believed it was neutral - something they could hold without worrying Washington would point it at their head. Once that belief dies, so does reserve currency status.

Step three: Count the exits. Poland, the world's largest central-bank gold (GC00) buyer, now holds more gold than the entire European Central Bank and just raised its target to 30%. China is building payment systems that bypass SWIFT - the global messaging network banks use to move money, and the same network Washington can weaponize to freeze any country out of the financial system. Turns out that when you use the plumbing to drown people, they start digging wells. Every central bank is calculating escape velocity.

The Trump administration saved Milei. It pushed out China. It made the markets happy for six months. And Washington taught the world that U.S. dollar dependence is a political liability, not a financial asset.

The precedent is set. The world is watching. And they've reached the same conclusion: the dollar isn't money anymore. It's a leash - and everyone holding it just realized they're on the wrong end.

Charlie Garcia is founder and a managing partner of R360, a peer-to-peer organization for individuals and families with a net worth of $100 million or more. He holds bitcoin in his personal account.

Agree? Disagree? Share your comments with Charlie Garcia at charlie@R360Global.com. Your letter may be published anonymously in the weekly "Dear Charlie" reader mailbag.

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More from Charlie Garcia:

America's 'sugar daddy' just went broke - and you're stuck with the bill

Bitcoin isn't dead - it's having an IPO moment. Here's when the selling will stop.

Think your bond funds and ETFs are safe investments? The credit market is lying to you.

-Charlie Garcia

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November 25, 2025 07:50 ET (12:50 GMT)

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