According to the Bureau of Labor Statistics' CPI, the purchasing power of the dollar declined by approximately 83% between 1975 and 2025.
Using a strong currency as a safeguard for savings is one of the most deeply rooted traditions in Latin America. It is a custom that persists even as the dollar, the dominant currency, undergoes a process of global depreciation. In fact,in Argentina alone, there are more than $200 billion stashed under the mattress. Given this situation, it is important to understand that hoarding dollars is not only insufficient—it is counterproductive.
According to the latest INDEC report, covering the third quarter of 2025,the amount of money outside the formal financial system exceeded USD 279.476 billion. Even with the enactment of the Fiscal Integrity Law, which encourages the inflow of dollars into the formal system, the informal sector remains the primary refuge from economic fluctuations. This is a historical pattern justified by widespread distrust of the local currency, but it reveals a notable lack of international historical perspective.
It is true that, without fail,the dollar ultimately prevails over the peso. But it is also true that this strength is relative, and that the U.S. currency is not immune to the ups and downs of the global economy. A simple example suffices to illustrate this situation: in 1964, $20,000 was enough to buy an average home inthe U.S.; by the year 2000, that figure had risen to $120,000; and today, a buyer needs $400,000 to purchase a similar property.
According to the Bureau of Labor Statistics’ CPI,the dollar’s purchasing power declined by approximately 83% between 1975 and 2025. Meanwhile, the DXY Index, a financial indicator that measures the dollar’s value against six other currencies, fell by about 10% in the first half of 2025, marking its worst performance in 50 years. The international context marked by conflict also does not allow for predictions of stability in the near future, and even consulting firms such as Morgan Stanley have anticipated greater volatility for the U.S. dollar in 2026.
Paradoxically,it is foreign savers who suffer the most from this situation. They have no access to fiscal stimulus measures or social programs financed by the Fed’s money supply expansion, nor can they obtain cheap credit in dollars. As the Cantillon Effect suggests, expanding the money supply enriches those closest to the creation of money and impoverishes those furthest from it. Small and medium-sized savers represent the last link in this monetary chain.
Dollars kept under the mattress do nothing but lose value year after year, regardless of their current or historical exchange rate against the peso. The data shows that a dollar kept in savings is a dollar sitting idle and, therefore, a loss of capital. Generating returns is the only proven method to counteract the devaluation of money, and to generate them, it is necessary to put savings to work.
Contrary to what common sense—shaped by a lack of financial literacy—might suggest, investing is not a risk but a protective measure. It is worth noting that investing is not necessarily synonymous with the stock market. As the example of real estate demonstrates,there are assets that serve as a safety net without exposing investors to the frenetic pace of the stock market.
To give just one example, storage facilities that were worth $5 million 25 years ago are now worth nearly $20 million. Those who invested in them made a profit and avoided risk, as they are part of a mass-market industry in the U.S. with transparent valuations and a massive market.
The dollar remains the world’s dominant currency, but it is no guarantee in and of itself: this is the key point savers need to keep in mind. Those who understand this will be better equipped to weather volatility. Those who do not run the risk of getting caught up in a cycle reminiscent of the myth of Sisyphus, condemned to push a boulder uphill forever, only to watch it roll back down again and again.
