Brazil: The Pitfalls of Our Short and Mid-Term Economic Scenarios

Last week the BRL reached the 12-year high appreciation level at 1.558, below the 1.559 of August, 1st 2008, at the beginning of the international crisis and the same rate as January, 19th, 1999 (see Chart 1).  Coincidently, this appreciation record comes with the worsening of the already complex international economic scenario: the yet unsolved […]

Propensities, the bad news principle, Brazil and the global financial crisis

Karl Popper, regarded as one of the greatest philosophers of science of 20th century and professor of the London School of Economics who died in 1994 at the age of 92, has a vast range of fields of study, from the way our brain works to thesis on the influence of mass media on the society in general.  However, Popper is better well known, in academic grounds, for his theories on human knowledge and his concepts on objective truth, the conjectural knowledge and on the impossibility of demonstrating positively our theories; ideas appreciated by some, but also very contradicted by others.

The recent Brazilian FX market: a few comments

One of the difficult moments in the recent past of the Brazilian financial markets was during May 2006 when the BRL jumped from 2,06 in the second day of the month to 2,35 on the 23rd day of the same month: a devalue of 14% in three weeks. The panic in that month came from […]

2008: Possible Impacts of a US Slowdown in Brazil

The famous phrase, “there’s no such thing as a free lunch” coined by the no less famous economist Milton Friedman, is probably the most direct and undoubted synthesis of the economic process or theory: today’s lunch comes from yesterday’s sweat and hard work. The current economic situation, Brazilian and worldwide, is the consequence of actions […]

Brazil: Good Policies and Good Luck

The discussion of the recent Brazilian economic performance brought by Rigobon and  Canuto sort of inspired me to move a bit further in the discussion.   On one side, I share some common thoughts with Rigobon. More espefically, Brazil has been very lucky on the profiting from the commodity windfall, given the buoyant external scenario.Even […]

Global imbalances and the Brazilian Real: What Comes Next?

These days the main subject of discussion in the Brazilian economic newspapers is the “unsolvable problem” of the appreciation of the Brazilian real against the U.S. dollar. We are currently experiencing a conjunction of important economic factors affecting Brazil’s exchange rate market. All of them are related to each other although they have different channels […]