Posted by: bklunk | December 12, 2006

The World IS sortof Flat

Hmm, Brazilian development hostage, in a way, to what the US Federal Reserve does.  What does this say about sovereignty in the 21st century?

Bad Timing…

Brazilian Stock

As an unexpected twist, the Brazilianstock has finally fell for the first time after a week.  Just yesturday, the Brazilian stock market had posted record highs and had been constintally on the rise.  Unfortunately, the US Federal Reserve kept interest rates steady which made the Brazilian stocks less attractive to foreign investors.  The concern for inflation is still about, and is likely to play a more profound affect on the market in the near furture.  Overall, Brazilian stockhas gained a total of 8.5 percent throughout the year.  The governemnt has done all that it can to keep the rates interessting by cutting the interest rate 12 straight time, and does not intend to stop.  Ironically however, this is the situation that could eventually lead to a total economic disaster for the country.  The governemnt needs to make the movement towards technological gais and get away from natural resources as the main source of income.  Failing to do so wll leave Brazil in the same situation and unable to compete with globalized giants such as China and India in the years ahead.  The greatet itae that the Brazilian governemnt continues to make is based on their values of the income. The monday made off natural resources is being re-invested in others, rather than using the money and investing in other ares of the economy.

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Responses

  1. Maybe if their economy does falter there will finally be an end to their vested self intrest. I think one of the main reasons that brazil needs to fall a little is the lack of imports from other countries. If they continue to invest so heavily in their own economy they will become less and less attractive to the world wide economy. Sure they have goods that we want but if they are only willing to take very little of our goods how much more are we really going to want to invest in brazil?


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