EXCHANGE & INTEREST: THE PARADOX DILMA, Mantega, Tombini & CIA LTDA

Published February 21, 2013

& EXCHANGE YOUR INTEREST AND POLITICAL PARADOX: DILMA, Mantega & E Tombini CIA

The Lula government as I wrote in an article titled The Luck of Lula had a condition favorable external economic displayed and exploited by their economic staft. As soon as he took over practiced called “Economic Pau Horse” which was contrary to the policy of laxative FHC, regarding the monetary base, wiped it early in his administration to contracting by more than 25% in a few months. Increased reserve requirements on banks, increased the Selic rate to the maximum already seen, difficult credit. This was done at the beginning of a government that historically stood between the catastrophe of the currency setting up, by Americans, for the pursuit of a currency at a low due to the effect described by me as Coin War. Slowly and gradually the policy of the Central Bank, with the country’s policy of inflation targeting, was doing a sprain and a restrictive policy desarrocho its initial controlling masterfully fine tuning. Taking advantage of the favorable external world, exogenous, ie change and vacuum or gap produced by the change in the dollar’s foreign policy in a globalized world potentiated endogenously conditions for the relative success of its economic policy. The period Dilma has started strong thunderstorms over the change of foreign policy of the U.S. dollar, which since 2004 or even earlier with the agreement Plaza, has a strong incentive surrounding the expansion of the U.S. monetary base seeking fund Pit Yuan, based in China and where they are located, exacerbated by dumping and social dumping money Yuan, anchored the interests of transnational corporations world whether American, European, Brazilian or other countries. So it is that in 2012, the second year of his administration, Dilma, Mantega and Tombini, feeling the acceleration of the appreciation of the real against the dollar due to the steady decline of this form of exogenous and endogenous, the latter enhanced by the conditions attached Horse Pau initial Lula, start to change in functions of the elections of 2012 the conditions of the economy in order to mermar wind chill of economic contraction and the process of economic stagnation due to the external pressure the dollar which affects, not only Brazil, but also Europe, which under the dictatorship of the euro over the dollar overvalued, under the leadership of Germany and France, coartam the PIGS, a deep social crisis economical by virtue of being closed within the EU and that their export commodities have a low power-added agribusiness as arising directly. PIGS as they were the state of Rio Grande do Sul in the Cardoso government, which benefited at the expense of other states gauchos whose industrial production of canned goods, machinery, shoes and besides the basic inputs such as rice, decimated by foreign competition enhanced by its low exchange rate against the real dollarized over Brazil’s PSDB season. So is that Dilma, Mantega and Tombini, unlike the wooden horse of Lula (as Zé Dirceu neologism) rather than make a slow and gradual distension made a macro loosening increasing from May to October 2012 the money supply by 50% the rate of 10% per month, reducing the Selic rate to a double digit, but is now a 7-something, decreasing the percentage of banks’ reserve requirements, interest rates down official banks, which inevitably led to a fall in Real against the dollar once was monitored by the Central Bank through reverse swaps monitored keeping the exchange, not the market, more or less anything above 2.00 below. Titled to this maneuver doping election / economical since last relapse of the amendment of measures called “macroprudential” GDP was observed as a PIBINHO and inflation, already accused by me in advance, became reluctant causing likewise for reflexes and depending on the choice of interventional mechanisms rather than market mechanisms, a general distrust that has been reflected in falling rates during the daytime IBOVESPA. So today is that we enter a process of economic PARADOX as the government would like mechanisms to curb inflation gradually back to the process of HORSE DICK which is the inversion of commands. The government has reversed the Exchange failing to act in the market which has led to an appreciation of the dollar on the real track passing anything below 2.00 or above 1.95 to below or above. This process slightly dampens inflation and at the same time gives a breather on acquisition or cheaper inputs like oil and its derivatives, wheat and other items on the agenda of national import that inflation pressure internally. Should, by logic, astringe other commands as the Selic rate which already signaling through the COPOM mermar and be maintained at the same level and even with a brief, short-recoil. This decline can not be large nor as light – both the exchange as the interest – directly affect, besides the inflationary problem, the problem concerning the internal dynamics of the economy. The government created a laxative so extraordinary liquidity through credit expansion of the money supply, lower interest rates, etc, and at a time in sequence, these mechanisms can not borrow, use and losing track of them, because if it did, would open space for total delinquency system – because stimulated consumption through credit – leading to bankruptcy and insolvency consumers first and citizens of disseminated form, then banks and credit stances, manufacturers and traders, then with your bankruptcy, the loss of jobs and put an end to widespread crisis. The controls that are left are very faint and can not fluctuate too much. Should signal, but by inertia, by the sense of responsibility and reasonableness to the future, not now but the government of the nation and the country. However the government is thinking government and as such the maintenance of power itself forgetting of Brazil as a nation. Thus, as a political method and improvising and finding no economic power not by being embretado, change interest rates, wage policy, exchange rates, etc., is to rob the very principle REPUBLICAN creating a program that raises awareness in terms of proselytizing about the extinction of hunger and poverty, but that is just another MOMENTARY PLACEBO IN ECONOMICS as doping as the previous election and who will DOPING FOR ELECTIONS OF 2014 reelecting DILMA and CIA. Moves to distribute as grants HANDBAG PURSE THAT THIS billions of dollars that will increase consumption and to hold their peace the mouth of the business, that with this increase in consumption caused by the excluded classes, which will be through demagogic speech “will part of the new middle class!! “As the country is huge and the economy is INFORMAL half formal, does not affect the paradoxes of formal economy that shipwrecked on taxes, regulations, exchange rates, interest, salary policy, etc., giving a team over for recurrence of the crisis, the space of two years for elections is enough to engender the game that economic fireworks are actually a decoy for a real policy of integration with the globalization and the struggle against dispossession Currency Wars phenomenon. This reason is that we find the indices of strong external and domestic divestment that will lead the country in the same direction that the demagogic governments of Hugo Chavez and Cristina Kirchner has led to its to the ditch full of scrap. The Ecuadorian President Correa, as master and doctorate in economics, liberal granchista, leverage is knowing their status, Ecuador, in line with modernity Wars Credits. His recipe, unfortunately, does not serve to Brazil because Ecuador is a country with economy simplified while Brazil has a highly complex living in violent economic asymmetries that generate paradoxes between the gains of agrarian and mineral wealth to the detriment of asymmetries industrial production that are enclosed by Brazil cost, with unfavorable exchange rates, unfavorable social policy against competitors that do not. Thus the BOVESPA index persist in red while the economy will be hopeful with the product and the product of the CROP Demagoguery Economic / Policy, Bolsa Bolsa it that, that in addition to corrupt the republican principle, definitely establishing the Social Coronelismo in Brazil by institutional buying of votes of the excluded, will water until elections with billions of dollars invested there in the functioning of the economy crash. If this income distribution was made as pensions INSS so neutral state and not by the government, I would not be against it, but as it is a government polítida opportunistic and seeking the vote as a democrat and a teacher for more than 28 years Constitutional Law I’m against it!! I’m told! Below corruption of the republic and democracy!! THIS YEAR – 2013 – INSTEAD OF ANOTHER PIBINHO … we’d PIBIZINHO!!

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