Wednesday, February 26, 2014

Dilma’s Inflection and Cliff Walking

Good article by Cristiano Romero, Valor newspaper. Economic policy seems in fact to be in an inflection point. First the monetary policy, with the Central Bank surprising the markets with higher rates. Now the fiscal policy, with the budget contingency. My NTNBs are doing great, thanks for asking (figure with the B23). But I don’t buy it.

My theory about Dilma's Government is the “cliff walk” theory. They have all the wrong ideas but react when facing constraints (I mean popularity related constraints). Now they are moving away from the cliff to avoid falling (fiscal mess à FX depreciation, downgrade and inflation à drop in popularity). But as things get better, they will move closer to the cliff again.

1 comment:

  1. Eu to apostando no DI. Comprado para ABR/14 e JUL/14 e vendido para JAN/15

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