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Strategies & Market Trends : 2026 TeoTwawKi ... 2032 Darkest Interregnum

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To: Haim R. Branisteanu who wrote (36993)	7/13/2008 6:49:29 AM
From: elmatador	of 218279

Still staying with officialdom, think the country as two officialdoms: one rural based. Another industry based. Industry-based elite vs. rural based elite. Petrobras is industry. Is nationalist. Likes closed economy and state-ownership. Rural elite is open to the outside world. They sell their agricultural products and import what they need. Industry side is: we produce everything here. ALWAYS read the news under this slant. PBR need rigs and ships built for pre-salt? Let's build them here. Proalcool, the ethanol project gave the rural elite another chance to 'save' the country. They had already given everything the country had: The economic cycles: Sugar cane, Coffee, natural rubber, leather... All based in the rural elite capacity to deliver. Industry had grown and rural elite would go to dust bin. More education, other wagons would carry load and S. Paulo power would wane. Proalcool gave once again had the chance to keep the power. Here comes ethanol. Auto industry would suffer without fuel. Industry engaged in ethanol and produced the first cars 100% ethanol powered. Sao Paulo sugar cane land delivered the ethanol. That lasted until 1986. Oil went down in 1986. PBR and industry revenge came. Gasoline prices went down and fleet of ethanol powered cars became very expensive to run. Industry went back to make gasoline cars. Now PBR was taking oil from off shore and delivering it. Industry and PBR plus nationalists took the "Brazil project" again. Industry resent the power of rural elites and always come back to beat them up any time they have a chance. Note those were 'Lost Decade' years. Little GDP growth neither so many cars. Gave PBR time to get the oil deep and deeper. Cut to late 1990's. Hyper-inflation out. Economy grew. Lots of cars. North Sea oil down. Libya and Iran out, Iraq blocked. And the world was not stopping consuming. Oil started to become scarce. Technology originated from Tech bubble make electronics dirty cheap. Cheap electronics make possible to put processor inside engine and mange it on the fly. That was the great coup of ethanol. Now you could sue gasoline and ethanol in any %, from 100% to 100% gasoline and anything in between. If you buy ethanol car and PBR dumps gasoline in the market, it won’t kill your fleet. You can just sue gasoline. Let’s see how long PBR can sell gasoline at loss to keep ethanol out. By them PBR was losing monopoly. Became a public company. Professionally managed and started losing its nationalist-monopolist cum closed economy pedigree. But Brazil was still importing Diesel. Our refineries are designed to produce more gasoline -with heavy crude- and fewer diesels. Country runs on top of trucks. Import bill? USD1.7 billion. Rural elite want that Diesel money too. Why not produce biodiesel and take that money -running through PBR pockets- and put it into the rural economy's pockets? Thus biodiesel project. All that is possible because the rural elite are in congress pushing their case. That's why I stared everything with the rural elite political power.

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