WOW! what brought all THAT on ? I was certainly not trying to be "grossly overdramatic". With respect, I think you missed the point of what I was saying. My post was a reply to an earlier one dealing with PE ratios. I was quite simply pointing out that unless Brazil holds together, the PE ratio analysis will count for absolutely nothing. Witness events in Russia. I've re-read my post, and I can't find any reference that I made on whether Brazil will hold or not. (as an aside, there are several earlier posts of mine where I make it clear that I think Brazil WILL HOLD). - But that was not the point of the post. The point, once again, was to alert new investors and newcomers to this thread to focus FIRST on the macro picture (ie, will Brazil hold, or not?) - You MUST have certainty there first, before you dive in and buy TBR because of its tempting looking PE ratios.
People have lost fortunes on this stock by applying "normal" investment analysis that quite simply will never be borne out UNLESS THE COUNRTY HOLDS. That's all.
Oh, and by the way, I would challenge YOU on your assertion that Mexico held together. As I recall it, (I was trading their bonds at the time) they ran completely out of reserves to the point where they could not repay their treasury bills, had to borrow billions from Uncle Sam (without which they would have certaily defaulted), sustained a full-blown banking crisis (the legacy of which is STILL dominating both the political and economic agenda right now even as I write this.) and saw their currency crumble. I may be wrong about this, but I think that in US dollar terms, the mexican stock market has yet to recover to its pre-tequila levels.
So, no, I don't think I was being "grossly overdramatic" as you put it. And, if there can be any further doubt, I say again.... I DO BELIEVE THAT BRAZIL WILL HOLD. I DO BELIEVE THAT TBR IS A STUNNING INVESTMENT - but don't buy it purely on its PEs or its P/BV anybody. Buy it only if you think the country will hold. |
