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Strategies & Market Trends : 2026 TeoTwawKi ... 2032 Darkest Interregnum -- Ignore unavailable to you. Want to Upgrade?

To: Elroy Jetson who wrote (14305)	2/11/2007 4:54:14 AM
From: elmatador	Read Replies (1) \| Respond to of 217528

That's the past script with fixed pegging. Today the Real is free floating currency and Brazil will no defend it's currency. Brazil is forced to save (what it takes in taxes) to pay the interest on that borrowed money. The public sector (fedreal, state and muncipalities plus the state owned enterprises) are subject to what is called fiscal adjustment. They have a target called primary superavit (tax revenue-spending) which should be 4.25% of the GNP. That limits what the government can spend. As a result the goverment cannot cut taxes, unless it cuts spending. The result is bad for the country because the government taxes are mostly covering government spending rather than invest in infrastructure. The government cannot print money to spend since it needs to keep inflation in check. As a result the money that came in was used to pay the foreign debt, thus decreasing the cost Brazil incurs to borrow money, which has this effect of being less risky and attract more foreign currencies. The Central Bank goes to the market and buy cheap dollars to increase foreign reserves.

To: Elroy Jetson who wrote (14305)	3/23/2007 4:32:18 AM
From: elmatador	Read Replies (1) \| Respond to of 217528

MQ you missed my humiliation of Elroy around Febr. 11th. He quietly left the discussion and pretented went for a shit. Brazil's real rides out storm with dollar inflows Thu Mar 8, 2007 1:56PM EST SAO PAULO, March 8 (Reuters) - While global markets were rocked recently by worries over the U.S. economy and the yen's appreciation, the Brazilian real (BRBY: Quote, Profile, Research) has been relatively stable, thanks to huge dollar inflows and solid economic fundamentals, analysts said. During the past 10 days, investors have pulled out of riskier assets such as emerging market bonds and stocks, fearing a possible recession in the United States this year, along with concerns about the unwinding of carry trades in the Japanese currency. The Bovespa index (.BVSP: Quote, Profile, Research) of the Sao Paulo Stock Exchange lost almost 8 percent in five days and Brazilian bond spreads over U.S. Treasuries as measured by JPMorgan's EMBI+ index (11EMJ: Quote, Profile, Research) widened to 2 percentage points from a record low of 1.75 percentage points on Feb. 22. Reuters Pictures Editors Choice: Best pictures from the last 24 hours. View Slideshow However, Brazil's currency, the real, fell only 1.97 percent during that same week, to 2.13 per U.S. dollar. "You have a great supply of foreign currency in the market, the real is feeling the effect of very strong inflows. Even with the central bank buying a lot of dollars, (the currency) is still under control," said Alex Agostini, chief economist at Austin Rating, in Sao Paulo. Rising exports and relatively high interest rates are attracting foreign funds while Brazil's robust economy helps to prevent the real from depreciating during turbulent times. "The increase in Brazil's foreign reserves created a very resistant cushion to absorb external shocks," he said. On Wednesday, Brazil's foreign reserves were at an all-time high of US$104 billion as a result of daily central bank purchases of dollars on the foreign exchange spot market. Jankiel Santos, economist at ABN AMRO in Sao Paulo, believes that the recent nervousness in global markets was the perfect answer to criticism over the central bank purchases. "The timing wouldn't be more perfect for the central bank to say: 'See? That's what those $100 billion of reserves are for,'" he said. Santos stressed that the recent volatility was due to external factors, not local ones. Reuters Pictures Editors Choice: Best pictures from the last 24 hours. View Slideshow On top of that, analysts said there was a difference between a crisis with macroeconomic causes and a correction of global markets. "When you have a process of complete profit taking, you don't have people running away to buy dollars because nobody is leaving (the country)," said Jason Vieira, chief economist at Maxima DTVM brokerage in Sao Paulo. "The market needed a correction.". With no structural changes on global economies, and with a solid Brazilian economy, analysts believe the Brazilian real will remain strong, close or below 2.10 per U.S. dollar. "The market is already coming and will probably reach 2.10 in the short term," said Eloi Dantas dos Santos Jr., economist at Intercam brokerage, in Sao Paulo.

To: Elroy Jetson who wrote (14305)	6/17/2007 12:04:31 PM
From: elmatador	Respond to of 217528

Brazil's economy is awash in U.S. dollars Since the start of 2003, the Brazilian real has climbed 83 percent in value against the U.S. dollar, including 10 percent this year alone. Brazil's central bank has battled to support the dollar by stepping in to the foreign currency market to buy up dollars coming into Brazil. But, by mid-May the dollar fell below the two-reais-to-$1 mark for the first time since 2001. And it has kept on sliding. The currency traded Friday at 1.94 to the dollar. Many predict the real could continue to strengthen in coming months. Behind the mighty real: Prices for Brazilian commodities such as iron ore have soared amid voracious demand, especially in Asia. Since such transactions are U.S.-dollar deals, they bring a glut of American currency into Brazil. Meanwhile, Brazil has kept its interest rates high to hold down inflation. That has drawn in many foreign investors eager to snare the high returns on bonds, especially since the country's economy appears stable. Foreign investors also have been pouring into the Brazilian stock market, which recently has performed strongly. They have swapped dollars for reais to buy stock in top quality Brazilian companies. Meanwhile, the sluggish U.S. economy, among other factors, has left the dollar weak in its own right.

To: Elroy Jetson who wrote (14305)	6/17/2007 8:53:40 PM
From: THE ANT	Read Replies (1) \| Respond to of 217528

You base your assumptions on the past,you will never make money that way.I have been telling you the reasons it is different this time.You have been wrong for at least a couple years now and I expect that will continue

To: Elroy Jetson who wrote (14305)	10/19/2007 12:32:43 AM
From: elmatador	Respond to of 217528

Dollar's weakness to intensify, experts warn. Elroy it is looking like there's some pressure in the home front there, isn't that so? Needing 70bn a month? Pretty soon need to knock at the IMF's doors. And they are tough, Elroy!! They ask for structural adjustments programs and the like... Dollar's weakness to intensify, experts warn By Richard Blackden Last Updated: 12:44am BST 19/10/2007 The dollar tumbled to a record low against the euro, breaching the $1.43 level for the first time, as the prospect of the US economy falling into recession increases. Japan and China lead flight from dollar Ambrose Evans-Pritchard: is the liquidity really limitless? Renewed weakness for the greenback comes a day after the International Monetary Fund cut its forecast for the American economy next year and predicted China will contribute more to world growth next year than the US for the first time. advertisementThe latest data from the troubled US housing market suggests that the steepest slump since the early 1990s is getting worse. According to figures released yesterday from the Commerce Department, the number of new homes being built across America fell to an annual rate of 1.19m last month. For many economists a rate of about 1m is consistent with a recession. Signs of further housing weakness is also fuelling speculation that the Federal Reserve will be forced to add to September's dramatic half point rate cut. Barclays expect the Fed to cut rates by another quarter point to 5pc in a move that further erode one of the dollar's key props. Paul Robinson, one of the bank's strategists, said: "We're dollar bears. The dollar is coming up for an important few weeks. "We expect it to get quite a bit weaker." The bank fears that the dollar could fall to as low as $1.50 against the euro. It's a view echoed by Royal Bank of Scotland and Goldman Sachs. Thomas Stopler, an economist at Goldman, said: "The data suggests there will be a weaker dollar. "The capital-flows situation remains negative." Data from the US Treasury earlier this week showed record outflows of $163bn (£80bn) from all forms of US investments. Asian investors dumped $52bn worth of US Treasury bonds alone, led by Japan ($23bn), China ($14.2bn) and Taiwan ($5bn). It is the first time since 1998 that foreigners have, on balance, sold Treasuries

To: Elroy Jetson who wrote (14305)	9/16/2008 11:38:09 AM
From: elmatador	Respond to of 217528

At this point Brazil and its citizens becomes the foreign lender's monkey. Message 23273181 I would like a follow up on this message of almost two years ago. Let me know ho you evaluate the situation today...