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Strategies & Market Trends : Telebras (TBH) & Brazil -- Ignore unavailable to you. Want to Upgrade?

To: chirodoc who wrote (7051)	8/23/1998 2:07:00 AM
From: jayray	Read Replies (1) \| Respond to of 22640

You're right about the buying opportunity; Telebras fundamentals are still sound,and the worry over devaluation contagion from Venezuela is probably way overdone. The only catch may be that we'll have to wait six months to two years for the rest of the first world's investment community to catch on. An article in today's O Globo makes a strong case for Venezuela's dependence on oil exports as the primary cause of possible devaluation. Oil revenues make up 25% of Venezuela's GDP, 80% of exports, and 50% of government revenues. When Asia's financial crisis hit, oil revenues dropped, creating a US$7 billion deficit. To a great degree, oil revenue dependency has also hurt Russia, but this is, thankfully, one problem Brasil does not have.