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

To: John Soileau who wrote (7569)	9/5/1998 9:27:00 PM
From: djane	Respond to of 22640

John, I enjoyed reading your well-written comments. It's clear that you know much more about commodities demand/supply than myself. A couple responses. Commodities It is clear that technological improvements have increased our ability to extract resources from the ground, produce crops and transport them around the planet. This is a negative price development for developing countries. I would argue that it may not be a "cyclical market phenomenon." If supply contracts, prices may go back up. But, obviously, slower worldwide/Asian growth ain't gonna help the demand side. Developing countries are stuck producing low profit margin commodities for the developed countries, who turn around and sell them value-added products and services. On the new Sat. CNBC show today at 4:30 p.m. PST, they put up stats that, since 1994, US exports to Brazil have increased 222% while Brazil exports to the US have increased 22% Who is the beneficiary of this system? I'm just pointing out that anger is building up again in many areas of the world to this obvious disparity. 1) had refrained from embracing state-controlled socialism from liberation forward No real argument with you here. My hypocritical Berkeley buddies would still have us turn back the clock while they drive their SUVs and drink their lattes. A historical fact. The current situation is much improved in countries like Brazil, Mexico and many Latin/South American countries. On a side note, if the US baby boomers (who are now huge holders of mutual funds) had their desired way in the late 1960s, the US would have been much more socialist now. Kinda funny if you think about it given their huge appetite from capitalism now. 2)now had in their treasuries all of the money stolen, diverted and pillaged by their OWN leaders Again, no real argument with you. The corruption of local elites in countries such as Indonesia, Russia and Mexico has been awesome and just incredibly sad to watch. But, to be fair, the US/Europe multinational corporations and political leaders have historically colluded with local elities in Latin/South America and looked the other way when these stolen profits were deposited in overseas bank accounts instead of being reinvested in the domestic economies. It is tragic as evidenced recently by Russia and the kleptocrats shoveling IMF funds directly into their Swiss, Austrian and Cyprus bank accounts. I have no idea if the current political/economic elites in countries like Brazil are more or less corrupt than before or if they are still squirreling their money away overseas. Anything the West could do to encourage reinvestment of these profits in the domestic economies would be helpful (I'm not holding my breath) 3)had put in place an open and transparent environment for international trade and investment? See the above comments on reinvestment in the domestic economy Is anyone else getting more concerned about the effect of "hot money" on emerging markets all over the world. I have started using the word "immoral." Is there a better word for the mindless destruction, havoc and instability they are causing? No, it is not creative destructionism ala Schumpter. The US/Europe/Japan need these economies to do well. On another side note, I do include myself in the "hot money" set to a minor extent. I find it fascinating that, on a whim almost, I can go short/long stocks such as TBR via my on-line trading account. Should relatively untrained people like myself (with a possible very short-term goal) be able to have such a potential impact on the Brazilian economy> Just a thought. I welcome comments on any of the above. It does seem appropriate to engage in this discussion over Labor Day Weekend.