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

To: Tony van Werkhooven who wrote (12311)	1/23/1999 7:15:00 PM
From: EPS	Read Replies (2) \| Respond to of 22640

In many ways Brazil has the defining characteristics that some the more advanced Eastern European countries had before the fall of the Berlin wall. The Brazilian capitalism is really state capitalism. Indeed the state controls the price of gasoline (and its production or imports) the state controls the price of telephone calls (stoped only recently), the major banks, the production of electricity, etc etc etc etc etc... A rather large portion of the population works for the state... When computing the earnings of some of these state companies major care is needed to understand the results that one gets. Example: are the costs of the pension benefits accounted or those are simply allocated to a different state account? Obviously Brazil needs to privatize and become a modern capitalist country. The process is and will continue to be painful. Many people here believe that changes are just around the corner, that they are just going to happen in the very immediate future.. I would like to advance the novel idea that is probably going to take some time..Problems run deep in every possible dimension you look at. I would also like to suggest that there are institutions within the Brazilean financial system that have the resources to manipulate the market. I've seen this happening over and over again. Last week end was an example. The beauty of the situation is that, to the untrained eye, the situation looks like a no brainer, so much potential, so much going for it.. At this time it would be interesting to see what is going to be the bottom for the real near term. Any good guesses? 2- 2.5 - 3?? Regards Victor

To: Tony van Werkhooven who wrote (12311)	1/24/1999 2:35:00 PM
From: Worswick	Read Replies (1) \| Respond to of 22640

Tony hello...hope you are fine today. It isn't that I am preternaturally gloomy but I think we really, all of us, have to consider what has happened in the world financial markets in the last 18 months. Think about what has happened. Give me an explanation. Please. We are now living - to begin with - in an era of "heightened investment risk". I don't know if you follow Charles Mosley of the Skeptical Investor but he, as well as I, are proponents for a deflationary scenario on a world wide scale. We are in a huge deflationary cycle here. I think this is really what you are seeing here in the world at the moment - all commodities go down, people wait to buy, the markets go down more. More and more "goods" are dumped on the market. Absent the white noise of the economists and the financial writers... the forest when you see the trees here.... is a delationary environment. As I aid. Please I am not wed to this idea. I get nothing whatsoever out it except cheap Thai Shrimp at the A & P and now, certainly, less expensive coffee....not to mention $ .95 per galon gas here in the US. World wide deflation. It seems to be gather ing steam. Comments from Japan that would have rocked the markets to their socks have been made by Japanese...by Japanese officials....and these commments are greeted with ho hum. Amazing. All for now and my very best, Clark