Mary Anastasia O’Grady – The Wall Street Journal, 07/22/2012
The adolescent crush that money managers had on Brazil is wearing off. As economic growth has underperformed expectations, this big hunky Latin object of investor affection is beginning to look unsophisticated and immature.
Now the country’s most important trade relationship, with neighboring Argentina, is breaking down. This is likely to give the economy more headaches.
Brazil still has plenty of promise, thanks mostly to its human capital. Its institutions have held up in recent years even as the Workers’ Party (PT) government’s closest ideological allies—in power in Venezuela, Ecuador, Bolivia, Nicaragua and Argentina—have destroyed institutional checks and balances in their own countries. A Supreme Court trial alleging corrupt practices by the ruling PT party staff of former president Lula da Silva, slated to begin next month, demonstrates a healthy separation of powers. Low inflation has also fostered a middle class.
