Eric Martin and Matthew Malinowski – Bloomberg, 10/21/2012
Jim O’Neill, the economist who bound Brazil to Russia, India and China to form the BRIC investing strategy, has some advice for Latin America’s biggest economy: Stop criticizing Federal Reserve efforts to revive the U.S. and do more to fix your own problems.
Blaming the Fed is “frequently an excuse to distract attention from the contradictions of monetary and fiscal policy in Brazil,” O’Neill, chairman of Goldman Sachs Asset Management, said in a telephone interview from London. The U.S. is the world’s biggest economy, and “if the Fed does something which is going to reduce the scale of the recession or boost the economy, that is really important for every other country, end of story.”
The Fed’s latest stimulus package dominated this month’s International Monetary Fund meetings in Tokyo, with policy makers from the Philippines to China warning that yield-seeking investors will flood emerging markets with capital. Chairman Ben S. Bernanke used the talks to rebut those arguments after Brazilian President Dilma Rousseff at the United Nations last month slammed rich nations for “fraudulent” protectionism.