Recent polls out of Sao Paulo show that only 30% vs. 51% in last
survey intend to vote for President Dilma's in the Oct 2014
elections which suddenly are looming.
[caption id="attachment_56850" align="alignright" width="300"
caption="Brazilian president Dilma Rousseff"]
That's a major fall from grace and puts the Workers Party in a
tight place going into a difficult period with protests building.
The irony is that President Dilma who is a technocrat came to
office with nothing more than this public blanket of support.
The cruel irony is that after 18months of unorthodox fiscal and
monetary policy in Brazil (
) intended to keep her popularity high, it is all backfiring.
Dilma chose a path of increasing social support netting for
the lower class Brazilian that has involved taking on corporate
lobbies and legacy entitlements for some of the biggest
sectors of the economy.
That in turn has made the Brazilian stock market a no-touch for
most global investors, and a dangerous one for locals and dedicated
emerging market investors. Brazil is -51% in USD terms since
There are many reasons for this including a slower global
economy where Brazil's core commodity exports are down with China's
demand. In fact, there are arguments that so goes the commodity
super-cycle so goes Brazil's economy.
It was easy to pave the streets in gold when iron ore prices
were $180/ton and when agriculture and ethanol were booming
Let's see how it goes for Dilma when she can't give away the
store to keep the masses happy and to transport the next 30 million
people from poverty into lower middles class, which had been Lula's
and Dilma's claims to fame.
It's also what made Brazil the goto BRIC when people couldn't
get comfortable with China risk, Putinomics, and India's perpetual
transition to a true democracy.