By now you are tired of the thousands of talking heads blathering on about the crash. I'm here to give you a new angle on the news.
Although the floundering stock market is eroding our U.S.-based retirement funds, here in Brazil we are getting some temporary relief from the storm.
The dollar, which had sunk to 10-year lows in 2008, has jumped about 40% in value against the Brazilian currency in the last two weeks.
Wait! Why should a worldwide banking crisis cause the dollar to rise in value overseas? It seems counter intuitive. Here's how it plays out in Brazil. International investors are selling their assets here and and taking their dollars elsewhere to cover their commitments. And not only are investors selling Brazilian stocks, they are not buying like they used to, because they don't have the money. Result: fewer dollars in Brazil, pushing the price of greenbacks upward! Simple supply and demand.
However, before you rush to invest dollars in Brazil, let me suggest one caveat: tomorrow everything could be different!
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