It’s ugly in Brazil.
Imagine a country with an inflation rate of almost 10%. It has a president with a 7% approval rating. The country’s GDP is set to contract 2.4% in 2015. The home currency has lost a quarter of its value since the start of the year. There is a multibillion government corruption scandal attacking the national psyche.
That country is Brazil.
And then on Wednesday, ratings agency S&P cut its rating on Brazil’s debt to “junk” status.
But if you turn back the clock a few years and Brazil was one of the hottest investment opportunities in the world.
By 2011, however, the world had cooled on Brazil’s prospects, and New River Investments’ Guillermo Roditi Dominguez made one of the best calls you’ll see on Twitter.
Mark my words: Brazil will be facing a financial crisis by 2015-16. My fav catalyst? EM easing cycle meets DM tightening cycle.
— Guillermo :( (@groditi) December 26, 2011
Take a victory lap.
NOW WATCH: 13 Surprising Facts About Brazil
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