The growth engines of the world are called the BRIC nations for Brazil, Russia, China, and India.  What happens when growth rates are just not as robust as they are supposed to be.  Monday was dogged by reports of sub-8% GDP growth in China.  Tuesday is faced by only 2.7% growth in 2011 from Brazil.  When you consider the recent growth rates and the improvement, Brazil should be running at twice that rate. The impact on Tuesday is being seen in everything tied to Brazil:

Gol Linhas Aereas Inteligentes (NYSE: GOL), the airline, is down 4.4% at $7.96 against a 52-week trading range of $5.03 to $14.35.

Petroleo Brasileiro S.A. (NYSE: PBR), or Petrobras, is down 4.6% at $28.26 against a 52-week range of $20.76 to $41.74.

Telefonica Brasil, S.A. (NYSE: VIV) is down 2.5% at $28.85 against a 52-week range of $22.81 to $32.14.

VALE S.A. (NYSE: VALE) is down 6.1% at $23.23 against a 52-week range of $20.46 to $34.74.

iShares MSCI Brazil Index Fund (NYSE: EWZ) is down 3.5% at $66.58 against a 52-week range of $49.25 to $80.23.

Brazil currently has a currency stronger than it can handle and it needs to cut interest rates as well.  Other stimulative measures need to come after that, as well as tax reform.

JON C. OGG