Investing

Brazil Tanks as Rousseff May Avoid Impeachment

Jon C. Ogg

Published: May 9, 2016 12:20 pm

Last Updated: January 13, 2020 9:40 am

If you ever wanted to see how the outside investing world views a nation’s leadership, look no further than Brazil on Monday, May 9, 2016. The impeachment efforts against Dilma Rousseff reportedly have been derailed. The financial markets covering Brazil have tanked as a result.

At issue is not just that Rousseff is deemed a socialist. The effort to shake out corruption in Brazil while Rousseff has been president has been widespread. The long and short of the matter is that anyone tied to finance and business outside of Brazil, and many of those same groups inside of Brazil, want the Rousseff regime to come to an end because the political promises have failed to boost the economy. Brazil’s economic performance has been a disaster.

This is being called a procedural stumbling block. Brazil’s lower house has reportedly moved to halt the current impeachment process, but another vote is being called after noting that the first vote was flawed. Rousseff may still be impeached, but this process does not look as though it will be as rapid or as smooth as financial market participants have hoped for in recent weeks.

It may seem sad to think that the market would tank when a president gets to stay in office. Again, this is Brazil, and most of the economic participants want Rousseff out.

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