At least according to the Wall Street Journal (read here). 
See, it’s not just me being bearish about the “Brazilian Bubble”, it’s the smart money as well. Liam Denning writes:
“Emerging” isn’t just a byword for growth. Market darling Brazil is flashing red. Industrial production there dropped 1.6% in June from May, much worse than expected. Tuesday, politicians unveiled a raft of measures to bolster manufacturers, including a “Buy Brazil” policy for government departments and a crackdown on imports deemed unfair.”
And the author goes on about the root causes and yield curve:
The country is struggling with a dilemma felt across the emerging world. Strong growth attracts capital, driving up the value of the currency, hurting Brazilian exporters. But Brazil also is struggling to contain inflation, exacerbated by an inflexible labor market and infrastructure bottlenecks, keeping interest rates high. In Brazil, the yield curve has inverted in the past month, suggesting rising anxiety over growth.”
And his closing paragraph says it all:
“Given the experience of the past few years, some loss of faith in America’s prospects is understandable. Just don’t go replacing it with false idols.”
After all, Brazil might be a “false idol”…

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