Jeitinho Brasileiro will Overcome Financial Crisis.

By 14:48 , ,

I've been trying to avoid commenting on this for a while because I don't know which news sources to trust or understand some of the numbers very well and just because I don't like talking about controversial things in general, but since it's related to mine and most people's lives - here goes my bit on the financial crisis goin' on out there in the world...

At the bar the other night, my friend Dave (an American living in Brazil) started to get on the topic of how the situation is worse than ever because American consumerism is at an all time low and how this is going to effect the rest of the world's economic growth - or lack thereof. And since I get irritated when people from the United States start bitching about financial situations, I retorted (is that a word?) with saying, "So? Brazil isn't doing so bad and won't be because of the whole crisis. The rest of the world has dealt with financial instability for ages, so the U.S. needs to man up and deal with it too now that it's their turn." Okay, this was a little exaggerated, but the part about Brazil was right! Instead of spending dollars travelling abroad, Brazilians have decided to travel inside our own continent (Buenos Aires was the spot this year), and instead of buying uber-expensive imported products, we're looking more domestic, and with this, are demanding they lower prices on these so called imported items.

However, I still worry about the U.S. financial situation. And Dave reminded me of my worries by sending me a few articles on the topic. Let's not forget at least my Top 5 loved ones are there and many more - so on the phone with my mother today, I asked "So, how are things going with you considering the crisis?" And she says, "We try not to follow the news about it because if we did, we'd go crazy. So we're just living our lives the way we always have and so far it hasn't affected us." Mind you my parents aren't the biggest U.S. consumers. Most of their money goes towards bills, education (for my brother, and until last year, for me), mortgage payments, and the occasional restaurant outing and clothes purchase. They're not driving V8 SUV's (they drive gas and wallet friendly Subaru's), traveling southwards to escape the cold weather, or have a flat screen TV and home theater system. So for people like my parents, things are going to be okay.

So who is this crisis REALLY going to affect (the most, at least)?

My prediction: The average consumer in the United States. The big spender. The guy who's used to sliding his credit card buying a new electronic toy to ease his stress, or the girl who doesn't mind paying $300 on a pair of shoes. The family that's used to traveling to the Caribbean for Spring Break and their summer home in Cape Cod.

But more importantly? The poor and lower middle class in developing countries. Many countries are fueled by foreign investment, and a good amount of this foreign investment comes from the U.S. - Central America, Andean Countries, some of Africa and Southeast Asia. And yeah, even Brazil... People will lose their jobs (and already have!) and the country will go back to where it was a couple of years ago with a measly growth rate. But I strongly believe that with a little jeitinho brasileiro, things will fall back into place within the next few years. I just urge that big investors keep their confidence in countries that need them the most. For everyone's sake.

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