Today’s Wall Street Journal highlights the fact that the nation’s legendary Central Bank President, Henrique Meirelles, is seriously considering re-entering elective politics. He is postulating a run for either the Governorship or Senate from his home state of Goias. He has also been mentioned as a Vice Presidential candidate on the Labor Party ticket with the strong support of President “Lula” da Silva. While Mr Meirelles prior work as a banker may make him less popular with other Labor politicians, it would be a smart move to garner support from centrists and pro business types in Brazil who respect Mr. Meirelles superior abilities, honesty and world reknown. In particular, he has been the Labor Party’s antidote to the charge that they would destroy Brazil’s currency, banks and free market systems.
The bad news is that he will have to resign as Central Bank President to pursue any office. This can’t be a positive for the Brazilian economy. His firm hand and solid judgment have made the Brazilian economy and financial system a model for the developing world as well as developed nations. It will be virtually impossible to replace him. It will be important to watch who Lula chooses to replace him. An inappropriate choice could have significant adverse implications to the prices of Brazilian securities and the value of the Real. The hope, of course, is that Mr. Meirelles eventually rises to an even more important position than his current job. A President Meirelles would really make Brazilian equities jump!
http://online.wsj.com/article/SB125496214570672191.html
Mary Anastasia O’Grady has an excellent and insightful piece on Brazil’s ongoing success in the current market turmoil. She also points to the irony of a Socialist President calling for more free trade and the possible “United States risk” in Brazil’s economic future. In particular, she notes issues with Citibank financing trade and a declining dollar as impediments to Brazil’s continued success. The one major item that she missed was that the secret key to Brazil’s success has been the vigilence and fortitude of their Central Bank President, Henrique Meirelles. In the face of cries to lower interest rates and a more “American” like monetary policy, he has persevered in the best interests of his country. He deserves much of the credit for Brazil’s success. Lula also deserves great credit for not succumbing to calls from the left and the right to ease up on Meirelles economic vigilence. They both deserve kudos for a continuing job well done!
http://online.wsj.com/article/SB123776326396008613.html
