Dilma Rousseff and Lava Jato

There is no evidence linking President Dilma Rouseff to the car wash scandal.   But, there is plenty of evidence linking others seeking her impeachment to this scandal,  including her vice president, Michel Temer.

But,  hopefully he does not follow Dilma out the door, as the next in line,  Eduardo Cunho, Speaker of the lower house, is being charged with money laundering in connection with the scandal.  An excellent article from the BBC is provided below:

Brazil Impeachment (BBC) 

Imagine you suspect your house was robbed, so you call the police, and they rob you for real.  I think this is the situation in Brazil.

The leaders  replacing Dilma may be worse than her.   Worse, the grounds for impeachment have been made too broad. The next president  must forever keep one eye on the politics of the lower house of congress.

The economy in Brazil is bad.  But, how much should be blamed on the president?  The past year was terrible for commodity prices, particularly oil and iron ore.  Everyone in Brazil knows how the government went on a  spending craze for new stadiums in 2014 prior to the World Cup.

But beginning late January to the first 10 days in January, oil prices have begun to recover.   The stock market, as measured by the index fund, EWZ in US dollars,  is up 51% in the last 3 months. The US market as measured by the S+P index is up 9% in the same period.   The real in the past week has risen 10% against the US dollar.   So, as Dilma is being shown the door,  I believe the economy of Brazil, which is a large part of the frustration with her,  is getting better.

Perhaps what went wrong, was the deterioration of the economy at a time of high expectations.  A 10% approval rating for President Dilma, is incredibly low.

There is an option to suspend President Dilma, for six months, with a simple majority.  I guess this would be the obvious choice if impeachment efforts fail to get the 2/3 needed to oust her.

Stay tuned,

Dave

 

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