Opinion

Lula v. the bond market

Lula's nascent government has had a tough time dealing with the bond market, the fears of which are partly warranted, and partly undue

Lula's nascent government has had a tough time dealing with the bond market, the fears of which are partly warranted, and partly undue
Photo: Diego Padgurschi/Folhapress

James Carville, the legendary political consultant for the U.S. Democratic Party, once said: “I used to think that if there was reincarnation, I wanted to come back as the president or the pope or as a .400 baseball hitter. But now, I would want to come back as the bond market. You can intimidate everybody.” 

The Brazilian bond market has been indeed quite intimidating since Luiz Inácio Lula da Silva was elected president for the third time in October of last year. In November, the ten-year benchmark annual yield for local government bonds rose from 11.9 percent to a...

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