Brazil on everyone’s lips (and in pockets too)

December 9, 2009

Forget China, at least for now. That “B” in BRICs is really gaining momentum. Many investment managers attending the “Reuters Investment Outlook Summit 2010″ in New York this week mentioned Brazil as a hot destination to park money next year.

There is a growing perception among decision makers that Brazil is on the right track for dynamic growth.
Pimco’s founder Bill Gross, who helps oversee $940 billion in fixed-income securities, says both China and Brazil have big domestic markets with relatively low consumption levels, around 30 percent of GDP, and still room to grow.

The key difference among Brazil and the other BRICs is that it has vast natural resources and is relatively well managed, said investor and author Jim Rogers. On the other side, Russia is a “disaster” and India is “anticapitalist and “antiforeigner”, he added.

Diane Garnick, investment strategist at Invesco calls Russia “the world’s biggest black market.”
Current market optimism is also big enough to overcome two historic bumps for Brazilian growth: low quality in education and lack of infrastructure. Garnick thinks both fronts are getting better, and Brazil’s economy is, well, ready to take off.

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