EUARTE

The Rise and Rise of the U.S. Dollar

The dollar is doing damage to other pop investments. The carry trade loved the R$. Now the only way the R$ can keep afloat is for Lula to use up dollar reserves. That is to say flood the market with his US$ dollar reserves. This is very short sighted. He does not have an endless supply and the dollar will, worldwide, keep rising for sometime. Lula will find himself with few dollars in his reserves and the much less valued R$ he was trying to avoid.