17-07-2019 - GLOBALIZACAO.NET - DEZ ANOS NO AR PARTE 1-2

Desde 2009 estamos no ar com o www.globalizacao.net.

O "site" foi criado na esteira da crise do "subprime" nos EUA iniciada em 15-09-2008, com a quebra do banco Lehman Brothers. O dólar esteve na iminência de colapso, como no no período 1971-1973, só que ainda mais grave. O "site" trouxe nosso livro publicado em 2.000 na versão impressa: "A globalização e os trinta anos de indexação no Brasil", 319 páginas. Com o "site", o livro passou a ser disponibilizado gratuitamente para "download" em PDF (pode ser baixado no "link" no pé da página). De lá para cá, mais de 15 mil livros foram baixados. O livro conta a história da inflação no Brasil e era um prelúdio do que poderia vir a ocorrer com o dólar com a crise de 2008. Iniciamos então o próximo livro, uma atualização do primeiro junto com a história da crise do "subprime". Desde então este segundo livro está em elaboração.

Em virtude do avanço da ditadura civil no Brasil iniciada na era Lula e da posterior desestabilização da economia na era Dilma, passamos a focar neste informativo, na vã esperança de que quando tudo voltasse ao marasmo tivéssemos tempo para terminar o segundo livro. O mesmo segue agora. Iniciada a Lava-jato em 2014, de lá para cá os acontecimentos evoluíram em exponencial volume e rapidez, caminhando para o colapso da ditadura civil, que a todo custo tenta sobreviver, seja com assassinatos, seja com auxílio do braço jurídico da máfia, o STF. Corrupção e inflação estão umbilicalmente ligados.

Para tentar acompanhar a evolução dos acontecimentos, focamos aqui neste informativo e o livro mesmo ficou parado, embora tudo que consta do informativo seja material para o livro. O mesmo se deu com a crise dos EUA, que foi avassaladora e com desdobramentos em escala exponencial. Nos EUA, a crise foi sufocada, adiando-se-a o quanto se pode, até que o marasmo tomou conta de tudo, quando então eclodiu a desestabilização da economia no Brasil na era Dilma em face da irresponsabilidade fiscal e da corrupção.

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Nosso primeiro informativo original, em inglês, de 18-06-2009, segue reproduzido abaixo e consta do endereço também abaixo reproduzido:

http://www.globalizacao.net/informativo-detalhe.asp?ID=1

18/06/2009 - ENGLISH SUMMARY ABOUT HYPERINFLATION IN BRAZIL

GLOBALIZATION AND THE THIRTY YEARS OF INDEXATION IN BRAZIL INFLATION AND HYPERINFLATION IN BRAZIL This is a translation to english of what is shown in the pages of this site in portuguese and also a little summary about the E-BOOK, that can be download for free from this site in PDF format. Globalization finally reached: the implosion of Wall Street with the subprime crisis of 2007/09 and the banking and gubernatorial frauds to rescue banks has the potential to generate a fiscal crisis whose outcome may be the beginning of a period of high inflation in the first world or something worse: a global hyperinflation as in Germany of Hitler.

The book "Globalization and the Thirty years of indexation in Brazil" from ANDRÉ DE OLIVEIRA GUIMARÃES is the unique book in Brazil that tell in detail as a country lived with three decades of high inflation and hyperinflation. The book "Globalization and the thirty years of indexation in Brazil" from André de Oliveira Guimarães, JAC - Graphic e Publisher, São José dos Campos, Brazil, published in 2000 is a historical, political, legal, economic, financial and sociological ROADMAP on inflation in Brazil. About the book "Globalization and the thirty years of indexation in Brazil Globalization finally reached: the implosion of Wall Street with the subprime crisis of 2007/09 and the banking and gubernatorial frauds to rescue banks has the potential to generate a fiscal crisis whose outcome may be the beginning of a period of high inflation in the first world or something worse: a global hyperinflation as in Germany of Hitler.

The book "Globalization and the thirty years of indexation in Brazil" from André de Oliveira Guimarães, JAC - Graphic e Publisher, São José dos Campos, Brazil, published in 2000 is a historical, political, legal, economic, financial and sociological ROADMAP on inflation in Brazil. In 319 page s (Volume 1) the author tells like the "Indexation" or "monetary correction" or "monetary updating" perpetuated the inflation allowing the occurrence of the hyperinflation in the 80s and 90s decades of the 20th century. The "monetary correction" or "Indexation" created in 1964 and abolished thirty years later, in 1994, with the Real Plan, was the instrument that - along with the military dictatorship - destroyed the state and society, producing the chaos of today that sums itself to the globalization, producing an even greater CHAOS whose result is the ruination of civilization.

The socialism / communism failed in the twentieth century and now in the XXI century is the capitalism / neoliberalism the system in the process of collapse, showing that political corruption is basically the major cancer of any system that be adopted. The great economic progress of Brazil, an emerging country, which occurred from 1994, can be dissipated because of the agony of the state, corrupted in all its spheres and powers since ever, and of the enormous pressures imposed on States by social exclusion generated exponentially growing by globalization. Democracy hard regained, in 1988, after 21 years of military dictatorship (1964-1985) is again in final stage of extinction by the dictatorship of corruption. Three economic processes overlap: thirty years of indexing and inflation (1964-1994), globalization and now in 2009 a financial crisis generated by the United States that at least will do the time itself advance a decade in a matter of months, catalysing exponentially globalization, which already was a process of acceleration of historical events.

Three scenarios exist today for the U.S.: 1) experience a cambial overshooting like happened in Brazil in 1999, with the dollar stabilizing itself at new level and leaving the Americans a little poorer, 2) experience the previous scenario and then the initiation of an "inertial inflation" like in Brazil of the end of the 70s decade and beginning of 80s, becoming the newest "Republic of bananas", 3) experiment, from the night to the day, a German hyperinflation like the one of the decade of 20 with the holders of government securities undoing themselves from their positions in a "herd effect" similar to the Stock Exchanges and fleeing to gold and other real assets.

Scenario 1 is already under way for months, being the dollar depreciated too: neglecting the crisis and inflation in the U.S., should be worth today in Brazil about R$ 4, however fluctuates between $ 1.6 and R $ 2.5.

SUMMARY OF THE BOOK "GLOBALIZATION AND THE THIRTY YEARS OF INDEXATION IN BRAZIL:

In the book there are 7 chapters:

The FIRST CHAPTER (INTRODUCTION) contains the several cases of hyperinflation in the world. For instance, Brazil had more than 4,900,000,000,000,000,000% of inflation from 1829 to 1999, what can be seen on page 18 table 3. It were 7 currencies with 9 denominations since 1822: real, cruzeiro, new cruzeiro, cruzeiro, cruzado, new cruzado, cruzeiro, cruzeiro real and finally real (since 1994). There were 5 cuts of "3 zeros" (or 000), which can be seen on table 4 in page 19. In page 20 a graph shows the worst period (hyperinflation): 1985 to 1994: currencies, main indexers, governments, economic plans dates, zeros cuts of the currencies, monthly levels of inflation (from about 10% per month in 1985 to 84% on march, 1990, going until sustainable 50% per month in 1994, before real plan) and the wage laws of automatic indexation (since readjustment by each semester until monthly readjustment). Indeed, government didn t want inflation end: inflation was good for the government, it caused discrepancy in its expenditure. Finish with the inflation is possible, but it is needed want it. Government did not want. Several plans were only instruments for produce more and big lags or discrepancys. From 1964 to 1985 Brazil was a military dictatorship sponsored by United States. Dictatorship and currency destruction produced floppy citizens and it is the cause of the garbage be on the power in whole Latin America. Thus, formed itself the Three Worlds: First World capitalist, Second World Communist and the Third World: the Underdeveloped World, after so called developing world and now, by a lie from financial market, Emerging World.

The SECOND CHAPTER (THE MONETARY CORRECTION) explains the mechanism of the indexation created by the government (whose main objective was "lag" its expenses and "correct" its revenue, creating fabulous budget profits). In 1964 governement created a public title (as american tresuries) indexed to the past inflation, the ORTN (Obrigação Reajustável do Tesouro Nacional or Readjustable Obligation from National Treasury, RONT). If inflation were 5% in the past month, in the next the ORTN were readjusted 5% also. Thus, the investor theoretically never would lose in fight inflation. But government lied about true inflation also. In that time, end of 70s decade, prices took some months to rise some percentage points. Indexation system newly created was used to index real estate financing by the also newly created National Bank of Housing (NBH or BNH, Banco Nacional da Habitação), having been established another new indexer: the Capital Standard Unit (CSU, or UPC, Unidade Padrão de Capital). It worked as ORTN. Also was created indexation for savings which would finance the BNH/NBH). In this initial moments of high inflation (about 90% per year in 1964), indexation seemed have solved inflation problems and seemed be a very good idea created by Roberto Campos, a smart economist. Started what was called the "brazilian economic miracle", a period (1968-1973) with economic growth rates about 10% by year. Gold standard ended and oil crisis begins in 1973. Gasoline prices and exchange rate pass to change like shown in tables 7 and 8 on page 40 and high inflation starts newly: from about 15% by year in 1972 to about 40% per year in 1978, when new oil crisis begins: in 1979 oil does inflation hit about 77% by year in Brazil. Government wanted control interest rates to leave them low. It was a disaster: 80s decade begins with new level of annual inflation: 100% by year. In this time already government wanted more and more inflation: thus its costs decreased. During 80s decade several plans occurred and the ORTN changed to BTN (Bônus do Tesouro Nacional or National Treasury Bonus, NTB). Only name change. In the 90s decade the indexation passed to be based not more in past inflation, but in future inflation. It was created the TR (Taxa Referencial or benchmark or reference rate, RR). The TR/RR was, in theory, interest more future inflation, but in practice worked as minimum level for future inflation. It was an imbecility: ev eryone already knew which would be inflation in the next month. TR readjusted savings, housing and fundings DAILY, but wages followed rising monthly or worse. Fiscal revenues already in this time were indexed by a new indexer: the UFIR (Unidade Fiscal de Referência, or Reference Fiscal Unit, RFU). Taxes were paid in UFIR/RFU, daily readjusted, and costs of government were paid monthly, sometimes without any correction. The mechanism of TR/RR is shown since page 49. It was of one quintessence that showed how much government was smart to collect and felon to pay. See in page 57 how was calculated the interest of savings (juros da caderneta de "poupança"). TR was the average of CDIs (Certificates of Interbank Deposits, CID, or Certificados de Depósito Interbancário) less 1.2 percentage points. Savings ("Poupança") paid TR more 0,5% per month. The system of lies about the true level of inflation did real estate financing end because financing worths were big and terms of payment also.

The THIRD CHAPTER (LOANS X INFLATION) explains how banks and other financial institutions adapted themselves to the inflation and began to earn scandalous profits "prefixing" future inflation in their credits (earning "real" interests of over 100% per year). Until the 70s decade the loans hadnt "monetary correction" or "indexation" ou "automatic monetary updating". Banks and others financial institutions lost money with this. The continuous growth of the level of inflation did financial institutions lose revenues in "real" terms. Thus, it needed "prefix" future inflation. With level of inflation rising it is very hard to do. It did "nominal" interest rates rise to sky and economy slump. Because this, in the 80s decade the "monetary correction" or "indexation" or "monetary updating" spread itself to all cont racts of economy. And with the seal of the law. It facilitated financial operations. Another ease that happened in the 90s decade was the relative stability of the level of monthly inflation. It created a perfect scenario to "prefix" future monetary worths. But even thus interest rates couldnt be low because there were the risk of change in inflation level making there be chance of loss. For instance, in the page 70 it is shown the table 17 with a spreadsheet that shows how would be a financing in 4 installments with 6% of inflation by month and 0,625% of interest over the balance due with FIXED INSTALLMENTS. US$ 700,000 would be paid in 4 installments of US$ 205,087.36, compensating the inflation and ensuring gains of 0,625% per month over the balance due. The same is shown in the table 19, on page 73, with a financing with "MONETARY CORRECTION" or "INDEXATION". In this case, the installment was harnessed to indexer BTN, this last like were a t reasury indexed to inflation. Thus, the bank or other financial institution dont lose, whether the indexer were reliable. On page 74, for instance, the table 20 shows that "prefixed" financing or financing with INDEXATION (or monetary correction or monetary updating) are the same thing if the prefixation got set the correct level of inflation. Other example of what is shown in the book (TO DOWNLOAD IT click down where is written "DOWNLOAD DO LIVRO" - the book is in a PDF file in portuguese) is on page 76, in table number 21. In 1973 to finance a car the buyer paid 51,2% of total "real" interest in 36 months. Inflation was about 15% per year. It was the maximum condition of financing. In 1988, when inflation in Brazil hit more than 1000% in a year, to finance a car the purchaser paid 11,5% of total "real" interest, but in only 6 fixed installments. Yet in 1988 the option was finance with "indexed" installments: then the time t o pay was of until 24 months, but installments rose 25% per month in "nominal" terms and the "total real" interest of the bank was of 44% in 24 months. In 1992, after several " freezings of prices" (1986 was the first, with the "Cruzado" Plan, followed by others in 1987, 1989 and 1991, beyond a confiscation of financial assets in 1990 with "Collor 1" Plan) a car could be purchased funded in until 30 times, but the "total real" interest was of 180% and installments rose 25% by month too in "nominal" terms. Now with the "Real" Plan established in 1994, cars can be bought in until 84 months with about "total nominal" interest of 100%, what yet is too much, but much better than the inflation time that happened before 1994. On page 77 (of the PDF file - the book - that you can download for free, clicking the link at the botton) the table number 22 shows how much credit cards, for instance, c ollected in inflation time in Brazil. On September, 1993, when monthly inflation was 35% (35% per month, or 3,564% by year! Oh yeah! It yes is HYPERINFLATION! Not what Peter Schiff said: 100% in 3 years; 100% in 3 years in United States cannot happen, for in the current situation the Federal Reserve couldnt rise interest rates without have print more money and it would carry to hyperinflation and it would be 100% in 3 days; US situation is: little inflation as ever or hyperinflation, there isnt medium-term) credit cards collected 57% of interest rate in one month. With 35% of inflation in the month, it ensured 16,29% of "real" gain in one month (or 512% of "real" gain per year more "monetary correction"!). Now, 2009, inflation is about 10% per year and credit cards collect about from 7 to 14% per month. In "special checks" (available credit with only the use of one check sheet) the interests were the same. Yet on page 77 the table numb er 23 shows that inflation gains are illusory. The relative prices remain the same: may there be until loss. From July, 1993, to September, 1993, the table shows how much fluctuated inflation, gold, currency (dollar), certificates of banking deposit (CDBs), DER (Special Deposit remunerated from Collor Plan), poupança (savings - remunerated deposits that paid TR, reference rate, more 0,5% by month), Ibovespa (São Paulo stock exchange index) and the index of Rio de Janeiro stock exchange). Were 136,93% of inflation in three months, and gold rose in "nominal" terms only 109,64%, with "real" loss of 11,51% for instance. "Real" gain of Ibovespa in three months was 18,42% and CDBs ensured only 1,65%. And it considering the INPC/IBGE inflation index. Using another index of inflation, the results would be others. This is the problem of inflation: little gains (regarding an index) can became big losses (regarding anotheres indexes). In U.S. there are many people thinking that will win money being enough absence of will of do anything, that is, nothing do, only wait prices rise. Prices rise only in "nominal" terms, like Marc Faber say always dying to laugh. On page 79 another example about book contains: the table number 24 shows how to do to prefix future monetary worths in inflationary environment. For instance: I will sell a commodity in 4 installments FIXED in "nominal" terms to facilitate the purchase for buyer (which dont have its revenues indexed to the inflation). It will be thus: one initial payment and other 3 installments, all of equal worths in "nominal" terms. I want gain 80% "real" with the sale. I guess inflation in the next three months will be: 5% on(in) the first, 8% on(in) the second and 13% on(in) the third. So, I shall multiply the cost of commodity per 0,4980. It will be the worth of the initial payment and of the 3 others installments. A commodity wi th cost of US$ 100.00 without inflation would be sold by US$ 180.00. With 5%, 8% and 13% of inflation successively over 3 months the cost will rise to 105, 113.4 and 128.14. With an initial payment of 49.80 (100 X 0,4980 according the table) and 3 installments of US$ 49.80 I will gain 80% "real" with a "nominal" margin of 99.2% (4 X 49,80 199.20). This was the main goal of this book when it was made: a financial witchcraft manual. When "indexation" doesnt exist is what happens, everyone need guess what will happen. On page 80 there is an example of receipt of payment of installment "indexed" to the BTN in 1990 in Brazil. Installment was of 465,20418 BTNs and the worth to pay was of NCz$ 6.043,37 (six thousand and forty three new cruzados and thirty seven cents, it because the BTN was quoted at NCz$ 12,997. So, 12.997 NCz$/BTN X 465.20418 BTNs $$$ 6,043.37 (in Brazil "." is "," and "," is ".", the n $$$ 6,043.37 [U.S.] 6.043,37 [Brazil]). After 1991 when "indexation" became based in "FUTURE INFLATION" the space with the worth to pay had the "NUMBER OF TR", which became the calculation one unknown process that everyone hated do.

The FOURTH CHAPTER (SALARIES X INFLATION) shows how the government "delayed" its main expenditures: creating wage laws of automatic "indexation" of wages that resulted after thirty years about 800% of "lag" on wages, which meant that wages lost about 90% of their "real value", which was the main ingredient for the emergence of a new class of professional politicians: the former syndicalist, the biggest liars from entire history of policy. On page 83 we can see: the first States intervention on work contracts with wage goal was the creation of the minimun wage in 1940. Since then it was readjusted about annually until 1973, period (1940-1973) in which inflation was very high b y international standards, but yet low by brazilian standards. After oil crisis in 1973, much more high inflation begins. The Labor Justice rehearsed the increases in minimum wage to other wage ranges and this jurisprudence became law with the law 4903 from 1965. Annually wages rose by law. On page 108, for instance, the table number 41 shows how much wages lost with several wage laws: for example, the law number 8.700/93 established that wages would rise each quarter (but with a little anticipation of the readjust of the quarter). That time monthly average inflationary level was 35% (like shown in the table of the PDF file that you can download for free from this site - www.globalizacao.net). The average loss in wage is 33,76% in the quarter (it was the gain of government in its costs as wages) and the average acquisitive power in the quarter was of 66,24%. Economy, then, was suffocated in minimum 33,76% which wages lost. And it without speak in very high interest rates whi ch disabled the economy too. Tables numbers 26, 27, 28, 29, 30, 31, 32,33, 34, 35, 36, 37, 38, 39 and 41 show how much wages lost in several wage policys from page 83 to 112, from 60s decade to 90s decade until "Real Plan" in 1994, when automatic "indexation" ended for wages and several contracts of the economy, having been it what ended with the "inertial" inflation. Table 40 on page 107 shows that there isnt wage policy that allow wages hold the "real" worth over time. With 5% of inflation monthly and automatic readjustment at each six months the average purchasing power of the wages is of only 84,59%, for the Kpam (coefficient of average purchasing power) according the table is 0,8459. For annual readjustments and 5% of inflation each month, the coefficient is 0,738604303 like shown in page 107. On page 109 a graph shows how much wages on public sector decreased from beginning of 60s decade to beginning of 90s decade. It was more on e factor to increase the corruption in entire country. In Brazil few things are serious and little wages show this, is not the little wages what do born the corruption, the corruption comes justly from one system which does not treat the things seriously, starting with salaries. Little salary is yes synonym of corruption and it is beucase this. Its therefore Gerald Celente is correct in its forecasts about civil war and unrests in United States and Jim Rogers also. A Third World War also cannot be discarded in this scenario. Brazil lives in civil war produced by poors thieves in slums. The slums were produced by thirty years of inflation and "indexation" and twenty one years of military dictatorship. People used themselves in Brazil with the poverty because inflation did this over three decades. Hence labor unions rose in Brazil and syndicalists got arrive to the power, forming a new class of political garbage, but much worse than the traditional politicians. Brazil lives the beginning of a new period of dictatorship, this time based on corruption and direct link with traditional organized crime. Only categories with big labor unions got hold the purchase power during inflation time. What needed decades to happen with Brazil can happen with U.S. in weeks whether what Gerald Celente, Marc Faber, Jim Rogers, Peter Schiff and others said occur. But globalization has destroyed the power of Labor Unions and has done the Right get return to the power after several years.

The FIFTH CHAPTER (ECONOMIC SHOCKS) shows how successive economic plans" that allegedly tried to quell inflation produced the famous "salary losses" and "skeletons" ( "monetary correction" due and not paid in various financial applications and contracts) always maintaining inflation on an "interesting" level(a controlled hyperinflation). Basically were 5 main economic shocks during the 80s decade and 90s. In the begnning of 70s in flation was in about 15% per year in Brazil. This before oil crisis. After 1973s and 1979s oil crisis, inflation in Brazil hit more than 100% per year in 1980. Began the moratoriums time in Latin America. Interest rates in U.S. overcomes 10% by year. Inflation in Brazil already is "inertial". From about 100% per year in 1980 inflation hit new baseline in 1983: more than 200% by year with gubernatorial efforts to improve exports. The military dictatorship ended in 1985 and the first civil president took the office. Annual inflation was over 200%. Government efforts before 1985 did not exist to end inflation. On February, 28, 1986, finally the Sarney Government decreed the "Cruzado" Plan ("Plano Cruzado"). Prices were "frozen" on levels they were at 02/28/1986. Government established prices tables for all and enterprises couldnt rise prices over the worths established. It was a sucess in the beginning, but after enterprises began to cash in agio from purchasers. After elections on november, 1986, prices were released and the own government increased public prices tens of percentage points. After this trauma all economic plans ever failed. Government did the plan only to win elections nine months later. Some months after, in 1987, the "Bresser" plan ("Plano Bresser") freezes prices newly. Weeks after, prices are "thawed". It is created the "URP" ("Unidade de Referência de Preços" or Prices Unit Reference, PUR) to adjust prices and salaries. After these two freezings economy became a big mess and "indexation" spread for all contracts. People stayed waiting the next "freezing" and then prices rose always in the same rate of the others, but always in higer speed, to avoid the table at low relative price. Interest also rose to sky and this did with government create the "tablita" (portuguese term that means "deflati on table"). With the "tablita" goverment "deflated" future monetary worths of financings that had them "inflated" in "nominal" terms to compensate inflation. At each plan of "freezing", there was one "tablita" to "deflate" monetary worths of financings and this was more one fear from economic agents. "Freezing" for salaries, tables to prices and "tablitas" for financings. This fear did inflation rise more and more at each rumor about new "freezing". In 1989 the same happened: this time was the "Plano Verão" or "Summer Plan". New cut of three zeros of the currency as in 1986, new currency as in 1986. The Cruzeiro, the currency of 1986, became "Cruzado" with three zeros less. The Cruzado became New Cruzado in 1989, with three zeros less too. The worst to economy happened on March, 1990: The "Plano Collor 1" or "Collor 1 Pl an", which confiscated financial assets in banks. It was the worst shock in economy. Inflation that was over 80% by month, fell, but months later came back. In 1991, new "freezing", the "Plano Collor 2" or "Collor 2 Plan". This time the "indexation" passed to be to "future inflation" (!!!!) with the TR. After 1986, Brazil entered in the HYPERINFLATION ERA, with inflation hitting more than 1.000% by year. Why there was economic growth even with inflation? Is the ask of the page 124: Its because "indexation" did prices rise more or less in the same proportion maintaining "relative prices" constant. People lived with their average of purchasing power like shown in the chapter four. But this economic growth was done of "bubbles". Why didnt happen an uncontrolled hyperinflation? The Recession caused by the loss in the purchasing power did inflation not go to uninteresting baseline. It worked as a fence. Beyond there was the fact that the "indexation" became based in the "future inflation" with the "TR" (Referencial Rate or "Taxa Referencial"). Were the banks, with the CDIs, who controlled the level of the inflation. Hyperinflation became merely inflation. People already knew how much would be inflation in next weeks or months, and it became possible know to "prefix" future monetary worths. Only poors, public servants and salaried employees hadnt full "indexation" in their revenues, but anyone had to lose for anyone win (government). It was this what caused the social odds and the poverty of the country. Salaries of February were corrected by January inflation at day 02/01, but they were only received at day 02/28, thirty days later, already "eaten" by February inflation. This when "indexation" was monthly, which neither ever occurred. Federal Constitution of the Country established that interest rates cannot be over 12% by year in its article 192. This was "dead letter". At page 134 the table number 45 shows how much indexes of inflation there were in the country in 1994: INPC, IPCA, IPCA-E, IRSM, IGP-DI, IGPM, IPAM, IPCM, INCCM, IPC, ICV, IPV, ICVM, CUB/SP and restricted IPC. Each one measuring one different inflation, for rich and poor people. Page 135 shows in the table number 46 how much each of these indexes ranged from October, 1992 to December, 1994, during Itamar Franco Government, which created and instituted the "Real Plan" or "Plano Real" of 1994. Inflation ("inflação" in portuguese) by different indexes ranged from about 25% by month to about 50% by month in this period. The "Real" got down these values to about 2 or 3% by month in the first six months of new currency. Page 139 shows the mess formed among different bank notes. It was a publicity of the Central Bank of Brazil on the new currency created in 1993, the "Cruzeiro Real". It was part of the "Real Plan": cause a big mess among terms as: cruzeiro real, real, "real power of purchasing" and "URV" (Unidade Real de Valor or Real Unit of Value) to make syndicates lose the power of persuasion on people, for the "Real Plan" also caused losses for salaries.

The SIXTH CHAPTER (THE REAL PLAN) shows how the "Real Plan" of 1994 finished forever with the inflation and how was the mechanism for stabilizing of the "relative prices", the URV, Real Value Unit. A new indexer was created to index all prices daily, from salaries to financial installments: the URV, Real Value Unit, or "Unidade Real de Valor". It was a non-dimensional value by which all values of economy should be divided to find prices in URV. As ever, as all times, salaries were divided by the URV and converted in URV by the average of the last four months. The graph o f page 151 shows what it meant: forever, salaries lost 33,76% like shown at page 108. They need an increase of 50,97% to reset the purchasing power which would be the legal in "real" and "nominal" terms. It was the gain of government in this plan this time. Federal public servants, mainly, were the main injured. More one time, an economic plan was made with electoral goals: like shown at page 150; the graph shows how much was the inflation before and after the "real plan" and when would be the presidential election. At page 149 two graphs showing two "effects": "Lula Effect" over the plan (down) and "Plan Effect" over Lula presidential candidature (which ended happening. That time Lula was a serious threat to economy and country. "Real Plan" was made for Fernando Henrique win the election. Down: the chances of Lula win would do hyperinflation hit the sky before election. Up: the chances of Plan be a succes sfull would do Lula sink, exactly as happened. Both graph of page 149 shows the level of inflation ("PATAMAR INFLACIONÁRIO" on graph) in monthly rates and the percentage of intention to vote for Lula ("INTENÇÃO DE VOTO EM LULA" on graph). Before plan and election, both were about 40-50%. Page 157 with the table number 49 shows how much was inflation during first government of Fernando Henrique Cardoso (1995-1998). From January, 1995, up to December, 1998. Different inflation indexes as INPC, IPC, ICV, IPCA, IGP-DI, IGPM, IPA-DI, IPCA-E and CUB show inflation decreasing from 2 or 3% per month to 0,5% by month (like in First World). But began the season of financial crisis around the World: Mexico crisis (1994), Asia crisis (1997) and Russia crisis (1998). The exchange rate stayed fixed from 1994 till beginning of 1999. This was basal for create a new mentality, doing "inertial" inflation die by the loss of the "inflation ary memory", whose existence was possible with the "indexation". This was the main strategy of Pedro Malan (Finance Minister) and Gustavo Franco (chairman of Central Bank of Brazil), two true historical heroes like Obama will be if get do U.S. exit from subprime crisis. They already have their places in the sky at the right side of Him (at the left right are those that themselves say from the left but are from the shit, from the very big garbage of the Latin American Left). They got do the Real give right. Affair discussed in the book too is the technological structural unemployment produced by globalization and that produce the globalization. Economy may sink, but it is not because what government is doing. Governments cannot control more anything. The graph of page 189 shows that Fist World wanted walk to utopia in 2000 (when the book was published) while Third World attempted exit from mess to reality. Now, in 2009, First World entered in a big mess too. Th e item 23, since page 211, "Apocalypse" shows what happened when Brazil had leave the cambial anchor in 1999. The table number 61 on page 224, for instance, shows the dollar going from 1,21 real to 2,10 real in less than one month when the anchor exploded on Janary, 13, 1999. Table number 62 at page 228 shows what happened when the exchange rate had to change in several countries: England, Australia, South Korea, Thailand, Mexico and Brazil. Is what already is happening with United States and may cause the dollar collapse also. Page 227: table number 63 shows the schedule of maturity of the Federal Public Due of Brazil in the beginning of 1999. "Corrected" due and "prefixed" due. Table number 66 at page 230 shows the unemployment in Brazil since 1980 up to 1998.

CONTINUA NA PARTE 2-2, INCLUINDO AS NOVIDADES DO DIA DE ONTEM (OS CRIMES DE ONTEM)

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