Fewer younger and with its banks working with standards appropriate for the much older, dooms Brazils economy
Sir, Martin Wolf writes: “Brazil is in economic, political and moral crisis…too many people are unemployed, the economy is too feeble, the politics too corrupt, and the state too captured…Brazil needs a political and economic rebirth. The crisis makes this necessary. If that does not happen, the future looks sad.” “Brazil’s crisis creates an opportunity” November 8.
Wolf recommends, among other “A funded pension scheme could raise national savings. The government must also have the freedom to control the numbers and pay of civil servants. Doing all this would liberate resources for other areas”
Indeed. But for those resources to be able to flow to where they can be most productive, Brazil also needs to rid itself of that odious regulatory risk-aversion imbedded in the risk-weighted capital requirements for banks. If not Brazil’s future, as well as that of any other nation that keeps those regulations, is doomed to be very bleak.
From “1970 to 74 in 2017…the fertility rate in Brazil has fallen from five children per woman to just 1.7… the population is ageing”.
I understand that for one of Mr Wolf’s age (and perhaps even mine) a risk minimizing investment strategy makes sense but were any financial advisor to suggest that to a young professional starting out, he might very well lose his accreditation.
@PerKurowski
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