How Brazil solved their economic troubles in the 1990s
Brazil, well-known for being the only Portuguese-speaking nation in the Americas, has been independent for nearly two centuries. As an independent nation, today, it is an emerging market economy that has suffered under years of leftist presidents such as Lula da Silva. Bolsonaro's economic and social reforms will likely decide the future of Brazil's economy and its people. Today, I will take a look at Brazil between 1986 and 1994, a string of economic stabilization plans that ultimately failed. Because emerging market economies keep making the common mistake of inertial inflation, and that central banks do not help on these economies. 28 February 1986: Plano Cruzado : The economic stability plan replaces Brazil's currency, the cruzeiro, with the cruzado, with one cruzado equal to 1000 cruzeiros. The price freeze worked initially, with monthly inflation going down from 12.47% on February 1986 to 1.43% on October of the same year. However, price controls have had an adve...