Causes Of Economic Crisis In Brazil

Economic crisis is a crisis can be described as the period of gloomy economic performance. There are many kind of economic crisis, which are financial crisis, currency crisis, so on and so forth. The causes of economic crisis are mostly unexpected, it difficult to specify the exact cause of the crisis, for instance, Uncertainty. Uncertainty is a condition when the participants in a market are uncertain about the issues such as the expected value of stocks and securities, then they will now unlikely trade in the same manner, which they used to. And uncertainty is allegedly as one of the most prolific contributors to economic crises all over the world.

The Economic in Brazil before World War II was characterized by six principal cycles, each

The first research, which the author found, is about the reason behind the Brazilian Crisis on 1990s. This article was saying that in that year, Brazil had a little problem with its foreign balance, which happened a hyperinflation at that time due to the evolution of Brazilian internal debt itself. And the interest costs of the outstanding government debt becomes a major component of government expenditure and thus of the government deficit is one of the reason of the hyperinflation. However, in this article, it saying that abandoning active fiscal policy and the impossibility of controlling monetary aggregates could be a way to overcome the hyperinflation in Brazil. In this article, did not mention about the specific number of the hyperinflation in Brazil. It could help the author to know the specific number, to compare it with other crisis, for instance Indonesia 1999 Crisis. Therefore, this article is relevance with the author tittle, because if we relate it with the IPE’s critical perspective, the author believed with the constructivism perspective. Since this article is more emphasize on the understanding the crisis instead of the explaining about the

Moreover, it mentioned the global connections in the financial crisis between those country, which are Germany and Brazil. Germany economic growth rate fell to 1% and in 2009 it became negative, at -4,7%. In the fact, Germany hit by the financial crisis more than Brazil, based on this article. And it was an honor for Brazil, to be the first country that could resolve it. It shows us the specific trade core, both German and Brazil. Therefore, this article was really related with the tittle, because it shows the author specific number when the crisis came in both country, which were Brazil and Germany. The author found another article, which mentioning the specific causes of Brazilian Currency Crisis in 1997-1999. This article believed that Inflation is the primary reason that Brazil adopted a crawling peg in the first place. To overcome the crisis, the Brazilian Government must reign in its public debt and budget deficit spending. And it more specifically discussed the 1997-1999 crisis in Brazil. The next article, it saying that mostly all financial crises in developing countries have been associated with preceding booms of capital