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Monday, October 28, 2002

Be-Bop-A-Lula The Brazillians went and elected Luiz Inacio Lula da Silva over the weekend, with the left-populist getting 61% of the vote in the runoff. Now, the question will be how far to the left will he govern? This last paragraph of this BBC piece is telling "He founded the PT [Worker's Party] in 1980, but in recent years has moved to the political centre and dropped the anti-capitalist rhetoric which marked his three previous presidential bids." Towards the center or to the center? It looks more like the former than the latter. Lula has promised to respect the foreign debt that Brazil has rung up over the years. The BBC coverage wanted to point out that the financial markets didn't tank today after hearing the news, but anyone who knows how markets works would simply state that a Lula win had already been factored in, since he got 47% in the first round and most of the other losing candidates had supported him. Now the question will be whether Lula can be sufficiently populist and still keep the international bankers happy. I think not. Fast forward to this winter (in the Northern Hemisphere) and we’ll see international debt relief being a front-burner issue.

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