And this gentleman was an IMF economist? Fixing Brazil’s Politics: an IMF Bailout

Stephen Jen has a proposal for Brazil to get out of the current economic mess: ask for a bailout from the International Monetary Fund.

Not that Brazil needs the funding, said Jen, a former IMF economist. Latin America’s largest economy holds $371 billion inforeign reserves, almost 10 times the amount of the government’sforeign-currency debt.

But Brazil’s political system is in such disarray that the country can’t push through reforms needed to curb debt, tackle inflation and avoid more downgrades, according to Jen, the co-founder of London-based hedge fund SLJ Macro Partners LLP. Financial aid from the Washington-based IMF would require austerity measures such as tax increases and spending cuts, providing President Dilma Rousseff’s government with the political cover to implement unpopular measures needed to shore up the budget, he said.

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