July 10 - Jeffrey Goldfarb talks to Christopher Swann about the downfall of Eike Batista's oil empire and how it is emblematic of a bigger problem in Brazil.
The bravado that has come to be associated with Brazil now houses poster boy I keep Batiste. Whose empire crumbling before our very eyes but not not before he gave all sorts of bold promises and pledges that it becomes sort of emblematic of the country you kind of stitched together all the pieces here. What exactly did he said he was gonna happen and how does that relate to. What we've come to think of is you know this this boastful -- -- truly think he was found it very content that -- Just a year ago he said he was kind of become the world's richest man they're taking it from -- Carlos Slim eclipsing bar -- buffet at the time he wasn't far away give us your thoughts are when he was at thirteen -- billion dollars. And instead he's broken hold back holds for the cost of slides down the rich list he's probably lost about 25 billion dollars since he made that and he says that even when -- out of ought to be married and his billionaire for all we know it would be very very tragic indeed he may not even be a -- Because the credits as a -- we don't know exactly how much debt he has but it made it looks quite monument. But this is just a symptom of sort of a bigger issue that has become associated with Brazil and you point to. Some other political and investment kind of seems that if -- ball where there's. Over promising and we'll let him do and I'll be TVX president with that Hamas to -- -- -- spending much of his time outside the country texting about how great country walls. He said that had prevailed with that like America in the 1950 night it was expected to have. That's years of uninterrupted growth yet contestants in Europe to place their bets on Brazil's obviously that if it did I would -- had a very. Disappointing time event because PS stock market found about -- he'll say percent since he made his promise and all the things behind it sort of tend to make sense right that's a resource rich country. We had this massive oil find which was supposed to them propel on the back of the minerals agriculture why is -- that the it can't seem to deliver up to expectations. I think what went wrong -- it was a combination of things. Obviously I mean that was a huge amount of hype they just failed to deliver on. They have very very rigid labor laws they have an incredibly low savings rate which means very -- investment test -- we in the country. And -- very dependent on foreign capital. I -- an essentially they dropped the building neglected fairly basic reforms like that cutting back BS state pension system. That you say there have been some achievements obviously a lot of people come out poverty ourselves. And they're still looking to you know I guess build out infrastructure have got two huge. Events that are gonna put the country on the world stage coming up the next couple years that they -- themselves have been rather contentious thing. It's not as they've -- finished without its achievements that he say about fourteen million people on the -- no way lifted out of poverty. Part of that was thanks to a commodity being part of that was thanks -- anti poverty measures that from the government. That the sporting event today and -- to -- in -- -- to simulate the problem and massively paper punches and I haven't fully execute properly on them. We will leave it there we'll keep an eye on I guess what was should now call sort of they have that -- she's low discount that needs to be -- -- result. We're back -- corporate news tomorrow.