2016-02-28 (Sunday)

Today, I learned that:

The way the world is today, we had better be optimistic in order to not go down further. But at the same time, we have to be realistic, and thus today’s post is not at all positive.

The Swedes still remember what happened today exactly 30 years ago, when the country’s CEO, also entitled “statsminister” or prime minister, was murdered, and which led to a lot of investigations and confusions that have never been totally concluded, and I doubt they ever will.

But here in Brazil, the big news on that very same Friday was the economic plan launched by the Federal government, the Cruzado Plan. It was the first in a row of similar attemps to stop the inflation and get the country into a more stable state. Among the measures taken were the conversion of the old currency, cruzeiro (Cr$), into a new one, named cruzado (Cz$), where 1 Cz$ = 1 000 Cr$. Also, there was a general freeze on prices and salaries. In the beginning, the people in general were optimistic and believed that the plan might eventually succeed, but it became evident that the lack of corrective actions to address observed undesirable effects gradually resulted in a failure, with the inflation bouncing back at even higher levels than before.

So during the period from 1986-02-28 to 1994-07-01, Brazil had the following official currencies:
1986-02-28 — 1989-01-15 cruzado (Cz$). ISO 4217 code BRC.
1989-01-16 — 1990-03-15 cruzado novo (NCz$), where 1 NCz$ = 1 000 Cz$. ISO 4217 code BRN.
1990-03-16 — 1993-07-31 cruzeiro (Cr$), where 1 Cr$ = 1 000 NCz$. ISO 4217 code BRE.
1993-08-01 — 1994-06-30 cruzeiro real (CR$), where 1 CR$ = 1 000 Cr$. ISO 4217 code BRR.
Starting on 1994-07-01 and still today, the currency is named real (R$), which was converted at the rate of 1 R$ = 2 750 CR$. ISO 4217 code BRL.

It is very well worth noting how to the real was introduced. During the four months that preceded the adoption of the real, Brazil had two different currencies. The first one was of course the official currency, cruzeiro real, but there existed also a parallel non-monetary reference currency named URV (Unidade Real de de Valor, meaning Real Value Unit), and all prices and salaries were quoted in both currencies. The government published the daily ratio between the two currencies, which included a daily devaluation of the cruzado real in relation to the URV. A complete explanation of this gradual process of conversion can be found in reference # 2 below.

100 reais

The Brazilian bank note with the highest facial value. Today, 100 reais correspond to approximately 25 US dollars or 23 Euros.

And so, on 2016-07-01, if nothing happens before that date, Brazil will have survived 22 years with the same currency and an apparent, stable economy. Of course, the last statement is not really true, because there have been periods with rather high actual inflation, although not reflected in the official numbers, and as I hinted in the very first paragraph of today’s post, the situation is very critical. The high levels of corruption and lack of efficient policies to develop and sustain the economic growth has led to a political crisis of huge expression, combined with prolonged periods of negative economic growth. In fact, today one of the leading daily newspapers in Brazil, O Estado de S. Paulo, expressed in its main article that “Após três décadas, risco de calote volta a assombrar economia brasileira”, which means that three decades after the ecomic crises of the decade of 1980, there is imminent danger that Brazil will break through once again, as it did in 1980. Reference # 3 contains the complete article.


Hollywood Boulevard’s Walk of Fame, photo taken on 2007-02-20

After such a gloomy post, is there nothing positive that can be said today? Well, the photo above shows the hands and feet of some of the biggest stars in the history of the film industry, like Humphrey Bogart and Shirley Temple, for ever present in the Hollywood Boulevard’s Walk of Fame. And to my surprise, the Swedish current star, Alicia Vikander, native from the Swedish West Coast, was presented with the Academy Award (“Oscar”) for her role in the movie The Danish Girl, fantastic! So at least this day ended up with a positive splash!


Alicia Vikander holding and thanking for the Oscar statue. Photo by Kevin Winter/Getty Images

Updated 2016-02-29: Listen to Alicia thanking for the Oscar, reference #5 below. And further to Alicia’s own Oscar, the sci-fi thriller Ex Machina, where she plays a robot, also won an Oscar for the best visual effects, beating such heavy productions as The Martian, Mad Max: Fury Road and Star Wars: The Force Awakens, in spite of a minuscule budget of just $15 million.

… That’s what I learned in school !


1: Plano Cruzado

2: URV

3: Após três décadas, risco de calote volta a assombrar economia brasileira

4: Oscars 2016: Alicia Vikander wins Best Supporting Actress for The Danish Girl

5: Oscar till Alicia Vikander

6: ‘Ex Machina’s’ Oscar win is a triumph for low-budget VFX

+: What did you learn in school today ?

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