The Dying Dollar

One thing I can say with confidence is that the government will not act. It will do too little, too late.

I was in a seaside resort town in Brazil a few years ago. While there, I developed a rapport with a former fashion model, with many interesting stories, who happened to own the bed and breakfast where I was staying.

One story was about how her father would make her give him most of her earnings for safekeeping. He converted them to dollars and stuffed the cushions and pillows of their couch with them, along with most of his earnings and her mother’s earnings as well. She and her mother thought he was crazy. Most of the people they knew also thought he was crazy. He was constantly ranting about inflation and how economic disaster was looming.

Then one day in March of 1990, the day after Fernando Collor de Mello was inaugurated as president of the Republic of Brazil, Brazilians awoke to find their bank deposits frozen. No one could withdraw money. Everyone with more than $1,250 in their bank account was told that the government had “borrowed” their money and wouldn’t give it back for 18 months. Nearly $46 billion sucked out of the nation’s economy in a single stroke. As word spread across town of what was going on, the father burst into the living room with a knife. He wildly slashed open couch cushions and began throwing $100 bills into the air and laughing maniacally “who’s crazy now?”

As the woman finished this story she pointed to her beautiful villa perched on a bluff overlooking the ocean, in the best neighborhood in one of the poshest towns in the Western Hemisphere, and said “my crazy father was the reason I was able to buy this place with the money I made from one Calvin Klein shoot.”

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