Opinion – Vinicius Torres Freire: The ceiling fell, the GDP stopped, the price rose and the market calmed down

The stock market rose 3.7%. Interest rates in the wholesale money market have dropped. On the same day, it was learned that the economy is at least stagnant, almost heading into recession. In Congress, passed the constitutional amendment that authorizes a partial default of precatories, a moratorium, in fact.

In the PEC package also came the death certificate for the expenditure ceiling, the one that was supposed to last until 2026, at least. To be more precise, the workaround for the readjustment of the federal government’s spending limit has passed.

Yes, of course, there are sequels, which will last for the next year or 2023 at least. Interest rates have fallen just a few notches below the roof of the skyscraper they have moved to since September, thanks also to Jair Bolsonaro’s teratological misrule. The Stock Exchange is at loss. Other indicators of “financial conditions,” as economists call it, suggest a tightening in investment and consumption.

Yes, of course, this general slump is not just due to the botched and electoral change in the spending ceiling. Unforeseen persistently high inflation, in addition to being partly imported, has contributed to degrading the environment, in addition to eroding wages, taking food away from many people and dampening consumer sentiment, the remedies that we can consume beyond subsistence. As a bonus, it helped to chip the GDP.

In short, the money-holders or also the managers of financial savings seem to have been relieved that the cap’s workaround was limited, for now, to what was already known—they feared that a general license to spend would be invented. As for the GDP, the economic activity, the production and the income, it was already taken for granted that it would yield nothing.

Moreover, in the end and beginning of the accounts, economic performance does not necessarily have to do with the progress of finance, even more in the short term. But it’s good not to settle down with the Congress-center mummifieds. The discussion of the 2022 Budget is still to come.

Is it given that we will have a recession soon or in 2022? Not even that. But it will be difficult to grow to that 1.5% a year that was the pattern for 2017, 2018 and 2019, the period of stagnant lull, of cemetery peace, between the end of the 2015-2016 recession and the 2020 epidemic — the “Bridge to the Future” years on the cliff.

To reach that depressed turtle speed, 1.5% growth in the year, it would be necessary for GDP to grow 0.5% in this final quarter of 2021 and 0.5% quarter-on-quarter of 2022. From the? Anyone who estimates economic growth in a bank says no. For the record, this year’s second quarter GDP dropped 0.4%; of the third, 0.1%.

The average people in the markets are content or resign themselves to “whatever is there” in the economy; for the rest, it barely cares. The destruction of the Amazon continues, it grows, but it has stopped causing public consternation, it is the “sinking cost” of the option for “polynarismo”. The destruction of the Ministry of Education and the system of research, science, technology and public higher education continues, in a glaring fashion in recent days, as is the case with Capes. There is no need to talk about health, diplomacy, business relations or the transformation of religious matters into a matter of State.

Now, it’s time to think about the “Third Way”. The supporters, adherents, accomplices and collaborationists of the Pocketnarist ruin try to sneak out — they will probably succeed. Tomorrow, it will be another day, “carpe diem”, the stock market may fall, interest rates may rise, “business as usual”, depending also on the mood of the rich center of the world. As for the rest, now Inês and many more people are killed. “Let’s go on”. Huh.