A Real Dilemma for the Dollar

There was an interesting article written by John Lyons in the weekend Wall Street Jornal about inflation in Brazil.  It's worth a look for those with interest in the coming domestic pricing for products such as ipe.  As the dollar continues its global and local slide, the opposite is true in South America's top economic power. 

There's no shortage of spending in Brazil these days.  Major infrastructure projects are well underway in preparation for the coming 2014 World Cup and the 2016 Olympic Games  The Brazilian Real climbed to 1.57 per US dollar last week, and the immediate future seems bright for our neighbors to the south.  I'm not sure the Brazilians can even put a price tag on the expenditures for the next five years' events, but it's going to be quite a sum of a lot of US dollars.

Or Real.  At the moment, I'd have to say the Brazilians are fairly well situated on the homefront.  The question, for those in the exotic import markets, is what will this do to domestic pricing?  In the short run, the dollar will continue to buy a little less and less overseas, which leads to the inevitable inflation at home.

Curious an American now has some concerns over foreign economic events.  The domestic markets were so fired up during the first decade of this century that it may well take the US a decade to fully recover.  There will be growth, to be sure, but have we Americans learned our lesson yet?  The land bubble may yet arrive here.  Farmland seems to be begging for a healthy burst soon.  I think the farmers are better prepared at this point than the bankers...