Lula lead spreads panic

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Lula lead spreads panic

Will it be fourth time lucky for Luiz Inacio Lula da Silva in Brazil's presidential elections? If he wins, the result will not be welcomed on Wall Street. What are the repercussions for Brazil, already teetering on the brink?

       

JUST A FEW months ago it all seemed so straightforward - at least to Wall Street. In the minds of investors, after unprecedented economic stability under Brazil's outgoing president Fernando Henrique Cardoso, voters in the October elections would recognize that it was in their best interests to opt for the government's candidate, Jose Serra. That way stability would be cemented.


Enter Luiz Inacio Lula da Silva, the man who spooked the markets. Described by some as a "dangerous leftist" and a "crackpot Marxist", Lula - as he is popularly known - is making his fourth attempt on the presidency and is ahead in the polls, cementing his lead over the ruling PSDB party's Serra.


The mere thought of a Lula victory has pushed Brazil into pre-election turmoil. The real is at its most volatile since it was created eight years ago.



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