death quotes

Image: Action Group


Since the beginning of the pandemic, the Ibovespa has behaved like a “death quote” in Brazil, a sinister “measure” of society’s suffering

“Brazil does not know Brazil / Brazil has never been to Brazil (…) / Brazil does not deserve Brazil / Brazil is killing Brazil” (quarrels from Brazil, by Maurício Tapajós and Aldir Blanc [Victim of Covid-19 in 2020]).

The announcement by US President Joe Biden that he intends to practically double the capital gains tax (which is levied on financial transactions) and raise the income tax rate of the richest became headlines and shook the financial markets (already volatile) in Worldwide. The “left” turn of the democratic government, with the Keynesian rapture of its Big New Deal, is a strategy to sustain the economy, but also a result of social pressures on the establishment political and financial in the context of the pandemic. As in the 2008 crisis, the debate on social inequality (everyone remembers the 99% versus 1%) gained strength again in the world and, with it, also the criticism of financial markets and great fortunes – although, in Brazil, the shielding of the financial sector is such that, at most, a minimum income program is considered.

The current situation echoes an important theoretical discussion on financialization in contemporary capitalism that took shape in the 1990s and gradually penetrated the debate in the various fields of human sciences, extrapolating its origin in critical economics. Contrary to orthodox economics, which, at most, is limited to pointing out from time to time an “irrational exuberance”[I] in financial markets, the different approaches to financialization found a series of important and perennial transformations in the functioning of capitalism over the last four decades. In some formulations, the postwar Fordist-Keynesian regime of accumulation thus gave way to the currently predominant financialized/financial accumulation regime.

Among the consequences of this passage presented by several authors, the following can be mentioned: the increase in financial transactions and speculation, accompanied by the predominance of the financial fraction of the capitalist class; the recurrent formation of asset bubbles with the outbreak of financial crises around the world, as well as permanent macroeconomic instability in countries due to the extensive liberalization of capital flows abroad; the reduction of productive investment rates and financialization of the activities of companies in the non-financial sector; the intensification of “productive restructuring” and company mergers/acquisitions, leading to outsourcing, production relocations, mass layoffs and precarious work in the center of capitalism – with similar repercussions in the periphery; and, of course, the increase in social inequality.

A point of controversy, on the other hand, is how to consider the “autonomy” of the financial sphere, which, in a way, is at the root of the questions raised in 2008 and which are now returning. Chesnais, one of the pioneers in the conceptualization of financialization, used the misleading term of “relative autonomy”[ii] in one of his writings, giving rise to criticism such as that of Prado[iii], which can be summarized as follows: the financial sphere could not be autonomous insofar as it does not generate value, but only feeds on that generated in production. On several occasions, Chesnais made his position clearer, that is, that fictitious capital (such as financial assets circulating on the stock exchange), although ultimately limited by real accumulation, has a dynamic that does not follow passi passu the movement of productive capital – insofar as it consists of the anticipation of future value to be generated and is subject to enormous speculative price variations. The movement of fictitious capital can, for example, operate large transfers of wealth from one hand to the other and leverage mergers and acquisitions, before the “call to reality” of the productive sphere occurs.

Anyway, what is sought here is to contribute to the reflection on the counterpart of this “economic” autonomy of the financial sphere: “social” autonomy. Indirectly, this manifests itself in the current economic “uselessness” of financial markets, which reverts to social uselessness. Lordon, for example, highlighted it in a provocative tone when considering the closure of stock exchanges. Among other evils, they would more appropriate wealth than encourage productive investment and employment: “And does the Stock Exchange finance companies? At the point where we are, it is mainly the companies that finance the Exchange!”[iv].

In a more direct sense of autonomy from a social point of view, it is possible to point out the great disregard of the financial markets for the concrete reality of life of the population that supports them (through their work and the payment of interest and taxes[v]). By reviewing some facts about Brazil during the pandemic, it is possible to assess the degree reached by this phenomenon in a period that is particularly conducive to analysis due to the sum of economic, political and health crises. We start from the evolution of the Ibovespa in 2020 (since the beginning of the pandemic in Brazil) and the evolution of the number of cases and fatal victims of Covid-19 in the country. The chart speaks for itself:

The ascending and descending moments of the displayed curves visibly coincide (the red dots mark the trajectory changes). Therefore, since the beginning of the pandemic, the Ibovespa has behaved like a “death quote” in Brazil, a sinister “measure” of society’s suffering. The Bolsonaro government's disregard for the pandemic is, in fact, proportional to the attention given by Paulo Guedes to the financial sector, just as foreign capital does not hesitate to take advantage of the internal turmoil (fall in asset prices and appreciation of the dollar) to go shopping and profit.

Moving from correlation to causality between the phenomena, however, stating that deaths from Covid-19 were the cause of the variation in the stock index (or the opposite...), would require the elaboration of intermediate hypotheses and the performance of a much more complex statistical analysis. sophisticated. It is not intended to go so far here, but to go against the grain in order to emphasize, as announced, the “social” autonomy of the financial sphere: the Ibovespa and the deaths/cases of Covid-19 not only did not vary inversely how they walked in the same sense. Focusing on the ascending sections of the curves, the unusual realization emerges that there was capital inflating stock exchange prices at the exact moment when deaths and infections increased and that resources were (and still are)[vi]) so necessary in the area of ​​health and to guarantee the minimum conditions for the survival of the population.

It is worth reaffirming that a large part of this capital is foreign, consistent with an older movement to denationalize the economy and driven by the effects of Lava Jato on large Brazilian companies (including those with international operations) since 2014. Over the past decade, foreigners have increased significantly its share of the spot stock market[vii] of B3, with a peak precisely between 2014 and 2016 (more than 50% of the financial volume). Thus, it went from 33% in 2010 to 44,6% in 2020 (2 percentage points more than in 2019, which was 42,6%)[viii]. Once again: Brazil (foreign capital and internal capital associated with it) watches the waves of turbulence in Brazil and, at the limit, yearns for them.

Other data point in the same direction as the graph. According to the B3 website[ix], in 2020: 28 companies went public on the stock exchange – they made an IPO (Initial Offering of Shares) –, against an average of 4 in the previous five years, raising more than BRL 43,8 billion; and there were 25 new stock offerings by companies already listed on the stock exchange (Follow on) – against an average of 14 in the previous five years –, raising almost BRL 74 billion. In the same year of 2020, more than 1,5 million individuals joined the stock exchange as investors (totaling around 3,2 million accounts at the end of the year)[X], an absolute record fueling the economic and social autonomy of the financial sphere. Thus, B3's total capitalization increased from R$4.607,5 billion in Dec/2019 to R$4.946,5 billion in Dec/2020.

Some will reply that the stock exchange does not just reflect the present moment, that the “fundamentals” of the Brazilian economy are taken into account, that interest rates (Selic) are low (which encourages “investors” to migrate to riskier assets), etc. These justifications, however, do not answer the crucial question of why and until when will financial interests continue to override the real (rather than fetish) foundations of society: people. Behind the stock market – that disguise for the face of finance – are market agents, national and international, with the collaboration of government officials. One cannot forget, therefore, the R$ 1,2 trillion package[xi] from the Central Bank, in March 2020, aiming to “rescue” the banking system – which continues to charge interest rates dozens of times higher than the Selic rate. The amount corresponds to 16,7% of GDP, a much higher proportion than the aid granted during the 2008 crisis, while Brazil's spending on income transfer programs is 1,2% of GDP[xii].

The recent approval of the Central Bank's autonomy and the concern with preserving at any cost the Expenditure Ceiling approved during the Temer administration (in order to guarantee, above all, the payment of interest on the public debt) also contrasts with the situation of the population most vulnerable (economically and to Covid-19[xiii]), left without any financial assistance for months and now counting on only four monthly installments of R$ 250.

In this sense, it is deeply strange to hear comments such as “the institutions are working”, when one or another of Bolsonaro’s absurd measures are barred, but the “cattle” continue to pass. The real situation in Brazil is an (anti) federal government indifferent to the pain and death of others, endorsed by Paulo Guedes (direct representative of the financial sector) and (still) by the Army; a Congress (with notable exceptions) moved by physiologism and by the interests of big capital (through direct and indirect representatives); and a “cowarded” STF. The disastrous situation in Brazil thus bears the direct, albeit camouflaged, mark of the fractions of the ruling class. The financial sector (the “Faria Lima”) played a prominent role in this Baile da Ilha Fiscal, with the approval of foreign capital.

The “economic” autonomy of the financial sphere is, as seen, limited by the productive sphere and culminates in the bursting of the bubble through the contradictions of the economic process itself. Assets are devalued, approaching the real capacity of the economy to produce value (and then restart the process…). The elasticity of social autonomy, however, has unfortunately already proved to be much greater than the economic one. And the “burst of the bubble” depends on factors that, during the pandemic and under Bolsonaro, are even more difficult to achieve than usual: popular mobilization and pressure and political organization. The question, therefore, is until when the social autonomy of the financial sphere can develop and how is it possible to burst the “bubble”. Until then, follow the Ball in Brazil, while Brazil screams SOS...

*Ilan Lapyda He holds a PhD in sociology from the University of São Paulo.


[I]Famous term by Alan Greenspan, then president of Federal Reserve of the USA, on the situation of the US stock exchange in the mid-1990s.

[ii]CHESNAIS, François. “The interest-bearing capital: accumulation, internationalization, economic and political effects”. In ______. (org.). Globalized finance: social and political roots, configuration, consequences. Sao Paulo: Boitempo. 2005, p.45.

[iii]PRADO, Eleutério. “Review of 'Globalized finance'”, in: October, No. 14, pp. 217-224. 2006.

[iv]LORDON, Frederic. “Close the Stock Exchange?”. Le monde Diplomatique Brasil. Feb/2010. Year 3, Nº 31, pp-28-29.

[v]And currently also with your data – to big tech and others.

[vi]In the first half of April 2021, with daily records of deaths from Covid-19 and more than 350 in total, the Ibovespa again hit 120 points.

[vii]Not counting the derivatives market, in which its share was 67% of the volume traded in Dec/2020.

[viii]See – Database (Mar/2021)

[ix]See – Database (Mar/2021).




[xiii]UFPel's 2020 survey shows the following: In all phases of the survey, the poorest 20% had twice the risk of infection compared to the richest 20%. In addition, indigenous people had a five times greater risk than whites. “We showed that the poor and the indigenous are the most vulnerable groups, who require even more attention from public health policies”, says Hallal (Cf. )

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