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Editor's Note: Below is a brief excerpt and chart from today's Early Look written by CEO Keith McCullough. Click here to learn more about the Early Look.

... Did I mention Brazil? The damndest thing happened as Darius Dale and I were going door-to-door meeting with Institutional Investors in New York City yesterday. Some people were simply not happy that we remain bearish of Brazil.

So I got in the car and reviewed why so many hedge funds got pro-cyclically long of Brazilian Credit and/or Equities during 2017 and the double-damndest thing became glaringly obvious in our 4 quadrant GIP (Growth, Inflation, Policy) model:

  1. Brazil’s economy was in either Quad 1 or Quad 2 for a record 8 straight quarters going back to 2016
  2. Brazil’s economy slowed into Quad 4 in Q1 of 2018 (stocks collapsed)
  3. Brazil’s economy is now trending in Quad 3 (and her currency is crashing)

Amongst other things, if you’re looking at a multi-country (multi-factor) and multi-duration dashboard of rate of change risk this morning, you’ll note that the only major country 10yr Yield that is UP by more than a few beeps is Brazil’s...

CHART OF THE DAY: Lots of Unhappy Investors Long Brazil - 09.12.18 EL Chart

CHART OF THE DAY: Lots of Unhappy Investors Long Brazil - early look