December Profits

The reduction of 19 sales allied to the probable adjournments of investments will cause unemployment and reduction of the wage mass, being able to result in generalized falls of the demand. In December the economy lost 650,000 formal jobs more than – the biggest fall in one decade. Probably, we will see new negative numbers in the next months. The fast deceleration of sales that affected, for example, the local and world-wide automobile industry, reduced the profits and the levels of activity in all the productive chain. The production drastically was cut to propitiate the reduction of the supply levels. The mineradoras, siderurgical, plants of tires, autopeas and plastic articles, among others, had been affected in the 20 sequence, and this second wave of reduction of the activity will reduce the general level of job and income, the tax collection, the impetus of the private investments and the profits. The fall of profits, in turn, will reduce the value of the companies and its action in the stock markets, having caused new depreciations to the shareholding market.

The current moment of reduction of volatileness and relative stability in the market would be substituted by another one of turbulence. These interactions would occur all with speed varied for the productive and financial system, nor the first impacts had been well digested and a new cycle of adjustments would occur in cascade for all economy. It can be imagined, still, that in the global scope the new levels of demand and price will create an unsustainable situation for many companies in terms of the installed capacity. It occurs that small a percentile loss of sum in the sales can mean the difference between profit and damage.