World Cup in 2014 and Olympics in 2016 are two important events that have put Brazil on the map. But has Brazil become too expensive too quickly? Does Brazilian Banking Expert Igor Cornelsen think Brazil is too expensive?
“Purchasing Power Parity (PPP)”
In 1948, the United States Bretton Woods agreement established that all nations engaged in international trade were required to use the dollar. Ever since that time, the United States dollar has been used as the world’s reserve currency. Due to this status, prices must be adjusted based on what types of currency they are denominated in. See: http://www.lulu.com/spotlight/igorcornelsen
The purchasing power parity measurement has been used to handle nominal variations that are a result of an inflated currency. The Economist like Igor Cornelsen has created its own attempt to measure the expensiveness of a culture called the “Big Mac Index.” This attempts to use a similar product – the Big Mac – to determine pricing around the world.
“How Does Brazil Rank on Big Mac Index?”
Of course, the Big Mac Index still uses the United States as the base point, so all nations are judged by whether their Big Macs are more or less expensive. In 2016, the United States Big Mac was priced at $4.93.
Switzerland had the most expensive Big Mac at $6.44. Sweden was next at $5.23 and Norway was next at $5.21.
“Brazil is Ready for Success”
Banking Expert Igor Cornelsen provided his objective viewpoint on why Brazil is still a great place for investment during his CNBC interview. The banking system is still somewhat undeveloped and the nation is still not too expensive according to Igor Cornelsen.
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