Brazil´s president Lula told in an important annoucement that the economic tsunami would reach the country as a small insignificant wave. Well, apparently, as quite common with politicians in the 20th and 21st century, he was wrong. Maybe a “modern” way to cheer up the population regarding the actual situation.

But the truth is undeniable, Brasil will now, a little later, go through the blinding storm of disastrous economics. The automotive sector is down a lot of percents, the steel industry laid off some 14.000 workers, credit is as tight as imaginable, the hope of growing commodities prices went down the drain this Monday, May 11, 2009.

Bad times.

Companies search for orders, but there are not even proposals to be done. Foundries, sugar processors, steel works, automotive parts suppliers and many others are simply tightening their belts in order to have a longer time alive, simply put.

Those companies short of credit, or with installments to pay, are in bad shape. And there are many in this situation here in Latin America. For the smaller companies, which never had much borrowing moral anyway, the situation might be a little easier.

Many have some reserves but must act fast in order not to waste these with heavy wages, salaries and related expenses. Not easy to do as it involves the human factor and sometimes longtime relationships.

But must be done.

All in all, similar to boating in heavy weather. Sails down (reminds of “sales down”), all hatches closed (try to shorten expenses as much as possible), all men on deck (and a few will go overboard in the storm, unfortunately), an experienced captain on the bridge (but this is not an automatic insurance to success) and a good helmsman at the wheel.

Try to ride with the waves (try to sell where a market might be), drop the sea anchor to hold course (don´t go for new products or expensive experiments, long expensive sales trips, etc.)

Maybe the boat will hold, but sometimes rocks may show (government, corruption, unions, etc.) and burst the hull. Look for good charts, but remember they are not always precise. And in very bad weather GPS receivers do not work too.

And try to withstand this approaching silent raging storm. Maybe some will make it, fiercely weatherig the heavy seas.

Copyright 2009, Brazil Free News Letter, Armando Espósito Oliveira, journalist.