In barely six weeks the real had lost nearly a quarter of its value, and in mid-October 2002, the real hit its weakest level in history at 4 per US dollar.

Thing is, the weakness in the Brazilian currency thirteen years ago wasn't based on any rational, objective data.

It's not like the Brazilian government had accumulated $18 trillion in debt, or another $42 trillion in unfunded liabilities.

In fact Brazil's debt to GDP ratio was less than 50% at the time (compared to over 200% for, say, Italy).

Most of the 'crisis' was simply an emotional reaction to what was happening next door in Argentina, which had recently defaulted on its debt.