During the global end of the Great Recession, Brazilian GDP contracted year-over-year in just three quarters. The worst was about -2.5% in Q1 2009, but by Q1 2010 GDP was rising 9% again. With the latest update today, Brazil’s GDP declined by just less than 6% year-over-year in Q4, representing the seventh consecutive contraction that doesn’t look to be ending anytime soon. In fact, all the economic accounts are still slowing down.

It was the worst quarterly GDP estimate since 1990. In isolation, -6% would be shocking given that comparison to not just the Great Recession but also the global end of the dot-com recession and more importantly Brazil’s experience during the Asian flu.

Brazil’s economy shrank 3.8 per cent in 2015, putting what was once one of the world’s fastest-growing large emerging markets on track to suffer its worst recession since official records began.

The big GDP contraction was the worst in 25 years, and comes as a perfect storm of collapsing investment, lower commodity prices and constrained government spending hits growth.

Again, all indications are that Brazil has yet to even see the “eye” of that “perfect storm.” The arrows on everything are all pointing down, except “inflation” where the calculated IPCA price index keeps rising.

This is far more than just aftereffects from China’s own brush with the interminable slowdown; it has to be.

Latin America’s largest economy was once a darling with investors as sound macroeconomic policy led to continuous growth, culminating in an Asia-like 7.6 per cent expansion in 2010.

Was it really “sound macroeconomic policy”? The amount of debt piled into Brazil during those decades might sound “sound” to an orthodox economist, but financialization of that kind is devilishly susceptible to reversal. As we know well from our own monetary experience, artificial growth in that manner is no true foundation at all. Basing economic growth, especially over a long period, upon foreign money supply means that there are no perfect methods of dealing with monetary interruption. This much is obvious in either the IPCA inflation rate shown above, or Banco do Brasil’s dramatic struggle with shrinking “dollar” availability shown below.