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Mohamed A. El-Erian

The Upside of Brazil's Defeat

Brazil's devastating defeat in the World Cup could improve the prospects for much-needed economic reform
What will Brazil's World Cup defeat mean for Dilma Rousseff?                           
What will Brazil's World Cup defeat mean for Dilma Rousseff?                           

Brazil is about to show the world how sports can influence the national mood, politics and markets. The country's devastating loss to Germany in the World Cup semifinals will weigh heavily on its leaders -- and, as a result, has the potential to end up being good for its economy and markets.

The 7-1 defeat represents a debacle for a nation where football is both a passion and an obsession, an international embarrassment that wasn't just unlikely but quite unthinkable. It is also eerily similar to what has happened to the country's economy, which has turned sluggish and disappointing in recent years after a period of impressive growth, investment and job creation.