Brazil’s external debt reduction package with its creditors under the auspices of the Brady Plan came about only in 1994 after almost three years of negotiations. By contrast, Brazil’s public sector has more foreign exchange commitments than it has revenues and therefore runs a deficit in its bal-ance-of-payments current account. Thus, if the Brazilian public sector services its debt, it has to buy foreign exchange from the private sector to do so. Following the First World War, Brazil had surprisingly easy access to embryonic US capital markets. As a result, another debt crisis occurred in 1930, the resulting restructuring did not solve Brazil’s problems, especially since the world depression led to a collapse of Brazil’s export prices. Brazil’s political economy of state-capitalism and patrimonial democracy reached a temporary cul-de-sac in the 1960s. The Brazilian armed forces had a particular view of the world that they soon imprinted on their nation.