Brazil: 30 years ago, Real Plan ended hyperinflation, balanced economy
One of the world economy's most innovative plans marks its 30th anniversary this Monday (Jul. 1). Exactly three decades ago, the cruzeiro real, a currency ravaged by hyperinflation, gave way to the real, stabilizing the Brazilian economy. This risky endeavor involved a form of social engineering to tackle inflation after multiple failed economic plans.Amid numerous attempts to stabilize prices and wages through different indexers, the economic team of the Itamar Franco government introduced a groundbreaking approach: the Real Unit of Value (URV). Over three months, all prices and wages were denoted in both real cruzeiros and URVs, with its daily rate fluctuating and loosely tied to the dollar. This system persisted until the introduction of the real, when BRL 1 equaled 1 URV, and 1 URV e...