The "war budget" amendment will be a bonanza for the financial market.

By Aquiles Lins, for the Journalists for Democracy 

The Proposed Amendment to the Constitution is already being processed in the Senate. No. 10 / 2020, known as the "war budget" amendment, which separates spending to combat the new coronavirus pandemic from the general federal budget. 

In one of its most important points, the PEC authorizes the Central Bank to buy and sell credit rights and private credit securities in national and international secondary markets. The secondary market is where investors trade among themselves, without the participation of the company that issued the security. Credit rights are the rights to credits that a company is entitled to receive, such as checks, rents, promissory notes, or credit card installments. A similar measure was adopted in March by the Federal Reserve in the United States. To support the financial markets in the face of the crisis, the Treasury assumes the risks of default. 

If passed in the Senate, the "war budget" amendment authorizes the Jair Bolsonaro government to buy private securities whose real value cannot be verified. This means the Central Bank could buy a stock worth 10 reais and pay 100, 500, or 1,000 reais. Banks could then push tons of worthless securities onto the Central Bank, which could accept them under the justification that the market needs liquidity. 

According to the text approved by the Chamber of Deputies, the total amount of purchases for each transaction involving private securities must be authorized by the Minister of Economy, Paulo Guedes. Every 45 days, the Central Bank will have to report to Congress on its transactions involving the purchase and sale of public and private securities during the period of public calamity, which lasts until December 31 of this year. 

Who will profit from these transactions? Let's always keep in mind that the Bolsonaro government acts as a predator of public assets in favor of financial capital. We cannot rule out the possibility that Minister Paulo Guedes will use the fight against the pandemic as a means to make the largest transfer of public money to banks and financial speculators in the country's history. 

In Santa Catarina, the macabre ritual known as "farra do boi" (bull-baiting) consisted of releasing a bull in a deserted place and then assaulting or "farring" the animal, making it chase after the people participating in the practice. This animal torture has been considered illegal since 1998. In our case, the bull could represent Brazilian treasure, placed in a location where the financial market will "farre" it with fraudulent securities and all sorts of losses.