If there is anything recent years should have taught us, it is this: be wary of investment bankers bearing gifts. One of the most durable of such offerings — thanks to Goldman Sachs — is a seemingly harmless acronym: BRIC. This was shorthand for grouping the four largest (in GDP terms) emerging market countries, Brazil, Russia, India, China, when grouping countries as “rich” and “poor” was beginning to appear vaguely antediluvian. Thus far, as boring economic memes go, the acronym has been rather sticky but harmless.
It has generated a cottage industry of pundits coining alternative acronyms. The BRICs themselves felt a sense of international kinship, added an “S”, an actual country (South Africa), conducted summits, postured and issued lofty communiqués. Up till now, it was all cheap talk; but the northeastern Brazilian city of Fortaleza changed all that. Now the BRICS have actually put some real mortar between them: they’ve committed real money to become “equal” partners in a New Development Bank. Now, that decade-old investment banking make-believe product carries a real cost. This is worrisome because there are several faultlines running through.
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