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The optimism that lit itself — August 2022

Episode

The extreme

It was optimism with no audience. While the rest of the world still read risk with caution, the Brazilian investor found a reason to breathe that no one abroad shared: a deflationary surprise. Prices pulled back, mood lit up, and the market began to reorganize like someone betting on the end of a fire. Except this confidence was born detached from everything around it. In numbers: the Ânima index jumped from 47.1 to 64.4 and the internal risk gauge went from 64.6 to 87.0 — risk-on defined — while global risk read 32.5, in risk-off. Underneath, capital swapped commodities (Commodities/IBOV from -1.35 to -2.17) for cyclicals and banks (Financials/IBOV from 1.84 to 2.20). The Selic, fixed at 13.75% over negative inflation, was paying idle cash a rare real rate.

What happened next

The optimism did not become a trend; it became a pendulum. In November, three months later, the mood collapsed — Ânima fell from 75.0 to 45.9 and internal risk plunged from 88.4 to 25.9, back to risk-off. In February 2023 it lit up and went dark again, with Ânima retreating from 67.6 to 26.6. And when mood finally reignited to the extreme, in mid-2023, it was the appetite for risk that collapsed: in August 2023 the Perene Risk Index went from 85.4 to 0.0 in a single month, while Ânima merely shed its excess. The gauge lit up and went dark; the machinery underneath ran on another clock.

What did not happen

August's optimism did not open a cycle of sustained appetite. The deflationary surprise that lit it did not last — the IPCA accelerated again to 0.84% as early as February. The Selic did not give way to validate the euphoria: it stayed at 13.75% for almost a year and still read 13.25% a year later. And the divergence with the world did not resolve in favor of home: it was domestic mood that, time and again, returned to the neighborhood of global discomfort — not the other way around.

The honest verdict

The mood gauge got the month's pulse right, but not the direction of the cycle. Optimism that lights itself — detached from the world, with cash earning so much — is the kind that swings, not the kind that holds. Mood is the most volatile part of the set: it climbs forty points in a month and gives them back in the next. Whoever read it as conviction read it wrong; it was only a breath.

Continue reading: Ânima vs. Perene Risk — mood against appetite · The house in the dark — 2022 · High Selic vs. low Selic — the mood in each rate →

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Characters: Structure (intermarket) · Flow (risk appetite) · Mood · Dollar