Radar Perene / concept
Global Regime
Brazil is a boat; the Global Regime is the weather outside. You can sail a flawless vessel and still pitch in a storm you didn't cause — or be carried by a tide you didn't earn. The Global Regime is the barometer of that weather: the aggregate reading of the external environment in which the Brazilian market operates.
What it is
The daily synthesis of the mood of money abroad — volatility, dollar strength, US long rates, gold, and the FX pairs capital runs to when it's scared. All of it becomes one reading, on the same scale as the Brazil Regime: defensive, neutral or pro-risk.
It is external context, not Brazil. On its own it says little. The value shows up when you cross it with the other axes.
Why it matters
Because almost all the capital operating in Brazil feels what happens abroad. A pro-risk global regime can rescue the IBOV from a bad domestic regulatory environment — and a defensive global regime can drag the IBOV down even with the domestic side in order.
Reading one side is half-reading.
The same boat, four kinds of weather
Most of the time Brazil and the world point the same way — and there's little to interpret. The interesting part is the divergences.
When Brazil is defensive and the world is pro-risk, it's usually domestic capital pricing a local problem the world is not yet weighing. When Brazil holds while the world retreats, something local is usually holding it up — a commodity tailwind, a specific flow. Those mismatches are what the Radar watches.
What it does not mean
It is not the S&P 500. It is not gold. It is not the dollar in isolation. It is a synthesis — and a synthesis is not a quote. Watching only the Global Regime and ignoring the Brazil Regime is the opposite of what the Radar was built to do.
And the weather outside doesn't reach Brazil on cue: transmission takes weeks to months, and it varies. That's why the Radar works with similar historical windows (see Historical Analogs), never nailing a point.
Related concepts: Brazil Regime · Risk-on / Risk-off · see the full method.
Related concepts: Brazil Regime · Risk-on / Risk-off · see the full method
Frequently asked questions
What is the Global Regime? The aggregate reading of the external environment pressing on Brazil — volatility, the dollar, US long rates and FX — summed up on one scale: defensive, neutral or pro-risk.
Does the Global Regime predict the stock market? No. It describes today's external weather and compares it to similar past episodes. Transmission to Brazil takes weeks to months and is never nailed to a point.
How is the Global Regime different from the S&P 500 or the dollar? The index and the dollar are each a single quote. The Global Regime is a synthesis of many risk signals — and a synthesis is not a quote.
Why cross the Global Regime with the Brazil Regime? To see divergences: when Brazil and the world disagree is where the reading gets interesting. One side alone is half-reading.