By YOUNG MONEY Staff
11 August 2010

Before the financial meltdown of 2008, and again in its aftermath, Brazil was the darling of global equities investors.

From many perspectives, it had everything: A relatively fast-growing economy, new oil discoveries that promised full energy independence, semi-private industry leaders like Vale and Petrobras and a stable political scene.

In addition, Brazil's highly traditional banking sector didn't get up to the same financial shenanigans as other major developed economies, so it weathered the crisis better. A newly vibrant middle class was consuming and spending at record rates, and inflation was in check.

But all good things must end: In the case of Brazil, it was too much of a good thing. As the Financial Times reports, inflows from foreign investors have dropped to $1.8 billion so far this year, after soaring as high as $13.5 billion in 2009.

Compare that to $6.5 billion in foreign investment in China for 2010, compared to $14.6 billion last year.

All that money drove a 70 percent surge in the country's main stock benchmark, the Bovespa, last year. Now that the rush has slowed, the index is down a bit, at 4 percent.

Still, many investors and most Brazilians remain positive about the country's future - though some of that may just be the nation's sunny disposition.