Brazil has accumulated a substantial stock of foreign investment over the decades. Even with a trade surplus, these assets generate income for non-residents. But it is important to understand that a primary income deficit does not necessarily translate into an equivalent actual outflow of foreign currency. Under the BPM6 methodology, reinvested earnings are recorded simultaneously as a debit in the primary income account and as a corresponding transaction in the direct investment component of the financial account. If Brazil runs a trade surplus, a significant portion of which is offset by a negative balance of income accruing to foreign capital, a legitimate question arises: how sensible is it to base a long-term economic development strategy primarily on attracting foreign capital rather than developing the country’s own productive capacity? Incidentally, due to political prejudices, Russia’s unique economic experiment in 2022 remains remarkably underappreciated — essentially a large-scale beta test of the possibilities afforded by monetary sovereignty. Russia imposed strict capital controls while maintaining a floating exchange rate. And its financial system did not collapse, despite unprecedented sanctions and the freezing of a substantial portion of its international reserves. Of course, the record current account surplus and the sharp contraction in imports played an enormous role. But that is precisely why Russia’s experience is of exceptional interest to post-Keynesian macroeconomics: it demonstrated just how profoundly a sovereign state can reshape the conditions under which financial markets operate by using the instruments of monetary sovereignty. xitter.cf/foscaecon/status/21148…