The Rising Influence of Rising Affluence

[DewDiligence]

The federal government of Brazil strong-armed VALE into investing $1.5B in the Belo Monte Amazon dam, which VALE’s outgoing CEO had opposed as unprofitable. VALE’s own language reveals that the company doesn’t think much of the investment potential:

http://online.wsj.com/article/SB10001424052748704463804576291393990261786.html

Vale said in its statement Thursday that it expects its Belo Monte investment to be profitable by the measure of the return on the investment being higher than Vale's cost of capital.

This is probably the weakest endorsement I’ve ever heard for a $1.5B investment by any company.