Hard Times In Brazil

For the past four years, Brazil has looked pretty good from the outside. American businessmen drooled at the sights and sounds and the promise of big money propelled by a currency called the real, reports CBS News Correspondent Richard Schlesinger.

But then it got ugly. The currency crashed and the stock market crashed, leaving Brazilian stock traders and everybody else yearning for the good times.

For years, the government propped up the currency at artificially - some say ridiculously - high levels. That meant cheap imports and a huge market for American-made products. But it cost the Brazilians millions of dollars and some economists started predicting disaster.

The trouble was there was little connection between the real and reality. If it weren't for the Brazilian government, the currency would be worth a lot less.

"Whenever you prop up a currency, you're basically building up for a more serious crisis sometime in the future," said banker Roger Wright.

Propping up the currency looked good to the government because it allowed Brazilians to jump-start the economy by buying more.

But the government ran out of money to support the real. The currency is down drastically. Two-thousand American companies do business here and many are wondering who will be able to afford all those products in all those stores.

Things are already getting a little scary. Ford had sales problems before this crisis and has laid off close to 3,000 workers. In Sao Paulo, an unemployment line stretches around the block and businessmen complain of economic chaos.

In just a few weeks, it will be carnival again. People are practicing the dance steps in the streets. This is what Brazil is famous for. But this year there's not a lot to celebrate here. And people are beginning to wonder what to do now that the music has stopped.

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