OUTRIGHT DEPRESSION

Brazil is the world's seventh largest economy and according to a recent Goldman Sachs report it's crying time again in the land of Ipanema. Part of Brazil's problem stems form the scandal the the nation's big oil company, Petrobras.

Brazil is the largest economy in Latin America and officials just announced it experienced its third straight quarter of downturn, the worst since the 1930s. But Brazil is hardly alone. Japan and Russia are in recessions and Canada doesn't appear all that healthy either. All eyes might be on China, but that might prove a bit myopic.

Latin America’s largest economy shrank more than analysts forecast, as rising unemployment and higher inflation sapped domestic demand, pulling the nation deeper into what Goldman Sachs now calls "an outright depression."

Gross domestic product in Brazil contracted 1.7 percent in the three months ended in September, after a revised 2.1 percent drop the previous quarter, the national statistics institute said in Rio de Janeiro. That’s worse than all but three estimates from 44 economists surveyed by Bloomberg, whose median forecast was for a 1.2 percent decline. It also marks the first three-quarter contraction since the institute’s series began in 1996, and a seasonally adjusted annual drop of almost 7 percent.

The U.S. dollar weakened overnight on the news of a weaker manufacturing number announced Tuesday after making a recent nearly nine month high, raising further questions about how aggressive the Fed will be in hiking interest rates next year.