We've correctly focused on our weak economy and the impact of a China slowdown.

Let's not lose sight of another huge GDP in trouble downin South America -- Brazil:

Brazil eked out just 0.1 percent growth in 2014. 

The economy is expected to shrink almost 3 percent this year. 

For 2016, economists are forecasting no growth at all or yet another recession.

A Brazilian slowdown would have a huge impact on Argentina, Uruguay, Chile and much of Latin America. Brazil is the engine that drives most of that region.   

Furthermore, Brazil is a huge trading partner with the European Union:

• The EU is Brazil's first trading partner, accounting for 19.5% of its total trade, and Brazil is the EU’s tenth trading partner, accounting for 2.0% of total EU trade (2014). This shows the strength of our bilateral trade relationship.
• EU imports from Brazil are dominated by primary products, in particular agricultural products (48.0%) and fuels and mining products (24.8%). But manufactured products such as machinery, transport equipment and miscellaneous manufactured products are also important: they represent around one fourth of EU imports from Brazil.
• Brazil is the single biggest exporter of agricultural products to the EU worldwide.
• EU's exports to Brazil consist mainly of manufactured products, such as machinery, transport equipment and chemicals. In terms of trade in goods, the EU historically runs an overall trade deficit with Brazil but in 2014 the EU recorded a trade surplus in goods. The EU also has a surplus in services trade.
• The EU is the biggest foreign investor in Brazil with investments in many sectors of the Brazilian economy. Around 50% of the FDI flows received by Brazil between 2008 and 2012 originated in the EU.

U.S. companies are also sensitive to a slowdown in Brazil. In other words, we export a lot to Brazil:

U.S. goods and services exports to Brazil in 2010 are estimated to be more than $50 billion, which will support more than 250,000 jobs. 

As any Brazilian will tell you, the economic slowdown and charges of corruption against President Dilma Rouseff have turned into a perfect storm of discontent and misery.   

The unemployment rate is rising. We've posted recently of mass marches, primarily of middle-class Brazilians fed up with taxes and a government that works for everybody but them.

There is a pension crisis around the corner. And the nation's debt rating just took another hit. My guess is that the currency will have to be devalued, adding more frustration to an already very frustated middle class.

A few years ago, Brazil was the darling of the experts. So what happened? The experts forgot to consider the impact of corruption. Crony capitalism hurts the economy, the nation's honest entreprenuers who are not dining with government officials and the rule of law.

Brazil will survive, but I hope that its citizens demand a government that is more transparent. In the meantime, expect a lot more marches from the middle class.

P.S. You can listen to my show (Canto Talk) and follow me on Twitter.