Pridiyathorn Resigns As Deputy Pm, Finance Minister

[george]

Pridiyathorn resigns over differences with PM

BANGKOK: -- Finance Minister and Deputy Prime Minister Pridiyathorn Devakula announced Wednesday that he had resigned, citing differenceswith the prime minister over the handling of the Thai economy.

"I am resigning from all positions. I have talked to the prime minister. He approved my resignation and understands," he said.

Pridiyathorn said that he was stepping down partly because of a recent controversial attempt to appoint Somkid Jatusripitak, a key Thaksin ally to a top economics post.

Somkid Jatusripitak, a former deputy to Thaksin, resigned the post after less than a week. But Pridiyathorn said he believed there was a hidden agenda behindthe effort to bring Somkid back into government.

-- The Nation 2007-02-28

[thedude]

global markets slump overnight, now pridiyathorn resigns. just a gentle reminder for those a bit slow off the bat, SELL ALL POSITIONS ON THE SET NOW!

[Mobi]

Well of course he should have resigned ages ago after the various debacles he initiated.

During his brief fling in power he managed to engineer more u-turns and partial u-turns than Sukhumvit Road has constructed between Na Klua and Jomtien.

Never the less this is an interesting, not to say worrying, turn of events.

Don't hold your breath that he will be replaced by someone more competent.

In fact the opposite may well be true.

I'm afraid this government is showing more and more signs of being in total disarray

[ThaiGoon]

global markets slump overnight, now pridiyathorn resigns. just a gentle reminder for those a bit slow off the bat, SELL ALL POSITIONS ON THE SET NOW!

Take it easy. The stocks might actually skyrocket thanks to this news... as Pridiyathorn wasn't that well liked on TV.

[ColPyat]

global markets slump overnight, now pridiyathorn resigns. just a gentle reminder for those a bit slow off the bat, SELL ALL POSITIONS ON THE SET NOW!

An amateur's question:

Is the fall in stock market only a temporary setback, or is this the beginning of a crash, and what effects might that have on the Thai economy, and life for us here?

[Old Man River]

global markets slump overnight, now pridiyathorn resigns. just a gentle reminder for those a bit slow off the bat, SELL ALL POSITIONS ON THE SET NOW!

An amateur's question:

Is the fall in stock market only a temporary setback, or is this the beginning of a crash, and what effects might that have on the Thai economy, and life for us here?

Nobody knows where this will lead, amateurs and non-amateurs alike. Normally, this type of thing does lead to a weakening currency and falling stock market (which was already expected given the view that China's economy may be cooling off). Whether this happens and if so, for how long is anybody's guess.

It will be very interesting who will replace MR Pridiyathorn. Personally, I think his resignation is a big loss, but then perhaps we should have expected it given that he is not a political player and is surrounded by those who should not be politicians, but are.

[Payboy]

did the 200 billion lost on propping up the thai baht have anything to do with this - i wonder?

[samran]

did the 200 billion lost on propping up the thai baht have anything to do with this - i wonder?

Thai baht ain't being propped up. They are doing their best to hold it down though.

[wintermute]

It will be very interesting who will replace MR Pridiyathorn. Personally, I think his resignation is a big loss, but then perhaps we should have expected it given that he is not a political player and is surrounded by those who should not be politicians, but are.

How is it a big loss..except a loss of face? It hurts the government in that it makes them look incompetent because they have problems putting competent people in charge. This man hasn't done anything decent policy wise for Thailand at all though. He was a bit of an economic populist, crafting policies that were based on unfounded popular protectionist/exclusionary sentiments. Him and his BOT sidekick Mrs. Tarisa Watanagase were both responsible for some horrendous economic bloopers in the past few months. The sad thing is if this is the best that Thailand had then someone even worse may be placed in charge.

Edited February 28, 2007 by wintermute

[Prakanong]

Well its never quiet is it?

[ThaiGoon]

I'm pretty sure that his resignation won't have as much an impact on Thai stocks as his 30% withholding policy did. Oh well.... Anyway I hope this is not a sign that this government is falling apart.

[Hampstead]

global markets slump overnight, now pridiyathorn resigns. just a gentle reminder for those a bit slow off the bat, SELL ALL POSITIONS ON THE SET NOW!

An amateur's question:

Is the fall in stock market only a temporary setback, or is this the beginning of a crash, and what effects might that have on the Thai economy, and life for us here?

Yes, a short term correction. it was triggered by a rumour that the chinese wanted to cool down equity investment gains by intrdoucing a capital gains tax on equity investments, the fallout is just a short term reaction around the world due to a major stockmarket having a sell off.

The fall around the world has also been exagerated by the bonds and fund markets trying to frighten the equity investors back into fixed income investments

global markets are ready for profit taking especially the chinese market as it has sky rocketed by 130% in one year

the thai market has just stagnated due to many negative factors but is still trading at 40% below its fair value.

[moskito]

global markets slump overnight, now pridiyathorn resigns. just a gentle reminder for those a bit slow off the bat, SELL ALL POSITIONS ON THE SET NOW!

An amateur's question:

Is the fall in stock market only a temporary setback, or is this the beginning of a crash, and what effects might that have on the Thai economy, and life for us here?

Oh ColPat....really which I can answer that question and have all the inside informations it needs to be 100% sure...but even then....

If someone can answer that question 100% he for sure is a billionäre soon

maybe China is showing only its muscles maybe there is really more behind it maybe the bubble is going to BLOB again to many may be`s

[ThaiGoon]

This government has been falling apart since the day they made sure the 14 tanks didn't have any ammunition in them and sent them off to Bangkok.

It's probably due to their efforts to stage the coup in a sufficient way.

[lannarebirth]

global markets slump overnight, now pridiyathorn resigns. just a gentle reminder for those a bit slow off the bat, SELL ALL POSITIONS ON THE SET NOW!

An amateur's question:

Is the fall in stock market only a temporary setback, or is this the beginning of a crash, and what effects might that have on the Thai economy, and life for us here?

Well, it all depends. Is the capital supporting the stock market primarily Thai money, or is it overseas money, that's likely to disappear as quickly as it appeared? Is a weakness in the stock market indicative of national economic weakness? If so, one might expect some interest rate cuts. If that happens the baht might weaken and property investment might fill the void (assuming there isn't massive debt overhanging the market).

In America, The Thai Fund (symbol TTF) has fallen over 10% this week. It is a closed end equities fund and it was trading at about a 20% premium to Net Asset value(I think they ot cc'd a couple days in advance on the Prdiyahorn resignation). If it slips below NAV at some point in the future, it might make an interesting investment. Particularly, if the dollar is also low at that time.

As far as a "crash" is concerned, I doubt it. There is a gap in the SET chart at 519, which WILL BE filled. Now or later. who knows?

[zhudi]

global markets slump overnight, now pridiyathorn resigns. just a gentle reminder for those a bit slow off the bat, SELL ALL POSITIONS ON THE SET NOW!

Please dont say this I just bought in!!! Come on guys have a little faith

[thedude]

global markets slump overnight, now pridiyathorn resigns. just a gentle reminder for those a bit slow off the bat, SELL ALL POSITIONS ON THE SET NOW!

An amateur's question:

Is the fall in stock market only a temporary setback, or is this the beginning of a crash, and what effects might that have on the Thai economy, and life for us here?

hi ColPyat. i hope i'm wrong, and i'm no expert either, but here's my assessment.

the SET has always been led by foreign trading, don't let anyone tell you otherwise.

recent rally was sparked partly internally, but to a larger extent by regional funds who put a Buy on thai index stocks as thailand was seen as undervalued with P/E at around 8 to 9 while regional bourses were closer to 20.

despite lower risk and higher growth prospects, regional markets were so overbought that with the relatively risky thai situation, a price earnings ratio of 8 was just too attractive, so funds looking to spread their risk a bit more took a punt on the SET. but remember, this is during a time when everything else is doing so well, maybe even too well.

if what we have seen in the last 24 hours or so is the start of a global sell off, then obviously funds will move first to protect their exposure in these regional markets. in any case, they will not be parking their funds here, an even higher risk market.

the impact on the SET with pridiyathorn resigning has little to do with whether he was well liked in thailand, and much more to do with how foreign funds view its impact on political stability. the market can deal with the good or the bad, as long as they see it coming, but markets are bad with dealing with uncertainty.

pridiyathorn's departure will create a vacuum, and whatever political wrangling and eventual replacement that will occur, and whether the replacement could be seen as being anymore worthy than pridiyathorn, and the as yet unknown policy angle he/she will adopt, all spells an even murkier and more uncertain picture for thailand.

i'm not sure if the global sell off is temporary, i hope it is, but in either case, they will not be looking here while they have the bigger markets to deal with. if regional prices retreat to 13 or 14 P/E, then obviously thailand will be relatively less attractive and they will be hunting bargains elsewhere.

and so my call is to sell, watch the global situation, wait till further clarity is reached regarding pridiyathorn's replacement, then come back to pick bargain stocks if the situation is encouraging.

[toptuan]

MORE DETAILS FROM BBC: 06:17 GMT

Thailand's finance minister quits

Thai Finance Minister Pridiyathorn Devakula has announced his resignation.

[Picture Caption] Pridiyathorn Devakula, Thai central bank governor Mr Pridiyathorn has angered foreign investors.

Mr Pridiyathorn - who was appointed after the coup that ousted former PM Thaksin Shinawatra last year - has been criticised for a number of policies.

His decision to impose capital controls led to a brief stock market crash, and a move to tighten foreign business laws also angered many investors.

Mr Pridiyathorn said he was resigning due to differences with Prime Minister Surayud Chulanont and media pressure.

Experienced economist

In the days following last September's coup, Pridiyathorn Devakula's name was at the top of many people's list of possible prime ministers.

He was a respected central bank governor in the previous administration and was courted by the leaders who ousted Mr Thaksin.

In the end he settled for the position of finance minister, as well as becoming one of the deputy prime ministers, and both appointments were widely welcomed in Thailand and abroad.

But according to the BBC correspondent in Bangkok, Jonathan Head, his credibility has suffered after two bungled policy initiatives - one to curb the rising value of the Thai currency, the other to limit foreign ownership of Thai companies.

Both measures were poorly explained and spooked foreign investors, our correspondent says.

Mr Pridiyathorn's relationship with Prime Minister Surayud Chulanont has also deteriorated, culminating in the Mr Surayud's failed attempt earlier this month to appoint a rival from the previous government, Somkid Jatusripitak, to another top economic position.

Unpopular though he was with foreign investors, Mr Pridiyathorn's resignation may only cause further damage to the interim government's standing at home, our correspondent says.

The government is now being widely criticised for a lack of clear leadership and internal disarray.

Little progress has been made in bringing charges of corruption against the previous administration.

And many politicians are worried that the military generals who launched the coup may start to reconsider their promise to return Thailand to full democracy by the end of the year.

[ThaiGoon]

Dude, I said it in jest about the stocks should skyrocket because Pridiyathorn wasn't well liked on ThaiVisa (TV) forum.

[lukamar]

This government has been falling apart since the day they made sure the 14 tanks didn't have any ammunition in them and sent them off to Bangkok.

It's probably due to their efforts to stage the coup in a sufficient way.

Don't fret, Military Intelligence is in charge of the country...

[ColPyat]

and so my call is to sell, watch the global situation, wait till further clarity is reached regarding pridiyathorn's replacement, then come back to pick bargain stocks if the situation is encouraging.

From what i gather there appears to be far too much uncertainty in almost all aspects here in Thailand, and in the region as well.

I don't know anything about stock markets, not even the basics, but i am somewhat worried what effect that might have on the life average population.

I do still remember with horror the '97 crises, and the utter misery it has caused, with social effects that are still visible here. I know that today the market situation is somewhat different than in those days, but i do miss any analysis that is even half reliable, the different statements i read in the media seem to contradict themselves all the time.

[slimdog]

global markets slump overnight, now pridiyathorn resigns. just a gentle reminder for those a bit slow off the bat, SELL ALL POSITIONS ON THE SET NOW!

An amateur's question:

Is the fall in stock market only a temporary setback, or is this the beginning of a crash, and what effects might that have on the Thai economy, and life for us here?

hi ColPyat. i hope i'm wrong, and i'm no expert either, but here's my assessment.

the SET has always been led by foreign trading, don't let anyone tell you otherwise.

recent rally was sparked partly internally, but to a larger extent by regional funds who put a Buy on thai index stocks as thailand was seen as undervalued with P/E at around 8 to 9 while regional bourses were closer to 20.

despite lower risk and higher growth prospects, regional markets were so overbought that with the relatively risky thai situation, a price earnings ratio of 8 was just too attractive, so funds looking to spread their risk a bit more took a punt on the SET. but remember, this is during a time when everything else is doing so well, maybe even too well.

if what we have seen in the last 24 hours or so is the start of a global sell off, then obviously funds will move first to protect their exposure in these regional markets. in any case, they will not be parking their funds here, an even higher risk market.

the impact on the SET with pridiyathorn resigning has little to do with whether he was well liked in thailand, and much more to do with how foreign funds view its impact on political stability. the market can deal with the good or the bad, as long as they see it coming, but markets are bad with dealing with uncertainty.

pridiyathorn's departure will create a vacuum, and whatever political wrangling and eventual replacement that will occur, and whether the replacement could be seen as being anymore worthy than pridiyathorn, and the as yet unknown policy angle he/she will adopt, all spells an even murkier and more uncertain picture for thailand.

i'm not sure if the global sell off is temporary, i hope it is, but in either case, they will not be looking here while they have the bigger markets to deal with. if regional prices retreat to 13 or 14 P/E, then obviously thailand will be relatively less attractive and they will be hunting bargains elsewhere.

and so my call is to sell, watch the global situation, wait till further clarity is reached regarding pridiyathorn's replacement, then come back to pick bargain stocks if the situation is encouraging.

Just to emphasise what thedude has stated, regarding foreign trading, looking at the SET's website shows that just this year, Thai Individuals and Thai Institutions have both been NET sellers, the only real buyers in the market today are foreigners..

More information can be found at:

http://www.set.or.th/set/investortype.do?l...&country=US

[Prakanong]

Dude, I said it in jest about the stocks should skyrocket because Pridiyathorn wasn't well liked on ThaiVisa (TV) forum.

Even I got that one

[twix38]

as an investor and tourist in Thailand, I was financially a lot better off with Taxin and a lot more secure.

I see trouble ahead with this Miliatsry Coup and sham government. Democracy or any chance of something close looks further away then ever and a time may well come when many will welcome Taxin back.

I knew he was a crook and corrupt (to whatever degree) and I also knew he was very likely better than what ever else may come along. I still think the same. From a Western and moral standpoint Taxin was unacceptable, but from a reality point of view I think I was economically and for foreigner's benefit, right to prefer he stayed as a businessman he did at least feather Thailand's pocket (and his own). They all do it in Asia and this lot are doing it too.

[thedude]

oh and one more thing regarding the SET.

the BOT is likely to fast track its policy rate reduction. this will encourage the baht to weaken. there is a strong relation between baht movement and SET strength (i'm sure there are actual experts on TV who can produce the charts), so a weakening Baht will not encourage foreign buyers to park their funds here. again, reinforcing the negative outlook right now.

[Crushdepth]

An amateur's question:

Is the fall in stock market only a temporary setback, or is this the beginning of a crash, and what effects might that have on the Thai economy, and life for us here?

You'll find out if it's the beginning of a crash when you wake up in the middle of a train wreck!

[prakhonchai nick]

Leaving a sinking ship!

[HenryB]

global markets slump overnight, now pridiyathorn resigns. just a gentle reminder for those a bit slow off the bat, SELL ALL POSITIONS ON THE SET NOW!

An amateur's question:

Is the fall in stock market only a temporary setback, or is this the beginning of a crash, and what effects might that have on the Thai economy, and life for us here?

Now is the time to buy.

Don't wait be positive.

In five years The Dow and The Set both at 17500.

One dollar will get one Baht.

Figure how much money you have.

Edited February 28, 2007 by HenryB

[ColPyat]

An amateur's question:

Is the fall in stock market only a temporary setback, or is this the beginning of a crash, and what effects might that have on the Thai economy, and life for us here?

You'll find out if it's the beginning of a crash when you wake up in the middle of a train wreck!

I only know that politically and socially we are in the middle of a train wreck. I have no idea how that though translates to the stock market, and the economy.

In '97 i feel it was a lot easier to see things coming than now, we had more information, and more advance notice. I remember that i warned friends who had money invested here then because of the very high interest rates to get that out ASAP then. A week or so later it all came tumbling down.

Right now though i have not the slightest clue where we are, in economical terms.

On the one hand, they say that the economy is wrecked because of Thaksin's populist policies, but on the other they say that the public debt situation is easily managable.

<deleted>??? Where do we stand now?

It all seems to be political statements based on agendas, and nobody seems to have any information where we really stand.

This is unsettling, to say the least.

[thedude]

Dude, I said it in jest about the stocks should skyrocket because Pridiyathorn wasn't well liked on ThaiVisa (TV) forum.

Even I got that one

sorry folks, my bad.

for a while i thought i was reading the kind of spin you'd expect to find in the newspapers.

just goes to show how far the bar has been raised in this country for making ridiculous statements sound credible.