Baht Continues To Be Strongest Emerging Market Currency

[simoh1490]

5 hours ago, elgenon said:

Where I get confused is that the Chinese have huge foreign reserves but the local governments owe huge. I think. But the debt is to the national government?

China is spending big in many parts of the world. Thailand couldn't begin to do it.

Can you sort all this out?

A good read on that subject here : https://www.economist.com/china/2017/11/16/what-a-debt-crisis-in-the-provinces-says-about-governing-china

[morrobay]

On 9/18/2018 at 5:51 AM, elgenon said:

Where I get confused is that the Chinese have huge foreign reserves but the local governments owe huge. I think. But the debt is to the national government?

China is spending big in many parts of the world. Thailand couldn't begin to do it.

Can you sort all this out?

According to IMf.China foreign reserves are 30 percent of GDP while overall debt 234 percent GDP. And growth in GDP 2015-6 by 5 trillion rnb took 20 trillion in New credit. Then there is the shadow banking, trade war with U. S., and imperial over reach. So since the banks are owned by government a credit risk is a sovereign risk. I see a yaun.devaluation to reduce debt that will affect Thai exports, tourism and investment. 

Edited September 19, 2018 by morrobay

[simoh1490]

9 minutes ago, morrobay said:

According to IMf.China foreign reserves are 30 percent of GDP while overall debt 234 percent GDP. And growth in GDP 2015-6 by 5 trillion rnb took 20 trillion in New credit. Then there is the shadow banking, trade war with U. S., and imperial over reach. So since the banks are owned by government a credit risk is a sovereign risk. I see a yaun.devaluation to reduce debt that will affect Thai exports, tourism and investment. 

As I recall, China accounts for only 12% of Thai exports so any hit from the devaluation of the Yuan would not be significant. Plus, Thailand is currently very cheap for Chinese tourists, any devaluation of the Yuan would have to be significant for it to meaningfully impact Chinese tourism to Thailand, I think.

[Mac98]

On 9/16/2018 at 5:11 PM, OJAS said:

Far from declining, I distinctly recall the THB's value actually soaring during the poliitical crises here in 2008 and 2010.

That's because the dollar was plummeting during that financial crisis where the Fed had to pump trillions of dollars into the economy.

[elgenon]

On 9/19/2018 at 1:01 PM, morrobay said:

According to IMf.China foreign reserves are 30 percent of GDP while overall debt 234 percent GDP. And growth in GDP 2015-6 by 5 trillion rnb took 20 trillion in New credit. Then there is the shadow banking, trade war with U. S., and imperial over reach. So since the banks are owned by government a credit risk is a sovereign risk. I see a yaun.devaluation to reduce debt that will affect Thai exports, tourism and investment. 

His Majesty The Donald will NOT be  happy. Deficits are rising.

[j8k]

Having USD, EUR and GBP at my disposal has meant LoS is no longer an attractive place to stay long term. It's getting to the point where even beers in 7/11 seem pricey. It's becoming like Malaysia.

 

Bars are crazy expensive too for falang now. London prices in some instances. Some are on their way to being Perth prices.

 

I spend a lot of time in southern Europe too and the costs of food and drink are now a fraction of Thailand - and it's healthy western food not deep fried, sugar laced Thai crap.

 

I recall being in BKK in the early 2000s and it did feel like a bargain then. Of course this has gone forever. All these Chinese coming in and slinging money around will only make things worse. 

 

I'd rather retire in Asia than Europe because it's simply more fun being here but I am being priced out of the former.

 

It's depressing. 

 

I can only hope for a 1997 style crash again and for Chinese tourists numbers to be curtailed. 

[simoh1490]

24 minutes ago, j8k said:

 

It's depressing. 

 

I can only hope for a 1997 style crash again and for Chinese tourists numbers to be curtailed. 

 

So you've lots of empathy with the native Thai population and aren't even a little bit selfish in your thinking then!

[marcusarelus]

4 minutes ago, simoh1490 said:

So you've lots of empathy with the native Thai population and aren't even a little bit selfish in your thinking then!

No, I think he wants the Aussies to go home.  As the Chinese tourists get fewer Thai bar and hotel prices will go up making it less affordable for Australians and they will all go home. 

 

Thai econ 101, when profits go down raise prices.  I went to Chula. 

[j8k]

38 minutes ago, simoh1490 said:

So you've lots of empathy with the native Thai population and aren't even a little bit selfish in your thinking then!

I am sorry but after my time here I have no empathy whatsoever for Thais. Most average locals won't even suffer in a crash - just those greedy ones with all the assets.

 

And do you really think they care about us? I think everyone knows the answer to that.

 

[marcusarelus]

3 minutes ago, j8k said:

I am sorry but after my time here I have no empathy whatsoever for Thais. Most average locals won't even suffer in a crash - just those greedy ones with all the assets.

 

And do you really think they care about us? I think everyone knows the answer to that.

You, probably not.  Me?  Yes.  I like Thai people and they like me.  Have had relationships with Thais since the 1960's.  I moved here because I like them better than most Americans and Canadians. 

[j8k]

17 minutes ago, marcusarelus said:

You, probably not.  Me?  Yes.  I like Thai people and they like me.  Have had relationships with Thais since the 1960's.  I moved here because I like them better than most Americans and Canadians. 

I guess there will always be exceptions and good on yer but most Thais would probably rather see the back of foreigners.

[marcusarelus]

2 minutes ago, j8k said:

I guess there will always be exceptions and good on yer but most Thais would probably rather see the back of foreigners.

Ask any gay guy. 

[morrobay]

On 9/21/2018 at 4:42 PM, j8k said:

I am sorry but after my time here I have no empathy whatsoever for Thais. Most average locals won't even suffer in a crash - just those greedy ones with all the assets.

 

And do you really think they care about us? I think everyone knows the answer to that.

 

That's right a devalued baht would benefit exports and tourism. And of course adversely affect those buying in London. Where are all these incompetent Thais when you need them?? IE in the financial system. 

[simoh1490]

On 9/21/2018 at 4:42 PM, j8k said:

I am sorry but after my time here I have no empathy whatsoever for Thais. Most average locals won't even suffer in a crash - just those greedy ones with all the assets.

 

And do you really think they care about us? I think everyone knows the answer to that.

 

When a currency crashes everyone suffers, just ask the locals who were here in '97.

[simoh1490]

A chart showing the ratio of foreign currency borrowings by sector/by EM country, note Thailand near the bottom with less than 2% of government borrowings in currencies other than THB, a key reason why THB is strong.https://www.telegraph.co.uk/business/2018/09/23/debts-over-stretched-markets-global-slowdown-threaten-economy/

 

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Edited September 24, 2018 by simoh1490

[morrobay]

2 hours ago, simoh1490 said:

When a currency crashes everyone suffers, just ask the locals who were here in '97.

No one is really wishing a crash. But is it a coincidence that the baht is overvalued at 32/$ instead of a reasonable 36-37/$ and benefiting the same crowd that are in position to control it's value? 

[simoh1490]

17 minutes ago, morrobay said:

same crowd that are in position to control it's value? 

5

Which is whom?

 

The value of THB is determined solely by demand, tourists demand it for vacations as do exporters when they get paid in USD. So how exactly those two vested interest groups can control THB value is unclear, don’t vacation in Thailand and don’t sell goods overseas is perhaps the answer!

Edited September 24, 2018 by simoh1490

[j8k]

At this rate any of my future massage sessions in the Kingdom are going to end up distinctly unhappy! 

 

Time is maybe approaching to move across the border to Cambo. At least I have $s and $ assets and therefore some control. That said, inflation there will probably take off once more of China moves in.

 

Where does a 50 something go? Africa? Central Asia? Sorry I am straying off topic now. I am just a little down about all this. At least I should always have enough notes for some Thai whiskey and a bowl of noodles.