The Thai Baht Reached a New 6-Year High. Here’s Why It’s Surging

[saengd]

1 minute ago, the guest said:

Pure and simple currency manipulation !

Show us how it's done.

[Ventenio]

11 hours ago, AussieBob18 said:

As it all things related to big finance, what always eventually comes after an absolutely bloated over-value, is a massive crash and over-devaluation.  The Baht is eventually going to crash and when it does it will crash big time - be prepared. 

 

I have called correctly every crash for the last 50 years, and, yes, the baht will eventually crash.  The year?  2037.  I have been buying Baht for YEARS and it's awesome.  i'm not cashing out just yet, this party is rocking!!!  I remember soooooo many people calling for the big time crash 10-years ago and 5-years ago and 3-years ago and last week and next week......  predicting is super fun when you make real money!!  but if you are not making real money on your predictions than you can predict everything all the time and eventually be right.  

[Number 6]

2 hours ago, Yinn said:

Hundreds of foreigner owned factory. Other place the same. 

No. I stay well clear of Chonburi and Pattaya. Hundreds? Producing what rubbish for what market? Sorry, not at all convinced. No doubt low tech, machinery, parts, etc. No value. Prolly most of it for auto parts in Rayong honestly.

 

Aconatic lol

 

2 hours ago, Yinn said:

only the rule for small business. You think Toyota, BMW, Benz, Isuzu, caretpillar etc tc is 51% thai owned. 

All businesses I am aware of yes.

 

These are Thai companies. The international corporation firms a regional corporation within Thailand.

 

2 hours ago, Yinn said:

Because thailand so successful rice is cheaper in low wage place. Thailand middle wage place. But have infrastructure so good, that why Thailand “Detroit of SEA”. 12th in the world car production = more money than grow rice.

I'm not following this at all. Thailand is successful at ??? and therefore rice is more expensive. No sorry that's not how economics works.

 

Detroit of the east...never heard that. Thailand is a base for selling cars bc Malaysia actually has its own brand. Thailand's neighbors bought cars and still do. It produces lots of cars for Thailand especially which could never get it's act together and build an industry. Being number 12 out of 20 isn't saying much. Thailand like all of Asia copies it doesn't innovate.

 

 

[zydeco]

7 minutes ago, Ventenio said:

I have called correctly every crash for the last 50 years, and, yes, the baht will eventually crash.  The year?  2037.  I have been buying Baht for YEARS and it's awesome.  i'm not cashing out just yet, this party is rocking!!!  I remember soooooo many people calling for the big time crash 10-years ago and 5-years ago and 3-years ago and last week and next week......  predicting is super fun when you make real money!!  but if you are not making real money on your predictions than you can predict everything all the time and eventually be right.  

Assuming you were at least 20 years old when you made your first prediction, then you must be around 70 years old right now. So, in 2037, you should be around 88 years old. What are you going to do with all your money? Buy a gold lined coffin?

[William C F Pierce]

To get the real Value you need to look at the money markets outside of Thailand and not a Thai made china piggy banks.

[CNXexpat]

1 hour ago, Lacessit said:

Try selling any property in Chiang Rai or Chiang Mai, and see what happens. That's why I will always rent.

In my moo baan 3 houses are sold during the last 6 weeks for between 6 and 8 million Baht. 

 

1 hour ago, Lacessit said:

The Chinese tourists? As mean as a s##thouse rat. Ask any shop or restaurant. Back off to avoid the spittle.

A friend owns a restaurant near the Thapae gate. He loves the Chinese because they order seafood plates for between 1,800 and 3,500 Baht opposite the farangs they order cheap Pad Thai. And the Chinese are no cheap tourist groups, only families, couples and some together traveling friends with good manners.

 

So in both of your points I have no idea what you mean. My experiences are totally different.

 

 

[kevin612]

Chinese tourists don’t come, baht will fall, because demand decreases.

[kickstart]

Is some one cooking the book's ,Mr Bloomberg said inflation in Thailand is running at 0.3%.......... tell that to my wife, who says most weeks after coming back from our weekly market, saying how expensive  thing are yet again ,how no one is buying anything ,bar the essential  items. 

Something wrong some where, as has been said ,history will repeat its self, 1997 again ,I was here then ,81 Baht to a Pound at the airport .

[Lacessit]

45 minutes ago, CNXexpat said:

In my moo baan 3 houses are sold during the last 6 weeks for between 6 and 8 million Baht. 

 

A friend owns a restaurant near the Thapae gate. He loves the Chinese because they order seafood plates for between 1,800 and 3,500 Baht opposite the farangs they order cheap Pad Thai. And the Chinese are no cheap tourist groups, only families, couples and some together traveling friends with good manners.

 

So in both of your points I have no idea what you mean. My experiences are totally different.

 

 

Good manners? Have you ever seen a group of Chinese at a buffet?

You're right - our experiences are entirely different.

Permit me to doubt your claim of 1800 - 3500 baht for a dish of seafood. Even Le Coq D'Or wouldn't charge that much. Mind you, I've never seen any Chinese in there.

Houses in moo baans or gated communities going for 6 - 8 million baht? More like 3-4 million in a bull market, which Chiang Mai certainly is not.

Edited October 26, 2019 by Lacessit

[CNXexpat]

16 minutes ago, Lacessit said:

Good manners? Have you ever seen a group of Chinese at a buffet?

You're right - our experiences are entirely different.

Permit me to doubt your claim of 1800 - 3500 baht for a dish of seafood. Even Le Coq D'Or wouldn't charge that much. Mind you, I've never seen any Chinese in there.

I have been today at the buffet at Eat at Rincome. Beside some farangs, more Thais were also around 25 Chinese there. Small different groups. One group was a bit loud sometimes, but not really disturbing. I had nothing to complain. My wife noticed, that at our neighbors, right and left, took a lot in one time from the buffet and didn´t eat everything - and they were Thais.

I don´t know where you are going for lunch and dinner, but I never made a bad experience with Chinese and I go out for eating many times a week. 

 

The seafood plates for this price are for 2 or more people. That´s the reason for the higher price. He sells a lot of them, but only to Chinese. He makes a fortune with them.

Edited October 26, 2019 by CNXexpat

[Nyezhov]

7 minutes ago, CNXexpat said:

I have been today at the buffet at Eat at Rincome. Beside some farangs, more Thais were also around 25 Chinese there. Small different groups. One group was a bit loud sometimes, but not really disturbing. I had nothing to complain. My wife noticed, that at our neighbors, right and left, took a lot in one time from the buffet and didn´t eat everything - and they were Thais.

I don´t know where you are going for lunch and dinner, but I never made a bad experience with Chinese and I go out for eating many times a week. 

 

The seafood plates for this price are for 2 or more people. That´s the reason for the higher price. He sells a lot of them, but only to Chinese. He makes a fortune with them.

I like it better when they hand you a set of plastic gloves, a bib and then dump a bucket of steamed squirmies out the table right under your nose. 

[Sydebolle]

"Thailand’s central bankers are finding it tough to stop the baht from surging."

Maybe you put people in charge of the Bank of Thailand who can manage the job. Nobody else but the Bank of Thailand "runs" the Baht, irrespective of all those Soros' and Illuminati-sources quoted. 

Capital outflow is a tedious medieval affair; do away with all those hindering outward brakes allowing Thais to invest overseas, control the currency with interest rates and, if necessary, do what the Europeans did more than once - apply negative interest rates. Also screen the Thai Baht currency basket and possibly adjust it accordingly; beware of the Yuan which is a monopoly-game currency and can go South anytime soon, depending on how the proxy games work between China and the US. 

If nothing is done anytime soon, then the tourism industry - being a big employer of Khon Thai - will collapse and exports will also become a thing of the past ........ beware - some people high up in the Thai banking system are playing with fire. 

[pokerface1]

As a rule successful currency traders don’t see the price as either height or low if they did they would be blown out of the trade by trying to pick tops or bottoms. It’s an illusion created to wipe you out. The fact is fundamental have little to do with the appreciation of the Thai Baht as you can plainly see. Of course interest rates matter but at such low rates only cause a hiccup in the bigger scheme of things The truth for why the Baht is so strong is.........

Also be aware that sometime market traders referring to hedge funds and dark pools etc. slowly unwind there long positions over many months or years so as to reap the biggest profits by selling to those unaware of the new down trend. 
So I wouldn’t count on a crash occurring anymore than I would a slow decline over the long term. 

In the meantime. 
if your really interested in understanding currency trading research is available online. Try marketguru4u.blogspot.com for a starting point there are plenty of sites to choose from. 

[Lacessit]

5 hours ago, CNXexpat said:

I have been today at the buffet at Eat at Rincome. Beside some farangs, more Thais were also around 25 Chinese there. Small different groups. One group was a bit loud sometimes, but not really disturbing. I had nothing to complain. My wife noticed, that at our neighbors, right and left, took a lot in one time from the buffet and didn´t eat everything - and they were Thais.

I don´t know where you are going for lunch and dinner, but I never made a bad experience with Chinese and I go out for eating many times a week. 

 

The seafood plates for this price are for 2 or more people. That´s the reason for the higher price. He sells a lot of them, but only to Chinese. He makes a fortune with them.

That cuts the cost per person down to about 1500 for the most expensive with two people, or 800 baht for four. I could live with that on special occasions.

Noted you haven't given any evidence of your claim on real estate sales. My condo has about 30% unoccupied rooms owned by the banks, after the original buyers defaulted on loans. I have a friend who has been trying to sell his house for 5 years now. It's a nice house, but Asians generally want new and the Western market is shrinking due to uncertainty on Immigration visas. He is basically selling at cost, 4.5 million. Too many gated communities trying to sell their 3 million clones.

[Stargeezr]

I just hope that I am not in Thailand when the Baht does take a fall.

  For now I have to plan on the trip costing me more, and I will not be

eating at fancy restaurants very often, might even limit my beer intake

a bit.  I just hope for great weather, when I am in the hot country over some of the Winter

months.

Geezer 

[ineedadvice]

I just hope that I am not in Thailand when the Baht does take a fall.
  For now I have to plan on the trip costing me more, and I will not be
eating at fancy restaurants very often, might even limit my beer intake
a bit.  I just hope for great weather, when I am in the hot country over some of the Winter
months.
Geezer 

Ever heard of Cambodia. A draft beer costs. 0.50 USD. Try REP or PNH. PNH is like Pattaya to a large extent except no beach.



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[saengd]

I may have interpreted what was written in the IMF report on Thailand incorrectly, unsure. In July they wrote:

 

"Background. The baht has been on a gradual real appreciation trend since the mid-2000s, despite occasional bouts of volatility (such as the mid-2013 US Federal Reserve tapering talks and the domestic monetary policy easing cycle in early 2015). In 2018, despite some volatility through the year, with marked depreciations in 2018:Q2 and 2018:Q3, the REER appreciated overall by 3.0 percent relative to 2017. As of May 2019, the baht had appreciated an additional 4 percent relative to the 2018 average. Assessment. Using an elasticity of 0.64, the 2018 REER would be assessed as undervalued by about 6 to 11 percent."

 

REER is the Real Effective Exchange Rate, IMF is saying it's undervalued by 6 to 11% which I now think means they believe the rate is too strong, undervalued as in they are not receiving enough USD for their Baht. Initially I took that to read that the Baht is undervalued, not the exchange rate.  Anyone?

 

https://www.imf.org/~/media/Files/Publications/ESR/2019/English/ch3.ashx

   Page 92

 

Edited October 26, 2019 by saengd

[WeekendRaider]

most folks want a simple answer.  here is another!

 

100% cash, no real estate, mostly all THB, for the first time since 1982.

 

you don't know the answer to the question why until you no longer can keep asking it.

 

there is a reason why liquidity is so important to a small cohort of investors relatively suddenly in 2019. how about the one that 98% of the " general population" have such clever as well as banal denial narratives about. yeah, that is why why.

 

the C word.  that has expensive golf resorts, fancy hotels (air travel) and a better border wall (for deniers who figure its a slow transition... in 2100 something but have not been keeping up with the literature and.... observations). Climate Change.  or rather... science. not the pretend and share feelings about.... Climate Change.

 

Edited October 27, 2019 by WeekendRaider

[AussieBob18]

14 hours ago, saengd said:

You're not reading what's been written or you've not understood, let me try again.

 

Bla Bla Bla

 

Perhaps you are right and it will not crash, but you are wrong about the reasons and your logic is totally skewed. 

I just did a quick google for you and here are some easy to digest facts and the links showing those facts: 

• Thailand is not 'officially' a currency manipulater because they are not rying to artificially lower their currency;
• Thailand's major surplus trade is with China and is not a problem to USA (but getting close);
• China is not taking any 'action' against Thailand currency at the moment because they are selling Thailand Billions of Military gear and Infrastructure projects - why would they want less for what they are selling:
• Thailand knows there is a problem but recognises they cannot easily solve that problem;
• The economic fundamentals are wrong for such a massive increase, especially when shown against the value of currencies that are traded heavily on the world stage;

http://www.americanautocouncil.org/currency-manipulation-101

https://en.wikipedia.org/wiki/Currency_manipulator

https://www.thaipbsworld.com/why-thailand-is-not-labeled-a-currency-manipulator-by-the-us/

https://www.bloomberg.com/news/articles/2019-07-03/-worried-thai-central-bank-looking-at-steps-to-damp-baht-surge

https://www.cnbc.com/2019/07/31/thai-baht-strength-sparks-concerns-with-thailand-economy-slowing.html

https://thediplomat.com/2019/09/china-thailand-military-ties-in-the-headlines-with-new-shipbuilding-pact/

 

 

Read all that and you will see that there is no 'valid' economic reason for the Thai Baht to be so high.  Whatever the reasons (and I think the buying of Chinese military gear and infrastructure by the Junta is a biggie) the reality is that the Baht is massively over-valued.  When any currency is massively over-valued and it is not 'corrected' internally enough by that country, then a massive correction eventually takes place due to 'external factors'.  I am not saying that it will be to the same level as Argentina or Venezuala or Zimbabwe, but I will say that as soon as China 'rebalances' things and the global economy reacts, Thailand's currency is in serious trouble - unless they start doing something to corect its over-value - but I think it is probably too late.  The fact that Thai Baht is a minnow is as you said, but it also means that any external correction will hit harder. 

 

As CNBC noted in their article:  "The poet John Donne wrote many decades a go that "no man is an island." In a global economy, no nation is either."  Thailand will one day have to pay the piper - how much depends on how quickly they correct things (if they do). 

 

[AussieBob18]

And another thing.  If the Thai economy was doing so well, why would they be doing this scheme - and all the others they are doing to try and 'stimulate' the economy??  And the fact that all these schemes are being massively subscribed to by Thais shows they are struggling - and show a Thai free money and they will jump at it without question ????

 

 

 

[saengd]

You jumped ahead several steps and went off at a tangent, blah blah blah!

 

You earlier wrote that THB is not strong because it is traded so often and you tried to demonstrate that by showing it's not in the top ten of the most traded currencies. You did not take into account the relative size of the currency, versus the extent to which it is traded. That was all I tried to show! 

 

Your subsequent posts about China and arm sales are red herrings and all very entertaining. But they don't do anything to alter the basic fact that THB is so strong because it is in demand as export bills are settled, capital inflows are converted and tourist money is exchanged.

 

And in case you were not aware, Chinese tourists see Thailand as a cheap destination, the fact that it is very close is a bonus. Exactly why China would want to weaken THB further escapes me. Thailand exported USD 30 bill to China in 2018, it imported USD 50 bill., Thailand has a trade deficit with China, not a trade surplus!

 

https://tradingeconomics.com/thailand/imports/china

https://tradingeconomics.com/thailand/exports/china

 

Edited October 27, 2019 by saengd

[saengd]

BTW trade between China and Thailand does not alter the value of THB since that trade is managed via a currency swap agreement that bypasses the need to use USD to settle trade bills, only 60% of Thailand's export bills involve USD currently.

 

http://www.xinhuanet.com/english/2018-01/08/c_136880422.htm

[brokenbone]

On 10/26/2019 at 8:39 AM, AussieBob18 said:

As it all things related to big finance, what always eventually comes after an absolutely bloated over-value, is a massive crash and over-devaluation.  The Baht is eventually going to crash and when it does it will crash big time - be prepared. 

 

im also into wishful thinking, but i specialized on lottery

[theoldgit]

Nonsense post removed

[BigStar]

On 10/26/2019 at 8:39 AM, AussieBob18 said:

As it all things related to big finance, what always eventually comes after an absolutely bloated over-value, is a massive crash and over-devaluation.  The Baht is eventually going to crash and when it does it will crash big time - be prepared. 

 

Oooh. Now you've got us all SO scared. And what with all the echoes here in the chamber, I like so many am prepared to jump. Fellow jumpers, please leave notarized affidavits for our Sherlocks that your wife, girlfriend, or bar girl did NOT push you and was in no way responsible. And do check for pedestrians below so that you don't hit anyone who simply wants to carry on as usual. ????

Edited October 27, 2019 by BigStar

[Sticky Wicket]

2 hours ago, WeekendRaider said:

most folks want a simple answer.  here is another!

 

100% cash, no real estate, mostly all THB, for the first time since 1982.

 

you don't know the answer to the question why until you no longer can keep asking it.

 

there is a reason why liquidity is so important to a small cohort of investors relatively suddenly in 2019. how about the one that 98% of the " general population" have such clever as well as banal denial narratives about. yeah, that is why why.

 

the C word.  that has expensive golf resorts, fancy hotels (air travel) and a better border wall (for deniers who figure its a slow transition... in 2100 something but have not been keeping up with the literature and.... observations). Climate Change.  or rather... science. not the pretend and share feelings about.... Climate Change.

 

"most folks want a simple answer.  here is another!" 

 

It's like you are writing in some kind of indecipherable code. 

I assume you are not a native English speaker.

Nobody understands this, you might be wasting your time posting on an English forum.  

[RocketDog]

23 hours ago, Yinn said:

Ok, I will explain for Sticky.

 

When Yinn put money in the bank, the bank pay Yinn for it.

If it lower, Yinn get less money extra money.

 

When Sticky need the loan, the bank take money for it. If it lower, Sticky pay less.

 

understand now Sticky?

You have a terribly naive grasp of currency regulation and control at the government level.

 

The interest rate the bank pays or charges to individuals is a result of much more complex policy.

 

Don't let your national pride replace researching for the truth.

[Skeptic7]

On 10/26/2019 at 3:39 AM, AussieBob18 said:

As it all things related to big finance, what always eventually comes after an absolutely bloated over-value, is a massive crash and over-devaluation.  The Baht is eventually going to crash and when it does it will crash big time - be prepared. 

 

Been waiting and prepared since 1998. Can it hurry up and CRASH already!!! ????

[baansgr]

The UK held ample foreign reserves and sterling was at a peak in the recession of 1981..... 3.5 million unemployed, factory closures, dwindling exports....didn't mean diddly squat....look around, its already started in Thailand.

[rvaviator]

IMF says the thai bath is overpriced.Morgan Stanley says the same.The strong thai bath is a problem for thailand.The only one who can effect the thai bath is centralbank they say.
I pay less for a beer in the pub in norway then bangkok.Porkmeat is cheaper in norway.
My wife said that the prices go up even in the local markeds.

Just a comment regarding pork - Swine flue is rampant in China - price for pork has doubled here (I am in China right now ... ) in 7 months - Apparently Thailand export a lot of pork to China ... So I can understand the prices rocketing ... Maybe Norway should export pork to China :-) ... I read in Dagbladed that Norway did a trade deal with China regarding salmon export ... Wonder if the China cross country ski team will do well .. after all the training they are getting from the “experts” ;-) .... Very survived that a pint is cheaper in Norway !!


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