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

[Yinn]

18 hours ago, Number 6 said:

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.

No doubt? 

So you not know, just imagine.

 

18 hours ago, Number 6 said:

 

Aconatic lol

 

All businesses I am aware of yes.

2 or 3

 

18 hours ago, Number 6 said:

 

Detroit of the east...never heard that.

 

That not surprise me you not know that also.

you think Paksida is Maksida. You write that. Why not just check dictionary instead argue with me, my language.

 

https://www.economist.com/schumpeter/2013/04/04/detroit-of-the-east

 

https://money.cnn.com/2018/07/10/news/world/thailand-auto-industry/index.html

 

http://www.eiu.com/industry/article/1880942372/thailand-cars-boom-times-for-the-detroit-of-south-east-asia/2013-09-10

 

 

18 hours ago, Number 6 said:

 

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.

 

 

12 out of 194 

You should go to school.

 

your personality is to argue. With no knowledge

I lazy to answer you again.

[saengd]

2 hours ago, baansgr said:

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.

Not even a close comparison!

 

Interest rates were extremely high, Thailand's are not.

Unemployment was very high, Thailand's is not.

Inflation was very high, Thailand is not.

Unions were making high wage demands, Thailand doesn't have unions per se.

Monetary policy was very strict, Thailand's is quite flexible.

 

"During 1980-81, the UK entered a recession – with falling output, rising unemployment and a fall in the inflation rate. The recession particularly hit manufacturing sector. The recession was caused by high-interest rates, an appreciation in Sterling and tight fiscal policy.

In 1979, the incoming Conservative government inherited an economy with inflation in double figures. (April 1979 inflation was 10.1%). Also, many industries were considered inefficient, and trades unions were powerful. There had been a winter of discontent with many strikes taking place in the late 1970s"

 

.https://www.economicshelp.org/macroeconomics/economic-growth/uk-recession-1981/#targetText=UK Recession of 1981,Sterling and tight fiscal policy.

 

 

 

[AussieBob18]

My last 'input/response' to the debate - time to move on.  This is last 10 years history of Baht versus AUD:

If you cant see that since the Junta arrived in 2014 that the Baht has been over-valued for an extended period, then you are not seeing the facts. We can argue til cows come home about the economic fundamentals (which are bad no matter how you look at it IMO).  However, aside from the historical jump in the Baht following the GFC in 2007/2008, the Baht has been at record rates since 2014 - and at historical high rates since 2017.  Something has got to give IMO.  Bye.

 

 

[saengd]

46 minutes ago, AussieBob18 said:

My last 'input/response' to the debate - time to move on.  This is last 10 years history of Baht versus AUD:

If you cant see that since the Junta arrived in 2014 that the Baht has been over-valued for an extended period, then you are not seeing the facts. We can argue til cows come home about the economic fundamentals (which are bad no matter how you look at it IMO).  However, aside from the historical jump in the Baht following the GFC in 2007/2008, the Baht has been at record rates since 2014 - and at historical high rates since 2017.  Something has got to give IMO.  Bye.

 

 

We can agree that THB has been remarkably strong since about mid 2015 but you haven't made a good case or even stated why the junta is to blame/responsible and how. Your graph of AUD/THB only shows that AUD has weakened against THB, if you look at the ten year graph of AUD/USD you'll see the same trend, was the junta responsible for that also?

https://www.xe.com/currencycharts/?from=AUD&to=USD&view=10Y

XE_ AUD _ USD Currency Chart. Australian Dollar to US Dollar Rates.html

Edited October 27, 2019 by saengd

[CharlieH]

Off topic posts removed. Back on topic please.

[Isaan sailor]

The higher the Baht goes—the more the economy will suffer.  So why does BoT bother to “closely monitor the Baht”?

[ericthai]

On 10/25/2019 at 10:10 PM, Sticky Wicket said:

What fundamentals? Hoarding foreign reserves to window dress the fact the economy is sinking.

You do realise this is a military government and there is no accountability or checks being taken place. They tell us the figures and we have to accept them. There are no proper audits or due diligence taking place

 

The hoarding has a two pronged effect:

1) It allows manipulation for the overseas Thai to gorge on

2) Stops any thoughts of funds shorting the baht. The powers that be are petrified of this as it shows the emperor has no clothes on

 

I'm sure you also agree with the fudged TAT figs, the 99% approval ratings for the junta and the fixed election!

What does being a military govt have anything to do with things in Thailand? 

Doesn't matter who is in power it's always fictional numbers being touted by the Goverment! 

[rohitsuk]

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. 

 

Please god !

[Angry Dragon]

On 10/26/2019 at 9:18 AM, smedly said:

According to the IMF’s real effective exchange rate calculations, which take into account Thailand’s trade flows, the currency’s already well overvalued. It’s at the strongest, by that measure, since its crash in 1997, which triggered the Asian financial crisis.

No, you are suggesting that the REER is somehow akin to the "big mac" index, showing whether a currency is over or under valued.  The REER does nothing of the sort, but simply states the value of the currency against a group of other currencies on a weighted basis.  It does not say if a currency is over or under valued.

 

The big mac index, although far from perfect, still shows the THB as being undervalued against both the GBP (slightly) and the USD (significantly).  Adjusted for GDP, however, it shows the THB as being overvalued against the GBP (significantly) and the USD (slightly)

 

Many here want to talk down the baht for their own personal reasons.  I understand that.  But let's not be ostriches.

[Angry Dragon]

On 10/26/2019 at 10:06 AM, Sticky Wicket said:

There are members of the BOT that want to draw down/transfer from the foreign reserves but they are being silenced

where did you hear this from?  very odd.  Central bankers usually want to retain foreign reserves and prevent the government from using them to finance projects.  This is happening in India now, with repercussions.

[Angry Dragon]

On 10/26/2019 at 1:10 PM, Sticky Wicket said:

Negligible inflation? I wonder what basket of goods they are using, because it's not mine!

probably not, as you are most likely not an average thai consumer.  inflation has been remarkably low for some time now, along with unemployment levels.

 

hard to see the THB going anywhere but from strength to strength.  remember that currencies are traded against other currencies.  how are things looking in the US, UK and Europe compared to Thailand?

[beautifulthailand99]

On 10/26/2019 at 4:05 PM, 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.

There's a seafood restaurant on the beach at Naklua been going there on and off with the family over the last 10 years. Way back the place was always full and a queue for tables at the weekend and nearly all Thai with a smattering of farang+Thai. Went their last year probably 80% full at the same time  - no queue for a table and all the customers were Chinese tourists having it large with tables groaning with food and drink. I was the only farang there and probably the only Thai's there. As Prayuth has said if Thais can't afford seafood they should choose cheaper food. 

[rohitsuk]

Well thank you Marie Antoinette - let them eat cake !

[pizzachang]

On 10/26/2019 at 10:05 AM, Sticky Wicket said:

Just because it is planned, doesn't mean it will get delivered. 

Also they are borrowing and using private capital when they have enough in dollars .

Must be a reason to have such a large amount of dollars on hand?!

If they're borrowing from China, rather than the IMF, (military - driven?) it won't end well. Just an opinion

[saengd]

13 minutes ago, pizzachang said:

If they're borrowing from China, rather than the IMF, (military - driven?) it won't end well. Just an opinion

Oh please! The IMF is the lender of last resort.

[saengd]

10 hours ago, AussieBob18 said:

I will confess to studying Economics at University a long lonmg time ago when Adam was a boy.  But my 'belief' in the subject declined dramatically when I questioned a Professor why the Government of the day was who decided both the determinates for inflation and the method for measuring them  - clearly it was an arbitarary political construct and through constant manipulation the Govt was theregy manipulating 'inflation'.  The same applies to most Economic 'measures' of the both micro and macro economy - and which are to this day still manipulated by Govts.  My disbelief and argument was treatred much like Giordano Bruno when he questioned the Church's dogma - needless to say I switched majors to 'Business'.  It was only later when I realised that much like the Chuurch leaders of the past, Economists are controlling the actions of the People/Governments through basically the same approach. There is truth in what they are saying/preaching, but they are basically manipulating things to further their own position.

 

My answer to your question is as valid as any economist would give, or a reasonably knowledgeable TV member - no one really knows.  I think you have answered your own question (greed), or they UK ones could well be fakes, or both reasons, and several other ones - and all or one could be correct.  Economics is all BS - but the fundamentals are there.  IMO the Baht is massicely over-valued and the inevitable result will be a severe drop.  Proof?  Like all other Economic predictions - only the future can say right or wrong. They/we are guessing - educated complicated guesses - but still a guess.

For somebody who studied economics you have missed one very basic premise, USD has moved in the same way that THB has, over the same period, not surprising since the one is managed against the other. Here's the $ Index, this should give you some clues: https://www.marketwatch.com/investing/index/dxy

Edited October 28, 2019 by saengd

[AussieBob18]

29 minutes ago, saengd said:

For somebody who studied economics you have missed one very basic premise, USD has moved in the same way that THB has, over the same period, not surprising since the one is managed against the other. Here's the $ Index, this should give you some clues: https://www.marketwatch.com/investing/index/dxy

This is a spherical argument. No matter how I look at it - IMO you are wrong.  

 

But as I said before - Economics is the new 'religion' that dictates ;behaviours' over all.  While we can both quote different parts of 'The Bible/Quran' to support our difference of opinion, the reality is that Economics is a 'social science' built on beliefs.  I believe the Baht is massively over-valued, and you do not. 

 

 

 

[saengd]

2 minutes ago, AussieBob18 said:

This is a spherical argument. No matter how I look at it - IMO you are wrong.  

 

But as I said before - Economics is the new 'religion' that dictates ;behaviours' over all.  While we can both quote different parts of 'The Bible/Quran' to support our difference of opinion, the reality is that Economics is a 'social science' built on beliefs.  I believe the Baht is massively over-valued, and you do not. 

 

 

 

You missed the point. In 2014 the US Dollar Index was at 80 and ever since then it has climbed to 98. BOT operates a managed float which means the value of THB is managed against the currencies of its largest trading partners...the US, ergo, against USD.

[AussieBob18]

43 minutes ago, saengd said:

You missed the point. In 2014 the US Dollar Index was at 80 and ever since then it has climbed to 98. BOT operates a managed float which means the value of THB is managed against the currencies of its largest trading partners...the US, ergo, against USD.

Spherical argument. Lets see what the future delivers. 

I hope you have not over-invested in the Thailand economy.

 

[kingdong]

On 10/26/2019 at 2:39 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 and over-devaluation.  The Baht is eventually going to crash and when it does it will crash big time - be prepared. 

 

And when it occurs it,'ll be all the fault of the western banks,anyone remember 1997?good luck to all the farang  living in thailand.

[saengd]

35 minutes ago, AussieBob18 said:

Spherical argument. Lets see what the future delivers. 

I hope you have not over-invested in the Thailand economy.

 

I have 3.5 mill. in Baht TD's and LTF's incountry, imported at around 56 per Pound, I wish I had brought in more at the time.

[AussieBob18]

27 minutes ago, saengd said:

I have 3.5 mill. in Baht TD's and LTF's incountry, imported at around 56 per Pound, I wish I had brought in more at the time.

Well done.  If I was in your situation I would look to liquify part of the portfolio and re-invest in an alternative arrangement, and look to offset the remaining portfolio against a potential drop in the Baht at 10% and at 20% and 30% etc. If/when the Baht does drop then re-invest the liquified assets when each secondary marker is reached - 20%, 30% etc.  As you know, the simple basics is to buy in when low, sell when high, and buy back in again when it drops - repeat and rinse - dont cash out too much at any given cycle.  But I think you would have already started that ???? 

PS - I have about $100K ready to buy in when it crashes - entry points being between 40% and 60%. But that startegy will depend on the crash, and therefore the Thai Government being changed at the next election, and Thailand's subsequent economic and geopolitical re-alignment with USA (as opposed to the Junta's re-alignments with China).

 

Edited October 29, 2019 by AussieBob18

[saengd]

14 minutes ago, AussieBob18 said:

Well done.  If I was in your situation I would look to liquify part of the portfolio and re-invest in an alternative arrangement, and look to offset the remaining portfolio against a potential drop in the Baht at 10% and at 20% and 30% etc. If/when the Baht does drop then re-invest the liquified assets when each secondary marker is reached - 20%, 30% etc.  As you know, the simple basics is to buy in when low, sell when high, and buy back in again when it drops - repeat and rinse - dont cash out too much at any given cycle.  But I think you would have already started that ???? 

PS - I have about $100K ready to buy in when it crashes - entry points being between 40% and 60%. But that startegy will depend on the crash, and therefore the Thai Government being changed at the next election, and Thailand's subsequent economic and geopolitical re-alignment with USA (as opposed to the Junta's re-alignments with China).

 

The Baht I hold in country covers my living and visa expenses, I don't regard Time Deposits as investments, rather they are just a store for cash that helps offset inflation. The LTF's are a five year holding  that have tax benefits....all my real investments such as my pension fund are outside Thailand but are balanced global funds.

 

Let's chat again in one year and we'll compare notes.

[sawadeeken]

If somebody ahead of me has not mentioned it, (and I havent read the 20 pages ahead of my reply), then I can answer it for you,,,,,,,,,

This current PM Prayut (and his buddies) are manipulating, and publicising, all the things that  'he thinks' (or they think).............. the Thai Populous will THINK that he is doing something better than previous government heads............ He wants to be the 'Greatest' and have more time to fill his pockets 'FULLER' than Thaksin ever dreamt of......

[DeeMoney]

On 10/26/2019 at 1:25 PM, holy cow cm said:

Do you know the restrictions and hurdles there are that Thailand regime now imposes on the foreigners regarding doing that? And the Thai banks only guarantee a little in coverage. It is plainly not safe.

 

There are minor restrictions put in place but it is not troublesome, expensive, or impossible. 

[johnarth]

the president of the Thai bank tried to slow down the baht a couple of months ago, he said it to high and needed slowing down, wonder what happened to him? next a high up in Kasikorn bank says the baht is going to go up until next year perhaps he will be the next Thai bank president. The PM is walking on egg shells weather he knows it or not, lac of turos is a big step

[metisdead]

Some off topic posts and replies have been removed.