Latest government Covid borrowing pushes state funds to the limit, says bank research center

[Brierley]

2 minutes ago, BestB said:

If borrowed money was well spent to support people and businesses then it’s the right thing to do but all

the borrowed money seems to just disappear into a black hole

This purely anecdotal of course but it does make the point: my wife has received about four tranches of government money since this whole covid business started. None of them were large, the first was about 7k per month for three months or so, then there was 2k for three month, followed by 2k of 50/50 spending at small businesses and now this week, she's just received another 2k for something or other. All in all I guess about 35k, she's a licensed tour guide and she received the money automatically. Multiply that alone by the number of similar recipients and it's not small change.

[BestB]

37 minutes ago, Brierley said:

This purely anecdotal of course but it does make the point: my wife has received about four tranches of government money since this whole covid business started. None of them were large, the first was about 7k per month for three months or so, then there was 2k for three month, followed by 2k of 50/50 spending at small businesses and now this week, she's just received another 2k for something or other. All in all I guess about 35k, she's a licensed tour guide and she received the money automatically. Multiply that alone by the number of similar recipients and it's not small change.

And how much money did agency owner received? Or everyone else who is not a licensed tour guide ? 

[Brierley]

56 minutes ago, BestB said:

And how much money did agency owner received? Or everyone else who is not a licensed tour guide ? 

Why ask me, how would I know? I can only report the things I see, not the things others see.

[Bangkok Barry]

Here's a thought. The government now has taken its borrowing to the very limit to what is allowed, yet there is every chance that the country will be suffering from the pandemic for at least the remainder of this year. So what happens if/when the latest borrowing runs out before the pandemic is banished?

[Brierley]

14 minutes ago, Bangkok Barry said:

Here's a thought. The government now has taken its borrowing to the very limit to what is allowed, yet there is every chance that the country will be suffering from the pandemic for at least the remainder of this year. So what happens if/when the latest borrowing runs out before the pandemic is banished?

The limits will be changed in Parliament. The borrowing limit is an internal political constraint, nothing more.

[SoilSpoil]

21 hours ago, holy cow cm said:

Now watch the guarantee of funds for bank account limit to drop to 500,000 from the next limit of 1000,000. These state owned banks could have a field da

Is this speculation, or for real?

[Rookiescot]

15 hours ago, Brierley said:

You are quite wrong on this point.

When the banking crisis was at its height, with money too tight and commercial banks in great distress, the world’s leading finance ministers, including the UK chancellor, agreed to stabilise markets by cutting interest rates together. 

Now how could they do that if the central banks, who are responsible for setting interest rates, were independent of government? 

[Brierley]

8 minutes ago, SoilSpoil said:

Is this speculation, or for real?

It's nonsense is what it is! The limits have been kept at much much higher levels for many years, they have tried to reduce them down to 1 million a couple of times but at the last minute they always change their minds and leave them high. The DPA runs this scheme, it's insurance which is managed separately from the banks.

[Brierley]

3 minutes ago, Rookiescot said:

When the banking crisis was at its height, with money too tight and commercial banks in great distress, the world’s leading finance ministers, including the UK chancellor, agreed to stabilise markets by cutting interest rates together. 

Now how could they do that if the central banks, who are responsible for setting interest rates, were independent of government? 

The government doesn't set interest rates, the MPC sets interest rates and the MPC is a part of the Central Bank. Government can wish and hope but it doesn't have a voice in that matter.

 

https://www.bot.or.th/English/MonetaryPolicy/MonetPolicyComittee/Pages/default.aspx

Edited May 22, 2021 by Brierley

[Rookiescot]

7 minutes ago, Brierley said:

The government doesn't set interest rates, the MPC sets interest rates and the MPC is a part of the Central Bank. Government can wish and hope but it doesn't have a voice in that matter.

 

https://www.bot.or.th/English/MonetaryPolicy/MonetPolicyComittee/Pages/default.aspx

Fully aware of what the MPC is.

So why were government finance ministers from all around the world agreeing to lower interest rates if they did not have the power to do it?

[Rampant Rabbit]

I  know where theres an odd  $60-70  billion lying  around.

Edited May 22, 2021 by Rampant Rabbit

[Brierley]

7 minutes ago, Rookiescot said:

Fully aware of what the MPC is.

So why were government finance ministers from all around the world agreeing to lower interest rates if they did not have the power to do it?

There's an interaction of course between the Finance Ministry or Treasury of every country and their Central Bank and when the economic problem is of a global scale it needs global coordination. The Governors of the Central Banks could meet and discuss these things but it's not their job to set government policy, only to carry it out. BTW it wasn't the Finance Ministers from all round the world, it was only the finance ministers from the G20.

Edited May 22, 2021 by Brierley

[Rookiescot]

2 minutes ago, Brierley said:

There's an interaction of course between the Finance Ministry or Treasury of every country and their Central Bank and when the economic problem is of a global scale it needs global coordination. The Governors of the Central Banks could meet and discuss these things but it's not their job to set government policy, only to carry it out.

So we are agreed then.

While central banks may look independent the reality is that they are not.

[Brierley]

4 minutes ago, Rookiescot said:

So we are agreed then.

While central banks may look independent the reality is that they are not.

If ever you learn anything about this subject RS you could become dangerous!

 

Central banks exist, in part, to manage the financial policy of their own country, of which they have control, against the financial policies of other countries, of which they have no control.

 

If one day a major global crisis comes along, one that needs global coordination, and the Finance Ministers of the various countries get together to agree a coordinated resolution, they can all go back to their respective central banks and say hey, look what we've agreed, they will all do this if we do that. There are times when one entity must take the initiative and take the lead, that does not result in loss of independence, it's the way everything in life works.

Edited May 22, 2021 by Brierley

[BestB]

1 hour ago, Brierley said:

Why ask me, how would I know? I can only report the things I see, not the things others see.

Exactly and consider your wife lucky, most did not get it or got 1/3 of what she got.

 I been paying personal tax for 15 years, I got nothing , no tax cut , no tax refund , absolutely nothing.

 

Some of my staff managed to get 18000 baht and others got nothing .

 

while 18000 may sound a lot , split that into almost 2 years of no work snd it’s less than 1000 per month , try to survive on that 

[Rimmer]

A post has been removed:

 

1) You will not express disrespect of the King of Thailand or any one member of the Thai royal family, whether living or deceased, nor to criticize the monarchy as an institution.

By law, the Thai Royal Family are above politics. Speculation, comments and discussion of either a political or personal nature are not allowed when discussing HM The King or the Royal family.

To breach these rules will result in immediate ban.

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[Brierley]

5 minutes ago, BestB said:

Exactly and consider your wife lucky, most did not get it or got 1/3 of what she got.

 I been paying personal tax for 15 years, I got nothing , no tax cut , no tax refund , absolutely nothing.

 

Some of my staff managed to get 18000 baht and others got nothing .

 

while 18000 may sound a lot , split that into almost 2 years of no work snd it’s less than 1000 per month , try to survive on that 

My wife has paid her social security payment every month for the past twenty years, have you and your staff, because that seems to be the deciding factor as far as I can tell, not income tax.

[shackleton]

some on here will now be looking at the Foreign exchanges

See if their currencies will be rising against the Baht  in the coming weeks/ months 

Come on the Sterling pound ????

[Brierley]

Just now, shackleton said:

some on here will now be looking at the Foreign exchanges

See if their currencies will be rising against the Baht  in the coming weeks/ months 

Come on the Sterling pound ????

Here's A hot tip....the April export numbers will be announced next week and they will show a 10% increase over the previous month, the Baht will open stronger on Monday as a result.

[CrunchWrapSupreme]

17 hours ago, ukrules said:

The Baht going down in value would also be a boon to exports.

Indeed. I'll export more of my online tutoring if I could get more baht per buck.

 

The $500 I made last month is still in my US bank. If it comes now I'll get about 15700. If the USD comes back up to 32 baht I'll get...300 baht more! Six more big Leos.

[Rookiescot]

48 minutes ago, Brierley said:

If ever you learn anything about this subject RS you could become dangerous!

 

Central banks exist, in part, to manage the financial policy of their own country, of which they have control, against the financial policies of other countries, of which they have no control.

 

If one day a major global crisis comes along, one that needs global coordination, and the Finance Ministers of the various countries get together to agree a coordinated resolution, they can all go back to their respective central banks and say hey, look what we've agreed, they will all do this if we do that. There are times when one entity must take the initiative and take the lead, that does not result in loss of independence, it's the way everything in life works.

 

So if the central banks were independent why were they not taking the initiative and agreeing amongst themselves to lower interest rates?

Why was it the politicians doing it?

 

End of myth of ‘independent’ central banks - OMFIF

 

Central banks are not independent. 

[CrunchWrapSupreme]

23 hours ago, webfact said:

the latest loan would push Thailand's borrowing to the very limit

Push it to the limit
Walk along the razor's edge
But don't look down just keep your head,

or you'll be finished!

Open up the limit
Past the point of no return
Reached the top, but still you gotta learn

how to keep it!

Hit the wheel and double the stakes
Throttle wide open like a bat outta hell

You could crash the gates!

(Crash the gates!)

[KannikaP]

19 hours ago, hotchilli said:

I think the reserves have already been plundered... why do you think Prayut can't afford to purchase vaccines?

Or the submarines & Moon shot?

Edited May 22, 2021 by KannikaP

[Brierley]

6 minutes ago, Rookiescot said:

 

So if the central banks were independent why were they not taking the initiative and agreeing amongst themselves to lower interest rates?

Why was it the politicians doing it?

 

End of myth of ‘independent’ central banks - OMFIF

 

Central banks are not independent. 

A Central Bank is independent within a particular country, that doesn't give them international scope to act independently and determine global interest rates or policies, that's for politicians to do. 

[Rookiescot]

2 minutes ago, Brierley said:

A Central Bank is independent within a particular country, that doesn't give them international scope to act independently and determine global interest rates or policies, that's for politicians to do. 

 

And the politicians came back and told their central banks what to do.

Ergo in real terms central banks are not independent. Its a myth. Even in western democracies. 

And yet you believe in a country like Thailand that its central bank is independent?

[holy cow cm]

1 hour ago, SoilSpoil said:

Is this speculation, or for real?

Speculation of what could happen next and nothing we could do unless we protected our money in banks. They have already said the limit will be put at only 1000,000, so wouldn't surprise me if they flip it after that comes into effect..

[SoilSpoil]

16 minutes ago, holy cow cm said:

Speculation of what could happen next and nothing we could do unless we protected our money in banks. They have already said the limit will be put at only 1000,000, so wouldn't surprise me if they flip it after that comes into effect..

It came down from 3 million last year, and 5 million baht a couple of years ago. Dont keep too much liquidity in your Thai accounts. I opened accounts for my kids, and gave them a nice donation because of this. I keep the cards, bank books and phone apps however, and didnt tell them much about it. Just in case.

[John Drake]

How about this idea to generate some revenue?  Proposal: Expats with 800,000 in the bank can use that money to purchase a lifetime retirement extension, instead of yearly proof? No other requirements ever needed, including insurance or 90 day reports. Would anybody be willing to go for that? I might.

[newnative]

24 minutes ago, John Drake said:

How about this idea to generate some revenue?  Proposal: Expats with 800,000 in the bank can use that money to purchase a lifetime retirement extension, instead of yearly proof? No other requirements ever needed, including insurance or 90 day reports. Would anybody be willing to go for that? I might.

Me, too.

[holy cow cm]

27 minutes ago, SoilSpoil said:

It came down from 3 million last year, and 5 million baht a couple of years ago. Dont keep too much liquidity in your Thai accounts. I opened accounts for my kids, and gave them a nice donation because of this. I keep the cards, bank books and phone apps however, and didn't tell them much about it. Just in case.

Yeah agree. I am set to send a lot of money over coming up soon, but will open up a couple more bank accounts to keep them well within the safe limits. If it crawls down to 500k limit, then I will definitely bring my 3 kids into the plan in order to safe guard the money. Oh, my wife incorporated as well. Good thing my wife and kid are all honest and trustworthy. I don't put anything past the institutions here.