Maybe the USD has paused tanking against the Baht?

[Pawpcorn]

I hope so, as my SSA payment has very recently absorbed about 75% of next year's COLA increase! ????

[In Full Agreement]

The USD appreciated against the Baht.    It did not tank.

[Pawpcorn]

My monthly Social Security payment dropped 6.33% in one month, since my SSA payment gets converted to Thai Baht, in Bangkok Bank's New York branch, and then transferred into my Direct Deposit account, in Thailand

 

For me... it tanked

Edited November 19, 2022 by Pawpcorn
tanked for me 555 ♡

[CharlieH]

MOVED to Banking forum

[nigelforbes]

The Fed is due to meet on 2 December to discuss interest rates and inflation, the expectation is that the Fed will call for an 0.50% increase rather than 0.75%. That reduction in rate increase expectation is enough to weaken USD, already today against THB it has fallen to around 35 and to under 42 against the Pound.

 

What's interesting here is that the Thai current account is still in deficit by USD 0.5 bill., because of low spending tourist numbers and reduced export figures. Historically, a current account deficit has meant a weaker Baht, not so today. This implies that THB can still continue to strengthen somewhat against the majors before it reaches fair value. If tourism does ever take off again (which it will), if China opens up again (which it will) and if exports ever regain their previous levels again (which they will), look out. Of course the Fed could surprise to the downside and impose another 0.75% rate increase, in which case USD will strengthen and the Baht will get stronger, markets are saying there's less than a 20% chance of that happening.

 

 

[spidermike007]

And the reality is, that the Thai economy is in tatters. Retail sales are down, car sales are down, home and condo sales are down. Tourist spending is down. 

 

So, there is more going on than meets the eye. As usual. 

[nigelforbes]

8 minutes ago, spidermike007 said:

And the reality is, that the Thai economy is in tatters. Retail sales are down, car sales are down, home and condo sales are down. Tourist spending is down. 

 

So, there is more going on than meets the eye. As usual. 

I hope this is not another conspiracy theory! The reality is that this is an issue of debt. Thailand has low government debt levels (consumer debt is not part of this picture), less than 60% of GDP and only a very small percentage (less than 5%) is foreign debt. Contrast that with US debt of 750%+ of GDP and UK debt level of over 100%. So whilst the Thai economy may not be great today it is hardly in tatters, and with Foreign Currency Reserves of over USD  200 bill. they can easily sustain a current account deficit at current levels, for many years if they have to. All Thailand has to do is tick over and wait for the rest of the global economy to improve and their lot will improve with it.

[nigelforbes]

Another way to look at this issue is the value of the 10 year bond. The US 10 year is currently 3.74%, the Thai 10 year bond just moved down from 3.12% this month but will recover when rates are increased on Friday, as announced by BOT. The premium on the US 10 year is quite small by comparison which reaffirms the confidence markets have in the Thai economy. The respective charts are linked below.

 

https://tradingeconomics.com/thailand/government-bond-yield

 

https://www.marketwatch.com/investing/bond/TMUBMUSD10Y?countryCode=BX&mod=MW_story_quote

 

[hotandsticky]

Just now, nigelforbes said:

Another way to look at this issue is the value of the 10 year bond. The US 10 year is currently 3.74%, the Thai 10 year bond just moved down from 3.12% this month but will recover when rates are increased on Friday, as announced by BOT. The premium on the US 10 year is quite small by comparison which reaffirms the confidence markets have in the Thai economy. The respective charts are linked below.

 

https://tradingeconomics.com/thailand/government-bond-yield

 

https://www.marketwatch.com/investing/bond/TMUBMUSD10Y?countryCode=BX&mod=MW_story_quote

 

 

 

That can't be right?

 

 

I have been reading on here for 16 years that the Thai Baht is going to Hell in a handbasket......

[spidermike007]

21 minutes ago, nigelforbes said:

I hope this is not another conspiracy theory! The reality is that this is an issue of debt. Thailand has low government debt levels (consumer debt is not part of this picture), less than 60% of GDP and only a very small percentage (less than 5%) is foreign debt. Contrast that with US debt of 750%+ of GDP and UK debt level of over 100%. So whilst the Thai economy may not be great today it is hardly in tatters, and with Foreign Currency Reserves of over USD  200 bill. they can easily sustain a current account deficit at current levels, for many years if they have to. All Thailand has to do is tick over and wait for the rest of the global economy to improve and their lot will improve with it.

While I agree with some of what you say, the 750% of GDP is ridiculous. Even taking into account that there is likely up to $15 trillion in debt that is not accounted for, that is still around 200% of GDP. 

 

And if the recession happens next year, as anticipated, the tourism restart here will suffer greatly. Thailand is facing many financial woes, that are under reported to a large degree, due to a high degree of incompetence on the part of the current administration. 

Edited November 30, 2022 by spidermike007

[Bangkok Barry]

54 minutes ago, spidermike007 said:

And the reality is, that the Thai economy is in tatters. Retail sales are down, car sales are down, home and condo sales are down. Tourist spending is down. 

 

So, there is more going on than meets the eye. As usual. 

I was recently in Kalasin and about half the shops are closed and shuttered. Another thing I've noticed is that Thais appear to be no longer travelling as they did. We used to have an hourly bus service Mukdahan to Khon Kaen. sometimes half-hourly. That has been reduced to just one a day, with vans used to run the hourly service. I think I'm right in saying that Roi Et airport used to be served by three airlines and that is now down to one. Suggests that no-one has money except for essentials now.

[Etaoin Shrdlu]

US government debt is about 125% of GDP.  

 

https://www.ceicdata.com/en/indicator/united-states/government-debt--of-nominal-gdp#:~:text=United States Government Debt: % of GDP,-1969 - 2022 | Quarterly&text=United States Government debt accounted,Mar 1969 to Jun 2022.

[nigelforbes]

17 minutes ago, spidermike007 said:

While I agree with some of what you say, the 750% of GDP is ridiculous. Even taking into account that there is likely up to $15 trillion in debt that is not accounted for, that is still around 200% of GDP. 

 

And if the recession happens next year, as anticipated, the tourism restart here will suffer greatly. Thailand is facing many financial woes, that are under reported to a large degree, due to a high degree of incompetence on the part of the current administration. 

You say these things Mike but with all due respect, they are theories and conjecture on your part rather than fact, otherwise how could you possibly know they exist if they are not/under reported?

 

I calculate that Thailand needs a minimum of 10 million tourists per month in order to keep their current account in surplus, all other factors being equal. September showed 13 mill, we don't yet know what the October numbers were but almost certainly they were higher. September's current account showed a surplus of USD 600+ mill., October showed a deficit as a result of lower tourist spending and reduced exports. The point here is that 10 mill. tourist per month for 12 months will see a positive balance, that's only a quarter of what it was before covid19 struck. You talk about tourism here suffering  greatly in light of recession but the US is the main recipient of that pain. Does anyone really believe that recession will effect every country in the world, including India, Russia, Europe and the ASEAN countries, which is where the majority of tourists visiting Thailand have come from. 

 

 

 

 

[nigelforbes]

6 minutes ago, Etaoin Shrdlu said:

US government debt is about 125% of GDP.  

 

https://www.ceicdata.com/en/indicator/united-states/government-debt--of-nominal-gdp#:~:text=United States Government Debt: % of GDP,-1969 - 2022 | Quarterly&text=United States Government debt accounted,Mar 1969 to Jun 2022.

Oh please!

 

https://fiscaldata.treasury.gov/americas-finance-guide/national-debt/#:~:text=As of October 2022 it,over the past ten years.

[nigelforbes]

12 minutes ago, Bangkok Barry said:

I was recently in Kalasin and about half the shops are closed and shuttered. Another thing I've noticed is that Thais appear to be no longer travelling as they did. We used to have an hourly bus service Mukdahan to Khon Kaen. sometimes half-hourly. That has been reduced to just one a day, with vans used to run the hourly service. I think I'm right in saying that Roi Et airport used to be served by three airlines and that is now down to one. Suggests that no-one has money except for essentials now.

Possibly, although Karasin is very rural so maybe not representative of the Thai economy as a whole, more anecdotal perhaps? The reduction in airlines is no surprise, that seems to be a global phenomena as airlines ramp up service and staffing based on demand.  A majority of Thai GDP arises in Bangkok, the major tourist and industrial areas are next, Chonburi/Rayong, Phuket, Chiang Mai. Karasin and similar places are not producing areas, they are home to workers and agriculture so I imagine workers who live there would normally travel to other areas for work, or have returned to work in the fields. We were in Pattaya and surrounds two weeks ago and were pleasantly surprised at how vibrant and alive the place was, it compared very favorably to our previous visit six months before when all the shops were shuttered and for sale signs were everywhere. 

[pomchop]

The tide comes in, the tide goes out.  The dollar v baht goes up, it goes down.

Such is life.  Complain, wring hands, rejoice.  The sure thing is it will sometimes go up and sometimes go down.

[Etaoin Shrdlu]

18 minutes ago, nigelforbes said:

Oh please!

 

https://fiscaldata.treasury.gov/americas-finance-guide/national-debt/#:~:text=As of October 2022 it,over the past ten years.

Those statistics are for national debt, not US government debt. National debt includes corporate and individual debt, state and local government debt, etc. 

 

If we are going to compare Thailand's central government debt of about 60% of GDP, then the appropriate figure to use would be the US Federal government's debt as percent of US GDP, which is about 125%.

Edited November 30, 2022 by Etaoin Shrdlu

[nigelforbes]

2 minutes ago, Etaoin Shrdlu said:

Those statistics are for national debt, not US government debt. National debt includes corporate and individual debt, state and local government debt, etc. 

Nope! You've included consumer debt in your definition and that's a horse of a very different color. For example, China owns about USD 1 trill. in US Treasuries, that's debt that has to be repaid, debt that was issued by the Treasury.

 

"The national debt is the amount of money the federal government has borrowed to cover the outstanding balance of expenses incurred over time. In a given fiscal year (FY), when spending (ex. money for roadways) exceeds revenue (ex. money from federal income tax), a budget deficit results. To pay for this deficit, the federal government borrows money by selling marketable securities such as Treasury bonds, bills, notes, floating rate notes, and Treasury inflation-protected securities (TIPS). The national debt is the accumulation of this borrowing along with associated interest owed to the investors who purchased these securities. As the federal government experiences reoccurring deficits, which is common, the national debt grows.

Simply put, the national debt is similar to a person using a credit card for purchases and not paying off the full balance each month. The cost of purchases exceeding the amount paid off represents a deficit, while accumulated deficits over time represents a person’s overall debt"

[MRToMRT]

On 11/19/2022 at 2:50 PM, In Full Agreement said:

The USD appreciated against the Baht.    It did not tank.

Very correct, it appreciated against virtually every currency in the world.

[Etaoin Shrdlu]

6 minutes ago, nigelforbes said:

Nope! You've included consumer debt in your definition and that's a horse of a very different color. For example, China owns about USD 1 trill. in US Treasuries, that's debt that has to be repaid, debt that was issued by the Treasury.

 

"The national debt is the amount of money the federal government has borrowed to cover the outstanding balance of expenses incurred over time. In a given fiscal year (FY), when spending (ex. money for roadways) exceeds revenue (ex. money from federal income tax), a budget deficit results. To pay for this deficit, the federal government borrows money by selling marketable securities such as Treasury bonds, bills, notes, floating rate notes, and Treasury inflation-protected securities (TIPS). The national debt is the accumulation of this borrowing along with associated interest owed to the investors who purchased these securities. As the federal government experiences reoccurring deficits, which is common, the national debt grows.

Simply put, the national debt is similar to a person using a credit card for purchases and not paying off the full balance each month. The cost of purchases exceeding the amount paid off represents a deficit, while accumulated deficits over time represents a person’s overall debt"

Here's a link to data published by the St. Louis Fed showing US Federal debt as percentage of GDP:
 

https://fred.stlouisfed.org/series/GFDEGDQ188S

[nigelforbes]

11 minutes ago, Etaoin Shrdlu said:

Here's a link to data published by the St. Louis Fed showing US Federal debt as percentage of GDP:
 

https://fred.stlouisfed.org/series/GFDEGDQ188S

And here's one from the same source showing total public debt. Can I also pint out this backwards and forwards is off topic and will result in mods deleting most of it and slapping wrists! 

 

https://fred.stlouisfed.org/series/GFDEGDQ188S

 

Note, the above includes Treasury issued debt but does not include private or consumer debt.

 

https://fiscaldata.treasury.gov/datasets/debt-to-the-penny/debt-to-the-penny

 

The Debt to the Penny dataset provides information about the total outstanding public debt and is reported each day. Debt to the Penny is made up of intragovernmental holdings and debt held by the public, including securities issued by the U.S. Treasury. Total public debt outstanding is composed of Treasury Bills, Notes, Bonds, Treasury Inflation-Protected Securities (TIPS), Floating Rate Notes (FRNs), and Federal Financing Bank (FFB) securities, as well as Domestic Series, Foreign Series, State and Local Government Series (SLGS), U.S. Savings Securities, and Government Account Series (GAS) securities. Debt to the Penny is updated at the end of each business day with data from the previous business day.

 

Data DictionaryData TablesMetadataNotes & Known Limitations

Edited November 30, 2022 by nigelforbes

[Etaoin Shrdlu]

10 minutes ago, nigelforbes said:

And here's one from the same source showing total public debt. Can I also pint out this backwards and forwards is off topic and will result in mods deleting most of it and slapping wrists! 

 

https://fred.stlouisfed.org/series/GFDEGDQ188S

 

Note, the above includes Treasury issued debt but does not include private or consumer debt.

 

https://fiscaldata.treasury.gov/datasets/debt-to-the-penny/debt-to-the-penny

 

The Debt to the Penny dataset provides information about the total outstanding public debt and is reported each day. Debt to the Penny is made up of intragovernmental holdings and debt held by the public, including securities issued by the U.S. Treasury. Total public debt outstanding is composed of Treasury Bills, Notes, Bonds, Treasury Inflation-Protected Securities (TIPS), Floating Rate Notes (FRNs), and Federal Financing Bank (FFB) securities, as well as Domestic Series, Foreign Series, State and Local Government Series (SLGS), U.S. Savings Securities, and Government Account Series (GAS) securities. Debt to the Penny is updated at the end of each business day with data from the previous business day.

 

Data DictionaryData TablesMetadataNotes & Known Limitations

Yes, those links support my earlier statement that US Federal debt totals about 125% of GDP. 

 

My point is that if one is to reference Thai central government debt of about 60% of GDP, the appropriate metric on the US side would be to use Federal debt to GDP which is about 125%.

Edited November 30, 2022 by Etaoin Shrdlu

[topt]

1 hour ago, nigelforbes said:

I calculate that Thailand needs a minimum of 10 million tourists per month in order to keep their current account in surplus, all other factors being equal.

Not sure I understand this unless I am misunderstanding you? I thought Thailands maximum total pre covid was 40 million? 

10million x 12 would be 120 million............

 

[nigelforbes]

8 minutes ago, Etaoin Shrdlu said:

Yes, those links support my earlier statement that US Federal debt totals about 125% of GDP. 

 

My point is that if one is to reference Thai central government debt of about 60% of GDP, the appropriate metric on the US side would be to use Federal debt to GDP which is about 125%.

OK, in which case let's do it this way

 

43 minutes ago, Etaoin Shrdlu said:

Those statistics are for national debt, not US government debt. National debt includes corporate and individual debt, state and local government debt, etc. 

 

If we are going to compare Thailand's central government debt of about 60% of GDP, then the appropriate figure to use would be the US Federal government's debt as percent of US GDP, which is about 125%.

You can't go back and edit your earlier answers, after the fact!

 

I haven't gone away, I managed to finalise the Thai side but I'm struggling somewhat with the US data side,...I will get there, this is the Thai side.

 

Let's come back to basics, until such time as we get slapped for discussing the US rather than Thailand, trust me, it will happen!

 

Thailand GDP is USD 502 bill, government debt is 60% of GDP or USD 300 bill.

Thai government bonds = 45% of USD 444 bill. or USD 200 bill.

Ergo, total public debt = USD 500 bill. or effectively 100% of GDP.

Note the above does not include consumer debt, corporate debt or any private debt which are totally separate. 

 

So, based on how we elect to express the figures, total Thai government debt is either 60% or 100% of GDP, agreed? 

 

https://www.thaibma.or.th/EN/Education/ThaiBondMarket.aspx

 

 

[nigelforbes]

5 minutes ago, topt said:

Not sure I understand this unless I am misunderstanding you? I thought Thailands maximum total pre covid was 40 million? 

10million x 12 would be 120 million............

 

Sorry, yes, it should read per month, not year.

[Etaoin Shrdlu]

1 minute ago, nigelforbes said:

OK, in which case let's do it this way

 

You can't go back and edit your earlier answers, after the fact!

 

I haven't gone away, I managed to finalise the Thai side but I'm struggling somewhat with the US data side,...I will get there, this is the Thai side.

 

Let's come back to basics, until such time as we get slapped for discussing the US rather than Thailand, trust me, it will happen!

 

Thailand GDP is USD 502 bill, government debt is 60% of GDP or USD 300 bill.

Thai government bonds = 45% of USD 444 bill. or USD 200 bill.

Ergo, total public debt = USD 500 bill. or effectively 100% of GDP.

Note the above does not include consumer debt, corporate debt or any private debt which are totally separate. 

 

So, based on how we elect to express the figures, total Thai government debt is either 60% or 100% of GDP, agreed? 

 

https://www.thaibma.or.th/EN/Education/ThaiBondMarket.aspx

 

 

My apologies about the edit. I did not intend to change the meaning, only clarify.

 

I was initially reacting to your earlier post when you mentioned that US debt was more than 750% of GDP after having mentioned Thai debt at 60% of GDP and then later UK debt of 100% of GDP. 

 

The 750% on the US side did not seem to jibe with what I thought I knew about US Federal debt to GDP, so I did an internet search. The sources I cited in my earlier posts refer to a US Federal debt to GDP ratio of about 125%. 

 

I am interested to know why you believe that a US Federal debt to GDP ratio would be over 750% when other sources seem to use figures closer to those in the links I posted and which I made in my earlier statement, and whether the methodology in arriving at the 750% is the same as that used in arriving at 60% for Thailand and 100% for the UK which would allow for direct comparison.

 

 

[nigelforbes]

2 minutes ago, Etaoin Shrdlu said:

My apologies about the edit. I did not intend to change the meaning, only clarify.

 

I was initially reacting to your earlier post when you mentioned that US debt was more than 750% of GDP after having mentioned Thai debt at 60% of GDP and then later UK debt of 100% of GDP. 

 

The 750% on the US side did not seem to jibe with what I thought I knew about US Federal debt to GDP, so I did an internet search. The sources I cited in my earlier posts refer to a US Federal debt to GDP ratio of about 125%. 

 

I am interested to know why you believe that a US Federal debt to GDP ratio would be over 750% when other sources seem to use figures closer to those in the links I posted and which I made in my earlier statement, and whether the methodology in arriving at the 750% is the same as that used in arriving at 60% for Thailand and 100% for the UK which would allow for direct comparison.

 

 

I picked up the 750% figure from an internet search but I can't immediately locate it again. My curiosity is now peaked so I'm going to continue digging to unravel the picture. I THINK the 750% number may include state spending that is devolved by Federal government but I'm not certain. 

 

US budget spending outlay for 2022 was 5.9 trill, which included a 1 trill deficit. That makes US budget spending only 20% of GDP although a further 24 trill. was carried as public debt also, making a total of 31 trill. I'm 100% certain of the earlier Thai figures and also the US budget figures, the missing link is devolved state spending which doesn't have anything comparable on the Thai side.

 

https://www.cbo.gov/topics/budget

[Etaoin Shrdlu]

10 minutes ago, nigelforbes said:

I picked up the 750% figure from an internet search but I can't immediately locate it again. My curiosity is now peaked so I'm going to continue digging to unravel the picture. I THINK the 750% number may include state spending that is devolved by Federal government but I'm not certain. 

 

US budget spending outlay for 2022 was 5.9 trill, which included a 1 trill deficit. That makes US budget spending only 20% of GDP although a further 24 trill. was carried as public debt also, making a total of 31 trill. I'm 100% certain of the earlier Thai figures and also the US budget figures, the missing link is devolved state spending which doesn't have anything comparable on the Thai side.

 

https://www.cbo.gov/topics/budget

Is the 750% possibly the total amount of all outstanding debt obligations issued in the US including Federal, state and local governments, corporate and private (including consumer) debt expressed as a percent of GDP, or some combination thereof? I really don't know.

 

I can't find any online source that cites a similar number, but if a logical case can be made for it using credible information, I'm certainly willing to listen. It may or may not be useful to compare such number with Thai or UK government debt levels, but if it helps explain why Thailand is in a better position than the US is economically, that may be interesting.

[spidermike007]

2 hours ago, Bangkok Barry said:

I was recently in Kalasin and about half the shops are closed and shuttered. Another thing I've noticed is that Thais appear to be no longer travelling as they did. We used to have an hourly bus service Mukdahan to Khon Kaen. sometimes half-hourly. That has been reduced to just one a day, with vans used to run the hourly service. I think I'm right in saying that Roi Et airport used to be served by three airlines and that is now down to one. Suggests that no-one has money except for essentials now.

Spot on. I see alot of expats making light of the economic problems here and sort of pretending it is not happening and the economy is kicking. It is not. I talk with new car dealers who complain their sales are way, way down. I have a friend who is a manager at a major real estate developer. One of Thailand's largest. She said leasing of commercial units and condos is way down. Sales are too. Millions are still out of work. It could take years before the economy recovers from the Prayuth decimation. 

[spidermike007]

2 hours ago, nigelforbes said:

You say these things Mike but with all due respect, they are theories and conjecture on your part rather than fact, otherwise how could you possibly know they exist if they are not/under reported?

 

I calculate that Thailand needs a minimum of 10 million tourists per month in order to keep their current account in surplus, all other factors being equal. September showed 13 mill, we don't yet know what the October numbers were but almost certainly they were higher. September's current account showed a surplus of USD 600+ mill., October showed a deficit as a result of lower tourist spending and reduced exports. The point here is that 10 mill. tourist per month for 12 months will see a positive balance, that's only a quarter of what it was before covid19 struck. You talk about tourism here suffering  greatly in light of recession but the US is the main recipient of that pain. Does anyone really believe that recession will effect every country in the world, including India, Russia, Europe and the ASEAN countries, which is where the majority of tourists visiting Thailand have come from. 

 

 

 

 

10 million a month? Really? And I am short on facts? More like 2-3 million. Maybe. And Thailand should consider itself very fortunate if it gets 2-3 million tourists a month, from here forward. And most of the tourists are regional. How many high spending tourists are coming from Laos and Cambodia? And India? 

 

The total number of visitor arrivals for the 1 January-26 October, 2022, period was 7,349,843. The top five source markets were Malaysia with 1,246,242 arrivals, India with 661,751 arrivals, Lao PDR. with 538,789 arrivals, Cambodia with 373,811 arrivals, and Singapore with 365,593 arrivals. 

 

https://www.tatnews.org/2022/10/thailand-welcomes-over-7-million-foreign-tourists-from-1-january-to-26-october-2022/