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Fed Cuts Rates By A Half Point

bingobongo
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jonniebkk Gold Member

jonniebkk

Posted
Posted

bad for people living off dollar based retirements but good for those who have Thai based salaries or assets and/or have investments denominated in non-usa currencies or major international companies with substantial foreign sales/profits. Said profits are amplified when translated back into US dollars.

For me, basically a substantial net plus :o

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JRinger Advanced Member

JRinger

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Live rates at 2007.09.19 01:30:37 UTC

Notice: The THB rate shown below is the international rate. Rates used within Thailand may vary.

1.00 USD = 31.9410 THB

United States Dollars Thailand Baht

1 USD = 31.9410 THB 1 THB = 0.0313077 USD... (source: www.xe.com)

Doesn't appear to be a drastic change...

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chiang mai Star Member

chiang mai

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Yep, it looks like the USD is headed South and unless the US economy responds to the 50bps cut it will go further. But I'm interested to see what the effect of that cut will be on the UK economy and rates there. I would expect dollar money to strengthen Sterling if for no other reason than that of the yield return. In turn that will stoke inflationary pressures and despite inflation having fallen last month, rates will rise again. I don't see the BOE cutting rates in the same fashion that the Fed has done so simply because the Fed's action will have a beneficial knock on effect on UK financial markets, plus, there is still that rather overly large housing bubble sat out there that needs to be dealt with. Anyone?

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lordofdelusion Advanced Member

lordofdelusion

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I had read recently that some Thai official was saying that if the US dropped rates, the BOT would reduce their rates by a like amount. This, to continue to stem the Baht appreciation versus the dollar. Not much change this morning in the exchange rate.

Oh, and I'm with you jonniebkk. I had a nice boost yesterday!!!!!!

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fletchsmile Platinum Member

fletchsmile

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Posted (edited)
well Thai exporters will take it on the chin........as mentioned before, the fed cuts, and the $ plunges to a new record low

http://www.bloomberg.com/apps/news?pid=206...&refer=home

If I've understood many of your posts: You're bearish on USD, THB, property and stockmarkets. Believing all are not good places for your money at the moment.

It's easy to pick holes in other people's ideas/ things, and tell people what not to do. Where are you putting your assets? Most people except bankrupts have to have some long positions along the way. You can't be short/selling everything :o

Or are you one of the "you know where you are with cash, cash is king, money in the bank" people.

Or perhaps: The end of the world is nigh. Repent ye sinners... :D

Edited by fletchthai68
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lannarebirth Star Member

lannarebirth

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Yep, it looks like the USD is headed South and unless the US economy responds to the 50bps cut it will go further. But I'm interested to see what the effect of that cut will be on the UK economy and rates there. I would expect dollar money to strengthen Sterling if for no other reason than that of the yield return. In turn that will stoke inflationary pressures and despite inflation having fallen last month, rates will rise again. I don't see the BOE cutting rates in the same fashion that the Fed has done so simply because the Fed's action will have a beneficial knock on effect on UK financial markets, plus, there is still that rather overly large housing bubble sat out there that needs to be dealt with. Anyone?

What difference does the yield return make? The baht gives a horrible yield but has been climbing strongly. The NZD had great returns but plunged. Yields are the bait for the trap.

Intermediate term:

http://stockcharts.com/h-sc/ui?s=$XBP...&a=48806132

http://www.eyield.co.uk/myarea/introductio...ng_triangle.htm

Long term:

http://stockcharts.com/h-sc/ui?s=$XBP...&a=79290890

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chiang mai Star Member

chiang mai

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"What difference does the yield return make? Yields are the bait for the trap".

So you keep saying in all of these threads and I keep replying with the same answers and this is getting boring!

"They say that more money has been lost chasing yield than in any other area of investing." Richard Russell

If we were talking corporate bonds or listed stocks I would agree. But since we are talking about guaranteed (Depositor Insurance) secure deposits in the top seven UK Banks I do not.

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lannarebirth Star Member

lannarebirth

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OK, fair enough. It's just that something you said in another post alarmed me a bit. I think it was that interest rates would attract funds which should keep the currency strong. Being that legitimate cross currency transactions comprise only 5%-10% of all foreign exchange, with the rest being hedging and speculation I thought it an odd point. In currency exchange, the tail wags the dog. Clearly you've given it a lot of thought and have taken good counsel, so best of luck.

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lordofdelusion Advanced Member

lordofdelusion

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If i remember correct then:

BOT strated to cut rates before the FED.

And since thai interest rate are actually lower in the moment than US, I dont see how " the BOT would reduce their rates by a like amount".

If the article was correct, the BOT will now lower the rate by another .50 as the US fed did to weaken the Baht along with the dollar. The Thai economy could use a kick in the arse anyway.

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cdnvic Star Member

cdnvic

Posted
Posted
So much for the Yanks that call Canadian money,Monopoly money! I see parity soon.

.991 at the moment.... may be sooner than we thought.

Got to be bad for Canadian tourism though. Viva Mexico.

Short term maybe, but we can never compete with Mexico on prices and it's silly to try. Where it may hurt tourism most is its making it cheaper for Canadians to travel abroad, so the domestic market may slow a bit, which would be nice as it would ease the labour shortage in the tourism sector.

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Farma Platinum Member

Farma

Posted
Posted

Fears of dollar collapse as Saudis take fright

By Ambrose Evans-Pritchard, International Business Editor

Last Updated: 12:18am BST 20/09/2007

Saudi Arabia has refused to cut interest rates in lockstep with the US Federal Reserve for the first time, signalling that the oil-rich Gulf kingdom is preparing to break the dollar currency peg in a move that risks setting off a stampede out of the dollar across the Middle East.

"This is a very dangerous situation for the dollar," said Hans Redeker, currency chief at BNP Paribas.

Continued here http://www.telegraph.co.uk/money/main.jhtm...bcnsaudi119.xml

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