Thai Economic Crash

[soundman]

Tisco: SET likely to see-saw on stimulus and dividends

Thai stocks are likely to continue to move sideways for the next several months, with volatility remaining high as companies cope with the global downturn, according to Tisco Securities.

Viwat Techapoonpol, head of the private client group at Tisco Securities, said the SET index was likely to range from 420 to 510 points in the first half, and from 450 to 550 in the second half of the year.

The index, which closed yesterday at 433.04 points, would likely reach a year-high at 550 points in late March, driven by the government's economic stimulus programmes and better-than-expected returns from large dividend stocks.

But the second half could see the index falling to 300 points once dividend payments are made and other positive factors are absorbed by the market.

Continued here.

[ray23]

You know the one question that stands out to me not only in Thailand but everywhere is have we hit bottom yet?

[Bizz]

It has been both interesting and informative to have read your posts of late. I hope you continue to do so as your comments and analysis are clearly needed on thaivisa.

i am honoured Bizz. but actually i was already thinking to stop playing with some of the little boys in thaivisa and devote more time to conduct philosophical discussions with my dog

think of this Bizz:

It's good to be good. I'm thinking about all the tiny, the rancid minds who were mocking you (and other people). Now the reality is showing its ugly face : they were all suckers. They were the glorious useful idiots.

what useful discussion can you have with some "cclub75"?

Clearly your dog may be more intuitive than some comments IV read.

[Lasic1]

Well with the high baht exports are more expensive and less competitive. Imports may be somewhat cheaper depending what the currencies are trading at. It would seem with airfares still relatively high and consumers with less purchasing power both the number of tourists and what they spend will be down. The banks hold the key are to what their reserves are and how many outstanding loans are out there. Not to mention investments in instruments comprised of subprime loans. My guess is that there will be a sharp drop-off GNP meaning lay-offs, reduced spending and a float of the baht.

Sawasdee,

Laser

[midas]

. The banks hold the key are to what their reserves are and how many outstanding loans are out there. Not to mention investments in instruments comprised of subprime loans. My guess is that there will be a sharp drop-off GNP meaning lay-offs, reduced spending and a float of the baht.

Sawasdee,

Laser[/color][/size][/font][/i][/b]

But I am told repeatedly in Thailand that the Thai banks dont have

any problems this time around ?

[flying]

You know the one question that stands out to me not only in Thailand but everywhere is have we hit bottom yet?

Are you joking with Naam or being sarcastic? I mean no disrespect by that ...but just wondered if you were being serious with this question?

[ray23]

No not joking I don't think we are there yet. But I'm trying to learn.

[stumonster]

Thai Banks don't have - not our problem - etc etc

The central bank's Financial Institutions Development Fund incurred liabilities of 1.4 trillion baht during the crisis for its bailout of creditors and depositors of ailing banks and finance companies.

Carrying costs for the liabilities are as high as 60 to 70 billion baht per year for the government, an expense item that Finance Minister Korn Chatikavanij has stated he wants to bring down to help free up funds for other programmes.

This is not the first time that policymakers have tried to address the FIDF burden. M.R. Pridiyathorn Devakula, a former central bank governor and finance minister, in 2007 proposed amending the Currency Act to allow the central bank to shift funds more readily across its various accounts to help pay down the FIDF liabilities.

The liabilities have been split into three lots, with 500 billion baht in the first lot to be paid down from annual profits generated by the central bank. Two other lots, of 112 billion and 776 billion, would be paid through returns from the central bank's general accounts.

From 1997 to 2007, however, the central bank has paid down just 31.6 billion baht for the first lot of 500 billion baht in debt.

full article here - http://www.bangkokpost.com/business/econom...-debt-authority

[flying]

No not joking I don't think we are there yet. But I'm trying to learn.

Ok like I said no disrespect intended. I was just wondering. We are all learning.

I just wondered if there were many folks who thought there was a possibility that we had hit bottom.

The view from this side of the world would tend to say we have only begun our descent.

[ray23]

No problem didn't mind answering at all.

Thanks

[Bizz]

This is the lull before the storm there is I fear more bad news yet to surface.

I hope we will not see another Leman or Bears.

Sadly I will be unable to post for the next 3 months well I hope three months I’m off to Luanda In the morning.

Internet access is limited.

Haven’t been there since 1984 with Santa fee staying on shore in a new complex top two floors overlooking sports stadium maybe someone here will remember CITI GROUP controlled the setup then.

A little worried now but have been told it is less dangerous now.

[midas]

Thai Banks don't have - not our problem - etc etc

The central bank's Financial Institutions Development Fund incurred liabilities of 1.4 trillion baht during the crisis for its bailout of creditors and depositors of ailing banks and finance companies.

Well I am gobsmacked I had not kept up to date with this - all they did was sweep the

problem under the mat.....................it hasnt really been resolved - well not much anyway ?

[Mali1964]

It has been both interesting and informative to have read your posts of late. I hope you continue to do so as your comments and analysis are clearly needed on thaivisa.

i am honoured Bizz. but actually i was already thinking to stop playing with some of the little boys in thaivisa and devote more time to conduct philosophical discussions with my dog

think of this Bizz:

It's good to be good. I'm thinking about all the tiny, the rancid minds who were mocking you (and other people). Now the reality is showing its ugly face : they were all suckers. They were the glorious useful idiots.

what useful discussion can you have with some "cclub75"?

I read this Tread with interest & Naam knows his stuff, but it was great to see some fun in this serious topic the Discussion with the Dog had me chuckling for ages love ya sence of humour Naam. .

Off now to have a chat with my dog see what he knows

[Ricardo]

My dog says ... the Baht is going through the 'woof' ! I'm not sure that I believe this tail. Paws for thought ?

[Naam]

You know the one question that stands out to me not only in Thailand but everywhere is have we hit bottom yet?

all indications point to a clear "no!"

[Naam]

sorry, deleted because of misunderstanding.

Edited February 12, 2009 by Naam

[livinthailandos]

How to reply to so many uninteresting postings on here hmm lets see whats all be covered so far

Doom, Gloom, Fear, Uncertainly, Denial hey i know lets add death, and destruction after all if the sky is falling, economy's are collapsing only a matter of time before people start killing each other for food, & money.

Like everything everywhere with the global recession. Thailand doesn't need to worry about global recession for it to collapse or even about a thai economic crash. Just look at how everything is done here.

1. How many empty buildings do you see around thailand even during good economic times

2. Look at how the joke of the airport is. They couldn't even build it properly. Or even finish it. ( You see from the inside I don't think the job was ever completed.

3. The idea of building a nuclear power plant near bangkok. ( how long before a thailand Chernobyl )

4. The 500 million baht for a Internet Firewall in thailand. ( Seriously wouldn't that money go better for educating thais )

5. Over priced commercial property

6. Look at how easy it was to close the airport for 7 days. I sure it will happen again

7. New prime minister's every 2 years or less.

8. Military coups happen often

So see thailand doesn't need to worry about a thai economic crash. Thailand itself causes its own messes every year. The real question is what will actually cause thailand to crash. one factor or many factors only time will tell

[12DrinkMore]

Thai Banks don't have - not our problem - etc etc

The central bank's Financial Institutions Development Fund incurred liabilities of 1.4 trillion baht during the crisis for its bailout of creditors and depositors of ailing banks and finance companies.

Well I am gobsmacked I had not kept up to date with this - all they did was sweep the

problem under the mat.....................it hasnt really been resolved - well not much anyway ?

So am I.

I thought they had proudly claimed to have paid this back a few years ago?

Has there been some economy with the truth? Who is this money owed to? Who bought these bonds? Is there a massive can of worms lurking here?

[midas]

Thai Banks don't have - not our problem - etc etc

The central bank's Financial Institutions Development Fund incurred liabilities of 1.4 trillion baht during the crisis for its bailout of creditors and depositors of ailing banks and finance companies.

Well I am gobsmacked I had not kept up to date with this - all they did was sweep the

problem under the mat.....................it hasnt really been resolved - well not much anyway ?

So am I.

I thought they had proudly claimed to have paid this back a few years ago?

Has there been some economy with the truth? Who is this money owed to? Who bought these bonds? Is there a massive can of worms lurking here?

I interpreted from the article that out 1.4 trillion baht in debt they have only paid off 32 billion baht in 12 years

- is that how you read it ?

[jdrake72]

How to reply to so many uninteresting postings on here hmm lets see whats all be covered so far

Doom, Gloom, Fear, Uncertainly, Denial hey i know lets add death, and destruction after all if the sky is falling, economy's are collapsing only a matter of time before people start killing each other for food, & money.

Like everything everywhere with the global recession. Thailand doesn't need to worry about global recession for it to collapse or even about a thai economic crash. Just look at how everything is done here.

1. How many empty buildings do you see around thailand even during good economic times

2. Look at how the joke of the airport is. They couldn't even build it properly. Or even finish it. ( You see from the inside I don't think the job was ever completed.

3. The idea of building a nuclear power plant near bangkok. ( how long before a thailand Chernobyl )

4. The 500 million baht for a Internet Firewall in thailand. ( Seriously wouldn't that money go better for educating thais )

5. Over priced commercial property

6. Look at how easy it was to close the airport for 7 days. I sure it will happen again

7. New prime minister's every 2 years or less.

8. Military coups happen often

So see thailand doesn't need to worry about a thai economic crash. Thailand itself causes its own messes every year. The real question is what will actually cause thailand to crash. one factor or many factors only time will tell

I agree in the point that Thailand is a very lucky country, because despite its unfriendly rules for foreigner immigration and investiment, has always be flooded by tourists, investors and people willing to spend their money here and Thailand is causing its own problems.

What could cause a real crash ?

Well, as i said, we humans have to die one day or another and that day you know will happen here and leave a vacuum and probably cause Thais waking up from their long (all life) hypnosis.

A very wild part of Thai people will come out and anything could happen.

Yes, i think that day could be the start for a big mess in Thailand which in turn will also cause an economic crash.

I hope not, but everything is pointing at that direction.

For this 2009, every day more Thai economic indicators show this country is by any means in a better position than most of other countries,...watch the export data for January and see...

THB seems to start to lose some ground, it is unavoidable, pressures against the BOT are almost unstoppable and every day stronger, the days of the THB stubborn strenght may be over.

Edited February 12, 2009 by jdrake72

[jdrake72]

Naams on form as usual, kind of like the conductor leading the band on SS Titanic And the band played on! Let's hear it for the Naamstar!

you misinterprete my intentions oh honourable and brave Knight. in my [not so] opinion i don't underestimate the crisis we are facing and neither do i underestimate its potential consequences. what i tried is drawing attention in an exaggerated way to the exaggerations of a bunch of gloom&doomers who think the sky will be falling.

but you know which is your problem ? Since maybe you have a good pension and the crisis doesn t affect you particulary, you are not able to see what is happening around you.

The sky is actually falling, Thai exports are crashing ,completely crashing (watch january data , just wait !), companies are ready to leave dozens if not hundreds of thousands of people out and i am afraid these guys will not go back to their ricefields like in 1997 since export of rice in Thailand is dropping like a stone, between a 20% and 30% down (that for the cheap rice of Vietnam and Philippines and India will resume strong production soon), an authentic disaster. Where will these guys go ?

They don t have a pension like you have, they have no money in the bank .....tell me...

there might no be crisis for you, but there is for millions and it will be worse and worse....

You keep posting the indicators of Thailand for 2008, but that s OVER, it is HISTORY, what it matters know are the CURRENT indicators, one worse after other and there will be worse and worse in the next months. There is nothing pointing at a recovery, nothing, all the opposite.

You though we were too negative few months ago, but December/January data was terrible as we negative prospected and next one will be worse. Just wait and see. It is not only Thailand, yes, I know, but this is a Thailand forum, so we are talking about the current situation here which is not better than other countries' as somebody have tried to tell us until now.

[midas]

but you know which is your problem ? Since maybe you have a good pension and the crisis doesn t affect you particulary, you are not able to see what is happening around you.

The sky is actually falling, Thai exports are crashing ,completely crashing (watch january data , just wait !), companies are ready to leave dozens if not hundreds of thousands of people out and i am afraid these guys will not go back to their ricefields like in 1997 since export of rice in Thailand is dropping like a stone, between a 20% and 30% down (that for the cheap rice of Vietnam and Philippines and India will resume strong production soon), an authentic disaster. Where will these guys go ?

They don t have a pension like you have, they have no money in the bank .....tell me...

there might no be crisis for you, but there is for millions and it will be worse and worse....

You keep posting the indicators of Thailand for 2008, but that s OVER, it is HISTORY, what it matters know are the CURRENT indicators, one worse after other and there will be worse and worse in the next months. There is nothing pointing at a recovery, nothing, all the opposite.

You though we were too negative few months ago, but December/January data was terrible as we negative prospected and next one will be worse. Just wait and see. It is not only Thailand, yes, I know, but this is a Thailand forum, so we are talking about the current situation here which is not better than other countries' as somebody have tried to tell us until now.

jdrake72 I am not disagreeing with the overall assessment that things will be bad

but i am curious for opinion as to why there doesnt seem to be any real signs

of gloom on the street ?

I am very surprised at you comment about rice because I thought

the world was still ready to pay a premium for Thai Jasmine rice

because it does have the nicest flavour and texture..........

And the real estate" bulls " in the Property section

of this forum try to gloat every day saying there is no evidence of

condominium prices falling.......?

[Naam]

Naams on form as usual, kind of like the conductor leading the band on SS Titanic And the band played on! Let's hear it for the Naamstar!

you misinterprete my intentions oh honourable and brave Knight. in my [not so] opinion i don't underestimate the crisis we are facing and neither do i underestimate its potential consequences. what i tried is drawing attention in an exaggerated way to the exaggerations of a bunch of gloom&doomers who think the sky will be falling.

but you know which is your problem ? Since maybe you have a good pension and the crisis doesn t affect you particulary, you are not able to see what is happening around you.

The sky is actually falling, Thai exports are crashing ,completely crashing (watch january data , just wait !), companies are ready to leave dozens if not hundreds of thousands of people out and i am afraid these guys will not go back to their ricefields like in 1997 since export of rice in Thailand is dropping like a stone, between a 20% and 30% down (that for the cheap rice of Vietnam and Philippines and India will resume strong production soon), an authentic disaster. Where will these guys go ?

They don t have a pension like you have, they have no money in the bank .....tell me...

there might no be crisis for you, but there is for millions and it will be worse and worse....

You keep posting the indicators of Thailand for 2008, but that s OVER, it is HISTORY, what it matters know are the CURRENT indicators, one worse after other and there will be worse and worse in the next months. There is nothing pointing at a recovery, nothing, all the opposite.

You though we were too negative few months ago, but December/January data was terrible as we negative prospected and next one will be worse. Just wait and see. It is not only Thailand, yes, I know, but this is a Thailand forum, so we are talking about the current situation here which is not better than other countries' as somebody have tried to tell us until now.

what is your point JDrake? like a bunch of others you misinterprete my opinions as you must have been too lazy to read the whole thread. from the beginning i focussed on "how will the predicted crisis in Thailand affect us farang retirees?"

are you telling me that the poor people will slit my throat to get to my (extremely low} pension? will they occupy my home and kick me and my wife out? i don't "keep on" posting indicators for 2008. i posted facts for 2008. undeniable and verifiable facts. what you post are assumptions and forecasts what will happen in the future. no facts, nothing to verify except "there will be... there will be... there will be...". seems you are too one of the esteemed prophets and seers who knows what the future holds for us. if that is the case tell us what -in your opinion- are the implications for us farangs? will the sky fall for us?

nearly forgot to mention. read my posting #227!

ray23: You know the one question that stands out to me not only in Thailand but everywhere is have we hit bottom yet?

Naam: all indications point to a clear "no!"

Edited February 12, 2009 by Naam

[mijan24]

Extract only

Naam: all indications point to a clear "no!"

I second this and if you need an example watch Australia Housing Prices within the next 4 to 6 months.

[Naam]

Extract only

Naam: all indications point to a clear "no!"

I second this and if you need an example watch Australia Housing Prices within the next 4 to 6 months.

Mijan, it's not limited to Australia and it's not limited to property prices. what i expect is that the avalanche of global unemployment will increase considerably and buying power will therefore decrease. this might counterattact inflationary pressures up to a certain extent and even cause deflation in some other sectors besides real estate.

[Pakeha]

buying power will therefore decrease.

This one statement says it all really. Things are going to get worse before they get better... although I do still like to dream that the baht will miraculously crash in the next few weeks... Alas I do believe I am deluded.

[ray23]

Unless I misunderstood something it would appear that Thailand is looking at deflation now, The finance minister yesterday asked he stores to reduce their prices. It would seem to me that will contribute to deflation. So what is the result of as economy in deflation? Besides lower prices

Edited February 13, 2009 by ray23

[meom]

It can go either way I guess. Thailand is exporting less so in theory they have an increased supply of goods and lowering of prices would partially set of reduced exports providing the goods will be sold locally. That’s where it might go bad because due to reduced exports more people will lose their jobs, the money supply will fall which causes more people to lose their jobs etc. and lowering of prices might not keep pace with an even lower money supply.

In summary I don’t know if it would be good or bad

[quiksilva]

5. Over priced commercial property

I agree and just wanted to add some points to this.

Current rents are indeed very high for Bangkok, in fact they have reached record levels recently. However it will not stay that way for long, as office rents fell for the first time since 2005 in Q4 08 in a trend which looks set to continue.

The danger is not so much the amount of new supply but rather space which will be returned to the landlords. The largest culprit of this will be the government themselves as they move various ministries occupying approx 150,000 sqm of private leased space, to Chaengwattana's new 16 billion Baht, 450,000 sqm (NLA) Government Center.

Even with this though I dont expect vacancy rates to jump to >40% as they did post 1997 (although its not entirely impossible) because that time we had huge amounts of new supply coming on stream coupled with an economy in a tailspin. That was a perfect storm. 1999 the grade A office market grew by 10% with the addition of just one building, cookies to those who know which one.

Today there is very limited new supply of office buildings due to enter the market. Over the next three years there will be 180,000sqm of new stock which is about the same amount of 2008's supply, so not too bad for now at least, just so long as existing tenants do not return too much space, or too many companies wind up operations entirely (again entirely feasible).

So, yes, so as long as we are only looking locally the over priced remark for commercial property holds true, but the market is at least slowly moving back in favour of the tenant.

Frankly I think the old comparison to regional markets also do not hold up this time either. When we look at this market from a global level Bangkok sits at 72 number out of 105 markets. This doesn't seem so high, but to put that in perspective this position is nestled between Toronto and Atlanta.

This is a quite step up for Bangkok, just a few years ago it occupied 103 out of 105 markets, just above Malawi, Africa at levels comparable to KL and Jakarta both of which are languishing 7 and 13 places below BKK respectively. (Harare is the cheapest major global market which we track)

[david96]

The THB should be trading at about 45 to the USD if the economy is so bad as it is made out. Australia is 0.63 to the USD today and our official unemployment rate is still 4.5% way below the US. We certainly do not need a "stimulus package" in Australia which is $42 billion AUD over 3 years. Australia should wait until unemployment reaches 9% at least. Political vote buying.