Thai Banker Offers A Glimmer Of Hope

[george]

Thai banker offers a glimmer of hope

Amid the gloom, a Thai banker offers a glimmer of hope

BANGKOK: -- Thailand's banks are more cautious than their US counterparts, and are in a better shape to weather the storm

Flashback to 1998, a year after the Thai crash triggered a meltdown in Asia financial markets: An American investor who lost almost all his savings in Thai stocks is furious..

"This could never happen in the United States," he fumed. "In America, there are checks and balances.

"What I can't understand is why nobody has been arrested in Thailand? Back home, they would be in jail."

-- Bangkok Post 2009-03-15

[dave_boo]

I'm not an economist, and don't even play one on the TV, but if Thailand wants to "no longer depend on exports to grow", and are apparently attempting to "build an army of green engineers" by providing scholarships at "several top universities" (has any Thai university been able to claim that it has provided the world with top graduates in their field?) that they seem to think will be in demand in the US since this is the "same area Mr Obama is now targeting" aren't they still banking (pun intended) on exporting the knowledge their students are going to have?

And, even though I'm American, why is it up to the US to "to build up the new global economy"? Isn't that counter to the self-sufficiency that HM promotes?

[geriatrickid]

This guy's a top banker? Maybe he needs to brush up on some basic characteristics of the international economy.

Let's look at some of his statements;

1. "Like in Thailand 12 years ago, the bankers and corporations that lost billions are walking free."

No one's going to jail? Maybe he needs to read some publications like the WSJ or IHT because the criminal indictements and convictions for SEC violations and fraud have been reported. Bear Stearns went down in large part because of 2 crooked hedge fund managers. The authorities have to investigate first. Unlike Thailand, there are actually investigations and prosecutions. Don't try to justify the situation in Thailand by pointing your finger at the USA.

From last June 18

Two former managers of hedge funds at Bear Stearns were arrested and charged with securities fraud on Thursday, a year after the collapse of the funds signaled the onset of a credit crunch that shows little sign of abating.The indictments, which will be detailed this afternoon by U.S. government prosecutors in New York, are the first to be brought against senior Wall Street executives linked to a tight credit market that has rattled global markets, led to more than $350 billion in write-offs, cost numerous executives their jobs and culminated in the demise of Bear Stearns. On Thursday, the two fund managers, Ralph Cioffi, 52, and Matthew Tannin, 46, who just 18 months ago reveled in their status as top hedge managers in a firm at the vanguard of the mortgage boom, surrendered to U.S. government agents

Wachovia paid a $144million fine for some of the practices that led to its demise. The former execs at Merrill Lynch, Lehman and AIG are all being looked at.

So you know what Mr. Banker? <deleted>, because criminal charges are indeed brought and people do go to jail. We'd all like a few more to go to jail, but there is a little thing called proving the guilt that has to be dealt with first.

2. "Other banking giants like AIG, Citigroup and Bank of America had to be rescued and are all now still facing difficulties, needing more cash injections, often from the US government."

AIG was not a banking giant. It is an insurance company. The AIG fiasco relates to funky financial products the company created in conjunction with clients. There wasn't any "banking" involved. In case he forgot, there is that successful prosecution against General Re on the finite insurance paper deal with AIG. Ooooh look at that, a Berkshire Hathaway company, a giant one at that, lauded by the "financial experts" as well run and ethical, got itself in big trouble with the US Feds for screwing around.

3. "Thai banks today are better run, take little risks."They are careful about leveraging."

Well, that's not hard, when most of the major development projects (e.g. BKK subway) are financed by foreign countries, right?

4."Mr Kosit is optimistic, however, that new US President Barack Obama has a good chance of making progress with his green initiatives to combat the downturn.'Where Thailand has returned to its roots as an agriculture power and set targets to lower the import of expensive foreign oil, America has also now adopted the same policies.

What? America has not adopted the same policies. As long as Canada and Mexico still supply cheap energy to the USA, there will be no incentive to change. The reason alternative energy sources didn't flourish was that it was cheaper to import the energy from the 2 largest energy suppliers of the USA; Canada and Mexico. The USA was always a self sufficient economy if one factors in its largest trading partner Canada. Toss in Mexico and the USA can survive very nicely. The situation is very different than Thailand which needs its diverse foreign markets for export.

5. With so many similar policies between Thailand and the US, it is clear that the two economies possess some of the best chances of beating a drawn-out financial slump.

<deleted>?? There are few if any similarities except for the idiots in the corporate boardrooms.

6. "Today all Thai people embrace His Majesty's sufficiency ideas because they are practical and reflect the values of our country."

Ahh the throwing in a reference to the King. When in doubt, make a reference to build up credibility.

7. The Thai government plans to reduce oil imports by 30% in the coming years.

That's great!!! What's the plan? Recycling the hot air from the politicians? Where's the mass transit strategy?

8. "This will affect the Thai economy in that we can no longer depend on exports to grow."

Geez, we agree on something. However, if exports are a major source of income, what's the replacement strategy? More tourism? Unfortunately, Thailand can't seem to get that industry sorted out either.

9. The economy of tomorrow will be quite different from the one we know today, he said, adding that Thais can no longer afford to waste fuel and resources and the adjustment may be hard but necessary.

Yes, and the sun will come up tomorrow. Thanks for stating the obvious.

10. He also noted that the demand for MBAs would not be as strong as before with the implosion of the global financial system.

What a tard. An MBA was never intended for just the financial industry. That's what B. Comms and BBAs were for. The MBA was intended to provide professionals that didn't come from the business sector with some basic business management education. Finance is only one option out of many subjects one can specialize in. This guy didn't get an MBA did he?

11. Bangkok Bank and its many scholarship programmes with several top universities has already sowed the seeds of change and is helping to build an army of green engineers who can help the country meet the challenges of the future, he said.

Super!!!. And in a couple years, they can join the ranks of the unemployed just like all the people that rushed into IT did. You can't just train everyone for one industry. What's wrong with funding things like basic sciences or agricultural sciences? That will be of more use than this nonsense about "green engineers".

12. "I expect the average growth rate to be in the 2% range for some years ahead," he says. "But it should not fall below that."

That is a honest statement, albeit very upeat. How about we call it 0-1% and the loser buys the beer?

[noahvail]

Spot on, Dave_Boo, lovely deconstruction. While I'd love to take the middle road, the banker's road seems to be drawn like one of the ancient cartographers ["And here the sea serpents dwell"] and yours seems to be a GoogleEarth map.

[britmaveric]

Well coming from a Thai Banker.... :D Sorry the whole credibility of the article was lost there.

[Scott]

Being in better shape than US banks doesn't really say a lot. It's difficult to be in worse shape!

[Junglejumbo]

Relying on the King's self sufficiency methods is a bit of a contradiction when it comes to Bangkok Bank. For one, it has found it difficult to compete in the lending market with other banks and corporate bonds despite trying hard and has one of the smallest loan growth numbers since the last crisis. One might say that this is because they expect their customers to be self sufficient and therefore, not require the services of a bank. However, on the contrary, the lack of lending here promulgated Bangkok Bank to lend overseas to China, Taiwan and Singapore where it ended up giving money to some very risky projects some of which have already become non-performing.

Abhisit's plan to scrap down payments for condos is also contrary to the King's self sufficiency, which is buy only what you can afford.

[thaiwanderer]

so much is objectionable in the article and may bother to pick it apart later but to start with the article may have more validity if the debts of the old crisis had been dented at all

[henryalleman]

This banker tell fantasy stories in fact pure bull....t.

Of course oil imports are going down because the economy is in a downfall so they need less oil.

Its all have to do trying to avoid a lost of trust on the stock market.

[fiddlehead]

Well coming from a Thai Banker.... :D Sorry the whole credibility of the article was lost there.

Well, their stocks (Thai banks) has sure held up much better than the American ones.

I'd much rather be holding Kbank than Citibank over the past year. Or look at some of the financial stocks in the states, even the somewhat solid ones like Genworth finance.

I question Thai banks sometimes because they give loans to building projects that seem nonsense to me, but they don't do 100 times leveraging.

[Seneque]

Green move, green venture, green technology, green engineers ...

More men in green ...?!

Ain't that the way we call army personnel (remember Chavalit's green isarn ..)

Hope all this green will turn the future into pink ...

[henryalleman]

Its almost unbelievable that this man is an CEO of a major bank.

Its of the highest stupidity to write

Mister Kosit himself is a big supporter of green technology and the sufficiency ideas.

There is not any country in the world that have an successful self-sufficiency economy.

A self-sufficiency economy is the shortest way to absolute poverty. Just look to North-Korea, Zimbabwe and the old USSR and their ex Eastern Europe Satellite states. 20 years after the fall of their communist system and self-sufficient economy they are still suffer from that and they are still the most poor countries in Europe.

In short not any country is able to establish and succesful self-sufficient economy, not even the US or the EU.

Does he not know that international trade is the only way for progress and a flourishing economy. Obama backed down on taking protective measure to protect the US economy, because it will backfire on him and harm the US too much. Why otherwise the IMF doubled his investment capital and the EU members agreed not to take any measures to protect the home economy. Also the next G20 summit will discuss what they can do to boost international trade.

Or does he mean a Self-sufficient economy the Thai way, an almost closed market for foreign products and investments, but an unlimited export.

But his biggest joke is his referal to Obama and the US as the leader in Green economy and enviromental technology. If there is one country who did mis the boat completely on this issues its the US. One of the reason for the collapse of the 3 sisters in Detroit, even their own public don't buy their cars anymore.

Does he not know that in Green economy and enviromental measures and technology the EU is so far ahead of others that it will be very difficult for any country to keep up with them. Be it in water waste cleaning, windmills, enviromental housing technology, recycling of garbage, cars and other products the EU has established already an complete new succesful economy who created tenthousands of Hi-Tech jobs and still booming export figures despite the economical crisis. This industry not even know the meaning of economical crisis.

Does he not know that more and more voices in the EU show seriuos doubts about Bio-fuel. Does he not know that BMW already developed an hydrogene motor who is twice so efficient as an benzine or diesel motor, and that in Flanders a public test buss is driving on normal routes on Hydrogene.

BTW did Mr. Kosit ever drived a car on Methanol. I don't think so otherwise he should know that it have an high consumption and no power at all.

All of this prove that Mr. Kosit can be a good bookkeeper, but he have no clue about much else.

His statement that the Thai economy will still grow with 2% in 2009 is the litmus test

[Old Man River]

This guy's a top banker? Maybe he needs to brush up on some basic characteristics of the international economy.

Let's look at some of his statements;

1. "Like in Thailand 12 years ago, the bankers and corporations that lost billions are walking free."

No one's going to jail? Maybe he needs to read some publications like the WSJ or IHT because the criminal indictements and convictions for SEC violations and fraud have been reported. Bear Stearns went down in large part because of 2 crooked hedge fund managers. The authorities have to investigate first. Unlike Thailand, there are actually investigations and prosecutions. Don't try to justify the situation in Thailand by pointing your finger at the USA.

From last June 18

Two former managers of hedge funds at Bear Stearns were arrested and charged with securities fraud on Thursday, a year after the collapse of the funds signaled the onset of a credit crunch that shows little sign of abating.The indictments, which will be detailed this afternoon by U.S. government prosecutors in New York, are the first to be brought against senior Wall Street executives linked to a tight credit market that has rattled global markets, led to more than $350 billion in write-offs, cost numerous executives their jobs and culminated in the demise of Bear Stearns. On Thursday, the two fund managers, Ralph Cioffi, 52, and Matthew Tannin, 46, who just 18 months ago reveled in their status as top hedge managers in a firm at the vanguard of the mortgage boom, surrendered to U.S. government agents

Wachovia paid a $144million fine for some of the practices that led to its demise. The former execs at Merrill Lynch, Lehman and AIG are all being looked at.

So you know what Mr. Banker? <deleted>, because criminal charges are indeed brought and people do go to jail. We'd all like a few more to go to jail, but there is a little thing called proving the guilt that has to be dealt with first.

2. "Other banking giants like AIG, Citigroup and Bank of America had to be rescued and are all now still facing difficulties, needing more cash injections, often from the US government."

AIG was not a banking giant. It is an insurance company. The AIG fiasco relates to funky financial products the company created in conjunction with clients. There wasn't any "banking" involved. In case he forgot, there is that successful prosecution against General Re on the finite insurance paper deal with AIG. Ooooh look at that, a Berkshire Hathaway company, a giant one at that, lauded by the "financial experts" as well run and ethical, got itself in big trouble with the US Feds for screwing around.

3. "Thai banks today are better run, take little risks."They are careful about leveraging."

Well, that's not hard, when most of the major development projects (e.g. BKK subway) are financed by foreign countries, right?

4."Mr Kosit is optimistic, however, that new US President Barack Obama has a good chance of making progress with his green initiatives to combat the downturn.'Where Thailand has returned to its roots as an agriculture power and set targets to lower the import of expensive foreign oil, America has also now adopted the same policies.

What? America has not adopted the same policies. As long as Canada and Mexico still supply cheap energy to the USA, there will be no incentive to change. The reason alternative energy sources didn't flourish was that it was cheaper to import the energy from the 2 largest energy suppliers of the USA; Canada and Mexico. The USA was always a self sufficient economy if one factors in its largest trading partner Canada. Toss in Mexico and the USA can survive very nicely. The situation is very different than Thailand which needs its diverse foreign markets for export.

5. With so many similar policies between Thailand and the US, it is clear that the two economies possess some of the best chances of beating a drawn-out financial slump.

<deleted>?? There are few if any similarities except for the idiots in the corporate boardrooms.

6. "Today all Thai people embrace His Majesty's sufficiency ideas because they are practical and reflect the values of our country."

Ahh the throwing in a reference to the King. When in doubt, make a reference to build up credibility.

7. The Thai government plans to reduce oil imports by 30% in the coming years.

That's great!!! What's the plan? Recycling the hot air from the politicians? Where's the mass transit strategy?

8. "This will affect the Thai economy in that we can no longer depend on exports to grow."

Geez, we agree on something. However, if exports are a major source of income, what's the replacement strategy? More tourism? Unfortunately, Thailand can't seem to get that industry sorted out either.

9. The economy of tomorrow will be quite different from the one we know today, he said, adding that Thais can no longer afford to waste fuel and resources and the adjustment may be hard but necessary.

Yes, and the sun will come up tomorrow. Thanks for stating the obvious.

10. He also noted that the demand for MBAs would not be as strong as before with the implosion of the global financial system.

What a tard. An MBA was never intended for just the financial industry. That's what B. Comms and BBAs were for. The MBA was intended to provide professionals that didn't come from the business sector with some basic business management education. Finance is only one option out of many subjects one can specialize in. This guy didn't get an MBA did he?

11. Bangkok Bank and its many scholarship programmes with several top universities has already sowed the seeds of change and is helping to build an army of green engineers who can help the country meet the challenges of the future, he said.

Super!!!. And in a couple years, they can join the ranks of the unemployed just like all the people that rushed into IT did. You can't just train everyone for one industry. What's wrong with funding things like basic sciences or agricultural sciences? That will be of more use than this nonsense about "green engineers".

12. "I expect the average growth rate to be in the 2% range for some years ahead," he says. "But it should not fall below that."

That is a honest statement, albeit very upeat. How about we call it 0-1% and the loser buys the beer?

Kosit knows what he is doing. You can analyze his comments away, but he knows his audience. The more other countries can explain to their populace that they really aren't in as bad a shape as the US, the quicker those countries will turn around. Right now, consumers are waiting for the US to turn around before they start spending again and governments are trying to get their populace to think they don't need to wait on the US.

Have you heard Bernanke recently? He is now telling people in the US that this will all be over at the end of the year. It is a matter of confidence, whether in the US or elsewhere. Smart people are saying what they don't believe themselves so that others will go back to their spending habits, pulling their economies out of this morass.

[jayjayjayjay]

snip

BTW did Mr. Kosit ever drived a car on Methanol. I don't think so otherwise he should know that it have an high consumption and no power at all.

snip

depends on if you make Methanol as you suggested or my preference, Ethanol. .Thailand ranking in the top 10 now! ........ coming from sugar cane or corn, of which Thailand does grow plenty, and is in a position to grow a lot more (i.e. 1600mm per year over most of the country).

[henryalleman]

snip

BTW did Mr. Kosit ever drived a car on Methanol. I don't think so otherwise he should know that it have an high consumption and no power at all.

snip

depends on if you make Methanol as you suggested or my preference, Ethanol. .Thailand ranking in the top 10 now! ........ coming from sugar cane or corn, of which Thailand does grow plenty, and is in a position to grow a lot more (i.e. 1600mm per year over most of the country).

sorry is was an typeing error, of course I was meaning Ethanol. But if you like to replace benzine by Ethanol completely its not possible to grow that amount of sugar cane and corn.

[mommysboy]

Surely the argument now is about the Thai economy as a whole not its banking sector. So a bit of a silly article really.

[tigerboy]

Have you heard Bernanke recently? He is now telling people in the US that this will all be over at the end of the year. It is a matter of confidence, whether in the US or elsewhere. *Smart*(?) people are saying what they don't believe themselves so that others will go back to their spending habits, pulling their economies out of this morass.

Yes, let's just *spend* our way out of this economic mess like we did the in the Tech Bubble of 2001 by buying things we cannot afford (houses). Brilliant!!

[Old Man River]

Have you heard Bernanke recently? He is now telling people in the US that this will all be over at the end of the year. It is a matter of confidence, whether in the US or elsewhere. *Smart*(?) people are saying what they don't believe themselves so that others will go back to their spending habits, pulling their economies out of this morass.

Yes, let's just *spend* our way out of this economic mess like we did the in the Tech Bubble of 2001 by buying things we cannot afford (houses). Brilliant!!

Consumer spending is, actually, the optimum way out of these recessions. If consumers don't spend do you really expect businesses to invest? Governments will (these are called stimulus packages), but they do this so people get back to work and then consumers spend etc. That is how it all works.

Don't confuse overspending with spending.

[henryalleman]

Have you heard Bernanke recently? He is now telling people in the US that this will all be over at the end of the year. It is a matter of confidence, whether in the US or elsewhere. *Smart*(?) people are saying what they don't believe themselves so that others will go back to their spending habits, pulling their economies out of this morass.

Yes, let's just *spend* our way out of this economic mess like we did the in the Tech Bubble of 2001 by buying things we cannot afford (houses). Brilliant!!

His latest speech was completely different. He proclaimed it would take 3 years to overcome the crisis and the biggest was the that some companies and financial institutes where to big and important to let them go down; But what us even more alarming that next year there will be a deficit of 13%, yes indeed 13%. While in the EU they find 4% already very excessive. I think the US economy is in a more deplorable state than we can imagine. Just look to the US$ rate the last few day's.

I don't complain about it because in a few day's I get almost 3 Baht more for each EURO

Edited March 22, 2009 by henryalleman

[cclub75]

Have you heard Bernanke recently? He is now telling people in the US that this will all be over at the end of the year. It is a matter of confidence, whether in the US or elsewhere.

No it's not. That's the critical point most of the politicians just don't get.

How can you bring "confidence" to someone who lost his job ? Who has a negative equity on his house ?

How can you bring "confidence" to a business that lost 25 % of its turn over, because there is a lack of (solvent) demand ?

How can you bring "confidence" to a bank to lend more money to people, people already in debt ?

The current crisis is more a solvency crisis than a confidence crisis.

They are all playing the Bernanke motto : like Bush, Paulson did before. Like Abhisit. Trichet. Gordon Brown... "Be confident and everything will be fine".

We are seeing the results : failure.

Edited March 22, 2009 by cclub75

[Johpa]

Have you heard Bernanke recently? He is now telling people in the US that this will all be over at the end of the year. It is a matter of confidence, whether in the US or elsewhere. Smart people are saying what they don't believe themselves so that others will go back to their spending habits, pulling their economies out of this morass.

Bernanke is simply the most current dealer in the longest running confidence game around. Smart people are saying lots of things but the smarter people can clearly see that they are scared and that those talking don't have a clue. Ever notice that Geitner, Bangkok International School's claim-to-fame grad, always look like he has a gun to his head.