UK Pound Collapse 47.99 against the Baht

[jdrake72]

It's not the Baht that's strong it's the Pound and the Euro that are weak.

With the prospect of a hung parliament in the forthcoming elections the prospects for the Pound are very dire indeed.

Am I the only one considering my future in Thailand, this forum has seen an increase in those struggling to meet the minimum financial requirements of the immigration authorities, and I am aware that a number of expats have said enough is enough and returned to their homelands.

Whilst considering my future in Thailand I have to wonder what I would be going back to.

I don t fully agree.

THB has risen against all world currencies in the past weeks, US Dollars, Uk Pounds, Swiss Franc, all asian and south american currencies and South African rand.

The Baht value is a big scam, we have a fifth world country full of political feud, very laid back in tachnology , with the lowest interest rate in the region and its currency rising like crazy....

well, 1997 teaches us... the Baht will tumble one day, and it will do very strongly...

[Abrak]

I don t fully agree.

THB has risen against all world currencies in the past weeks, US Dollars, Uk Pounds, Swiss Franc, all asian and south american currencies and South African rand.

The Baht value is a big scam, we have a fifth world country full of political feud, very laid back in tachnology , with the lowest interest rate in the region and its currency rising like crazy....

well, 1997 teaches us... the Baht will tumble one day, and it will do very strongly...

You really dont understand anything do you?

Has it really surprised you that the baht's value has risen over the last six months when it has essentially been a one way bet.

[VegasVic]

It's not the Baht that's strong it's the Pound and the Euro that are weak.

With the prospect of a hung parliament in the forthcoming elections the prospects for the Pound are very dire indeed.

Am I the only one considering my future in Thailand, this forum has seen an increase in those struggling to meet the minimum financial requirements of the immigration authorities, and I am aware that a number of expats have said enough is enough and returned to their homelands.

Whilst considering my future in Thailand I have to wonder what I would be going back to.

I don t fully agree.

THB has risen against all world currencies in the past weeks, US Dollars, Uk Pounds, Swiss Franc, all asian and south american currencies and South African rand.

The Baht value is a big scam, we have a fifth world country full of political feud, very laid back in tachnology , with the lowest interest rate in the region and its currency rising like crazy....

well, 1997 teaches us... the Baht will tumble one day, and it will do very strongly...

"the baht will tumble one day..." This may very well be true, however in the interim will the Pound and the Euro fall even more, thereby mitigating any future fall in the BAHT

[whichschool]

This great news. I am a Canadian and my dollar is 10% to 15% higher right now than last year. Things just keep getting better. Strong dollar and less brits to deal with. There really is somew justice in this world.

Got to feel sorry for those working in tourist Thailand if all they have are Canadians to offer wit, humour and fun, 3 human traits which are an alien concept to the Canadian race.

[Abrak]

The notion that devaluing a currency is the way to dig a country out of its hole is pure folly and will ultimately lead to greater hardship

Well I guess we will see over the next few years. I am sure you are in the no pain no gain camp. Portugal, Spain, Greece have all implemented austerity measures because they cant devalue (although I would admit that Greece seems to have shown it is possible)

Now in the UK they realize that austerity is for losers when you can devalue your currency. Dont see much austerity there.

Edited March 9, 2010 by Abrak

[ding]

Also, quite a few expats will not be able to survive here at 45b/pound - some will have to go home I guess...

This great news. I am a Canadian and my dollar is 10% to 15% higher right now than last year. Things just keep getting better. Strong dollar and less brits to deal with. There really is somew justice in this world.

I hope this isn't representative of most Canadians' attitude. The post needs a smiley of some sort

Edited March 9, 2010 by ding

[OZEMADE]

This great news. I am a Canadian and my dollar is 10% to 15% higher right now than last year. Things just keep getting better. Strong dollar and less brits to deal with. There really is somew justice in this world.

Got to feel sorry for those working in tourist Thailand if all they have are Canadians to offer wit, humour and fun, 3 human traits which are an alien concept to the Canadian race.

Well here is another one for you Canadians and Yanks, us Aussie's are now only 2 Baht behind you and it's going up.

[Abrak]

If the Thai gov fails to repeg the baht/dollar rate, the planes from the UK are going to be empty.

Now how exactly do you think the Thai Government ot BoT would be able to do that.

If you happen to know but it is a big secret please send the answer to K.Tarisa BoT who is losing the country US$500m a month trying to suppress the currency. Doesnt seem to stop the tourists coming though. December was a record ever month for tourists.

[lovelomsak]

If the Thai gov fails to repeg the baht/dollar rate, the planes from the UK are going to be empty.

Now how exactly do you think the Thai Government ot BoT would be able to do that.

If you happen to know but it is a big secret please send the answer to K.Tarisa BoT who is losing the country US$500m a month trying to suppress the currency. Doesnt seem to stop the tourists coming though. December was a record ever month for tourists.

How did you do that? Make that post look like I said it? nice trick I would maybe like to try it sometime.

[lovelomsak]

This great news. I am a Canadian and my dollar is 10% to 15% higher right now than last year. Things just keep getting better. Strong dollar and less brits to deal with. There really is somew justice in this world.

Got to feel sorry for those working in tourist Thailand if all they have are Canadians to offer wit, humour and fun, 3 human traits which are an alien concept to the Canadian race.

Well here is another one for you Canadians and Yanks, us Aussie's are now only 2 Baht behind you and it's going up.

Yes it will be good news for Thailand when the us 3 countries will be the tourists and represent the white fooreigners here. It will be good to see the bar raised a bit

Edited March 10, 2010 by lovelomsak

[loong]

If the Thai gov fails to repeg the baht/dollar rate, the planes from the UK are going to be empty.

Now how exactly do you think the Thai Government ot BoT would be able to do that.

If you happen to know but it is a big secret please send the answer to K.Tarisa BoT who is losing the country US$500m a month trying to suppress the currency. Doesnt seem to stop the tourists coming though. December was a record ever month for tourists.

How did you do that? Make that post look like I said it? nice trick I would maybe like to try it sometime.

You did say it - post 356

[theoldgit]

I have said it before, it's not the Baht that is strong it's the GB Pound that is weak.

Thailand has seen an increase in the number of tourists and exports are up, so why does it need to devalue it's Baht to please a few Brits? and I am British.

Britain on the other hand is in deep doo doo, it is deep in debt, the political situation is in turmoil, the currency is falling against the US, Canadian and Aussie Dollers, the Euro and just about major currency. The economists and political pundits are all saying that the UK actually needs a weak pound to help the country get out of the deep sh*t it is in, so I think we need to buckle up and settle in for a rough ride as I think it will get a lot worse before it gets better.

[Ricardo]

Yes it will be good news for Thailand when the us 3 countries will be the tourists and represent the white fooreigners here. It will be good to see the bar raised a bit

Do you mean to say, those three nationalities are taller than us Brits, and therefore require a higher surface to lean upon, while discussing life down at the 'rubbity-dub' ?

[Abrak]

If the Thai gov fails to repeg the baht/dollar rate, the planes from the UK are going to be empty.

Now how exactly do you think the Thai Government ot BoT would be able to do that.

If you happen to know but it is a big secret please send the answer to K.Tarisa BoT who is losing the country US$500m a month trying to suppress the currency. Doesnt seem to stop the tourists coming though. December was a record ever month for tourists.

How did you do that? Make that post look like I said it? nice trick I would maybe like to try it sometime.

You did say it - post 356

Thank you Loong.

What generally annoys me about these Thai exchange rate debates is that the 'imminent baht collapse' 'the baht value is a scam' 'the baht is grossly overvalued' is never ever accompanied by an economic argument to support it. It is sometimes accompanied by general insults 'like Thailand is fifth world country' but compared to half the first world countries they look far more fifth world than Thailand. To have horrific dual deficits and debt and call Thailand fifth world really is pretty insulting.

To be honest I actually dont really think that people who think that the baht will continue to appreciate really need to justify with economic arguments because as every economic fundamental points to it as far as I can see continuing to appreciate it is not that surprising if it does. Even on a PPP basis it is generally considered undervalued by at 30%, the long term implications of sterilization imply further appreciation, it is one of the few countries in the world with a twin surplus and please remember that to indicate that a currency mght appreciate the bar is set incredibly low.

In the West they argue about unwinding QE while Thailand has to think how it unwinds its reverse QE. Perhaps that is the most bearish factor for the baht although it would be economic suicide. They could choose to massively increase inflation rather than to appreciate their currency.

It appears though from the above that many posters cant even remember them

And for those who go for the scam argument I would agree that artifically suppressing your exchange is a bit of a scam. To behonest those who think the baht can be made to fall, the BoT and Korn would seriously appreciate your advice but 'Thailand is a fifth world country' is really a good starter for your theory.

[chiang mai]

Folks don't want to believe the truth on this Abrak, it's human nature - what me, got it wrong, impossible! What, the Baht is stronger than the Pound and the Thai economy in better shape than the UK, impossible! What, me have to leave and return to the UK, impossible!!

[Abrak]

Folks don't want to believe the truth on this Abrak, it's human nature - what me, got it wrong, impossible! What, the Baht is stronger than the Pound and the Thai economy in better shape than the UK, impossible! What, me have to leave and return to the UK, impossible!!

I will also give one very good reason that the baht is quitely to appreciate another 10% this year. Lets assume that all the better fundamental that make it look cheap are matched by the other bad factors lkely the Government is led by two Oxford scholars etc. That is really the baht is pegged to the Yuan and not the US$ and they have tried to suppress its value to keep it competitive. Well noone knows what is going to happen to the Yuan as with capital controls they can set it at whatever it likes. But it would be a hugely optimistic/imaginative result if the YUan was depreciated. At some point ths year I dont believe it is an unreasonable assumption they will revalue or else there will be calls for trade tariffs on the simple basis that as the yuan has capital controls t can set its exchange rate far below other countries who are subject to market forces.

I beleved that this should have happened last year and China could have been forced to revalue in less than a month (and it could have made thailand the hero of this financial crisis) rather than being remebered as the country the caused the last one. Thailand is not deliberately trying to undervalue its exchange rate they are merely trying to remain competitive with those who do.

[xbusman]

Let me throw out some current thinking and see if any of it makes sense regarding a strong baht.

It seems like wealth, real GDP growth and per capita income, relies heavily on exports. Countries like China and Brazil are growing like gang busters while countries that are net importers like the US are gradually reducing their standard of living. Before you argue about the dominance of exports and trade balances, I think exports are more an indicator than the actual causal factor. Having a surplus of exports mean that you are competitive on the world market and by extension the local market. There are many things involved. Education, political stability, infrastructure, supportive government, geography to name but a few. In my opinion, perhaps one of the most important factor in the mix is currency.

Lets start with the problems in Greece. For the past few thousand years Greece has been able to collapse their currency as required to compete in the world market. While it creates higher costs for money (higher risks) it kept their shipping and tourism industries afloat when necessary. Being tied into the Euro took away all the flexibility that deflating a currency provides. Soon enough, their fiscal policies and structural inefficiencies became unmanageable with no other viable options than default (unless of course uncle Germany decides they need to contribute).

China of course, is extremely cagey locking the remimbe to the US dollar. As America tries to deflate itself back into the competition the Chinese stay right in lockstep, not giving an inch. Why do you think everyone is constantly puking blood over this policy. Its an ugly game of chicken in which either the Chinese will completely dominate or everyone will lose. If you dont think American deflation is good for exports a brief look at the financial statements of Airbus and Boeing give an insightful look at what is happening across Europe as the Euro remains so powerful.

The effects of currency take a long time to kick in. Airbus is just now making plans to leave Europe after many years of terrible suffering from the strong Euro. Given another ten or fifteen years of a strong Euro against the dollar/remimbe and things could get serious.

So when I think about Thailands baht, I mostly think of exports. Since this economy is mostly made up of exports, around 60 or so percent depending on who you ask, and slightly made up of tourism, the relative strength of the baht is of fundamental importance in the long term prosperity of the country.

The big exporters are easy to generalize if not precisely accurate. Germany is extreme engineering, precision, solid quality. Japan is the relentless pursuit of perfection, extreme efficiency, attention to detail, customer orientation. America is innovation, infra structure, geography. Brazil is climate, policies, and geography. While you might have different definitions for these powerful exporters, we can agree that China is cheap cheap labor and little to no structural overhead. As long as the remimbe continues its downward spiral in lock step with the dollar, no one is going to cut into their market with the exception that India could give a go at it if they ever got their act together.

So what does Thailand have to offer the world markets. If you clearly understand that a society cannot get wealthy on internal services, in other words if everyone in Thailand were masseurs they could not rub each other into prosperity, and that we must export our way to prosperity, what exactly do we have to offer. (lets consider tourism a form of exports for this overly simple discussion, it does bring money into the economy from the outside).

Well, we do have a strong opportunity with tourism. Beautiful beaches, friendly people, adequate infrastructure, and location. Lots of economies are based entirely on tourism. Bali and cambodia to name two. Heavily dependent include greece, Monte Carlo, the entire carribean island group, and on and on. Could it possibly be enough to sustain Thailand? I dont think so and what would be required to grow the industry to that level. If I were to guess, it would have to be price and that is a direct result of currency. As our currency gains against the currency of other tourist destinations without significant other factors we will suffer an overall decline in tourism. Unfortunately our political instability has facilitated the decline as well.

So exports remain the single most important economic driver in Thailand. Ask yourself what Thailand produces that is competitive world wide and you do find lots of things. Food, jewelry, furniture, sewn goods, and on and on. While there are some things that are somewhat unique, i.e. rubber, rice, shrimp and the like, most of those items are dictated by world commodity markets and a stronger baht only means less profit for producers, often to the point that the government has been forced to heavily subsidize those markets to keep them intact. For the rest of the exports, what Thailand offers is cheap labor. So who is the cheap labor competitor? You got it, our neighbor to the north (Vietnam has entered the stage as well over the past few years). Our strong currency has been closing manufacturing here for the past few years and moving it north in the search for ever cheaper labor. It will take time, but it will happen.

So it doesnt really matter if the baht is strong to the dollar or the pound. They are only buyers. Its deadly serious that the baht is strong to the remimbe and dong. Those boys are competitors and given such a huge pricing advantage are going to take us to the cleaners. You can add the won and taiwan dollar to the mix but they have their sights set more on Japan and going from a cheap labor economy to a technology orientated economy (and quite successfully I might add).

Like I said, this stuff takes years and years to take effect. Other factors will come into play that will change the equation. For example, should China red finally decide to swallow China green, all bets are off. That competitor would evaporate should that happen and Thailand could explode with business over night at any exchange rate.

So, in my opinion, on the world market where it matters, the thai baht is grossly over valued and if it remains that way for many years will cause serious damage to the GDP and per capita income of Thailand unless we can innovate our way into new markets that are not dependent on cheap labor. I see that as less a probability than a baht devaluation.

Nothing pessimistic about any of this, just trying to look at it as hard as Toyota does when planning a new plant.

[jdrake72]

So it doesnt really matter if the baht is strong to the dollar or the pound. They are only buyers. Its deadly serious that the baht is strong to the remimbe and dong. Those boys are competitors and given such a huge pricing advantage are going to take us to the cleaners. You can add the won and taiwan dollar to the mix but they have their sights set more on Japan and going from a cheap labor economy to a technology orientated economy (and quite successfully I might add).

So, in my opinion, on the world market where it matters, the thai baht is grossly over valued and if it remains that way for many years will cause serious damage to the GDP and per capita income of Thailand unless we can innovate our way into new markets that are not dependent on cheap labor. I see that as less a probability than a baht devaluation.

Nothing pessimistic about any of this, just trying to look at it as hard as Toyota does when planning a new plant.

I agree at 100%

THB is by far the most overvalued currency in the world.

It will tumble like a falling stone the X day.

It is true CURRENT surpluses and the accumulations of reserves give us a short-term still undervalued currency, but LONG TERM fundamentals are totally a different matter.

THB has increased brutally against almost all asia currencies, between 10% and 20% in few months against Vietnamese dong, Chinese yuan, South Korea won, Indian rupiah and so on...

Thailand has a fifth-world politics, it is like a middle age society with a maquillage of first world infrastructure , but it is just a maquillage.

Few export products have really a good aggregated value to justify such a strong currency: many others have not .

Thai Government always say to th exporter to increase the aggregated value of their products and not to complain about the exchange rate,

But ...my god...increasing the aggregated value of products cannot be done overnight !!

It implies improvement in EDUCATION, infrastructure, oppenness of the market, all things Thailand lacks behind .

Government is promoting a new eductaion system to brainwashing people and to DISCOURAGE THEM TO THINK AND ENCOURAGE ONLY TO OBEY AND NOT QUESTION ANYTHING : this is the opposite way of creating innovation and future aggregated value to Thai products.

THB will be strong for awhile, but after a X day it will collapse in a way which will make us remember the 1997....when ? It is hard to say no...as you said, it will take time.

[lovelomsak]

If the Thai gov fails to repeg the baht/dollar rate, the planes from the UK are going to be empty.

Now how exactly do you think the Thai Government ot BoT would be able to do that.

If you happen to know but it is a big secret please send the answer to K.Tarisa BoT who is losing the country US$500m a month trying to suppress the currency. Doesnt seem to stop the tourists coming though. December was a record ever month for tourists.

How did you do that? Make that post look like I said it? nice trick I would maybe like to try it sometime.

You did say it - post 356

Ok I see what happened I copy and pasted the original post because i couldnot find the quote button to push thanks for helping understand how that happened. I quess not good practice to copy and paste huh

[Naam]

thank you LORD! HALLELUJAH AMEN! after letting us suffer for a long time you finally sent prophets again (not one prophet but a dozen or so) who can tell which currency will trade when and at what rate vs. other currencies.

[lovelomsak]

Yes it will be good news for Thailand when the us 3 countries will be the tourists and represent the white fooreigners here. It will be good to see the bar raised a bit

Do you mean to say, those three nationalities are taller than us Brits, and therefore require a higher surface to lean upon, while discussing life down at the 'rubbity-dub' ?

Yah some

thing like that you got the idea

Edited March 10, 2010 by lovelomsak

[lovelomsak]

Now I am no genius as anyone who reads my post must know by now. One of my main faults is seeing things from a different perspective than the crowd. So here goes my thoughts on the Thai baht.

China doesnot want to put their currency out there on the market. Asia needs a currency that is currently on the open market to keep or increase its value against the American dollar,Britsh pound and Euro. With other asian nations having a high investment level in Thailand, and wanting to protect that investment and have financial gain. Thailand can then trade and support the other asian nations because of its baht value being higher than theirs. Thailand can become the marketing center for asian nations, to the rest world. The middle man much like Hong Kong . Asians helping asians. So the baht willnot fall but level, and byt he end of this year if not sooner.

Tourism would play a very small part in this scenario.

Edited March 10, 2010 by lovelomsak

[chiang mai]

Now I am no genius as anyone who reads my post must know by now. One of my main faults is seeing things from a different perspective than the crowd. So here goes my thoughts on the Thai baht.

China doesnot want to put their currency out there on the market. Asia needs a currency that is currently on the open market to keep or increase its value against the American dollar,Britsh pound and Euro. With other asian nations having a high investment level in Thailand, and wanting to protect that investment and have financial gain. Thailand can then trade and support the other asian nations because of its baht value being higher than theirs. Thailand can become the marketing center for asian nations, to the rest world. The middle man much like Hong Kong . Asians helping asians. So the baht willnot fall but level, and byt he end of this year if not sooner.

Tourism would play a very small part in this scenario.

Surprisingly there is actually some logic to what you've written, Thailand is regarded as being a support economy for surrounding countries.

[lovelomsak]

Now I am no genius as anyone who reads my post must know by now. One of my main faults is seeing things from a different perspective than the crowd. So here goes my thoughts on the Thai baht.

China doesnot want to put their currency out there on the market. Asia needs a currency that is currently on the open market to keep or increase its value against the American dollar,Britsh pound and Euro. With other asian nations having a high investment level in Thailand, and wanting to protect that investment and have financial gain. Thailand can then trade and support the other asian nations because of its baht value being higher than theirs. Thailand can become the marketing center for asian nations, to the rest world. The middle man much like Hong Kong . Asians helping asians. So the baht willnot fall but level, and byt he end of this year if not sooner.

Tourism would play a very small part in this scenario.

Surprisingly there is actually some logic to what you've written, Thailand is regarded as being a support economy for surrounding countries.

Thanks

You know the saying "think outside the box" Well I live outside the box

[chiang mai]

Now I am no genius as anyone who reads my post must know by now. One of my main faults is seeing things from a different perspective than the crowd. So here goes my thoughts on the Thai baht.

China doesnot want to put their currency out there on the market. Asia needs a currency that is currently on the open market to keep or increase its value against the American dollar,Britsh pound and Euro. With other asian nations having a high investment level in Thailand, and wanting to protect that investment and have financial gain. Thailand can then trade and support the other asian nations because of its baht value being higher than theirs. Thailand can become the marketing center for asian nations, to the rest world. The middle man much like Hong Kong . Asians helping asians. So the baht willnot fall but level, and byt he end of this year if not sooner.

Tourism would play a very small part in this scenario.

Surprisingly there is actually some logic to what you've written, Thailand is regarded as being a support economy for surrounding countries.

Thanks

You know the saying "think outside the box" Well I live outside the box

Well hang on, don't go overboard, I saw your earlier comments about tourism and currency pegs et al and doubtless you saw my response where I advised you cease the intake of various substances, medicinal or other! You've made up a few points with your latest idea but you do have some distance to go yet so don't stop now.

[lovelomsak]

Now I am no genius as anyone who reads my post must know by now. One of my main faults is seeing things from a different perspective than the crowd. So here goes my thoughts on the Thai baht.

China doesnot want to put their currency out there on the market. Asia needs a currency that is currently on the open market to keep or increase its value against the American dollar,Britsh pound and Euro. With other asian nations having a high investment level in Thailand, and wanting to protect that investment and have financial gain. Thailand can then trade and support the other asian nations because of its baht value being higher than theirs. Thailand can become the marketing center for asian nations, to the rest world. The middle man much like Hong Kong . Asians helping asians. So the baht willnot fall but level, and byt he end of this year if not sooner.

Tourism would play a very small part in this scenario.

Surprisingly there is actually some logic to what you've written, Thailand is regarded as being a support economy for surrounding countries.

Thanks

You know the saying "think outside the box" Well I live outside the box

Well hang on, don't go overboard, I saw your earlier comments about tourism and currency pegs et al and doubtless you saw my response where I advised you cease the intake of various substances, medicinal or other! You've made up a few points with your latest idea but you do have some distance to go yet so don't stop now.

Sorry no subsance abuse here. Strongest thing I use is sugar in my coffee.

[whichschool]

OK as the pounds so low and this is a Thai webste where there must be a fair few earning decent money in Thai Baht or other currencies, it would seem now is as good a time as any to invest in the UK, as im sure even the biggest pessimist must accept the UK will get out of this mess eventually.

All my sterling will be getting invested in nice boring safe investments in the UK shortly, not worth putting it into Euros, dollar or baht investments at present, wouldnt have thought im the only one thinking this way ... surely this will be to the benefit of the UK economy.

Edited March 10, 2010 by whichschool

[mommysboy]

OK as the pounds so low and this is a Thai webste where there must be a fair few earning decent money in Thai Baht or other currencies, it would seem now is as good a time as any to invest in the UK, as im sure even the biggest pessimist must accept the UK will get out of this mess eventually.

All my sterling will be getting invested in nice boring safe investments in the UK shortly, not worth putting it into Euros, dollar or baht investments at present, wouldnt have thought im the only one thinking this way ... surely this will be to the benefit of the UK economy.

Well No! that is the thing here, there are a significant number of people who genuinely think the recession will never end, or a few others who think that the balance of power has shifted from Europe/N. America to Asia.

I think they are on a loser but there you go!

[mommysboy]

Now I am no genius as anyone who reads my post must know by now. One of my main faults is seeing things from a different perspective than the crowd. So here goes my thoughts on the Thai baht.

China doesnot want to put their currency out there on the market. Asia needs a currency that is currently on the open market to keep or increase its value against the American dollar,Britsh pound and Euro. With other asian nations having a high investment level in Thailand, and wanting to protect that investment and have financial gain. Thailand can then trade and support the other asian nations because of its baht value being higher than theirs. Thailand can become the marketing center for asian nations, to the rest world. The middle man much like Hong Kong . Asians helping asians. So the baht willnot fall but level, and byt he end of this year if not sooner.

Tourism would play a very small part in this scenario.

Surprisingly there is actually some logic to what you've written, Thailand is regarded as being a support economy for surrounding countries.

Well as I see it the Thai bt. is just on a bit of a fluke run as Thailand has a good fiscal position currently and is protected from shorting. It seems to be pegged to the dollar in some way too. Long term it will fall IMHO.

[mommysboy]

So it doesnt really matter if the baht is strong to the dollar or the pound. They are only buyers. Its deadly serious that the baht is strong to the remimbe and dong. Those boys are competitors and given such a huge pricing advantage are going to take us to the cleaners. You can add the won and taiwan dollar to the mix but they have their sights set more on Japan and going from a cheap labor economy to a technology orientated economy (and quite successfully I might add).

So, in my opinion, on the world market where it matters, the thai baht is grossly over valued and if it remains that way for many years will cause serious damage to the GDP and per capita income of Thailand unless we can innovate our way into new markets that are not dependent on cheap labor. I see that as less a probability than a baht devaluation.

Nothing pessimistic about any of this, just trying to look at it as hard as Toyota does when planning a new plant.

I agree at 100%

THB is by far the most overvalued currency in the world.

It will tumble like a falling stone the X day.

It is true CURRENT surpluses and the accumulations of reserves give us a short-term still undervalued currency, but LONG TERM fundamentals are totally a different matter.

THB has increased brutally against almost all asia currencies, between 10% and 20% in few months against Vietnamese dong, Chinese yuan, South Korea won, Indian rupiah and so on...

Thailand has a fifth-world politics, it is like a middle age society with a maquillage of first world infrastructure , but it is just a maquillage.

Few export products have really a good aggregated value to justify such a strong currency: many others have not .

Thai Government always say to th exporter to increase the aggregated value of their products and not to complain about the exchange rate,

But ...my god...increasing the aggregated value of products cannot be done overnight !!

It implies improvement in EDUCATION, infrastructure, oppenness of the market, all things Thailand lacks behind .

Government is promoting a new eductaion system to brainwashing people and to DISCOURAGE THEM TO THINK AND ENCOURAGE ONLY TO OBEY AND NOT QUESTION ANYTHING : this is the opposite way of creating innovation and future aggregated value to Thai products.

THB will be strong for awhile, but after a X day it will collapse in a way which will make us remember the 1997....when ? It is hard to say no...as you said, it will take time.

The first part was good, and indeed too much is made of its foregn reserves and generallly strong short term position, too little made of all its problems. After that what you said was just a lot of hot air!