UK Pound Collapse 47.99 against the Baht

[slim]

Collapse my arse, OK not great if you need to buy baht now but it's only a 9 month low against US$...

dailymail readers, all of you

http://www.dailymail.co.uk/money/article-1...-1-20-rate.html

(from 23rd January)

Anyone who doesn't think that Sterling is collapsing clearly has no understanding of whats happening. This is not just a short term blip - this is the foreseeable future. There is nothing in the way of Sterling's fall. It will keep on falling because there is nothing that can arrest the fall. Eventually (maybe next year) when GBP/USD is down to 1.20 and the Thai baht is sub 30 Sterling will look cheap and traders will start to buy Sterling instead of selling it.

The return to current levels (50 baht to the pound) could take years, possibly decades. 70 baht to the pound is already a dim and distant memory. In 12 months time its likely that anyone wanting to retire in Thailand (800,000 in a Thai bank) will need about £25,000.

I hope I'm wrong but I fear the worst.

[Jonathanpattaya]

The last couple of pages of this thread tells the story:

http://www.thaivisa.com/forum/Pound-Starti...64#entry3379764

If you've got money in Pounds it's probably a very good time to sell it and buy US Dollars, that's what everyone else in the world is doing.

I don't agree. The US Dollar is enjoying a rally based on an increase in the intest rate for emergency loans.

Just wait for inflation to have an effect in Europe and the UK and things will change but, not anytime soon.

As Corporal Jones would say, "Don't panic Mr Mainwaring!"

[Oneman]

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

"Theoldgit" may be old, but he's is still sharp:

That's exactly what's happening, just that most don't think about it that way.

The Pound is falling.

The Euro is falling.

The Baht is falling, too, just more slowly, so it gives the illusion of being "stronger".

But they are all going down.

All over the world, every country's money is falling.

Thailand is no exception.

(Clever readers will ask, "Falling against what?"

That's a worthwhile question, but better saved for a different thread, because the topic here is the Pound and the Baht.)

This is not just a short term blip - this is the foreseeable future. There is nothing in the way of Sterling's fall. It will keep on falling because there is nothing that can arrest the fall. ... In 12 months time its likely that anyone wanting to retire in Thailand (800,000 in a Thai bank) will need about £25,000. ... I hope I'm wrong but I fear the worst.

Superb analysis.

Thank you, "Slim".

We might quibble about the amount of the "fall", but falling it is.

a number of expats have said enough is enough and returned to their homelands. ... I have to wonder what I would be going back to.

There is no "wonder" about it.

If your homeland is/was primarily English-speaking (UK, US, Canada, Australia, NZ, etc.), then its either going or already gone.

Similar with our European friends.

What we once had in our "home" countries simply is no more, and never will be again.

Not in the life time of anyone reading this now.

The cultural decay and the financial depression are too deep, have gone too far.

I'm staying.

There's nowhere else I can see that offers similar quality of life as Thailand, let alone any place better.

Yes, problems on the horizon -- not to be discussed here -- but there are problems everywhere.

I've assessed the risks and will take my chances in Thailand.

I'm open to further discussion -- on the forum, or in private messages.

(For this sort of topic, private messages are usually more productive.)

-- Oneman

Chiangmai

Edited March 2, 2010 by Oneman

[VegasVic]

Pound at USD 1.20 by mid year, GBP/THB around 40.

I am hearing that the Pound will pass the Euro on the way down somewhere in the upper $1.20's vs. the Dollar, and that both the Pound and the Euro could be close to par with the Dollar by years end Since the BOT unofficailly ties the baht to the Dollar, the Euro and the Pound could be in the 32-35 baht range by years end if the Euro-Pound bears are correct.

[Shotime]

G_D Bless America....and The Tiger.

Looks like PM Blair didn't impress many people he wanted to go on the dole with. Can you imagine what living in England must be like? It's no better in the USA. The government must be supporting 60% of the people.

"I'm staying.

There's nowhere else I can see that offers similar quality of life as Thailand, let alone any place better.

Yes, problems on the horizon -- not to be discussed here -- but there are problems everywhere.

I've assessed the risks and will take my chances in Thailand.?

He has a very good point.

Edited March 2, 2010 by Shotime

[Jonathanpattaya]

Let's not forget there are "other factors" which will affect confidence in the Baht and they are just around the corner.

[cmsally]

I don't agree that some election poll has anything to do with this. I would imagine it is entwined with the Prudential/AIG/TATA deal.

Something which has Mandelsons's ratty little paw prints all over it. Presumably sold an awful lot of GBP to purchase AIG and maybe while cheap you will see TATA reinvest some of that money into the UK at an enormous gain.

[basinboy]

The last couple of pages of this thread tells the story:

http://www.thaivisa.com/forum/Pound-Starti...64#entry3379764

If you've got money in Pounds it's probably a very good time to sell it and buy US Dollars, that's what everyone else in the world is doing.

I think if everyone else in the world were buying USD it would be a lot stronger than it is today. Compared with many other currencies it is weaker now than 1 year

againt Yen 2.1% weaker

against Canadian dollar 13.3% weaker

against Aust dollar 22% weaker

against THB 8.5% weaker

I donn't know if there is any safe currency available today, certainly the AUD is up and down like a brides nightie

[chiang mai]

Pound at USD 1.20 by mid year, GBP/THB around 40.

I am hearing that the Pound will pass the Euro on the way down somewhere in the upper $1.20's vs. the Dollar, and that both the Pound and the Euro could be close to par with the Dollar by years end Since the BOT unofficailly ties the baht to the Dollar, the Euro and the Pound could be in the 32-35 baht range by years end if the Euro-Pound bears are correct.

Hi Vic, yes, I hear the same things, not good at all. But there's a window in which to make a decent return if USD will just hold up for a while.

[elektrified]

Thailand is not nearly as cheap as people think imo.

I couldn't agree with you more! You need lots of money to live here these days.

[chiang mai]

I don't agree that some election poll has anything to do with this. I would imagine it is entwined with the Prudential/AIG/TATA deal.

Something which has Mandelsons's ratty little paw prints all over it. Presumably sold an awful lot of GBP to purchase AIG and maybe while cheap you will see TATA reinvest some of that money into the UK at an enormous gain.

You'd have to believe that the deal was hedged though so there can't be that much impact, surely. Personally, I think it's beginning to look like speculators and scalpers jumping on the band wagon, the day time positions look awful but there's a recovery towards the end of day,

[CockneyGit]

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

Bummer..!!

[elektrified]

The last couple of pages of this thread tells the story:

http://www.thaivisa.com/forum/Pound-Starti...64#entry3379764

If you've got money in Pounds it's probably a very good time to sell it and buy US Dollars, that's what everyone else in the world is doing.

I think if everyone else in the world were buying USD it would be a lot stronger than it is today. Compared with many other currencies it is weaker now than 1 year

againt Yen 2.1% weaker

against Canadian dollar 13.3% weaker

against Aust dollar 22% weaker

against THB 8.5% weaker

I donn't know if there is any safe currency available today, certainly the AUD is up and down like a brides nightie

The Swiss Franc. History shows the safety of being invested in the CHF.

[slim]

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

"Theoldgit" may be old, but he's is still sharp:

That's exactly what's happening, just that most don't think about it that way.

The Pound is falling.

The Euro is falling.

The Baht is falling, too, just more slowly, so it gives the illusion of being "stronger".

But they are all going down.

All over the world, every country's money is falling.

Thailand is no exception.

-- Oneman

Chiangmai

This is complete nonsense. There is no illusion about the strength of the Thai baht against the USD, EURO and GBP which is what this thread is all about. "The Pound is falling The Euro is falling" - not against each other they're not. The Euro is nearly at parity to the GBP from a position of 2 Euro to the pound not long ago.

If a currency falls, it must fall against something else - because that's what exchange rates are all about.

[kmj]

Anyone who doesn't think that Sterling is collapsing clearly has no understanding of whats happening. This is not just a short term blip - this is the foreseeable future. There is nothing in the way of Sterling's fall. It will keep on falling because there is nothing that can arrest the fall. Eventually (maybe next year) when GBP/USD is down to 1.20 and the Thai baht is sub 30 Sterling will look cheap and traders will start to buy Sterling instead of selling it.

The return to current levels (50 baht to the pound) could take years, possibly decades. 70 baht to the pound is already a dim and distant memory. In 12 months time its likely that anyone wanting to retire in Thailand (800,000 in a Thai bank) will need about £25,000.

I hope I'm wrong but I fear the worst.

are you really trying to tell me that sterling wont hit 50 baht again for years or decades? & I knew enough to bring my money in at 66 in 2008

[Richie1971]

Anyone who doesn't think that Sterling is collapsing clearly has no understanding of whats happening. This is not just a short term blip - this is the foreseeable future. There is nothing in the way of Sterling's fall. It will keep on falling because there is nothing that can arrest the fall. Eventually (maybe next year) when GBP/USD is down to 1.20 and the Thai baht is sub 30 Sterling will look cheap and traders will start to buy Sterling instead of selling it.

The return to current levels (50 baht to the pound) could take years, possibly decades. 70 baht to the pound is already a dim and distant memory. In 12 months time its likely that anyone wanting to retire in Thailand (800,000 in a Thai bank) will need about £25,000.

I hope I'm wrong but I fear the worst.

are you really trying to tell me that sterling wont hit 50 baht again for years or decades? & I knew enough to bring my money in at 66 in 2008

Rising slowly - xe

1.00 GBP

=

49.0148 THB

United Kingdom Pounds Thailand Baht

1 GBP = 49.0148 THB 1 THB = 0.0204020 GBP

[bangkokbanks]

What surprised me (even last year when the pound was in the high 50s) is when my folks visited from the UK and my brother and his family visited from Oz rather than them being delighted that they could pick up cheap market t-shirts for the kids they told me they could buy cheaper at home at places like Asda. or the Oz equivalent and better quality.

I was looking at changing my car and perusing a few locally produced SUVs like the MU-7 etc. but at the current exchange rate we're looking at 26000 quid for the top end versions. That looks expensive to me for something that's not imported.

I will speak in defence of the MU 7, we bought one a few years back - the Gold Series. It was worth the price (about 1.2M Baht). We have been all over Thailand in it, with the two kids and a Nanny in the back on long vacations. It's roomy and fuel efficient. I was happy not to go with the Toyota SUV, liking the MU 7s extras much more. I know what you mean about converting your home currancy for a car made in Thailand, but with regard to the MU 7, I have never looked back.

[slim]

Anyone who doesn't think that Sterling is collapsing clearly has no understanding of whats happening. This is not just a short term blip - this is the foreseeable future. There is nothing in the way of Sterling's fall. It will keep on falling because there is nothing that can arrest the fall. Eventually (maybe next year) when GBP/USD is down to 1.20 and the Thai baht is sub 30 Sterling will look cheap and traders will start to buy Sterling instead of selling it.

The return to current levels (50 baht to the pound) could take years, possibly decades. 70 baht to the pound is already a dim and distant memory. In 12 months time its likely that anyone wanting to retire in Thailand (800,000 in a Thai bank) will need about £25,000.

I hope I'm wrong but I fear the worst.

are you really trying to tell me that sterling wont hit 50 baht again for years or decades? & I knew enough to bring my money in at 66 in 2008

Wise man

[favre360]

I was pullin for you Brits to make a stand against the Euro but it looks like you better just fold

[Joints]

If a currency falls, it must fall against something else - because that's what exchange rates are all about.

Exactly, seems to be difficult to understand for some. I, on the other hand, have problems to understand why the Baht is still going so strong. The future of this country isn't looking too bright, is it?

[geriatrickid]

YIPPEE

Good news for me - I'm going to the UK this month.

Also, when I send money home to my mother, she gets more.

It isn't too bad for the pensioners - it was only 37 baht to the pound when I first came here in 1992.

It might make a few of the undesirable stay away from here, or go back too.

Your post is total rubbish.

Back in the early 90s the cost of living in Thailand was less than a quarter compared with today`s prices and Thai bank interest rates reached a high of 13%. Plus only 150000 baht was required for a one year Non Immigrant visa.

With an amount of 1 million baht in the bank, you could very comfortably live on the interest without tapping into the capital or need to bring over more money.

Things have changed dramatically and it`s going to be financially down hill from now on.

No it's not rubbish.

House prices in Thailand reached their highest point in 1992 (adjusted for inflation). Contrary to popular belief, house prices were already on the decline prior to the 1997 Asian Crisis, falling 2.4% p.a. from 1992 to 1997 in inflation-adjusted terms.

Very nice chart that shows the trends and the indices here http://www.globalpropertyguide.com/Asia/Th...d/Price-History

If we go into Mr. Peabody's way back machine, to the year of 1992 we see that the UK base rate was in steady decline and went from 10% in May to 7% at the end of November. (The base rate was 15% in 1989. )

In fairness, subsequent to Black Wednesday 16-Sept-1992 the UK government did raise interest rates to 15% to stabilize things. However, times were quite bleak in the UK;

1992 - Still recession - still various protestations of recovery from politicians! GDP declined by 1 %. Combined effect of the recession raised unemployment to 2.87m - more than 50% of them out of work for more than 6 months, and a third for more than a year. Businesses collapsed at a rate of about 1,200 per week.

But inflation fell to 3% - helped by interest rate cuts. House prices continue to fall, and `negative equity' to rise.

Concerns about the UK economy and the French referendum on Maastricht send pound down to its bottom limit. Fears that sterling would be devalued fuelled significant selling of the £ and buying of the Deutschmark. As a result of departure from ERM, interest rates are cut significantly.

And the situation in Thailand? Interest rates were also declining. The lower rates were so attractive that companies were rushing to refinance debt. Here's a nice article reference;

Jan 14, 1992 - Bangkok Post (Bangkok, Thailand) (via Knight-Ridder/Tribune Business News); July 16, 2003 ; 527 words ...Byline: Darana Chudasri Jul. 16--Low interest rates are attracting corporate bond issuing to refinance higher costs of funds ... 100 billion baht reached last year. But low interest ...

So no, it isn't rubbish, but shows he has a very good memory for an elderly gentleman.

it is amazing that chat and speculation can rock the currency of a g6 country and the thai baht can be supported with no problems, it is also amazing that the gian amareican ecomomic pundits can say the pound is doomed and be happy with the dollar when the fed has been printing money like toilet paper, no real logic in the dollar strength, just opinion and swagger.

i guess gordon brown will just have to tell us it is all ok eh?

The "gian amareican", or if I may, the USA, is in better shape for the long term than the UK and even the EU. Here's why;

1. Yes, it is carrying a crippling debt, but that debt is nowhere near as bad as the burden of the Portugal, Greece, Ireland and Spain.

2. The USA is one of the few nations with access to the 3 pillars of stability:

i) A reliable energy supplier (Canada is the largest source of energy and has lots of hydro electricity, natural gas and oil to feed the little piggy Americans. Mexico is the other big energy source)

ii) A reliable and efficient food supply. ( North America is so vast and diversified it could literally close its borders tomorrow and it would have so much food in surplus that a large part of the planet would starve.

iii) Clean and abundant water. (Despite water mismanagement in the USA, the USA and Canada's have some of the cheapest abundance of fresh water.)

The UK balance of payments will be crushed once the North Sea oil is finished. The EU is dependent upon the Russians and the middle east for energy and as such is at their mercy. Thailand really isn't that much different: It's water supplies are impacted by its neighbors, it relies upon energy imports and the food it exports need that cheap energy and water. If anything interferes with the delicate balance, all he11 will break loose.

If the USA ever lost Canada as a friend and partner, and to a certain extent, Mexico the USA would end up in the same shape as Greece. Most Americans have no idea how much their national security and national wealth is dependent upon Canada and Mexico. In a twisted sort of way, it is alot like the Europeans were made great by the wealth of former colonies. The difference now is that the Americans are paying market prices unlike Europe did in her days of exploitation glory.

[teletiger]

Most currencies are falling against gold and other PMs. But as Oneman said, that's another thread.

Regards.

[robokop]

I could not understand why the pound stayed above 50 and now is dropping which I can understand. The UK economy is a mess. The country is overtaxed even to the point of a TV Tax to support BBC, the Govt controlled major news outlet. When the politicians can control the major news outlet, they can control the news and the people of the UK. Socialized medicine in the UK is a disgrace. UK is heading down the tubes and those who are retired in Thailand will be forced to go back to a country whose a economy along with it's banking industry is in a shambles. In the USA, the Socialist President Obama is taking the USA down the socialization path that merry ole UK enjoys. Obama is pushing a massive Socialized Healthcare Plan that has a cost of over 1 Trillion Dollars. Obama's 2010 budget has a deficit of 1.6 Trillion Dollars, more money in debt than the cost of the entire Bush budget of 2001. Bush's last year in office had a out of control $800 Billion Dollar deficit, Obama's first year ending deficit was $1.4 Trillion. UK economy is in a mess and USA is about to join hand and hand with the UK. The Dollar will soon crash against the Baht as the Pound is now doing.

[shawndoc]

Anyone care to guess why the Baht is going so strong and why the government doesn't bring it down?

Last I checked, it wasn't in Thailand's best interest to have a strong currency. With their currency rising, its going to have a negative impact on the already struggling tourism industry. When tourism is low scams/crime rises in tourist areas, leading to lasting negative impressions on those tourists who do come. Less money flowing into Pattaya and Phuket means less money being sent home to Issan, which is likely to fuel political troubles for the country.

Thailand is one of the world's largest rice exporters, I can't imagine a high baht is helpful there.

And from my understanding, Thai manufacturing was already having a hard time with the slowing global economy and competition from China and elsewhere. A high baht is going to see those factories shuttered and moved elsewhere.

Now if Thailand were a big importer, I'd see this as a plus. But my understanding is Thailand isn't a big importer, and most of the economy relies on exports and tourism.

[Pui]

YIPPEE

Good news for me - I'm going to the UK this month.

Also, when I send money home to my mother, she gets more.

It isn't too bad for the pensioners - it was only 37 baht to the pound when I first came here in 1992.

It might make a few of the undesirable stay away from here, or go back too.

i find undesirables of all races including natives.

How does making Thailand more expensive to English people help keep undesirables away?

Bangkok Bank 2nd March 2010

Exchange Rate 1 British Pound = 47.9538 Thai Baht

[Oneman]

If a currency falls, it must fall against something else - because that's what exchange rates are all about.

Thanks, Slim, for those comments, but I wish you knew a little more about international currency trends.

Yes, "it must fall against something", that's right, but it's only half right.

What you've missed is the "something".

I respectfully suggest you look more carefully, before you call foul or "nonsense".

Most currencies are falling against gold and other PMs.

Teletiger is close to the right track, but only close.

All currencies are falling against gold.

By that standard of measure, there is not one currency -- in recent years -- that is holding up.

(Currency charts are widely available on the Internet for all to see.)

Everything confirms Teletiger's signature, "A storm is coming".

So, for a financial safe harbour, what else might hold up (besides gold)?

Where else if not the Pound, the Euro, the Dollar, etc?

I wish I knew.

-- Oneman

Chiagmai

.

Edited March 2, 2010 by Oneman

[LamaiCat]

Euro drop from 49 to 44 baht...

Superbaht??

When the government finish the money to subsides rice and fuel, maybe the bath will collapse.

At this level next winter no Thaiand for me, Bali is not really cheap, so Vietnam is the last cheap place....

[ding]

I could not understand why the pound stayed above 50 and now is dropping which I can understand. The UK economy is a mess. The country is overtaxed even to the point of a TV Tax to support BBC, the Govt controlled major news outlet. When the politicians can control the major news outlet, they can control the news and the people of the UK. Socialized medicine in the UK is a disgrace. UK is heading down the tubes and those who are retired in Thailand will be forced to go back to a country whose a economy along with it's banking industry is in a shambles. In the USA, the Socialist President Obama is taking the USA down the socialization path that merry ole UK enjoys. Obama is pushing a massive Socialized Healthcare Plan that has a cost of over 1 Trillion Dollars. Obama's 2010 budget has a deficit of 1.6 Trillion Dollars, more money in debt than the cost of the entire Bush budget of 2001. Bush's last year in office had a out of control $800 Billion Dollar deficit, Obama's first year ending deficit was $1.4 Trillion. UK economy is in a mess and USA is about to join hand and hand with the UK. The Dollar will soon crash against the Baht as the Pound is now doing.

I used to think the USD would fall vis-a-vis the Baht. But after reading the preceding part of your post, I have renewed hope! Obama is a socialist - for the banksters! He's transferring tax dollars to eliminate risk and replace losses. He's for corporate welfare. You must watch Fox news. Certainly not for working families. Clinton gave Americans NAFTA, GATT and seeded the Wall Street ponzi scheme. These same crooks are in the Obama cabinet; The Warning

We ignore history and facts at our own peril.

[Oneman]

The Swiss Franc. History shows the safety of being invested in the CHF.

I wish it were still like it was in history.

Years ago, the Swiss France was a dependable, safe haven.

But not any longer.

All the rules of this game are changing quickly, even for Switzerland.

A quick look at currency charts will confirm that even the Swiss Franc is on the decline.

Alas.

-- Oneman

Chiangmai

Edited March 2, 2010 by Oneman

[Pui]

I could not understand why the pound stayed above 50 and now is dropping which I can understand. The UK economy is a mess. The country is overtaxed even to the point of a TV Tax to support BBC, the Govt controlled major news outlet. When the politicians can control the major news outlet, they can control the news and the people of the UK. Socialized medicine in the UK is a disgrace. UK is heading down the tubes and those who are retired in Thailand will be forced to go back to a country whose a economy along with it's banking industry is in a shambles. In the USA, the Socialist President Obama is taking the USA down the socialization path that merry ole UK enjoys. Obama is pushing a massive Socialized Healthcare Plan that has a cost of over 1 Trillion Dollars. Obama's 2010 budget has a deficit of 1.6 Trillion Dollars, more money in debt than the cost of the entire Bush budget of 2001. Bush's last year in office had a out of control $800 Billion Dollar deficit, Obama's first year ending deficit was $1.4 Trillion. UK economy is in a mess and USA is about to join hand and hand with the UK. The Dollar will soon crash against the Baht as the Pound is now doing.

Big numbers and slightly off topic but US really needs health care reform. Leaving it in the hands of insurance company's, now thats what i call corruption. 46million Americans have no health care. If people get sick they can lose everything. Did you watch Michael Moore's Sicko? $5 dollar Asthma inhaler cost $125 dollars and people complain Thailand is corrupt!

Obama wants to do something about that and you cannot make an omelet without cracking eggs.

Britain is very over taxed and the welfare system is also not helping the economy.

Britain paid out more last year in welfare than it collected in income tax. That cannot be good for the economy.

Another problem is an over priced stagnant housing market.

Britain no longer makes anything. Thailand on the other hand exports a lot.

Edited March 2, 2010 by Pui