Hung Parliament Sends Uk Pound Crashing...!

[Gambles]

A loss of 3% since 1st May certainly is not good

Now, why has the Baht not gone pear-shaped considering the political turmoil here is 1000000 times worse than the UK?

That is the 1 million baht = £1 question?

Are there any experts out there who can enlighten us?

baht is weaker than comparable currencies (IDR, MYR and PHP) and this difference is generally seen as the extent to which the political risk is priced into the currency -

Political risk curbs country's potential

Writer: Pornnalat Prachyakorn

Political risk curbing country's potential

Thailand might fail to capitalise on its strengths to become one of the best investment markets in Asia if political risk continues to affect the country's economy, according to Scott Campbell, an S&P award-winning fund manager.Foreign investors remain bullish on the growth of emerging markets including Asia, Mr campbell said at a briefing in Bangkok this week.

''Asia along with other emerging markets will continue to be the best place for investment for the next 30 to 40 years,'' said Mr Campbell, director of the international fund manager Miton Optimal.

''Over the past 10 years, the stock market in the west has done nothing while Asian stock markets have grown three- to fourfold.''

Although Thailand's economic fundamentals are attractive, political risk is seen as the major obstacle on the path to a better economic position.

Mr Campbell said that since April last year, there has been a significant rebound in Asian currencies.

''Currency is a barometer of political risk and the Thai baht has been pretty much flat since last year,'' he said. ''If the political risk gets sorted out, then you'll see the Thai baht appreciate just to catch up with what everything else has done.''

The fundamentals for the whole Asian region are still very positive but Thailand could lag because of political instability, he added.

Paul Gambles, managing director of the consultancy MBMG International Co, said Thailand started to underperform the rest of the region in 2004, when political tensions first began to affect the economy.

''Thailand's economy has significantly underperformed over the last few years. This can be best be seen by comparing Thailand's economic growth, foreign-exchange rates and stock market valuations with those of comparable economies in Southeast Asia,'' he said.

Mr Gambles quoted John Sheehan of the consultancy Global Market Asia, who observed that growth rates in a number of Asean neighbours had not only caught up, but had overtaken that of Thailand.

''If you take the superior GDP growth rate of a jurisdiction like the Philippines and apply this higher rate to Thailand's growth from 2005, it can be seen that by the end of 2008 Thailand's GDP would be somewhere between US$30 billion and $40 billion higher,'' Mr Gambles said.

One very positive sign for Asia, Mr Campbell said, has been the growth in domestic consumption and markets and in intra-regional trade.

''The region is exporting to itself. This has shown that Asia is much less dependent on the west which is very positive,'' he said.

Asian demographics also are positive with the population shape being similar to that of the United States Baby Boom era in the in 1950s and 1960s when a large chunk of the American population was aged below 10 years.

''An economy that has a bigger chunk of people at the bottom

[age group] is in a much better than the economy that has bigger chunk of people at the top,'' he said.

India, for example, will have the same demographic shape as that of the US today in 2025 to 2050. ''So the emerging markets have another 40 years of prosperous growth.''

In the past, a high-risk portfolio was emerging market bonds and a low-risk one contained US government bonds, German blue-chip companies and UK property. ''Now, the situation is reversed,'' Mr Campbell said.

Asian commercial property is also extremely positive with lower risk and much better interest rate. As the Asian markets are growing, there is a much better chance of increasing your rent and occupancy rate. The yield is much more real than in the west, he said.

The rent will be increased with the inflation at about 5% per year, so youre going to get your yield up by 5% per year. But in the west, they're going down.

Gold should be included in investors portfolio. Based on historical data, Mr Campbell expects the gold prices could rise to between $2,000 and $2,500 an ounce.

Over the last 10 years, the Dow Jones has gone down and the gold price has gone up by fivefold to$1,200 an ounce from $250 in 2000.

Edited May 9, 2010 by Gambles

[roamer]

If people would stop reading some of the rabid right wing ranting they might instead hear a lot of commentators say that sterling may well be hit badly tomorrow, as will the Euro. The markets expected this result, its factored in already. The concern is whats happening in Greece and other Euro nations. The British Elections are a small slide show to that. Some of you whingers that only a Tory government can be trusted with Sterling obviously were not in LOS in 1992 when people woke up to find sterling had been devalued overnight by Norman Lamont and you were 25% poorer. That would have sent you moaning.....

[MarkyM3]

Anyway, if it keeps going this way then a holiday in Britain is definitely on the cards. Would love to go and enjoy the cheap beer, a Prem League match, and get re-acquainted with the color gray in all it's shades.

Hope you have deep pockets, last time I checked EPL games with top teams in London (Chelsea, Arsenal etc.) are at least 50 GBP.

Regarding the subject of this thread, anyone living on income in LoS sourced from GBP is affected so not quite sure why you think it has no relevance to Thailand? No less relevant than comments about the evils of social healthcare and Barack Obama from our American friends

[MarkyM3]

Maybe all the Brits will go home and we'll lose all the whiners and snivelers here on thaivisa.

Oh, wait! That would be terrible!

That is the most important issue on thaivisa and the place would become a morgue.

Another ThaiVisa keyboard warrior LOL.

[tw25rw]

Anyway, if it keeps going this way then a holiday in Britain is definitely on the cards. Would love to go and enjoy the cheap beer, a Prem League match, and get re-acquainted with the color gray in all it's shades.

Hope you have deep pockets, last time I checked EPL games with top teams in London (Chelsea, Arsenal etc.) are at least 50 GBP.

Not just the top teams. I pay £50 or so to watch West Ham..

[WinnieTheKhwai]

Anyway, if it keeps going this way then a holiday in Britain is definitely on the cards. Would love to go and enjoy the cheap beer, a Prem League match, and get re-acquainted with the color gray in all it's shades.

Hope you have deep pockets, last time I checked EPL games with top teams in London (Chelsea, Arsenal etc.) are at least 50 GBP.

Not just the top teams. I pay £50 or so to watch West Ham..

At today's rate that's 2350 baht. Indeed not something I'd like to be paying bi-weekly, but as a one-off, I think I've spent more on some afternoons in Thailand.. (And good afternoons they were, but still. )

[StreetCowboy]

Its only bits of paper and recycled metal. Anyone that invests in such scrap deserves to lose it. Invest your money in something of value.

I recall 1992, when Norman Lamont cut my mortgage by 25%, and the numbers on my share prices changed by something similar. At the end of the day, things may have value, businesses may have value, but money does not.

Some people say that the only things of value cannot be valued with money, but that's a bit too spirirtual for me

SC

[Carmine6]

For us non-Brits, what is it about a hung Parliament that would cause the pound to decline?

Is it something to do with indecisiveness of the electorate, mechanics of passing legislation, uncertainty in direction, or something along those lines? Would the pound do better regardless of who won as long as one party was a clear winner, or would a certain party have been better?

[WinnieTheKhwai]

For us non-Brits, what is it about a hung Parliament that would cause the pound to decline?

Is it something to do with indecisiveness of the electorate, mechanics of passing legislation, uncertainty in direction, or something along those lines? Would the pound do better regardless of who won as long as one party was a clear winner, or would a certain party have been better?

Wel erm.. Hung parliament, so when their penis size increases, there is less need to import women, meaning the currency goes down..

[tw25rw]

For us non-Brits, what is it about a hung Parliament that would cause the pound to decline?

Is it something to do with indecisiveness of the electorate, mechanics of passing legislation, uncertainty in direction, or something along those lines? Would the pound do better regardless of who won as long as one party was a clear winner, or would a certain party have been better?

I think it's more that the economy is currently a bit battered and in need of a firm guiding hand.. A minority government is less able to give that guidance.

[spud1]

For us non-Brits, what is it about a hung Parliament that would cause the pound to decline?

Is it something to do with indecisiveness of the electorate, mechanics of passing legislation, uncertainty in direction, or something along those lines? Would the pound do better regardless of who won as long as one party was a clear winner, or would a certain party have been better?

Wel erm.. Hung parliament, so when their penis size increases, there is less need to import women, meaning the currency goes down..

Is that what you call humour?

[bangon04]

I can't say I'm very happy about this right now. I'm supposed to be arriving in Thailand on Wednesday and staying for four weeks, this is going to cut the value of my potential spending money quite a bit.

You must be on a razor edge budget that a baht or two makes such a difference.

It's not a huge budget, and every baht lost is is still money I won't be spending where I otherwise might have.

Why not give the lady a 10 or 20-pound note instead of a 500 / 1000 Baht note? This way you make it her problem and it makes you feel better.....

[bangon04]

For us non-Brits, what is it about a hung Parliament that would cause the pound to decline?

Is it something to do with indecisiveness of the electorate, mechanics of passing legislation, uncertainty in direction, or something along those lines? Would the pound do better regardless of who won as long as one party was a clear winner, or would a certain party have been better?

I think it's more that the economy is currently a bit battered and in need of a firm guiding hand.. A minority government is less able to give that guidance.

and they'll spend more time debating the reform of the voting system thn how to dig the country out of its hole.

[smokie36]

and they'll spend more time debating the reform of the voting system thn how to dig the country out of its hole.

I admire your faith. My guess is more time is being spent divvying up the grace and favour apartments and free ministerial transport issue.

[thaibeachlovers]

1 GBP = 48.84987 THB

Looks about 1 bht less than last week ........ is that considered crashing?

Try 46.7, which was the rate last Friday. Almost down to 1996 rate, at half the value. OK if you're working, but if retired, you're watching your comfortable life vanishing. Much lower, and it'll be a choice between having AC and doing anything else involving spending money ( if you're here, you'll understand just how much of a choice that is, as it's hot, dam_n hot ).

According to the baht rate on TV, it's 47.1 today. Hardly cause for celebration.

If this keeps up, it's got to have an effect on farang numbers, and I've never seen them so low at this time of year before. I reckon there's going to be an awful lot of vacant rooms, given the number of apartments being built in Pattaya.

[streetlife]

When it hits 40 to the pound i'll have a toast on the behalf of all the Brits here who can't afford champagne (or reside) in Thailand anymore.

With your relentless and continual Brit bashing it is transparent that in the past something has upset you...my money is on your X ran off with one.

[thaibeachlovers]

How about closing this thread since it has nothing to do with Thailand?

Been asked and answered.

I just don't get why you come on this thread if you don't want to read it. So easy, just don't click on it.

[thaibeachlovers]

Unlike the multinationals and wealthy individuals who relocate their profits overseas to avoid paying taxes. And of course London's financial district denizens would not have had any culpability in the now very sad state of affairs of Mother England.

Oh well, glad to see that some pommies wear the same blinders as their Tory brethren in my own country who wage political warfare under the Republican banner.

Political warfare?...The Banks controlling Governments are the problem, so it affects both sides of the political divide, Ponder this -

The British Labour Government has borrowed enourmous amounts from the Bankers that the majority of Labour voters (public/state sector workers) have to pay back the Bankers interest through higher taxation for generations to come...of course the majority cant fathom this because they are too busy glued to the TV watching Britains got talent or X Factor

This er borrowing of taxpayers money to bribe this sector of the electorate is a corruption of the democratic process for the Labour Parties own gain.

They will keep spending, borrowing, spending borrowing, importing Labour voters (immigrants) as this is a clear project to continue in power, however is this project the Labour parties first consideration whats the best for the UK?

Similar to the Red shirt supporters (and other plummage) being paid to attend the Bangkok demonstrations whith there own money just being recirculated as it was stolen off of them in the first place.

I'm not sure I quite follow this. I thought you were going to say that the Government borrowed enormous amounts to bail out the bankers and then ended up owing the money to those same bankers, whom the population now has to pay back. Commentators write about the credit crunch and the transformation of private debt into public debt. I think the people watching the games shows certainly need to do some thinking

This is exactly what happened in Thailand in '97. The Hiso's got the economy in the doodoo, the government borrowed money from the IMF, and the taxpayers had to pay it back. Time for a "new" system perhaps?

I actually have to respect the US Teaparty, as their policy is to let private banks go broke, not bail them out. They are now kicking out Republican polies that supported the bail out. it was so good to see that Senator from Utah crying because he'd been booted!

I'm with the guy who went down to Wall St. with a sign saying "Jump, you bastards".

As for the game shows etc, they are the modern equivalent of bread and circuses.

Had a problem posting due to number of quotes, so apologies if previous seems distorted.

Edited May 10, 2010 by thaibeachlovers

[thaibeachlovers]

Anyway, if it keeps going this way then a holiday in Britain is definitely on the cards. Would love to go and enjoy the cheap beer, a Prem League match, and get re-acquainted with the color gray in all it's shades.

Hope you have deep pockets, last time I checked EPL games with top teams in London (Chelsea, Arsenal etc.) are at least 50 GBP.

Not just the top teams. I pay £50 or so to watch West Ham..

Which begs the question, "recession, what recession?" dam_n sure if I was worried about losing my job I wouldn't be forking out 50 quid for a footy game I could watch on telly.

Anyway, easily solved by a fan "strike". A season without ticket buyers and they'd soon be cutting player's salaries and gate prices. The answer is in your own hands.

[thaibeachlovers]

I think yesterdays dive was more to do with the stock exchange crash in NY and the problems in Greece than the election. And Crossy all the wishful thinking in the world will not sent the baht crashing, the Thai economy is to strong to be heavily influenced by happenings in central Bangkok.

So maybe we need bloody (in the literal sense) riots in London & Regent's Park to be blockaded by disgruntled protesters to send the £'s value soaring again - just as the baht's value soared in the aftermath of the 10 April bloodshed in Bangkok?????

You may well get the riots if the Conservatives manage to force through the job cuts they would want to do. Not sure it would have the desired effect on sterling though.

I hope they start with NHS managers. IMO the most useless pack of time wasters/ dead wood/ whatever.

Then they can sack all the London city planners. You won't know the difference.

Edited May 10, 2010 by thaibeachlovers

[Livinginexile]

Great news if one works here in Thailand and sending money home!

I hope it crashes to 35 bht

Edited May 10, 2010 by Livinginexile

[tw25rw]

Which begs the question, "recession, what recession?" dam_n sure if I was worried about losing my job I wouldn't be forking out 50 quid for a footy game I could watch on telly.

Anyway, easily solved by a fan "strike". A season without ticket buyers and they'd soon be cutting player's salaries and gate prices. The answer is in your own hands.

Watching on TV is hardly satisfactory for a lifelong fan.

A fan strike would just drive them out of business. People always go on about not renewing their season tickets as payback for a shit season as if that would solve anything.

[smokie36]

It seems likely now there will be a new Labour leader supported by the Lib Dems. What a turn up that is. I guess the proportional representation issue won the day in the end.

So what will this do for the £/Baht I wonder....!

[tw25rw]

It seems likely now there will be a new Labour leader supported by the Lib Dems. What a turn up that is. I guess the proportional representation issue won the day in the end.

So what will this do for the £/Baht I wonder....!

That was always going to be the more likely outcome, if not necessarily the fairest.

[smokie36]

It seems likely now there will be a new Labour leader supported by the Lib Dems. What a turn up that is. I guess the proportional representation issue won the day in the end.

So what will this do for the £/Baht I wonder....!

That was always going to be the more likely outcome, if not necessarily the fairest.

It surprised me that a clear majority wasn't won by the Tories but it seems fair to have electoral reform now the third party has a quarter of the vote.

[Thongkorn]

Things have changed , Mr Brown is preparing to leave number !0 and the Stock market has Risen sharply , the FTS has risen 5%,

[tw25rw]

If Brown had a bit more self awareness and gone sooner (as in months ago), this might have been avoided.. There doesn't seem to be anyone on any side with the right profile to replace him.. There just aren't any obvious PMs in waiting.

[smokie36]

Breathing space for the UK hopefully then....well we can only hope...

[Thongkorn]

The libs are talking to Labour tomorrow don't hold your breath yet.

[smokie36]

I agree it still hangs in the balance. But I really thought the Tories would strike a deal....very surprising imo

If Labour/Lib Dems form a government it seems more stable to me....the Tories have barely a cohesive plan anyway.

Mind you nor do the others!

No obvious PM? No obvious policy from anyone!