Farang Sense Of Entitlement

[Chunky1]

I have tried to explain this to a few acquaintances but they don't seem to get it. European nations are falling like dominoes - Iceland, Greece, Ireland. Portugal, Spain, Italy not far behind. Western nations have been consuming on credit. It's no different than someone who buys something with a credit card when they do not have the cash to pay for it. Our production lags significantly behind. The Chinese and other emerging markets, largely for political reasons, have continued to throw good money after bad money supporting the West's debt based consumption. It has now come to the point of no return. America and Europe are insolvent. The standard of living in the West is about to collapse.

Now, what many farang say is something like "Without us, they won't have anyone to sell their products to." They view the world's economy as a restaurant where every third world citizen has a job to perform and their job is to eat and that without them, the restaurant would not function. If these Western nations were to be washed away in a tidal wave, factories in Thailand would not shut down. The products that Thais produce would instead be consumed locally.

You might recall the notion that Henry Ford who invented the factory line created the idea of paying employees enough so that they could buy the products. This hasn't yet happened in Thailand because the factory owner could export those products. Now that those Westerners are bankrupt, the employees will need to become the customers. The Thailand of today will look nothing like the Thailand of tomorrow.

You will see 25 baht per USD by the end of 2011 and I am seeing a five year target of 15 baht per USD.

Edited November 13, 2010 by Chunky1

[gotlost]

You will see 25 baht per USD by the end of 2011

Maybe sooner.

Edited November 13, 2010 by gotlost

[Naam]

the fact that "seers" post their visions in ThaiVisa is extremely reassuring

[Naam]

i recall seers in ThaiVisa who saw (two years ago) USD/GBP @ 2.40 and EUR/USD @ 1.00. there are also seers who see GBP/THB soon @ 55 as opposed to the seers who saw 6 months ago GBP/THB @ 35 and i wonder what happened to the seers who saw by the end of the year (they didn't say which year) USD/THB @ 42.

[sirineou]

I Might get ugly, but It will certainly not be hilarious.

The Economic situation in the world is a a very complex subject., that can not be answered in simple terms, any simple explanations will certainly be wrong.

I will try to put it in simple terms and there for my answer will be incomplete.

The Chinese have a curse, “ may you live in interesting times” and we certainly do live in interesting times.

After world War 2 the Europe, and Japans Manufacturing capacity was pretty much destroyed , The USA took that opportunity to become a world dominating economic and military power. In the 60’s Europe rebuild and by the early 70’s Japan also joined the world stage as an economic power.

World War 2 officially ended in the 40‘s but, vestiges of WW2 dominated the world stage until the 90’s in the form of the Cold War.

Now China , India, and Brazil, are taking their rightful place in worlds Economy.

I personally see a great amount of stress as we change to the New model of doing business, those that are invested in the old Model will not give up their investment and power, easily. But I also see this as a great Opportunity,. Countries that are interdependent must cooperate more, greatly diminishing the prospect of War. With the entrance of all the new players in the world stage, the petroleum economy is no longer viable, so new energy resources must be secured, hopefully those recourses will be less polluting and sustainable.

So where others see great danger ( and there certainly is Danger) I also see great opportunity.

[manarak]

You might recall the notion that Henry Ford who invented the factory line created the idea of paying employees enough so that they could buy the products.

Hardly a sustainable model. That's feasible when your company is the best at selling a new product with a scandalous profit margin.

Ford's biggest problem was turnover, and his overpaying of employees cut that to level he didn't bother to measure anymore.

Stable jobs and high pay brings the possibility of consumer credits.

And it is credit that poisoned and still poisons western economies.

Why do you want to do that to Thailand?

[sirineou]

I Might get ugly, but It will certainly not be hilarious.

The Economic situation in the world is a a very complex subject., that can not be answered in simple terms, any simple explanations will certainly be wrong.

I will try to put it in simple terms and there for my answer will be incomplete.

The Chinese have a curse, “ may you live in interesting times” and we certainly do live in interesting times.

After world War 2 the Europe, and Japans Manufacturing capacity was pretty much destroyed , The USA took that opportunity to become a world dominating economic and military power. In the 60’s Europe rebuild and by the early 70’s Japan also joined the world stage as an economic power.

World War 2 officially ended in the 40‘s but, vestiges of WW2 dominated the world stage until the 90’s in the form of the Cold War.

Now China , India, and Brazil, are taking their rightful place in worlds Economy.

I personally see a great amount of stress as we change to the New model of doing business, those that are invested in the old Model will not give up their investment and power, easily. But I also see this as a great Opportunity,. Countries that are interdependent must cooperate more, greatly diminishing the prospect of War. With the entrance of all the new players in the world stage, the petroleum economy is no longer viable, so new energy resources must be secured, hopefully those recourses will be less polluting and sustainable.

So where others see great danger ( and there certainly is Danger) I also see great opportunity.

I was called away at work and ended up posting an incomplete thought, First I like to say that the above, is only a superficial explanation.

and I like to expand by saying that, now we find our selfs, in a situation where new diners are coming to the table, and if we are all going to eat out fair share, until we bake a larger Pie, we all have to eat a smaller slice of the pie

As Far as the dollar is concerned,it is only politics. The US is printing 600 billion dollars, though it is a lot of money to me and you, but with in the context of the US Economy, it is a small percentage,not enough to devaluate the dollar significantly, but enough to send a message to the Chinese. Message "if you dont strengthen your Currency

we will have to devaluate ours .

Any way you are right to be concerned, we are in a situation of economic uncertainty, but I do belive things will work their way out.

[CharlieH]

And I recall "seers" saying it dont matter is all over in 2012 anyway ................

[bushwacker]

It will all work out in the long run. But in the long run, we will all be dead.

[maccaroni man]

if all it took was a little work, resources and a down turn in economies Mexico would be king of the hill by now but thailand is hendered by the same thing that holds mexico down; corruption and as long as the school boys keep it in place thailand will always be a developing country. btw the dollar was at 22 to the baht when i came here in 96.

[Chunky1]

As Far as the dollar is concerned,it is only politics. The US is printing 600 billion dollars, though it is a lot of money to me and you, but with in the context of the US Economy, it is a small percentage,not enough to devaluate the dollar significantly, but enough to send a message to the Chinese. Message "if you dont strengthen your Currency

we will have to devaluate ours .

Any way you are right to be concerned, we are in a situation of economic uncertainty, but I do belive things will work their way out.

We can only pay our debt by borrowing more. A Weakened currency will not somehow magically create an export market. Japan has a very strong currency and they still have a trade surplus. The imminent collapse in the dollar will occur before the prospect of such an event.

why are our creditors all opting for 2 year t-bills? what happens when California and new york default? what happens to municipal bonds? all this debt will be monetized. what other solution is there? the us government is insolvent.

people are lying to themselves that there is a secret plan in all of this. bernanke has been writing about these BS keynesian ideas for thirty years.

Edited November 14, 2010 by Chunky1

[ThaiRich]

Yeah. My suggestion is that you go sit out side with your undereducated local friends and drink more of that cheap local whisky and let it eat up the rest of your brain cells.

[rgs2001uk]

if all it took was a little work, resources and a down turn in economies Mexico would be king of the hill by now but thailand is hendered by the same thing that holds mexico down; corruption and as long as the school boys keep it in place thailand will always be a developing country. btw the dollar was at 22 to the baht when i came here in 96.

I can only assume the rate you quote was offered by some hotel and not by a bank.

The $ was always around 25 baht minimum and until the 97 crash I had never seen lower than 25, but I believe previously it was pegged at about 20 baht.

http://www.x-rates.com/d/THB/USD/hist1996.htm

[tpiety2]

Are you guys telling me we are upside down I'm shocked! I'm also buying baht.:jap:

[Loz]

No easy answers...

Buckle up, its gonna be a rough one. When a nation spends 1.1 trillion of freshly created money (leveraged against the future tax revenue of a declining workforce) to metaphorically stick its finger in the dam, it's time for a new model.

Many things are not certian. One thing is. The wheels WILL come off this wagon!

[emsfeld]

On a funnier note, but relevant to the topic:

Keynes vs Hayek - a clash of ideologies. It's a must see and absolutely hilarious.

[sfokevin]

"The products that Thais produce would instead be consumed locally"...

If all the cars made here actually stayed here someone better get started building a few more roads...

Edited November 14, 2010 by sfokevin

[sleepyjohn]

You will see 25 baht per USD by the end of 2011 and I am seeing a five year target of 15 baht per USD.

Thankyou so much it's wonderful to hear where currencies are going.

When Newsweek predicted "The End of the Dollar" a few years ago and went so far as to have a cover picture of someone using a $ bill to light a cigar it confirmed my decision to sell more than half my assets from GBP at $1.896.

[Gonsalviz]

if all it took was a little work, resources and a down turn in economies Mexico would be king of the hill by now but thailand is hendered by the same thing that holds mexico down; corruption and as long as the school boys keep it in place thailand will always be a developing country. btw the dollar was at 22 to the baht when i came here in 96.

And boy did that bubble pop. All the way to ฿50 to the dollar.

[Chunky1]

"The products that Thais produce would instead be consumed locally"...

If all the cars made here actually stayed here someone better get started building a few more roads...

Tell me about. You leave the CBD and streets don't even have lanes painted.

[Chunky1]

if all it took was a little work, resources and a down turn in economies Mexico would be king of the hill by now but thailand is hendered by the same thing that holds mexico down; corruption and as long as the school boys keep it in place thailand will always be a developing country. btw the dollar was at 22 to the baht when i came here in 96.

And boy did that bubble pop. All the way to ฿50 to the dollar.

That is what happens when a country is fiscally irresponsible. Of course, the United States current situation is infinitely worse than the Asian Financial Crisis.

California is estimating that next years State deficit will only be 19 billion.

[appropriate]

I don't think the locals will be able buy the products they'll produce because they'll still spend more than their entire salary on downpayments on big shiny things that they can shove in their neighbour's faces.

Cheers chaps.

Dominic.

[rakman]

if all it took was a little work, resources and a down turn in economies Mexico would be king of the hill by now but thailand is hendered by the same thing that holds mexico down; corruption and as long as the school boys keep it in place thailand will always be a developing country. btw the dollar was at 22 to the baht when i came here in 96.

And boy did that bubble pop. All the way to ฿50 to the dollar.

That is what happens when a country is fiscally irresponsible. Of course, the United States current situation is infinitely worse than the Asian Financial Crisis.

California is estimating that next years State deficit will only be 19 billion.

Which has grown from 14 Billion a couple of years ago. They have just been kicking the can down the road by borrowing and making payments in the next year. Now that Gov Moonbeam is back as Governor look for their deficit to only grow as more productive people and businesses leave the state.

Edited November 14, 2010 by rakman

[jazzbo]

It's The End of the World As We Know It ... AGAIN

[Naam]

European nations are falling like dominoes - Iceland, Greece, Ireland. Portugal, Spain, Italy not far behind.

when did they fall? did i miss something?

[jazzbo]

California is estimating that next years State deficit will only be 19 billion. ... the potential collateral value of state-owned agricultural properties may make that number look insignificant ... and agriculture for the most part cannot flee California.

[sfokevin]

You will see 25 baht per USD by the end of 2011 and I am seeing a five year target of 15 baht per USD.

You do not give the Thai's any credit for their ability to <deleted> up an economy...

My bet is we see 45 before 15...

Edited November 15, 2010 by sfokevin

[mitsubishi]

You will see 25 baht per USD by the end of 2011 and I am seeing a five year target of 15 baht per USD.

You do not give the Thai's any credit for their ability to <deleted> up an economy...

My bet is we see 45 before 15...

You know how many times people have been saying the $ and the £ are going to magically rally and climb out of the abyss in the past 3 years?

Thousands of times. Britmaverick, bless his optimism is the leading voice. However times change and I can see that the UK isn't going down the route of increased spending power for it's expats.

Indeed, just listen to the voices from their financial guru's advising more quantitive easing (printing presses at full steam ahead) and more zero percent interest rates.

When this happens the £ gets weaker as it gets devalued.

It's not the interests of the guys pulling the strings.

They want the UK skint and the people tied to the country via a £ that won't buy them a loaf of bread for a wheelbarrow-full before long.

Once that's done it's in the Euro currency and hey presto there's no more £. The Euro in question is just as shaky but that's another story.

So get out now while you still can I say.

China is forcast to take over, it's their turn guys.

They are getting stronger, the west is getting weaker.

The wheel turns boys and whether you like it or not, it's gonna take us all spinning into the next paradigm. Will you be trapped in the cogs (UK and US) or on the freewheeling vanguard with the Asians (Thais and Chinese).

Edited November 16, 2010 by mitsubishi

[sfokevin]

You will see 25 baht per USD by the end of 2011 and I am seeing a five year target of 15 baht per USD.

You do not give the Thai's any credit for their ability to <deleted> up an economy...

My bet is we see 45 before 15...

You know how many times people have been saying the $ and the £ are going to magically rally and climb out of the abyss in the past 3 years?

Thousands of times. Britmaverick, bless his optimism is the leading voice. However times change and I can see that the UK isn't going down the route of increased spending power for it's expats.

Indeed, just listen to the voices from their financial guru's advising more quantitive easing (printing presses at full steam ahead) and more zero percent interest rates.

When this happens the £ gets weaker as it gets devalued.

It's not the interests of the guys pulling the strings.

They want the UK skint and the people tied to the country via a £ that won't buy them a loaf of bread for a wheelbarrow-full before long.

Once that's done it's in the Euro currency and hey presto there's no more £. The Euro in question is just as shaky but that's another story.

So get out now while you still can I say.

China is forcast to take over, it's their turn guys.

They are getting stronger, the west is getting weaker.

The wheel turns boys and whether you like it or not, it's gonna take us all spinning into the next paradigm. Will you be trapped in the cogs (UK and US) or on the freewheeling vanguard with the Asians (Thais and Chinese).

Then we are in for "interesting times"... Given how the Chinese are so proficient at making skyscrapers and toothpaste lets see how they run the world economy...

[SiamRose]

You know how many times people have been saying the $ and the £ are going to magically rally and climb out of the abyss in the past 3 years?

Thousands of times.

About the same number of times that people have claimed that the $ and the £ are just about to collapse and die. (They probably will eventually, but in the long-run so will we all).

It's not the interests of the guys pulling the strings. They want the UK skint and the people tied to the country via a £ that won't buy them a loaf of bread for a wheelbarrow-full before long. Once that's done it's in the Euro currency and hey presto there's no more £.

I must say I find these mindless conspiracy theories rather foolish. All of these events can be explained by politicians wanting to stay in power, financially illiterate voters wanting free hand-outs and bankers wanting the biggest bonus they can get. There is no need to invent any conspiracy, and doing so detracts from what is otherwise a valid position.

Edited November 17, 2010 by SiamRose