Pound Hits 50, How Long Will The Trend Last?

[chiang mai]

An imminent financial crisis in a timeframe of 0-3 years Tommo, no vagueness there then, you've just zoomed right in and nailed it!

[12DrinkMore]

Not if we are at the point of a violent change, which I suspect we might be.

I'm currently betting on an imminent financial crises in Thailand ...... time frame 0-3 years.

Blimey, that sounds serious.

Bit like Europe, eh?

Although the financial footing of Thailand would seem to be substantially better than most European countries. And certainly the Thai economy at ground level is, it seems to me, infinitely more capable of handling any crisis than the Euro-Lot, who are reliant on government jobs, government handouts and massively increasing government debt.

When I walk around the streets in Thailand, indeed Asia, there are thousands of little private/family businesses all trading together. Low overheads, no government interference, and NO conviction that the "State Owes Them Something and is RESPONSIBLE for them.".

As this thread is about the Squib, I guess it would be fair to point out that the barriers to opening up a noodle stand, hairdresser, clothes shop on the pavement outside your house in the UK reach approximately Alpha Centauri.

The Asians have the personal survival skills to surmount anything.

The Brits rely on the government to ensure that the water and toilet paper is hygienic enough and meets the EU-norm (CE 47368 and CE 894302 respectively) to wash their <deleted>.

Edited May 17, 2012 by 12DrinkMore

[ThaiPauly]

Well it was nice while it lasted.

Seems that the pound has lost half a baht in 24 hours, now showing on my sidebar as 49.770.

I hope some of you Brits managed to make a transfer at 50+

[chiang mai]

The GBP selling rate currently looks like it's 49.64 so it appears to be in its tradditional (of recent weeks) downwards mode. If the pattern of the past eight weeks continues then it will reverse within one or two business days and I presume this is a function of BOT intervention (?), on that basis look for 50/51 come Monday or Tuesday of next week. For anyone that's interested, look at Oanda (or similar) and see the predictable pattern of ups and downs and the slow upward trend.

[ruddy2000]

Depends on how much is a 'load'?

Posted with Thaivisa App http://apps.thaivisa.com

[12DrinkMore]

The Brits rely on the government to ensure that the water and toilet paper is hygienic enough and meets the EU-norm (CE 47368 and CE 894302 respectively) to wash their <deleted>.

Unbelievably on cue.

http://www.telegraph...-baby-talk.html

The new Information Service for Parents will offer NHS-approved guidance on what food is safe to eat during pregnancy, how to make homes safe for babies and toddlers, and nappy changing.

Topics covered include “Tots’ bots”, which states: “Find out what you need to know about nappies, including how to choose the best type, how to change a nappy and the accessories you’ll need.”

Cameron“This is not the nanny state; it’s the sensible state."

Its a very sad situation where the once-proud Brits now need government instructions on how to change nappies. And that the government feels it has to provide them. And the Prime Minister himself launches the "Initiative on Nappy Changing".

Surely this is one area where the so-called but non-existent Austerity Measure could have been applied to the fullest. But no, the government feels that the tax payers must pay more taxes to be told how to change nappies.

The "Sensible State", jeeze, just gove me a break Pathetic.

Edited May 18, 2012 by 12DrinkMore

[chiang mai]

And the impact on the Pound/Baht trend as a result of those things is?

[chiang mai]

Any number of opinions, but no one has any real idea as to the direction of either currency. One post suggests a USD rate of 1.50, ignoring the fact that the USD/GBP rate has fluctuated for many years, moving over time between 1.38 and 2.10. Thailand government policies threaten massive debt obligations vs a low tax inflow, and a strong likelihood of quantitative easing - printing money.

In most countries, a combination of coups, airport seizures, street occupations, political musical chairs, dubious government policies, etc would have impacted on the currency. But foreign inflows have helped to keep the THB strong - I'd suggest overly so. Question is, how much of those inflows are speculative? And what happens if - or when - the speculators decide - as in 1997 - it's time to pull the plug?

I just read a report this morning from the BOI that says flows of inbound foriegn capital last quarter were up by 44% over the previous quarter.

[12DrinkMore]

And the impact on the Pound/Baht trend as a result of those things is?

Clearly this new Initiative has affected the markets and sent the GBP down.

49.62

[chiang mai]

And the impact on the Pound/Baht trend as a result of those things is?

Clearly this new Initiative has affected the markets and sent the GBP down.

49.62

The ex rate these days it like the British weather, wait a few hours and it'll change.

[12DrinkMore]

Any number of opinions, but no one has any real idea as to the direction of either currency. One post suggests a USD rate of 1.50, ignoring the fact that the USD/GBP rate has fluctuated for many years, moving over time between 1.38 and 2.10. Thailand government policies threaten massive debt obligations vs a low tax inflow, and a strong likelihood of quantitative easing - printing money.

In most countries, a combination of coups, airport seizures, street occupations, political musical chairs, dubious government policies, etc would have impacted on the currency. But foreign inflows have helped to keep the THB strong - I'd suggest overly so. Question is, how much of those inflows are speculative? And what happens if - or when - the speculators decide - as in 1997 - it's time to pull the plug?

I just read a report this morning from the BOI that says flows of inbound foriegn capital last quarter were up by 44% over the previous quarter.

A strong likelihood of the BoT doing QE?

You have to be joking, interest rates are still positive and not at zero, the banks are well capitalised and are not screaming for more liquidity, and there is no sign of the bond prices falling, pushing up interest rates.

Thailand is a net exporter and running a current account surplus. In order to keep the THB DOWN the BoT is engaged, and has been engaged for several years, in selling THB and buying forex. It has amassed a huge mountain of forex.

1997 was caused by the Thais taking on large debts denominated in foreign exchange and trying to keep a USD peg. These conditions are no longer met. What happened in 1997 is no longer relevant.

The various problems you have listed, and indeed the most recent, the floods in BKK, have only shown time and time again how robust the Thai economy really is.

But there is a hard core of delusional people who simply cannot believe that the Thais can run an efficient economy (note i'm not saying its a fair economy for all, but with 1% of the US population holding the vast majority of the assets and power, I can't really see the difference. All economies are skewed towards the rich getting richer)

There will be no QE, no hyperinflation and no collapse of the THB or Thai economy.

http://www.boi.go.th...ected_57257.pdf

About Bt 65 billion investment from China expected

http://www.boi.go.th/upload/content/Investment_applications_51000.pdf

Total value of investment promotion applications submitted to the Board of Investment of Thailand (BOI) during the first quarter this year hit record high of 106 per cent compared to the s ame period las t year. F oreign direct inves tment (F D I) ros e 91 per cent in Thai Baht term, confirming the continued strong confidence in the potential of Thailand.

In the first quarter of 2012, the BOI recorded total investment value of Bt 231.1 billion, a significant increase of 106% from Bt 111.9 billion in the same period of 2011. The number of investment applications reached 470 projects, a 15% higher than 409 projects in 2011. Thanks to such promising statistics, the BOI is certain that it will achieve the total investment target of Bt 600 billion by the end of 2012.

An impressive growth was seen in the chemicals, paper and plastics industries with the investment value reaching Bt 65.4 billion from 73 projects, followed by the

service and public utilities sector with 118 projects applying for the BOI incentives worth around Bt 54.8 billion. Came in third was the electronic and electrical appliance industries with Bt 48.3 billion in investment value from total 86 projects.

Sounds excellent news to me.

I often wonder where all the pessimists get the data for their forecasts and predictions.

I suspect that they all come from conversations over a beer in the "Drop Dead Bar", based on data found in the bottom of the glass and observations of the economy and population of Soi 7.

49.57

Edited May 18, 2012 by 12DrinkMore

[chiang mai]

"I often wonder where all the pessimists get the data for their forecasts and predictions.

I suspect that they all come from conversations over a beer in the "Drop Dead Bar", based on data found in the bottom of the glass and observations of the economy and population of Soi 7". 12DM

That's about the long and the short of it, pun intended.

[yoshiwara]

Considering how the pound is tanking against the $US right now, the baht rate is holding up very well indeed.

Those dreaming of 55 baht to the pound will have to go back to sleep however.

[Murf]

£ lost 0.5 to the Baht in the last few days...

Bak to where it has been for an age.

[chiang mai]

The news that the ECB is preparing an orderly exit for Greece could be a partial reason although I don't think so, I suspect that come Tuesday or so we'll see 50 plus again, it appears to be a cyclical thing in tight bands with GBP and USD still the recipients of hot money and getting stronger as a result. The real question is how much money is BOT prepared to spend in trying to weaken THB, this could be expensive for them but almost the entire region has the same problem.

[billd766]

If only you people would be quiet and not say anything the GBP may sneak up again.

[thaibeachlovers]

Actually the UK is doing very well . Unemployment is on the down , production is on the up. The government Deficit on the way down. its because of whats happening in Europe is masking the UK true economic output. The UK true out put is also masked, for example The wings for the Airbus are made in the UK , but then flown to France for assembly, Then France says we have sold x amount of Air buses, so France gets the Economical benefits.

No the UK is NOT doing very well. It's just not doing as badly as the likes of Greece.

The fact of the matter is that austerity hasn't even really begun to bite down that hard yet and already the pips are squeaking. The country's technically back in recession, inflation remains anchored way above the BoE's target and the banks ain't lending. Make no mistake, things are going to get far, far worse in Britain and it'll take 5 years and a hell of a lot more quantitative easing before any sustainable, meaningful economic recovery takes hold.

If I was the OP, I'd change it up sharpish before the downtrend resumes.

I hope you are right, as I changed it all today.

However, the rates as given in the TV exchange rates are not those in the banks. Best I could get was 49.76, and that was out of 4 banks.

Oh well, now that I don't have any left to change, I fully expect the pound to skyrocket against the baht- Murphy rulez!

Hmmmm 49.2 today ( on TVs page ), so I would seem to have lucked out this time. Usually I am changing money just before it rises, or just after it falls. Still, can't be unlucky ALL the time!

[thaibeachlovers]

Unbelievably on cue.

http://www.telegraph...-baby-talk.html

The new Information Service for Parents will offer NHS-approved guidance on what food is safe to eat during pregnancy, how to make homes safe for babies and toddlers, and nappy changing.

Topics covered include “Tots’ bots”, which states: “Find out what you need to know about nappies, including how to choose the best type, how to change a nappy and the accessories you’ll need.”

Cameron“This is not the nanny state; it’s the sensible state."

Its a very sad situation where the once-proud Brits now need government instructions on how to change nappies. And that the government feels it has to provide them. And the Prime Minister himself launches the "Initiative on Nappy Changing".

Surely this is one area where the so-called but non-existent Austerity Measure could have been applied to the fullest. But no, the government feels that the tax payers must pay more taxes to be told how to change nappies.

The "Sensible State", jeeze, just gove me a break Pathetic.

Actually, the lack of nappy changing prowess may have been caused by hospitals sending women home as soon as possible after delivery, which does not give young mothers sufficient time to learn the skills needed, and a breakup of families meaning that grannie is not available to show how it's done.

Changing a nappy isn't learned by genetic imprinting, it's a learned activity.

[thaibeachlovers]

If you know it's guesswork, why are you asking for experts? And if you want experts, what the hell are you asking on this forum for?

Need to change money, but have no idea if now is a good time or not, and I was asking for ADVICE. Some on here actually know something about finance!!!!!!

Did you get out of the wrong side of the bed, today?

[thaibeachlovers]

TBL - The current GBP sell rate on Oanda is 50.22 so figure that the bank takes about 50 satang per Pound for their exchange fee, that makes 49.76 look quite healthy.

Thanks for that explanation.

[12DrinkMore]

Actually, the lack of nappy changing prowess may have been caused by hospitals sending women home as soon as possible after delivery, which does not give young mothers sufficient time to learn the skills needed, and a breakup of families meaning that grannie is not available to show how it's done.

Changing a nappy isn't learned by genetic imprinting, it's a learned activity.

If the average level of intelligence in the UK is now so low that they require government instruction on how to change a nappy, then the UK is in a very bad way.

[thaibeachlovers]

Actually, the lack of nappy changing prowess may have been caused by hospitals sending women home as soon as possible after delivery, which does not give young mothers sufficient time to learn the skills needed, and a breakup of families meaning that grannie is not available to show how it's done.

Changing a nappy isn't learned by genetic imprinting, it's a learned activity.

If the average level of intelligence in the UK is now so low that they require government instruction on how to change a nappy, then the UK is in a very bad way.

You make it sound like every woman instinctively knows how to change a nappy- not so. When i was doing my maternity training, part of the job was teaching how to change nappies and all the other things associated with it ( or did you think it was just taking one off and putting another on? ).

The "government" doesn't instruct nappy changing- it was a maternity nurse job, but who's doing it now?

[12DrinkMore]

If the average level of intelligence in the UK is now so low that they require government instruction on how to change a nappy, then the UK is in a very bad way.

You make it sound like every woman instinctively knows how to change a nappy- not so. When i was doing my maternity training, part of the job was teaching how to change nappies and all the other things associated with it ( or did you think it was just taking one off and putting another on? ).

The "government" doesn't instruct nappy changing- it was a maternity nurse job, but who's doing it now?

Homo Sapiens has been around for 50,000 years.

After reading your post I am beginning to wonder how we survived.

From wiki

http://en.wikipedia.org/wiki/Human

Humans have a highly developed brain and are capable of abstract reasoning, language, introspection, and problem solving.

It seems we are regressing, as the ability to reason and problem solve has clearly died out in the latest generation of young parents.

Really, if they can't change a bloody nappy without government assistance, how on earth can you expect them to bring a kid up?

or did you think it was just taking one off and putting another on

Well, that's how it sort of works in my very limited experience, or is this a fiendishly complicated task similar to Rubrik's cube, and requires some complex twisting and turning in order for the legs to pop out at the correct corners and the body to come out of the larger hole?

Anyway, thank god I was lucky with the brat I was baby sitting. Jeeze, it could so easily have gone DISASTROUSLY wrong.

In retrospect I should have attended a six month basic course on nappy changing, and got some diploma or other. I've had a dreadful thought, maybe I need government instructions on wiping my own arse?

Yep, I'll write to Cameron straight away. He'll be on the job in no time.....

Edited May 19, 2012 by 12DrinkMore

[cmsally]

It seems to be part of the British culture now. Don't consider yourself competent in even the most menial task unless you have completed the course. Actually I'm wondering how they are going to do these courses because most times in UK now you can't lift anything (presumably includes babies) in case you put your back out and that would lead to some sort of claim etc etc.

Who knows maybe in the future people will take their babies to court because of a slipped disc caused by nappy changing.

Although regarding currency the ball seems to be kicked out of the British court at the moment with US dealing with the Euro leaders. Not quite sure if Cameron is locked out of this and how it pans out for the Brits. It will be in the interests of US to put a plan in action , but at whose expense we don't know yet.

[12DrinkMore]

It seems to be part of the British culture now. Don't consider yourself competent in even the most menial task unless you have completed the course. Actually I'm wondering how they are going to do these courses because most times in UK now you can't lift anything (presumably includes babies) in case you put your back out and that would lead to some sort of claim etc etc.

Who knows maybe in the future people will take their babies to court because of a slipped disc caused by nappy changing.

Although regarding currency the ball seems to be kicked out of the British court at the moment with US dealing with the Euro leaders. Not quite sure if Cameron is locked out of this and how it pans out for the Brits. It will be in the interests of US to put a plan in action , but at whose expense we don't know yet.

Cameron has locked himself out entirely.

He has clearly stated that it is a European problem and not a UK problem. Through the media he pontificates about how the Europeans should quickly get their act together.

Europe will not listen to him anymore.

[12DrinkMore]

Sorry wrong place.

Edited May 19, 2012 by 12DrinkMore

[bkk_mike]

I personally think that the baht will fall and the pound will rise back to maybe 60, but it'll take a couple of years, and the end of QE and low interest rates in the UK to do it.

i.e. The baht will struggle this year because of a hangover of issues after the flooding last year. (I don't know how much Thailand's exports will recover on the hard disk and car components side of things.) Add in that the government appears to be in line to run a deficit, rather than the recent surpluses, and the last few years of baht strength appears to be coming to an end.

Sterling on the other hand got hammered in 2008, but when it starts to look like it will recover (t's technically in a double-dip recession now). i.e. The pound is probably going nowhere until the markets think it's looking better and that QE is behind us and that interest rates are likely to rise. (If only because the way the Bank of England decided to do QE, where they've printed money to buy bonds, they need to sell the bonds back into the market once they see it's done, and then effectively burn the money they printed by removing that money from the money supply.)

Recovery will, in this anti-QE that will follow it, result in a sterling rise. - but this is probably 2-3 years away. However, how quickly the markets will price that in will depend on when they think that the recovery will happen. (and how much they trust the BofE to follow through on the sale of the bonds and retiring of the subsequent cash).

[12DrinkMore]

I personally think that the baht will fall and the pound will rise back to maybe 60, but it'll take a couple of years, and the end of QE and low interest rates in the UK to do it.

i.e. The baht will struggle this year because of a hangover of issues after the flooding last year. (I don't know how much Thailand's exports will recover on the hard disk and car components side of things.) Add in that the government appears to be in line to run a deficit, rather than the recent surpluses, and the last few years of baht strength appears to be coming to an end.

Sterling on the other hand got hammered in 2008, but when it starts to look like it will recover (t's technically in a double-dip recession now). i.e. The pound is probably going nowhere until the markets think it's looking better and that QE is behind us and that interest rates are likely to rise. (If only because the way the Bank of England decided to do QE, where they've printed money to buy bonds, they need to sell the bonds back into the market once they see it's done, and then effectively burn the money they printed by removing that money from the money supply.)

Recovery will, in this anti-QE that will follow it, result in a sterling rise. - but this is probably 2-3 years away. However, how quickly the markets will price that in will depend on when they think that the recovery will happen. (and how much they trust the BofE to follow through on the sale of the bonds and retiring of the subsequent cash).

I'll just try and point out the errors.

For a sovereign developing nation running a small budget deficit is not negative at all, especially if the money is being spent on infrastructure. A budget surplus, on the other hand, means that it is taxing its people too much and withdrawing money from the general economy, this would be economically very bad. The only economies that should be running surplus budgets are the big commodity exporters, particularly oil, which have given rise to huge sovereign wealth funds.

Otherwise you have to answer the question, "why am I being taxed so much and allowing the country to put the extra money in some sort of savings account (for what purpose), when I could be spending/saving it myself?"

QE can never, ever be reversed. It has monetised the government debt and driven interest rates down to zero. It will be VERY hard to get back off the floor in the UK.

Who on earth is going to buy the bonds in addition to all the new bonds that the UK government needs to issue to fund its continually increasing level of expenditure? It would collapse the UK bond market, sending pension schemes utterly insolvent and force banks to ask for more bailouts, as the bonds they hold loose value.

Zero interest and QE are here to stay. It's the Japanese disease times roughly 5, and they have been at it for 20 years with no end in sight.

But you have missed the two major issues.

1. The biggest UK problem is not the UK public debt. Merv has that all in hand. The biggest problem is the humongous private sector debt hanging over the UK. The UK population simply cannot take anymore debt on board to keep the economy humming. It is the worst in the world.

2. The UK's biggest trading partner is the EU. I think that says it all.

I could carry on, but I'll finish by saying that the UK is in a deflationary spiral and the economy is going to bump along the bottom for eternity. Japan without the savings culture.

Oh yes, the politicians will give you positive noises.

The current one is

"Once Greece has been sorted out, one way or the other, then things will get better".

But they won't.

Bigger and nastier cans of worms are coming up very soon.

[chiang mai]

There seems to be a some sort of regional exchange rate setting/review body that meets every Monday where regional FOREX rates are co-ordinated, these adjustments seem to hit every Tuesday morning at 7a.m, for the past couple of months this has become a predictable event, anyone know who/what it is, regional central banks perhaps? It appears as though that group sets the range in which regional currencies will trade for the comming week and also the extent to which currencies in the region will be strengthened/weakened, 7am this morning saw the two I was watching, THB and SGD weakened in response to last weeks gain and in preparation for the current weeks trading.

Useful to understand if you are going to exchange GBP, never do it on a Friday since THB nearly always seems to strengthening in preparation for the weekend.

[Naam]

Bigger and nastier cans of worms are coming up very soon

early bird catches the worm!