Will Thailand Suffer The Same Fate As South Korea? Uncontrolled Inflation

[robkey69]

I remember in the 80's when Korea was the place to go for great prices, food and a all around good time. Inflation and the growth economicly changed all this and its now more expensive then the USA.

I just returned from 3 weeks at my home in the Ban Chang area and I do have to say I can see the same wave of inflation and growth starting to grab Thailand. Food prices were seem to lead the way and they are now about the same as the USA. Home building keeps moving at a fast pace and I saw a lot of signs with 100% finacing for local Thai's available, I don't really see the Thai economy as being strong and I'm really worried there is going to be the same housing and economic crunch that hit the USA and Europe come to Thailand soon,

But I think it will hurt Thailand much worse then the USA....So I'm really thinking of selling my home soon not to get caught in a 60-70% decrease in housing prices.

Does anyone else feel this is coming?

[Ulysses G.]

"Does anyone else feel this is coming?"

No and food prices are much cheaper here than the USA unless you buy imported foods.

[thenervoussurgeon]

Yes i do believe food especially is getting more expensive and people are charging more for their services

[chainarong]

I've noticed and commented that stuff is getting much more expensive, than two years back, thousand Baht note now lasts no time at all,this price trend is world wide, whether it leads to double inflation or not is in the hands of but a few, the government and treasury officials, if the Thai economy is going to go Sth , guess who will be responsible .

[Sateev]

"Does anyone else feel this is coming?"

No and food prices are much cheaper here than the USA unless you buy imported foods.

I would modify that somewhat, and say "unless you buy Western-style foods", regardless whether or not they are imported.

For example, 79 baht for a loaf of sourdough, baked at Big C (formerly Carrefour), is about par for similar at a supermarket in the US (although Big C's version is not as good).

Still, if you buy local staples, fresh market meat and vegetables, it's still WAY cheaper than the US. Digging slightly deeper, however, the trend is toward higher prices, partly due to energy prices which have been held artificially low. That can not last forever.

Comparing Thailand and S. Korea is fraught with danger, because they are not even close to the same economic standard. S. Korean productivity has risen disproportionately and they are a modern, technological economy. Thailand's productivity, by any measure, will not approach S. Korea's in even the distant future, for reasons that are beyond the scope of this thread, I suppose...

[Mousehound]

I have to say that when visiting the US most things seem a lot cheaper than Australia. Food and clothing as well as housing and cars were a lot cheaper - except housing in the super expensive parts. Here, in Perth, if you can rent a house under $500 a week it will be a dump. A loaf of bread is about $3-6 and a beer $8-10 for a pint. A decent pub meal is about $30-40 for a main course. Average house about $550 000 if you live outer city and a million plus within 5k of the city in a reasonable area. Electricity and gas $400 per month . Cinema average about $19 for adult. A 5k train ride $5. Petrol 92 $1.42/L (down from $1.82/L). A Big Mac combo $11. Average family car 30-40k. Standard service for Toyota Camry with new "saphire" plugs $420 - I just had this done. A family needs about $150k/year to have a hope of buying a small house and a car and that would be tight. Average income tax about 35% - 46%. The only thing free is the sun - you also get free melanoma thrown in with this! I was quoted $42 000 for major work by the dentist. Chiang Mai Smile - less than $10 for the same procedures, but that was 2years ago so may well have gone up since then - I am still saving up! Death is expensive here also - I am told $7k is a DIY price and will get you a cardboard box and cremation - so I can';t afford to die yet either. I have to work 'till I'm 74 when my wifeand I will be able to apply for a State pension. So I am flat out with two jobs (I'm 64) - the tax man is relying on me to bale the nation out of debt!

If, after all this, you feel sorry for me you can buy me a ticket to the LOS - I miss it.

[meatballs]

I have to say that when visiting the US most things seem a lot cheaper than Australia. Food and clothing as well as housing and cars were a lot cheaper - except housing in the super expensive parts. Here, in Perth, if you can rent a house under $500 a week it will be a dump. A loaf of bread is about $3-6 and a beer $8-10 for a pint. A decent pub meal is about $30-40 for a main course. Average house about $550 000 if you live outer city and a million plus within 5k of the city in a reasonable area. Electricity and gas $400 per month . Cinema average about $19 for adult. A 5k train ride $5. Petrol 92 $1.42/L (down from $1.82/L). A Big Mac combo $11. Average family car 30-40k. Standard service for Toyota Camry with new "saphire" plugs $420 - I just had this done. A family needs about $150k/year to have a hope of buying a small house and a car and that would be tight. Average income tax about 35% - 46%. The only thing free is the sun - you also get free melanoma thrown in with this! I was quoted $42 000 for major work by the dentist. Chiang Mai Smile - less than $10 for the same procedures, but that was 2years ago so may well have gone up since then - I am still saving up! Death is expensive here also - I am told $7k is a DIY price and will get you a cardboard box and cremation - so I can';t afford to die yet either. I have to work 'till I'm 74 when my wifeand I will be able to apply for a State pension. So I am flat out with two jobs (I'm 64) - the tax man is relying on me to bale the nation out of debt!

If, after all this, you feel sorry for me you can buy me a ticket to the LOS - I miss it.

Crazy prices. I'm sure you feel like a billionaire when you bring your money to los. Sadly, not everybody's economy is doing so well.

[PattayaPhom]

Prices the world over have increased for essentials, not only Thailand. Forget the housing market, that isnt fuelling the rising cost of living. Pork, chicken rice and eggs have all increased almost 50% in the past few years, however fish is almost the same price as 2007

[khunron13]

"Does anyone else feel this is coming?"

No and food prices are much cheaper here than the USA unless you buy imported foods.

I would modify that somewhat, and say "unless you buy Western-style foods", regardless whether or not they are imported.

For example, 79 baht for a loaf of sourdough, baked at Big C (formerly Carrefour), is about par for similar at a supermarket in the US (although Big C's version is not as good).

Still, if you buy local staples, fresh market meat and vegetables, it's still WAY cheaper than the US. Digging slightly deeper, however, the trend is toward higher prices, partly due to energy prices which have been held artificially low. That can not last forever.

Comparing Thailand and S. Korea is fraught with danger, because they are not even close to the same economic standard. S. Korean productivity has risen disproportionately and they are a modern, technological economy. Thailand's productivity, by any measure, will not approach S. Korea's in even the distant future, for reasons that are beyond the scope of this thread, I suppose...

I'd have to agree, there is no comparison between Thailand and Korea.

[chris2004]

Those Australian prices are scary, especially with the Pound at 1.50 to the $. Is the average family income $150,000 ? I had a great holiday in Oz in 2004 and i thought it was a bit expensive then. It's a wonder anyone can go there now. $42,000 for dental work ! you could buy a house here for that.

[tuky]

"Does anyone else feel this is coming?"

No and food prices are much cheaper here than the USA unless you buy imported foods.

I would modify that somewhat, and say "unless you buy Western-style foods", regardless whether or not they are imported.

For example, 79 baht for a loaf of sourdough, baked at Big C (formerly Carrefour), is about par for similar at a supermarket in the US (although Big C's version is not as good).

Still, if you buy local staples, fresh market meat and vegetables, it's still WAY cheaper than the US. Digging slightly deeper, however, the trend is toward higher prices, partly due to energy prices which have been held artificially low. That can not last forever.

Comparing Thailand and S. Korea is fraught with danger, because they are not even close to the same economic standard. S. Korean productivity has risen disproportionately and they are a modern, technological economy. Thailand's productivity, by any measure, will not approach S. Korea's in even the distant future, for reasons that are beyond the scope of this thread, I suppose...

I'd have to agree, there is no comparison between Thailand and Korea.

Absolutely.

I just spent the last 2 years living in South Korea and I found it as cheap as Thailand to live.

The luxuries are a bit dear, like King Crab and so on but daylies are the same price.

[soundman]

Off topic and bickering posts removed.

Please try to discuss/debate/argue in a civil manner.

[Sateev]

Absolutely.

I just spent the last 2 years living in South Korea and I found it as cheap as Thailand to live.

The luxuries are a bit dear, like King Crab and so on but daylies are the same price.

I would put it differently: You can spend as much as you want in Thailand, even as much as in S. Korea.

I think this is getting to be a bit of "How long is a string?" If you live like a farmer in Isaan, Thailand is probably one of the cheapest habitable places on Earth. If you live in a high rise in Lang Suan, then you can pay as much as anywhere else in the habitable world.

Looking at ads for apartments in S. Korea, I see thing like 600,000 won, plus 5 million key money for a 2 bedroom apartment, and UP. For that money, you could rent an awfully nice place anywhere in Thailand. Not the top, but pretty nice, especially if you amortize the key money. Maybe you can enlighten us - is there much housing for the equivalent of 5000 baht in ANY city in S. Korea?

Food, admittedly, I have no clue about S. Korea, but basic Thai food is dirt cheap, if you can accept blue crab legs over King Crab ones...

[happysanook]

if you haven't seen prices increasing rapidly in thailand, your eyes haven't been open. even for example side-walk food is 50% more than it was just 3 years ago... movie prices increased by 50% as well...popcorn at the movies at kad suan kaew almost 100% increase... just a couple of small examples...

is it as expensive as living in the west? obviously the answer is no.. but things are changing rapidly here... even in my little countryside town there is expansion and renovation happening everywhere you look...

[davejones]

I've noticed and commented that stuff is getting much more expensive, than two years back, thousand Baht note now lasts no time at all,this price trend is world wide, whether it leads to double inflation or not is in the hands of but a few, the government and treasury officials, if the Thai economy is going to go Sth , guess who will be responsible .

This isn't true. Inflation is mostly caused by supply and demand. With a growing world population, commodity and food prices are likely to get much more expensive over the long term. Nothing a government can do to stop that sort of inflation.

If inflation takes off your house will rise in price not fall. I can't see house prices falling 70%. If you sell you'll need to rent instead and your rent will go up massively if there is high inflation, so I don't see how selling will help you.

You have a very negative perspective on things. Cheer up.

[davejones]

if you haven't seen prices increasing rapidly in thailand, your eyes haven't been open. even for example side-walk food is 50% more than it was just 3 years ago... movie prices increased by 50% as well...popcorn at the movies at kad suan kaew almost 100% increase... just a couple of small examples...

is it as expensive as living in the west? obviously the answer is no.. but things are changing rapidly here... even in my little countryside town there is expansion and renovation happening everywhere you look...

I think many forget that Thailand is a developing country, and as it develops things will likely get more expensive. If it eventually became as developed as the UK, then it would have prices to match. So expect prices to continue increasing over the medium to long-term. I've been here two years and haven't hardly noticed any price changes. In fact, my current condo is better than my last two and cheaper. Property prices haven't gone up at all in any of the condos I check prices at. In fact they have come down in some cases. And food seems to be the same as it always was. I don't find myself spending any more money than when I first got here. In fact, a little less, because I buy less Western food these days. But even if food tripled in price it would still be cheap compared to the UK.

[Sateev]

if you haven't seen prices increasing rapidly in thailand, your eyes haven't been open. even for example side-walk food is 50% more than it was just 3 years ago... movie prices increased by 50% as well...popcorn at the movies at kad suan kaew almost 100% increase... just a couple of small examples...

is it as expensive as living in the west? obviously the answer is no.. but things are changing rapidly here... even in my little countryside town there is expansion and renovation happening everywhere you look...

I think many forget that Thailand is a developing country, and as it develops things will likely get more expensive. If it eventually became as developed as the UK, then it would have prices to match. So expect prices to continue increasing over the medium to long-term. I've been here two years and haven't hardly noticed any price changes. In fact, my current condo is better than my last two and cheaper. Property prices haven't gone up at all in any of the condos I check prices at. In fact they have come down in some cases. And food seems to be the same as it always was. I don't find myself spending any more money than when I first got here. In fact, a little less, because I buy less Western food these days. But even if food tripled in price it would still be cheap compared to the UK.

All due respect, but two years doesn't give you much of a view. Prices of everything are noticeably higher if you view the last five or more years, partly due to currency movements, energy costs, and the rising standard of living. Noticeably, but not outrageously. It's still fairly cheap.

Popcorn/movies are, in my view, NOT staples, and follow a supply/demand relationship more based on discretionary spending (i.e. the newly expanding middle class and tourists) than on a commodity based curve.

Really there's no way to separate your lifestyle from the cost of living, unless we agree to limit the discussion to a few basic needs: rice, water, meat, energy, housing, etc.

I eat popcorn a LOT, but rarely go out to the movies...my cost of living is STILL pretty high, as is my choice.

[freedom4life]

I've noticed and commented that stuff is getting much more expensive, than two years back, thousand Baht note now lasts no time at all,this price trend is world wide, whether it leads to double inflation or not is in the hands of but a few, the government and treasury officials, if the Thai economy is going to go Sth , guess who will be responsible .

We're responsible for letting inflation in to begin with. I'm in South Korea now and the prices are ridiculous i.e., beef, chicken The price of gas is almost $2.00 a liter!! The mindless mob here continuous to pay without so much as a worried-look. The masses are akin to the analogous "boiling frog" and they so deserve the fate that awaits them.

[Naam]

The price of gas is almost $2.00 a liter!!

try Europe with $2.20-2.70 a liter.

[Pib]

The inflation in Thailand is low and controlled...ask any politician in the ruling party (regardless of which party is in power at the time).

Now with that being said, yes, the cost of many items in Thailand, especially food, has risen sharply over the last one to two years regardless of what the politicians say. But overall, Thailand is still much cheaper to live in than most western nations when a person sets down and counts up all the yearly costs of living, with medical/health care coverage being one of the wild cards depending on a person's situation and age. While health care and medications in Thailand are low cost compared to most western nations, if a person can't obtain fairly priced health care insurance (private or govt provided) for those times when some serious health care is needed (like an operation, extended hospital stay, special medications, etc) then that could be the one cost that makes Thailand expensive to a person.

[Rancid]

Well we have the US, Europe. UK and China (and Japan I think) all printing money, any illiterate imbecile knows that is inflationary so the central bankers call it quanitative easing as they think we are all too stupid to know that is the same thing...well respected we are. Throughout history it has never ever worked but we are lead to believe that this time is different because...actually no because ever given.

Thailand like many countries imports a certain amount of inflation from the said money printers, but not sure if their central bank has warmed up the presses yet or is saving that for later, their debt isn't that bad but it is going up every day. Australia is expensive as the economy has done well from the mining boom and the high wages paid, however the current Fool-in-Charge has been a disaster so next time it all goes bad, so will Australia as the cupboard is now bare.

Maybe Thailand isn't that bad a place to be when the final phase of this great depression really hits, the inferior men can't kick the can down the road forever, but becasue they have it will be much uglier than it needed to be...politicians and their desire for re-election at any cost, gotta love them.

[lonewolf99]

Rampant inflation :- 2005 street vendor selling Watermelon 10 Baht per slice...2012 10 Baht

Sawg Taow Jomtien - 2005 Jomtien to Pattaya 10 Baht - 2012 10 Baht

Internet Cafe 2005 1 baht per min - 2012 1 Baht per min...

45 Sq mtr Condo 2005 10,000 Baht / month - 2012 10,000 Baht.

Singha / Chang on draught in - 2005 40 Baht - 2012 45 Baht ...ouch !!! But I am sure somethings are more expensive...but never really noticed.

Edited August 22, 2012 by lonewolf99

[tangcoral]

couple years ago 2hrs massages were 250-300baht now they avg 400-450.

anyone notice this in bkk?

paragon food court averaged 50-55 baht now they are 65-75

I noticed all food courts raised about 10-20% but this is probably in line with increased egg and oil price in recent years.

[tangcoral]

OP: "...60-70% decrease in housing prices.?

can it really go that low? What a buying opportunity since housing cost isn't ridiculously high yet.

[JcCarlin]

I've noticed Thailand to be a better place for us white men than any other place in Asia and hell of a lot cheaper.

I dont know about working for real money here though??????

[Phronesis]

There is already a house price bust unfolding here in Phuket.

The owners of the many old properties for sale in my area are asking prices that are well above the asking prices for a similar house, on the same sized parcel of land, in one of the many new developments hereabouts.

The bust is being accelerated by the lack of availability of skilled tradespeople.

I know of at least six new condo or resort developments that have been going for more than two years but have now stalled.

The concrete skeletons go up very quickly (because they use trucked in Burmese to complete this initial phase of construction), but then everything comes to a screaming halt as soon as glaziers, electricians, plumbers and cabinet makers are required. The repugnant resort development at the most northern end of Kamala beach is a relevant example. Another high season will pass it by and still not even remotely near to completion.

With regard to Australia, it is well on track for the mother of all residential property crashes. This may unfold suddenly, or there may be a painful and slow deflation of the bubble over more than a decade (as happend in Japan). Why will it be the mother or all crashes? Because 85% of the personal wealth of Australians is in residential property and the market is predicted crash 70 to 80%.

A number of (experts... ) have identified shorting Australian residential property as the best global opportunity to make money in the short term.

There is an interesting read on investment in Thailand and the pending crash of Australian property here:

http://www.nationmul...g-30188238.html

The article also confirms that the Thai government is currently rushing to put itself and the general population in greater debt. At a micro level this is also apparent with the many new government small loan programs that are now available to the subprime borrowers in rural Thailand.

Extensive commentary on the unfolding property crash in Australia is also available here:

http://bubblepedia.n.../tiki-index.php

The mantra for all of us moving forward will be: Deflation on everything you own and inflation on everything you buy.

As adumbrated by the OP, perhaps now is the time to cash out of Thai residential property.

Good luck to all with their individual decisions.

Edited August 23, 2012 by Phronesis

[davejones]

to the OP - what makes you think prices will drop 60-70%. I would be buying up half of Bangkok if they even fell 20%, and so would many others. So I can't see how they could drop 60-70 when the economy is growing quite quickly.

I think you'll find that almost every country in the world is more expensive than it was in the 80s. i can guarantee you one thing though - that they'll all be even more expensive in another 20-30 years time.

I'm not really sure what your point is.

[JeffreyWitty]

Looking at ads for apartments in S. Korea, I see thing like 600,000 won, plus 5 million key money for a 2 bedroom apartment, and UP. For that money, you could rent an awfully nice place anywhere in Thailand. Not the top, but pretty nice, especially if you amortize the key money. Maybe you can enlighten us - is there much housing for the equivalent of 5000 baht in ANY city in S. Korea?

The prices you see are for apartments in SEOUL. The rest of the country is a different story. In fact, the further from Seoul you go, the cheaper it gets.

I live in Pyeongtaek (*NOT PYONGYANG*) - centrally located in the country but along the west coast. My rent is W9.6mil a year (less that $10,000 US). I have lived and worked here since 2003. Additionally, rent for 5k baht (equivelent)? Nope.

[freedom4life]

Rampant inflation :- 2005 street vendor selling Watermelon 10 Baht per slice...2012 10 Baht

Sawg Taow Jomtien - 2005 Jomtien to Pattaya 10 Baht - 2012 10 Baht

Internet Cafe 2005 1 baht per min - 2012 1 Baht per min...

45 Sq mtr Condo 2005 10,000 Baht / month - 2012 10,000 Baht.

Singha / Chang on draught in - 2005 40 Baht - 2012 45 Baht ...ouch !!! But I am sure somethings are more expensive...but never really noticed.

I'm glad that you are keeping a watch on things..and that's they way everyone should be living. Keep a watch on prices and don't buy it if the price rises and make mention to the vendor/store/mall or wherever you shop, that you won't buy it until it is priced to what it originally was.

[freedom4life]

"Does anyone else feel this is coming?"

No and food prices are much cheaper here than the USA unless you buy imported foods.

I would modify that somewhat, and say "unless you buy Western-style foods", regardless whether or not they are imported.

For example, 79 baht for a loaf of sourdough, baked at Big C (formerly Carrefour), is about par for similar at a supermarket in the US (although Big C's version is not as good).

Still, if you buy local staples, fresh market meat and vegetables, it's still WAY cheaper than the US. Digging slightly deeper, however, the trend is toward higher prices, partly due to energy prices which have been held artificially low. That can not last forever.

Comparing Thailand and S. Korea is fraught with danger, because they are not even close to the same economic standard. S. Korean productivity has risen disproportionately and they are a modern, technological economy. Thailand's productivity, by any measure, will not approach S. Korea's in even the distant future, for reasons that are beyond the scope of this thread, I suppose...

I guess it is beyond the scope of this thread. Thailand is a tourist-based economy or a mixed economy and Korean is an export-based economy. Thailand doesn't need to produce as much as Korea and is not inclined to do so. Thailand is not only unique economically, with a true free-market system in operation, but it has not quite been historically colonized by any nation. Thailand's economy exists independently without the dependence of imports or exports, such as Korea. Korea's inflation is indirectly/directly the result of imports and exports. Thailand is much better off then Korea will be, especially in the distant future. I lived in both countries and there is a big margin of difference in the standard of living and comfort. Thailand surpasses Korea in almost every aspect. Edited August 26, 2012 by freedom4life