What's Up With The Thai Baht?

[RogueLeader]

Buy a little gold every month

Keeping your savings in gold is, without a doubt, the most effective solution.

Yes. Gold is so heavy, it never falls in value.

Oh, wait...

[bumpkin]

Thailand pegged its currency at 25 to the dollar from 1984 until July 2, 1997, and 35 to pound sterling when the country was hit by the Asian Financial Crisis. The baht was floated and halved in value, reaching its lowest rate of 56 to the dollar and 88 to the pound in January 1998. Up until 1997 Thailand had been booming at these exchange rates, they can hardly complain now when the exchange rate is only B30/$ and B47/£! You should expect the exchange rates to recover to pre-1997 levels within 2 years as the world economies recover.

Many would say that the recovery in world economies might take just a little longer than 2 years. The EU is still "kicking the can down the road" treating the symptoms and not the cause, while the USA has recently committed itself to the prospect of another 4 years of incredible national borrowing. As for China, only time will tell if Xi's tenure will make any real changes. But, sir, we sincerely wish your prediction is correct !

[cdmtdm]

do not buy the smoke screens sent out from the US of A ,,,,, they cannot get out of the mess they have created without a big correction , the cards will start falling in Wall street first ... then work its way across the globe ... i am happy to be living in SE Asia where the cost of living is /can be greatly reduced .... good luck to all , we each have our own strategy for survival ..the best we can all do is to not ignore this looming financial global Tsunami ... its real and it will happen at some point ...

[attento]

A simple answer. The very liberal socialists have broken the Western economies. They simply can no longer afford to provide for people who have no desire to work. Thailand hasn't gotten to that point, YET.

But i think that 'slowly' very slowly, that western governments are beginning to wake up about those who prefer not to work !

You are probably correct, but there is also the small problem of finding useful work for these people to do.

[TommoPhysicist]

You are probably correct, but there is also the small problem of finding useful work for these people to do.

Bicycle connected to generator connected to grid.

They must cycle 50Km per day to earn their benefits.

Good for them, good for the environment, good for the world.

[Mousehound]

I have followed professional advice many times and always lost a heap of money. The few times I took a punt on a hunch I have made at least a small profit. I have made most money on a case of 1971 Grange Hermitage I got for $8 a bottle to mark the birth of my daughter. It is worth a packet now. Sure I have kept it a while. If I had some cash right now I would look at oil futures. It may be high but the demand is ever increasing and supply is not forever. Long term again, but might be worth a punt. Got to do better than the $400k loss I made following "expert" advice

PS Whisky can be a good investment as well - if the market crashes you can always drink yourself to death!

[attento]

When I first came to Thailand 20 years ago the Can $ was worth 20 Baht.

5 years ago it was worth 34.

Now it is worth 30.

Notice any predictable pattern?

No, nor do I.

No one can tell you which way a currency will go against any other currency (except maybe Zimbabwe).

35 years ago gold went to $900 an ounce.

Then it dropped to $200 an ounce.

Today? $1700.

Notice a pattern?

No nor do I.

Is there any point to this post?

Yes - life is unpredictable. Don't expect otherwise.

Yes, you are correct and "Whores Drawers" springs to mind!

What an interesting mind you possess ...

[farangbanok]

The Thai baht (as I understand it) is controlled by Thailand, and does not float on the Forex.

Pre Thaksin - 65 to 72 baht per UK pound

Thaksin rule- 65 to 72 baht per UK pound

Coup rule - 65 to 68 baht per UK pound

Pheua Thai rule - 65 to 72 baht per UK pound

Democrats - 47 - 51 baht per UK pound

Current Goverment - 43 - 50 baht per UK pound

When the Democrats came into power the rich (self-styled) elite decided that they could grab more from exports with a strong baht. Additionally with many "red shirt families" supported by family members working overseas they happily reduced those families' income to 60%. Two birds with one stone. Good thinking!

Thai rice is now too expensive to sell overseas, and many small export firms have gone to the wall. More openings for the elite!

Sadly the current Government continues this iniquitous behaviour. Sad for all - especially retired farang with crappy UK pensions.

[GOLDBUGGY]

When I first came to Thailand 20 years ago the Can $ was worth 20 Baht.

5 years ago it was worth 34.

Now it is worth 30.

Notice any predictable pattern?

No, nor do I.

No one can tell you which way a currency will go against any other currency (except maybe Zimbabwe).

35 years ago gold went to $900 an ounce.

Then it dropped to $200 an ounce.

Today? $1700.

Notice a pattern?

No nor do I.

Is there any point to this post?

Yes - life is unpredictable. Don't expect otherwise.

You can't use just straigh comparisons of a Can$ buying 20 Baht 20 years ago and now buying 30, as you need to through in the Inflation Rate of both countries over this period to do this.

If on average Thailand ran an Inflation Rate of 2% higher than Canada did over these past 20 years, then you would need 30 Baht to $1CAD to buy the same things here you could with 20 Baht 20 years ago. But I think the average Inflation Rate over this period is higher than 2%. Let's make it simple and say it was 3%.

If that is the case then you need to get about 36 Baht to buy the same things you could 20 years ago with 20 Baht. But since people who trade this dollar, and their own currency as well I am sure, are only getting less, and for you 30 Baht, they are finding it more expensive here then 20 years ago. And they would be right. But if you are Thai and your wages or income doubled in these 20 years, then you won't feel the pinch.

True nobody knows for sure which way a currency is exactly headed, or at least when. But you can be sure that if the Thai Government dropped Interest Rates by 1%, the Baht would fall. So governments do have some small control on this at least.

[attento]

You are probably correct, but there is also the small problem of finding useful work for these people to do.

Bicycle connected to generator connected to grid.

They must cycle 50Km per day to earn their benefits.

Good for them, good for the environment, good for the world.

Wouldn't that be supporting the continuation of benefit culture? Whose money will the government take in order to pay these eco-cyclists ? Shouldn't we be searching for ways of reducing government "take", not finding ingenious ways of perpetuating it

[chiang mai]

The Thai baht (as I understand it) is controlled by Thailand, and does not float on the Forex.

Pre Thaksin - 65 to 72 baht per UK pound

Thaksin rule- 65 to 72 baht per UK pound

Coup rule - 65 to 68 baht per UK pound

Pheua Thai rule - 65 to 72 baht per UK pound

Democrats - 47 - 51 baht per UK pound

Current Goverment - 43 - 50 baht per UK pound

When the Democrats came into power the rich (self-styled) elite decided that they could grab more from exports with a strong baht. Additionally with many "red shirt families" supported by family members working overseas they happily reduced those families' income to 60%. Two birds with one stone. Good thinking!

Thai rice is now too expensive to sell overseas, and many small export firms have gone to the wall. More openings for the elite!

Sadly the current Government continues this iniquitous behaviour. Sad for all - especially retired farang with crappy UK pensions.

Your political alignement to Thai currency levels is coincidental, nothing more, unless you're a conspiracy theorist that is.

Edited January 31, 2013 by chiang mai

[TommoPhysicist]

The Thai baht (as I understand it) is controlled by Thailand, and does not float on the Forex.

Pre Thaksin - 65 to 72 baht per UK pound

Thaksin rule- 65 to 72 baht per UK pound

Coup rule - 65 to 68 baht per UK pound

Pheua Thai rule - 65 to 72 baht per UK pound

Democrats - 47 - 51 baht per UK pound

Current Goverment - 43 - 50 baht per UK pound

I thought pre-Thaksin was 35-98 baht per UK pound ???

[GOLDBUGGY]

Buy a little gold every month

Keeping your savings in gold is, without a doubt, the most effective solution.

If I would have money I would prefer farm land. I recall the stories of my grandparents, how the rich people went to the countryside and bought a chicken with a golden ring. Everyone was hungry beside the farmer. You can't eat gold, but having 10 natural chicken that produces maybe 3-5 eggs per day is easy.

Hate to tell you this Son, but me thinks your grandparents were B.S.(ing) you on that story. I don't think the Rockefeller Family were crying themselves to sleep every night due to hunger during this period.

[DeepSea]

As one who gets paid in THB and transfers money back to the UK each month to pay bills, it's quite a cheerful situation...

[GOLDBUGGY]

Relative to its size, Thailand has big deficits, and it also prints money to pay bills. I know some think that Thailand's economy is booming and that it has "no" unemployment and no debt and... Link

I personally know three Thais who were laid off work last week in Udonthani because of the increase in the minimum wage. I don't think we've begun to see the fallout from that. I think it will also affect decisions of multi-nationals to expand into Thailand because wages and other costs are now cheaper elsewhere.

Let's see how this all washes out. Thailand has a habit of borrowing money, or setting aside budget money for something and then spending it on something else. Look at the money earmarked for flood damage that got siphoned off.

I believe, and don't ask anyone to agree with me, that Thailand is way overbuilt in housing, that real estate has skyrocketed into a bubble, and that the new minimum wage will actually be the straw the breaks the camel's back.

Housing, land, medical care, food - it's all rising which means the Baht buys less.

Inflation is just another term for deflation of the value of money. If it takes more baht to buy something then the baht is worth less.

If the West wasn't being so imprudent with currencies, I'd hold a belief about the future of the baht. As it is, I'm just sitting back and watching. Something out there is unsustainable. Maybe many things.

I can understand why you think the housing market here is now in a bubble, and getting ready to burst. I sometimes think that myself. What gets me to think about it even more is when the housing bubble burst in the US, which has been, and still is, very damaging, it was the US citizens buying these homes and then getting screwed. Here in Thailand, I am trying to figure out the outcome as so many of the condos sold here are owned by foreigners. It is not the working class Thai citizens that are buying them, whereas in the US it was the US working class. I know they can only be 49% owned by foreigners, and the rest to Thai's, but that includes Thai companies setup by foreigners. Any thoughts anyone?

And Thai Wives of Farangs! So all in all, probably closer to 80-90% than 49%.

[rotary]

For the US Dollar it is almost sure it will become ever weaker against the Baht and most other money due to the state of the US economy, the refusal of the US govt to stop spending money like a drunken sailor, and a real unemployment rate of 20 per cent plus.

[chiangmaikelly]

For the US Dollar it is almost sure it will become ever weaker against the Baht and most other money due to the state of the US economy, the refusal of the US govt to stop spending money like a drunken sailor, and a real unemployment rate of 20 per cent plus.

Wasn't the financial problem of the US worse 2007 to 2009? And if so there must be something else at work here than just the US financial situation. It wouldn't have anything to do with Thailand would it?

[farmer floyd]

The US and UK and Euro Japan are all in the same boat BROKE and Any country near China and doing work with China like australia are doing good because of the jobs from China.

Look at Spain, Ireland, Portugal, Crete, all broke all losing jobs just ck news. Another recession, dropping gdp right NOW.

Same with USA yesterday, Obomo says recovery and the report Wed was a drop in output to a MINUS side, NO ECOVERY

I started using the Baht in 2005 and got 38-37 to the dollar, now 30 baht -dollar. Get out of your curriency get in Singaporo China, Baht, anything but the countries TRYING to drop the value of their money to keep jobs and then have riots on their hands like Spain. and union thugs in Beligium yesterday fire bombs in news USA is just printing money 85 billion aMONTH to buy bad loans from banks, this is not over yet. That is why Obumo is spending 1 1/2 trillion a yr over income. (Just printing it) cant sell bonds, that is inflation crazy inflation in 3 yrs like mugobee in zimbabwe. Get the hell out of US Bonds. Good luck

Edited January 31, 2013 by farmer floyd

[axact]

Buy a little gold every month

Keeping your savings in gold is, without a doubt, the most effective solution.

If I would have money I would prefer farm land. I recall the stories of my grandparents, how the rich people went to the countryside and bought a chicken with a golden ring. Everyone was hungry beside the farmer. You can't eat gold, but having 10 natural chicken that produces maybe 3-5 eggs per day is easy.

Man cannot live on eggs alone.......

So shall we invest in eggs or chickens as we can't own or farm legally here.

[reflectionx]

When I first came to Thailand 20 years ago the Can $ was worth 20 Baht.

5 years ago it was worth 34.

Now it is worth 30.

Notice any predictable pattern?

No, nor do I.

No one can tell you which way a currency will go against any other currency (except maybe Zimbabwe).

35 years ago gold went to $900 an ounce.

Then it dropped to $200 an ounce.

Today? $1700.

Notice a pattern?

No nor do I.

Is there any point to this post?

Yes - life is unpredictable. Don't expect otherwise.

Your comparison is pointless, USD was 1.4 - 1.5 to CAD at that time. Most of this fluctuation is due to variation of the CAD vs USD.

[StreetCowboy]

The US and UK and Euro Japan are all in the same boat BROKE and Any country near China and doing work with China like australia are doing good because of the jobs from China.

Look at Spain, Ireland, Portugal, Crete, all broke all losing jobs just ck news. Another recession, dropping gdp right NOW.

Same with USA yesterday, Obomo says recovery and the report Wed was a drop in output to a MINUS side, NO ECOVERY

I started using the Baht in 2005 and got 38-37 to the dollar, now 30 baht -dollar. Get out of your curriency get in Singaporo China, Baht, anything but the countries TRYING to drop the value of their money to keep jobs and then have riots on their hands like Spain. and union thugs in Beligium yesterday fire bombs in news USA is just printing money 85 billion aMONTH to buy bad loans from banks, this is not over yet. That is why Obumo is spending 1 1/2 trillion a yr over income. (Just printing it) cant sell bonds, that is inflation crazy inflation in 3 yrs like mugobee in zimbabwe. Get the hell out of US Bonds. Good luck

Invest in education and literacy

[chiangmaikelly]

The US and UK and Euro Japan are all in the same boat BROKE and Any country near China and doing work with China like australia are doing good because of the jobs from China.

Look at Spain, Ireland, Portugal, Crete, all broke all losing jobs just ck news. Another recession, dropping gdp right NOW.

Same with USA yesterday, Obomo says recovery and the report Wed was a drop in output to a MINUS side, NO ECOVERY

I started using the Baht in 2005 and got 38-37 to the dollar, now 30 baht -dollar. Get out of your curriency get in Singaporo China, Baht, anything but the countries TRYING to drop the value of their money to keep jobs and then have riots on their hands like Spain. and union thugs in Beligium yesterday fire bombs in news USA is just printing money 85 billion aMONTH to buy bad loans from banks, this is not over yet. That is why Obumo is spending 1 1/2 trillion a yr over income. (Just printing it) cant sell bonds, that is inflation crazy inflation in 3 yrs like mugobee in zimbabwe. Get the hell out of US Bonds. Good luck

Invest in education and literacy

Always a good idea. How is it doing in Japan?

[StreetCowboy]

The US and UK and Euro Japan are all in the same boat BROKE and Any country near China and doing work with China like australia are doing good because of the jobs from China.

Look at Spain, Ireland, Portugal, Crete, all broke all losing jobs just ck news. Another recession, dropping gdp right NOW.

Same with USA yesterday, Obomo says recovery and the report Wed was a drop in output to a MINUS side, NO ECOVERY

I started using the Baht in 2005 and got 38-37 to the dollar, now 30 baht -dollar. Get out of your curriency get in Singaporo China, Baht, anything but the countries TRYING to drop the value of their money to keep jobs and then have riots on their hands like Spain. and union thugs in Beligium yesterday fire bombs in news USA is just printing money 85 billion aMONTH to buy bad loans from banks, this is not over yet. That is why Obumo is spending 1 1/2 trillion a yr over income. (Just printing it) cant sell bonds, that is inflation crazy inflation in 3 yrs like mugobee in zimbabwe. Get the hell out of US Bonds. Good luck

Invest in education and literacy

Always a good idea. How is it doing in Japan?

I think that they've got one of the highest living standards, and highest levels of productivity in Asia.

It's a while since i've been there, though.

SC

[scorpio]

Buy a little gold every month

Keeping your savings in gold is, without a doubt, the most effective solution.

Buy a little gold every month

Keeping your savings in gold is, without a doubt, the most effective solution.

where is best place to buy gold, i have 4 million sitting in bank gathering 3% ....is gold a better option ?

[vijer]

I believe, and don't ask anyone to agree with me, that Thailand is way overbuilt in housing, that real estate has skyrocketed into a bubble, and that the new minimum wage will actually be the straw the breaks the camel's back.

I agree with you 100%. Where I live there are at least 5 of the goofy 3 story commercial/office/home buildings that were finished within the last 6 months. Driving by them every day they all appear to be more or less empty and more are being built. The landlords want a fairly steep price too, we asked one place and he wanted 38,000 a month for a small unit in a relatively back water area of Bang Phil. You have to sell a lot of stuff to cover rent and utilities and make a decent living.

Everyday a new piece of vacant land is being filled with dirt in preparation for building. I don't see how they can all rent the space out. It's the same mindset that hit the US, "oh look my friend/cousin/brother/somebody is making a lot of money flipping houses, I will do that too", and then bang all at once everyone realized they were paying too much and people stopped buying. That's what appears to be happening in Thailand, "oh look the property next to mine is building a tenement, I should do that too and make money. I'll be rich and drive a Mercedes!"

[Lopburi99]

29.8 THB to the USD. And we still have a full 4 years of Obama spending and printing ahead of us....

And the U.S. economy shrunk for the first time in 3.5 years? Hmm. After spending $787,000,000,000 in Stimulus I? How's that for a kick start....

Edited January 31, 2013 by Lopburi99

[chiangmaikelly]

The US and UK and Euro Japan are all in the same boat BROKE and Any country near China and doing work with China like australia are doing good because of the jobs from China.

Look at Spain, Ireland, Portugal, Crete, all broke all losing jobs just ck news. Another recession, dropping gdp right NOW.

Same with USA yesterday, Obomo says recovery and the report Wed was a drop in output to a MINUS side, NO ECOVERY

I started using the Baht in 2005 and got 38-37 to the dollar, now 30 baht -dollar. Get out of your curriency get in Singaporo China, Baht, anything but the countries TRYING to drop the value of their money to keep jobs and then have riots on their hands like Spain. and union thugs in Beligium yesterday fire bombs in news USA is just printing money 85 billion aMONTH to buy bad loans from banks, this is not over yet. That is why Obumo is spending 1 1/2 trillion a yr over income. (Just printing it) cant sell bonds, that is inflation crazy inflation in 3 yrs like mugobee in zimbabwe. Get the hell out of US Bonds. Good luck

Invest in education and literacy

Always a good idea. How is it doing in Japan?

I think that they've got one of the highest living standards, and highest levels of productivity in Asia.

It's a while since i've been there, though.

SC

I was talking about the economy.

"There is the crisis of the Japanese economy, in which we have been unable to extract ourselves from the bog of deflation and a strengthening yen, while the enormous sum of what is said to be up to ¥50 trillion in national income has been lost along with industrial competitiveness, and no matter how diligently one works, one’s day-to-day living never improves."

Policy speech by Prime Minister Shinzo Abe Jan 28, 2013

Perhaps you can see the lesson in the above applied to the baht.

Edited January 31, 2013 by chiangmaikelly

[outre99]

A simple answer. The very liberal socialists have broken the Western economies. They simply can no longer afford to provide for people who have no desire to work. Thailand hasn't gotten to that point, YET.

This might be true in the case of Europe, but in the US the problem is the opposite. Too many giveaways to the corporations and drastic reduction of the government oversight led to the excesses on Wall street and in the real estate markets. US could have used more liberal thinking not less.

[JDGRUEN]

Concerning the United States... The U.S. Government is buying a significant portion of its own debt in order to issue more money - and has been for quite a while now. This 'monetizing' of the debt is extremely risky business. To my knowledge the United States has never done this before in its history. Countries that have monetized their own debt have crashed quite catastrophically. The only reason it has not crashed so far is the extraordinary nature of the transaction relationships between the U.S. Treasury and the Federal Reserve (much is secretive and slight of hand). Sooner or later the House of Cards will fall. In light of this - how the U.S. Dollar keeps its value again any world currency is baffling. It should be 300 Baht to the dollar - on the way to 3000.

Note: Aside from being 16 Trillion is debt... the U.S. Government has over 100 TRILLION in unfunded liabilities (mostly off the books - Social Security, Medicade, Medicare, now Obamacare). Yes Folks - OVER 100 TRILLION... Socialism is great until you run out of other people's money...

Edited January 31, 2013 by JDGRUEN

[Saan]

Buy a little gold every month

So where and how do you suggest we buy it ? I really am interested in this suggestion.

Buy Kruger Rands - 1 fine ounce of gold. It used to be a convenient way of dealing in gold that was instantly recognisable just about anywhere in the world. I haven't kept upto date up so things might have changed.