American Chair

[ando]

I'm here in Australia with my Thai wife of 12 years and two of the wifes daughters have got into financial trouble with this "American Chair" thing. What exactly is it?

As far as I can figure out its like some kind of a workplace syndicate where everyone puts a % of monthly salary in and then bids for a loan. Those bidding the highest interest repayment win the loan. One daughter works for a private company in Bangkok and the other works for the post office in Chanthaburi, so its obviously a widespread practice in various kinds of workplaces.

Can anyone offer further information on this thing?

[BKK90210]

I think it's "American share" not "chair"

Since the Thais started playing around with the Thai language they have effectively made up a whole string of English sounding phrases that most foreigners wouldn’t have a clue to the meaning of and one of the ‘classics’ has to be ‘American Share’. This Thai-Eng lingo does in fact mean to ‘share the bill’. In Thai tradition it’s usually the elder that foots the bill (ie the one who is oldest or wealthiest). This phrase did in fact arise from the days of the American Gis. ‘American Share’ has certainly become popular over the years due to cultural development.

[lanny]

I've never heard the term "American Chair" but my Thai wife sends money to her mother each month to put in such a scheme. It sounds much like what the Japanese call a "Tanimoshi." In Hawaii, tanimoshis were very common in the past. The immigrant Japanese plantation workers put small amounts in each month. Members would then present plans for a new business, etc. and be given money to finance their startup. Many Japanese owned business in Hawaii got their start this way. In the Japanese model, if the group agreed to finance a member who ultimately failed, the group took the loss, not just the individual. It is a communal, self-help type thing.

The idea is that the group can accumulate money easier than any one individual. Then, the accumulation can be used to get some one started in business. The money would be repayable in time and then redistributed, with the gains, to the members. Thus, everyone would profit.

[Farma]

One version I’ve heard about involves a group of people each placing an equal amount in the pot each month. Lots are then drawn each month. The winning person gets the pot that month and so on until all contributors receive their amount. Each person continues contributing until all members have had the pot. Good if your name is drawn out near the start. The last person gets no more benefit than they would have if they had just saved their money.

[Thaising]

Thais call it community share. This group investment schemes also know as tontine, members just invest and contribute fund in the scheme. Whoever in need of fund has to offer higher interest just to secure the tender bind, and each surviving member will receive equal dividends and benefits, in the end, the final surviving contributor receiving his/her full investment plus the highest interest rate in return on the scheme.

Edited June 11, 2006 by Thaising

[RedHotChilli]

Hello There,

I didn't realise that my Thai gf (at the time) was playing this game, so after we split up I bought her out so that she wouldn't lose the 6000 baht she had already paid.

It was being played in my neighbourhood...and the owner of the game lived opposite me.

There were 21 of us playing, we all had to give the owner of the game 1000 baht, so there was 21,000 baht in the pot.

Once a month, they had a gathering and whoever wanted the pot, had to write on a piece of paper how much interest they would pay for the remainder of the time. The highest bidder then won the pot. The interest some months went as high as 500 baht., although sometimes just 200 baht. Seeing as I wasn't strapped for cash (at that time) I decided to wait till the end.

What should have happened was that I'd get the 21,000 baht plus all the interest from the 20 other players. If the average interest was, lets say 300 baht. Well, I would make 6000 baht interest on top of the 21,000. However, 3 months before this long drawn out game was over, the lady owner left her husband and two children to go live with her new lover and was nowhere to be found.

I did however manage to track her down (with help from her ex) it just so happened that the owner's new boyfriend's sister was the Headmistress at one of the well-known Thai schools and I'd just gotten a job at one of there sister schools.

The owner of the game was now working in their finance office, so I gave her a call.

Of course, she didn't have the money to give me, but then paid me in bits and pieces over the following year. I did get some interest but nothing to what it should have been.

Well, hopefully my post makes sense.

Anyway, in my experience keep away from these type of games, it's not worth the headache.

Redhotchilli

Edited June 11, 2006 by RedHotChilli

[lopburi3]

I have never heard it called "American" but normally they have a saving/loan system that is normally called "chair game" where one person acts as holder with a set time/payment period and number of members. Everyone pays into the pot at a set amount to start and the pot is given to the person offering the highest interest (on future payments). If everything works well first people get low interest loan and late people get good interest return. However, it often fails with members not being able to maintain payments (which means the holder is responsible) and that may become too much and they are unable to pay out. Very good way to lose money and friends but is always popular.

[Gary A]

I too have no idea where the name came from but it is a common thing. It runs ten months at a time and they all put in a 1,000 baht a month. When someone wants a loan the person bidding to pay the highest interest rate gets the loan. I was skeptical and told my wife that I figured she would lose her money. I was wrong, she ended up getting 11,600 baht back for the 10,000 she paid in.

[Niloc]

Go to Stickman's site, www.Stickman.com. look at Readers Submissions No.10, read an article called "Thai Share" by "Dreamer".

It is an excellent description of how shares work. My wife is a member of a Share, actually we both are at 500 baht each every ten days. Payday is in July and the lady who runs it turns up three times a month. I just hope she turns up next month!!

[ando]

Niloc,

do you have a link you could post?

This is all I get when I type in that address.

http://www.stickman.com/

Edited June 11, 2006 by ando

[jdinasia]

Reading the topic and decription .......

Well you sit in it ... it just has to be a bit wider

[BKK90210]

Oh well....I was waaay off the mark then!

At least I know what it is now. Seem like I'm learning something new everyday about thailand on this board.

Cool!

[ando]

Oh well....I was waaay off the mark then!

At least I know what it is now. Seem like I'm learning something new everyday about thailand on this board.

Cool!

American Chair, = American Share = Thai Share. Simple really. Its all in the translation.

My Thai wife is the same age as me, 53. She probably picked up the name years ago when the concept was introduced by American servicemen around her home town in Sattihip near the Naval base. Or maybe its the word "American" that I am misinterpreting? Needs more work, but sometimes can be painful to get to the bottom of things.

[OldAsiaHand]

Niloc,

do you have a link you could post?

This is all I get when I type in that address.

http://www.stickman.com/

It's http://www.stickmanbangkok.com/.

[Niloc]

Please accept my apologies, OldAsiaHand is correct. It's http://www.stickmanbangkok.com/.

[oopapasan]

I've never heard the term "American Chair" but my Thai wife sends money to her mother each month to put in such a scheme. It sounds much like what the Japanese call a "Tanimoshi." In Hawaii, tanimoshis were very common in the past. The immigrant Japanese plantation workers put small amounts in each month. Members would then present plans for a new business, etc. and be given money to finance their startup. Many Japanese owned business in Hawaii got their start this way. In the Japanese model, if the group agreed to finance a member who ultimately failed, the group took the loss, not just the individual. It is a communal, self-help type thing.

The idea is that the group can accumulate money easier than any one individual. Then, the accumulation can be used to get some one started in business. The money would be repayable in time and then redistributed, with the gains, to the members. Thus, everyone would profit.

Pyramid?different name,same results?

[boppia]

I remember lao people doing this in the US. They would put in money every week or.The first person would get a lot and would be the first to get it but would have to pay a little more than the others so that everyone after them got more for waiting. This went with the second third etc. The last person got a bit more. No one loses much money. Collectively the group members are able to give more to those who wait. The people who get it earlier agree to pay a bit more depending on their place in the line. It's not gambling but rather collective action. The only negatives aspects of it is that some members may try to cut out or run into financial difficulty as it goes so the remaining members might have to struggle to get the others to pay their fair share.

Foreigners don't trust each other enough to do this. if they did they could do something like

base = 15,000 baht per month for 20 months (Some will pay more.)

Person 1 = 300,000 baht this month

Person 2 = 302,000 baht next month

.

.

.

Person 20 = 400,000 baht in 20 months

That's the basic I'd as I remember it. the math experts here will figure it out.

Anyways I remember a Lao girl who had just cam to the US and suddenly had the downpayment for a new Dodge Neon.

One note. All the members of the scheme are working.

[ando]

I asked the Thai wife what would happen if a member dint repay the debt.

She said that since all the members lived or worked nearby, they would probably place sufficient pressure to make one pay up. She was making the slicing motion of the finger across the throat when she said it. So I guess there is not a high rate of locals reneging on debts!

So I guess I will just have to bail my Thai daughters out when they get in trouble. God, I wouldn't want them to have to hock their gold!!

[Sophon]

Pyramid?different name,same results?

I don't think it's fair to compare it to a pyramid scheme. A pyramid scheme is based on bringing in more and more participants, and when the structure breaks down (as it invariably will), the last people in will end up loosing their money.

In these Thai share/chair schemes you normally operate with a more or less static number of people, and as long as everyone pays the agreed upon interest, and nobobody runs of with the capital, nobody will loose their investment. It's very much based on trust.

Sophon

[lomatopo]

She was making the slicing motion of the finger across the throat when she said it. So I guess there is not a high rate of locals reneging on debts!

So I guess I will just have to bail my Thai daughters out when they get in trouble. God, I wouldn't want them to have to hock their gold!!

What good would it do to kill a share member who did not pay? Would the obligation pass to a family member.

Seems like most participants aim to get their money out at about the mid-point (as measured by term or number of participants; if the share runs 6 months then the mid-point would be 3 months; if it has 15 participants then aim to be number 7 or 8), as things usually fall apart after that.

I take it your daughters withdrew money, presumably for a sound business investment, and are now having trouble making their payments? How long is the term for their loan?

[Archie Bunker]

I used to have a mexican worker named peedro who pronounced "share" like "chair". we would talk about stocks and he'd ask me "how many chairs you got mang". from that day forward I always called him mang

[barryofthailand]

In the U.S. I think they called this a peromid scheme. Now illegal in the states.

[toptuan]

Reading the topic and decription .......

Well you sit in it ... it just has to be a bit wider

D*mn! I thought it was a thread on capital punishment.

[jdinasia]

In the U.S. I think they called this a peromid scheme. Now illegal in the states.

Nope .. not a Pyramid scheme ... or even a "sparse matrix" like Scamway ....

as described this involves a limited number of participants ... each gaining reward commensurate with what they put in ...

[Patex]

I "len dschaee" for many years and sometimes I am the "Tao dschaee", the initiator and responsible person.

Say, you have 12 gamblers who pay monthly 2000฿ in the pot, than the game runs 12 month with a monthly pot from 24000฿.

The "Tao dschaee" gets the first pot without intrest and the remaining 11 month all gamblers can bid on the pot - the highest intrestoffer gets the pot and you are, of course, only able to get one pot.

For example:

2nd month 24000 in the pot, highest intrestoffer: 500

3rd --------24500 ------------------------------------250

4th --------24750 ------------------------------------250

5th ---------25000 ------------------------------------500

6th ---------25500 ------------------------------------250

7th ---------25750 ------------------------------------250

8th ---------26000 ------------------------------------500

9th ---------26500 ------------------------------------250

10th --------26750 ------------------------------------250

11th --------27000 ------------------------------------150

12th --------27150, gets the pot without intrestoffer

After you got the pot you always have to pay the 2000 + your once bade intrest.

If one player vanish the "Tao dschaee" have to pay his monthly debts .

Risk: Many players = long playtime

Too high intrests...

In my case the most players have to be forced to make a bid on the pot, everybody does not realy need the money and is just hoping to get one of the last pots . You also have to fix an intrestminimum, for example 150฿.

I hope I explained it understandable .

[barryofthailand]

This is definately how the piramid scheme worked in the U.S. You put in a set amount every week or two, and every time everyone puts in you move up one on the ladder. When you get to the top you get your money. All that you put in. Why not just put the money in the bank each week.

Barry

[jdinasia]

Again ... NOT a pyramid scheme ...

a Pyramid scheme requires an ever broadening base (as does mlm and sparse matrix.

this is a limited number of participants .. more like a fotball pool where every square wins ... but the last square picked wins the most.