Differing opinions on THB and the coup

[Senechal]

This is worth a read: Morgan Stanley vs JP Morgan on whether the Baht will rise or fall.

http://www.businessweek.com/news/2014-05-20/morgan-stanley-squares-off-against-jpmorgan-on-baht-currencies

Only one thing is clear: Someone's on the wrong side of this trade.

[KittenKong]

The only thing anyone can really say about the Baht is that its value seems to be entirely manipulated.

In the West, if some central bank official has eggs for breakfast instead of cornflakes all the main trade-able currencies (USD, EUR, GBP etc) can jump around all over the place. Yet in Thailand where the economy is tiny in comparison, even when there is a military coup the Baht hardly moves by a couple of cents in value. How likely is that?

I suspect that the Baht will go in the direction the Thai government of the day wants it to go in, for whatever reasons they may have, and economic theory will have little or nothing to do with it.

[Carmine6]

They could actually both be wrong. One is saying 37baht/dollar by the end of the year. The other is saying it will strengthen. It could instead hover around the current level or end up in between, maybe 34/dollar or 35/dollar.

[Gsxrnz]

Economists and Weather Forecasters are the only two professions that can get it wrong more than 50% of the time and still keep their jobs.

[Jay1]

I occasionally send money back to my UK account, last time I did it was something like 47baht per pound. It is now reaching 55baht per pound. I have been saving for a while now and was looking at transferring it to UK in a month or two.. With the coup now happening would you advise to send it back now, or am I panicking a bit too much?

Cheers

[SheungWan]

The only thing anyone can really say about the Baht is that its value seems to be entirely manipulated.

In the West, if some central bank official has eggs for breakfast instead of cornflakes all the main trade-able currencies (USD, EUR, GBP etc) can jump around all over the place. Yet in Thailand where the economy is tiny in comparison, even when there is a military coup the Baht hardly moves by a couple of cents in value. How likely is that?

I suspect that the Baht will go in the direction the Thai government of the day wants it to go in, for whatever reasons they may have, and economic theory will have little or nothing to do with it.

'er no. The baht has already declined about 20% over the last 12 months against for example the pound and has done this against the background of political uncertainty. It is more likely that if there hadn't been a coup any increased and intensified violence on the streets would have put further downward pressure on the baht but as the coup has stabilised the ongoing situation at least in the short term then one might not expect what you obviously have, namely an immediate downward swoon in the markets. Do you have any further wayward observations? Edited May 23, 2014 by SheungWan

[SheungWan]

I occasionally send money back to my UK account, last time I did it was something like 47baht per pound. It is now reaching 55baht per pound. I have been saving for a while now and was looking at transferring it to UK in a month or two.. With the coup now happening would you advise to send it back now, or am I panicking a bit too much?

Cheers

Stay calm and carry on.

[SheungWan]

Economists and Weather Forecasters are the only two professions that can get it wrong more than 50% of the time and still keep their jobs.

You could pull any percentage figure out of a hat with the logic of that statement.

[KittenKong]

The only thing anyone can really say about the Baht is that its value seems to be entirely manipulated.

In the West, if some central bank official has eggs for breakfast instead of cornflakes all the main trade-able currencies (USD, EUR, GBP etc) can jump around all over the place. Yet in Thailand where the economy is tiny in comparison, even when there is a military coup the Baht hardly moves by a couple of cents in value. How likely is that?

I suspect that the Baht will go in the direction the Thai government of the day wants it to go in, for whatever reasons they may have, and economic theory will have little or nothing to do with it.

'er no. The baht has already declined about 20% over the last 12 months against for example the pound and has done this against the background of political uncertainty. It is more likely that if there hadn't been a coup any increased and intensified violence on the streets would have put further downward pressure on the baht but as the coup has stabilised the ongoing situation at least in the short term then one might not expect what you obviously have, namely an immediate downward swoon in the markets. Do you have any further wayward observations?

No, just the same ones which you appear to have misunderstood.

To address your points: the THB is at almost exactly the same value today against the USD as it was 5 years ago. So no obvious sign of reaction to political uncertainly there. The GBP has indeed improved against the USD over the last year, for real reasons, and inevitably this movement is reflected in the value of the THB against the GBP.

But none of that has anything to do with the simple fact that the value of the THB is manipulated.

[SheungWan]

The only thing anyone can really say about the Baht is that its value seems to be entirely manipulated.

In the West, if some central bank official has eggs for breakfast instead of cornflakes all the main trade-able currencies (USD, EUR, GBP etc) can jump around all over the place. Yet in Thailand where the economy is tiny in comparison, even when there is a military coup the Baht hardly moves by a couple of cents in value. How likely is that?

I suspect that the Baht will go in the direction the Thai government of the day wants it to go in, for whatever reasons they may have, and economic theory will have little or nothing to do with it.

'er no. The baht has already declined about 20% over the last 12 months against for example the pound and has done this against the background of political uncertainty. It is more likely that if there hadn't been a coup any increased and intensified violence on the streets would have put further downward pressure on the baht but as the coup has stabilised the ongoing situation at least in the short term then one might not expect what you obviously have, namely an immediate downward swoon in the markets. Do you have any further wayward observations?

No, just the same ones which you appear to have misunderstood.

To address your points: the THB is at almost exactly the same value today against the USD as it was 5 years ago. So no obvious sign of reaction to political uncertainly there. The GBP has indeed improved against the USD over the last year, for real reasons, and inevitably this movement is reflected in the value of the THB against the GBP.

But none of that has anything to do with the simple fact that the value of the THB is manipulated.

Much as nutty conspiracy theorists like to have a good old wallow in the word 'manipulated', the BOT's tools are limited. As for the nonsense reference to 5 years ago as an excuse to discount the volatility of the last 12 months, well... At the back of our little discord here is the fact that we had a government which had abandoned any semblance of economic management to purely focus on the personal interests of Thaksin. The decline of the baht is a reflection of that. The markets do not like instability. The Thaksin cheerleaders would of course rather tell a different story. When reality kicks in, better run for the hills yelling 'manipulation'.

[opalred]

put yourself in thaksin shoes iam developing major projects in a up and coming country where have many corrupt friends in govt burma

months ago could see problems ahead my friends i have in all govt sectors will maniipulate and keep baht strong as possible till can get our and friends money out before the dive

how do i get my stash out last time ok as i took bags of it out on my plane

i do have my sister staying in cm for next month or so i will send my chopper to airport there for her to use

as it is only afew hrs flight to my pad in yangoon

cannot transfer money through banks?

wow? have answer after a few flights i have billions to exchange to other curriencies in my pad here in yangoon now can finish port project and ship goods from my friends in china to world as now shorter trip to major markets than bangkok when i finish will sell maybe to burma govt for 500times what it cost i have done before no problems

i forgot about the roads we are building from china to port to transport goods sorry i am now starting to cry for what i have done