Thai editorial: Baht-yuan swap agreement grabbing global attention

[Time Traveller]

Good point, Sharchen. But could the slow move against the dollar be a long-term strategy to break the hold of the (petro) dollar on the world? Some people predict the Yuan will be fully convertible in about 5 years.

They've been saying that for the last 10 years - at least. The fact is the Chinese are terrified of an open economy. Sorry to tell the buffalo soldiers the truth but looking at the size of the buy/sell spreads at currency exchanges in Thailand it's clear which currency they prefer.

Edited December 31, 2014 by Time Traveller

[cloudhopper]

After Greek elections on Jan 25, 2015, it could be another huge slide for the euro again and huge win for the USD by the end of 2015. If greece eventually moves out of the euro, guess what italy and spain are going to do?

Greece won't move out of the euro. Neither will Spain or Italy.

I know its the New Year and all that, but really doomsday predictions?

No, not doomsday at all but an opportunity for buying USD's. If the new party wins in Greece, they want to write off a lot of the debt whether Brussels agrees with this or not and a 50/50 chance they opt out of the eurozone. At 25% unemployment, they have much of population with them this time around.

It won't happen.

We'll see. Abandoning the euro and restoring the drachma is their only way out. The proportional default guarantees would be unpayable by the remaining PIIGS and the biggest loser will be Germany as it all flies apart. It will be interesting to see what the IMF et al do next to forestall the inevitable. The Germans should actually leave first but it's politically impossible for them.

[Thailand]

I think Preyuth in his short term in power has sold Thailand to China!

Yeah, right.

So you're saying PT, yingluck and their dear leader kept China at bay, refusing to have anything to do with them?

Current dear leader no doubt simply endorsed what the previous elected government arranged with China and 100%,China will be on the winning side.

Certainly seem to be resurrecting many things that the big bad PTP proposed in their time in tenure.

[bitcoinbob]

CHINA has no sizable bond market, no floating currency,few political freedoms, questionable property rights. 75 % of all Chinese millionaires have moved there assets out of china . china is in a rush to sign a lot of these currency swaps deals because in a few months or years whole Chinese model is going to collapse. Russia is using its swap agreements and now looking for a bailout from china . the price tag on that will be huge. there is 9 trillion in dollar based loans outstanding people are starting to freak out because Americans are no longer printing unlimited amount of dollars anymore QE has stopped

[Bluespunk]

After Greek elections on Jan 25, 2015, it could be another huge slide for the euro again and huge win for the USD by the end of 2015. If greece eventually moves out of the euro, guess what italy and spain are going to do?

Greece won't move out of the euro. Neither will Spain or Italy.

I know its the New Year and all that, but really doomsday predictions?

No, not doomsday at all but an opportunity for buying USD's. If the new party wins in Greece, they want to write off a lot of the debt whether Brussels agrees with this or not and a 50/50 chance they opt out of the eurozone. At 25% unemployment, they have much of population with them this time around.

It won't happen.

We'll see. Abandoning the euro and restoring the drachma is their only way out. The proportional default guarantees would be unpayable by the remaining PIIGS and the biggest loser will be Germany as it all flies apart. It will be interesting to see what the IMF et al do next to forestall the inevitable. The Germans should actually leave first but it's politically impossible for them.

No ones leaving. Too much at stake. It's here to stay. Learn to live with it.

[ffaarraanngg]

After Greek elections on Jan 25, 2015, it could be another huge slide for the euro again and huge win for the USD by the end of 2015. If greece eventually moves out of the euro, guess what italy and spain are going to do?

Greece won't move out of the euro. Neither will Spain or Italy.

I know its the New Year and all that, but really doomsday predictions?

Leaving the Euro isn't doomsday, only people making doomsday predictions would come out with such nonsense.

One thing you can be 100% sure of is Greece cant pay off their debt without very high inflation which isn't happening in a deflationary world, or by defaulting.

Right, lets see:

I didn't say Greece leaving the euro was doomsday. I said Greece followed by Italy and then Spain leaving was a doomsday prediction.

I stand by that.

Because it is.

Decidedly so.

You most certainly claim that Greece is not going to leave the Euro, thus implying if they did it'd be doomsday. You put a full stop in between mentioning the nations.

But staying in the Euro is proving to be the doomsday for tens of millions of young unemployed individuals in these countries, youre not one of the endless millions of young unemployed people there with no future, so you have no clue.

[Bluespunk]

@ffaarraanngg

You said.

You most certainly claim that Greece is not going to leave the Euro, thus implying if they did it'd be doomsday. You put a full stop in between mentioning the nations.

But staying in the Euro is proving to be the doomsday for tens of millions of young unemployed individuals in these countries, youre not one of the endless millions of young unemployed people there with no future, so you have no clue.

My response.

Nope wrong. Again.

I responded to a post that said Greece, followed by Spain and Italy would leave the euro. I said the prediction is a doomsday prediction. And it is.

I hold to that position that it won't happen (and that its a doomsday prediction).

Ok?

As for the second paragraph of your post.

Another doomsday prediction.

Somewhat over the top as well.

Edited December 31, 2014 by Bluespunk

[steve654]

After Greek elections on Jan 25, 2015, it could be another huge slide for the euro again and huge win for the USD by the end of 2015. If greece eventually moves out of the euro, guess what italy and spain are going to do?

Greece won't move out of the euro. Neither will Spain or Italy.

I know its the New Year and all that, but really doomsday predictions?

No, not doomsday at all but an opportunity for buying USD's. If the new party wins in Greece, they want to write off a lot of the debt whether Brussels agrees with this or not and a 50/50 chance they opt out of the eurozone. At 25% unemployment, they have much of population with them this time around.

It won't happen.

We'll see. Abandoning the euro and restoring the drachma is their only way out. The proportional default guarantees would be unpayable by the remaining PIIGS and the biggest loser will be Germany as it all flies apart. It will be interesting to see what the IMF et al do next to forestall the inevitable. The Germans should actually leave first but it's politically impossible for them.

No ones leaving. Too much at stake. It's here to stay. Learn to live with it.

You may have to learn to live with that you could be wrong. High unemployment and debt can move the will of the people to find alternative ways to restore balance and one way is canceling debt, moving on and hoping for the best. Not sure about Italy, but if Greece goes, Spain will very motivated as well.

[Ulic]

Rouble-Yuan, Baht-Yuan, seems to me China is diversifying and lining up currency partners to

offset its huge US dollar reserves. The Chinese government thinks very far in advance, we shall see

what other agreements are signed in the coming years.

[Bluespunk]

@Steve654

You said

You may have to learn to live with that you could be wrong. High unemployment and debt can move the will of the people to find alternative ways to restore balance and one way is canceling debt, moving on and hoping for the best. Not sure about Italy, but if Greece goes, Spain will very motivated as well.

My response

I don't think it will happen. I may have to live with being wrong but I really doubt it.

Time will tell though.

Edited December 31, 2014 by Bluespunk

[MaxLee]

From the bottom line and to make it plain simple:

"easier to do corruption with the long lost big brother China, whose previous immigrants BROUGHT it over to Siam in the first place...."

[tookwan cottage]

I am hoping the Aussie$ to Yuan will be of some benefit to my business in Australia. Everything I sell is made in China!

Maybe pay the windfall to the uber-exploited Chinese slaves you are living off. Top work cobba!

[steve654]

@Steve654

You said

You may have to learn to live with that you could be wrong. High unemployment and debt can move the will of the people to find alternative ways to restore balance and one way is canceling debt, moving on and hoping for the best. Not sure about Italy, but if Greece goes, Spain will very motivated as well.

My response

I don't think it will happen. I may have to live with being wrong but I really doubt it.

Time will tell though.

I predict currencies as a hobby and not so good at it either, but around 75% accurate so I try to hear what the locals are saying to use that as part of the framework to see where the swings will go. Many Greeks are in a very desperate, seemingly hopeless position at the moment. They are deeply frustrated to a point I have never seen since WW2, so you just never know. My guess is the chances are good that Greece exits with others to follow.

Edited December 31, 2014 by steve654

[NeverSure]

China and Thailand can exchange currency if they so desire. But they can't engage in international trade with their currencies outside of their small sphere of influence. China is a huge importer and it can't buy goods worldwide with Yuan. Japan and the US are Thailand's #1 and #2 buyer of its exports. Thailand will be paid in dollars. Thailand imports a lot from the West and it will pay in dollars.

This is the reason that both Thailand and China have to buy US Treasuries. It's to back their international trade by having dollars.

The US is able to sell treasuries bearing a tiny amount of interest because right or wrong, the US is considered a safe haven for money.

China isn't considered a safe haven. It's finances aren't transparent and the truth about them would be shocking. The world isn't going to trust a communist country whose books aren't audited and who many global experts think is in serious trouble. Thailand is in serious trouble and the Baht is good for money laundering but not safe parking.

The current leaders of Thailand have no global experience with economics or macroeconomics and it is truly showing. Many moves they've made have slowed the economy and the statements they make are embarrassing but they don't know it.

This is one of those things that Thailand will have to learn the hard way. China does no one any favors.

[jcisco]

Now I'm going to stick my neck out here and state no, it isn't grabbing global attention and in all likelihood about 0.0000001% of the world know or care.

Does The Nation really think the TV salesman in Addis Ababa or the blues singer in Clearwater, Florida are on tenterhooks this new year's eve?

first usage of tenterhooks both in application and spelling i've experienced online anywhere.

[stickyrice2000]

I could see where China is heading in this agreement. They want yuan to be accepted worldwide like the dollar. It's part of their roadmap to lay the foundation. The Chinese government does not cooperate with any countries. If there are issues down the line, Thailand is the one to lose in this deal.

[Muirton]

"The move is not just being watched closely by the United States, but also by the rest of the world."

I've tried to reach friends in the US by fone; they all explain they can't chat because they're watching the yuan-baht swap development ever so closely. Same with a friend in Paris, another in Edinburgh.

[Muirton]

Remember that all things are only opinion and it is your power to think as you please.
-Marcus Aurelius (apparently)

Perhaps:

Fere libenter homines id quod volunt credunt.

Gaius Iulius Caesar

[mania]

The US is able to sell treasuries bearing a tiny amount of interest because right or wrong, the US is considered a safe haven for money.

Yes that "was" true for many decades. It no longer is considered as safe

by many and this is why we are seeing more of these swaps. As for Treasuries...That too has fallen off in regards to having enough buyers of the

incredible amounts of debt with its accompanying Treasuries/IOU's the US has created since 2008.

It has gotten so they (Fed Reserve) need to buy their own IOU's with more of their own IOU's

As not enough buyers exist any longer. Many feel this will not end well.

Here is a small graphic to give an idea of how much

Mind you it is just QE3 2012 and 2013...It has gone much farther before and after

http://demonocracy.info/infographics/usa/federal_reserve-qe3/money_printing-2012-2013.html

It is not surprising some countries look for alternatives....And why not?

But those that were small and did so on their own were suddenly termed enemies and are no longer

stable at all after certain events

So instead now these larger powers such as Russia &China will allow trade in currencies with other countries

in their own currencies...again why not? It is their choice. They will not be bothered as the smaller countries who tried alone were

as they have the size to do so. It is their choice

Edited December 31, 2014 by mania

[JingerBen]

@Steve654

You said

You may have to learn to live with that you could be wrong. High unemployment and debt can move the will of the people to find alternative ways to restore balance and one way is canceling debt, moving on and hoping for the best. Not sure about Italy, but if Greece goes, Spain will very motivated as well.

My response

I don't think it will happen. I may have to live with being wrong but I really doubt it.

Time will tell though.

I predict currencies as a hobby and not so good at it either, but around 75% accurate so I try to hear what the locals are saying to use that as part of the framework to see where the swings will go. Many Greeks are in a very desperate, seemingly hopeless position at the moment. They are deeply frustrated to a point I have never seen since WW2, so you just never know. My guess is the chances are good that Greece exits with others to follow.

What they think is an exit door is a window in a hi-rise building.

[steve654]

@Steve654

You said

You may have to learn to live with that you could be wrong. High unemployment and debt can move the will of the people to find alternative ways to restore balance and one way is canceling debt, moving on and hoping for the best. Not sure about Italy, but if Greece goes, Spain will very motivated as well.

My response

I don't think it will happen. I may have to live with being wrong but I really doubt it.

Time will tell though.

I predict currencies as a hobby and not so good at it either, but around 75% accurate so I try to hear what the locals are saying to use that as part of the framework to see where the swings will go. Many Greeks are in a very desperate, seemingly hopeless position at the moment. They are deeply frustrated to a point I have never seen since WW2, so you just never know. My guess is the chances are good that Greece exits with others to follow.

What they think is an exit door is a window in a hi-rise building.

Possibly, but I can think of many big lenders that would be waiting at their doorstep if they do exit.

[smedly]

This article is so over exaggerated. They made it seem like the world is going to end that Thailand and China made an agreement to make trade with their own currency. I am sure that Thailand and China are not the first.

my visual of this is Thailand represented by a matchstick floating in a safe harbour for years then being collected up by some garbage ship and getting tossed far out to sea in the middle of a storm, if they are lucky the wind and tide might float them back into the harbour - they are an insignificant player in the world money market and should tread very carefully

[khunken]

Actually this article is right on the money (Yuan).

Here are some countries/entities that have already reached swap deals with the Yuan:

Russia

Argentina

Brazil

Malaysia

New Zealand

Switzerland

South Korea

The Euro zone

Sri Lanka

Canada

I seem to remember Singapore too but I can't find evidence of it.

So,yes, it is very much a big deal.

[rickirs]

The yuan-baht agreement is all about China's strategy to get reserve currency status for the yuan that would make world central banks, particularly those in developing economies, more eager to hold yuan assets and “diversify at the margin" away from dollars.

In late 2015, the IMF will conduct its next twice-a-decade review of the basket of currencies its members can count toward their official reserves. Including the yuan in this so-called Special Drawing Rights (SDR) system would allow the IMF to recognize the rise of the world’s second-biggest economy while aiding China’s attempts to diminish the dollar’s dominance in global trade and finance.

Historically, China has failed to meet IMF’s requirement for a “freely usable” currency which is not subjected to artificial government controls on exchanging the currency. The reason China maintains such controls has been to restrict foreign capital flows into China to prevent inflation that in turn will weaken demand for Chinese exports and drive the consumer price index up. The average Chinese might start to openly protest. If China is going to convince the US and the other 187 IMF nations that it's time to recognize the yuan as an international currency, it must show that nations now have confidence in the stability of the yuan as a freely-usable currency.

China's currency swap, stock market, and dual rail deals with Thailand coincidentally will assist China’s last minute efforts to gain IMF support. Hopefully, Thailand will get some payback in the form of a stronger economy from being used as an economic pawn.

Edited December 31, 2014 by rickirs

[SinCityGr8One]

Remember that all things are only opinion and it is your power to think as you please.

-Marcus Aurelius (apparently)

Perhaps:

Fere libenter homines id quod volunt credunt.

Gaius Iulius Caesar

Spot On! "Men willingly believe what they wish" I'll go one further: Nihil nobis metuendum est, praeter metum ipsum or "We have not to fear anything but fear itself"

[Vagabond1]

Yuan swaps and stuff....

OPEC is not having any exotic ideas about changing the currency.

[baboon]

Now I'm going to stick my neck out here and state no, it isn't grabbing global attention and in all likelihood about 0.0000001% of the world know or care.

Does The Nation really think the TV salesman in Addis Ababa or the blues singer in Clearwater, Florida are on tenterhooks this new year's eve?

first usage of tenterhooks both in application and spelling i've experienced online anywhere.

My posts always did have a nimiety of genius...

[NCC1701A]

so china has like one old used soviet aircraft carrier with no planes on it...

and the Federal Reserve Bank of the United States of America is going to just roll over and play dead?

good luck with that commies...

sorry to highjack the thread, but I saw a Russian guy walking down the street here in Hua Hin a few weeks ago, he was looking at his smartphone and was white as a sheet. Anybody know why?

[jcisco]

so china has like one old used soviet aircraft carrier with no planes on it...

and the Federal Reserve Bank of the United States of America is going to just roll over and play dead?

good luck with that commies...

sorry to highjack the thread, but I saw a Russian guy walking down the street here in Hua Hin a few weeks ago, he was looking at his smartphone and was white as a sheet. Anybody know why?

I'll bite. Why?

[does]

so china has like one old used soviet aircraft carrier with no planes on it...

and the Federal Reserve Bank of the United States of America is going to just roll over and play dead?

good luck with that commies...

sorry to highjack the thread, but I saw a Russian guy walking down the street here in Hua Hin a few weeks ago, he was looking at his smartphone and was white as a sheet. Anybody know why?

He must have felt embarrased that his country has only one aircraft carrier and can't bomb other countries at will?