What to do with thai baht?

[Naam]

your baht is worth the same as it always was unless you plan to spend it internationally.

Which I have been saying for 30 years or so - that 3 baht bag of Cha Dum Yen will still cost you 3 baht doesn' matter what the exchange rate is...........if you live in Thailand, enjoy the high exchange rate, when I first came here the baht was 20 for a $1.......but we lived well on a thousand $'s a month.

a low Baht is not worth the same if you buy French cheese, Italian salami or a German car in Thailand

[Linzz]

when every taxi driver and his mother-in-law think there's going to be a rate hike in september then most probably... there won't be any

What a stupid comment. Of course no one can predict the future and surprises will always abound but it is not taxi drivers and mother in laws that are making predictions or driving currencies, it's the consensus of economists.

[Gik]

your baht is worth the same as it always was unless you plan to spend it internationally.

Which I have been saying for 30 years or so - that 3 baht bag of Cha Dum Yen will still cost you 3 baht doesn' matter what the exchange rate is...........if you live in Thailand, enjoy the high exchange rate, when I first came here the baht was 20 for a $1.......but we lived well on a thousand $'s a month.

Many food prices gone up by 100% and more for the past 6 years. Few examples:

1. Big Leo used to be 32 now 56.

2. Fuji set 180 baht now 320.

3. Coconut in lotus 9 baht now 35.

4. Phat thai kung in street kitchen 30 baht (8 shrimps) now 50 (4 shrimps).

5. Live shrimps 1 kg 120 now 280.

The inflation is big and weaker baht will drive it up faster. Therefore your savings in baht will lose in value pretty fast. So far the best solution (except investing in business so money make more money) was to open offshore account and keep money there.

[Linzz]

your baht is worth the same as it always was unless you plan to spend it internationally.

Which I have been saying for 30 years or so - that 3 baht bag of Cha Dum Yen will still cost you 3 baht doesn' matter what the exchange rate is...........if you live in Thailand, enjoy the high exchange rate, when I first came here the baht was 20 for a $1.......but we lived well on a thousand $'s a month.

Many food prices gone up by 100% and more for the past 6 years. Few examples:

1. Big Leo used to be 32 now 56.

2. Fuji set 180 baht now 320.

3. Coconut in lotus 9 baht now 35.

4. Phat thai kung in street kitchen 30 baht (8 shrimps) now 50 (4 shrimps).

5. Live shrimps 1 kg 120 now 280.

The inflation is big and weaker baht will drive it up faster. Therefore your savings in baht will lose in value pretty fast. So far the best solution (except investing in business so money make more money) was to open offshore account and keep money there.

Offshore account in USD

[Naam]

when every taxi driver and his mother-in-law think there's going to be a rate hike in september then most probably... there won't be any

What a stupid comment. Of course no one can predict the future and surprises will always abound but it is not taxi drivers and mother in laws that are making predictions or driving currencies, it's the consensus of economists.

there was never a consensus of economists on any matter. even single economists are known to state "on one hand..., but on the other hand...". presently we have reached a stage where the proverbial "taxi driver and mother-in-laws" applies.

september will be over in two months and, depending on the outcome you will pull my leg or i might pull yours without using the expression "stupid".

by the way, if investors were convinced there will be a rate hike for sure then shorting short maturity US Treasuries would be a highly profitable deal and everybody would jump in. i see shorts in the market but the volume of shorts does not indicate any "consensus".

[Linzz]

when every taxi driver and his mother-in-law think there's going to be a rate hike in september then most probably... there won't be any

What a stupid comment. Of course no one can predict the future and surprises will always abound but it is not taxi drivers and mother in laws that are making predictions or driving currencies, it's the consensus of economists.

there was never a consensus of economists on any matter. even single economists are known to state "on one hand..., but on the other hand...". presently we have reached a stage where the proverbial "taxi driver and mother-in-laws" applies.

september will be over in two months and, depending on the outcome you will pull my leg or i might pull yours without using the expression "stupid".

by the way, if investors were convinced there will be a rate hike for sure then shorting short maturity US Treasuries would be a highly profitable deal and everybody would jump in. i see shorts in the market but the volume of shorts does not indicate any "consensus".

No it wouldn't if what you said earlier still applies about anticipating a rising $ causing it to rise still applies.

I never intended to brand you as "stupid" and I apologize if you read it that way. But your comments about taxi drivers and mother in laws was. Go ahead and take their advice if you like. While economists may not always agree if you do some research on line you will find that there is a general expectation that the Fed will hike the exchange rate shortly because they have to.

Accordingly my advice to the OP who was wondering what to do with his accumulated THB was not to keep it in a weaker currency when he could invest in a stronger one.

[Naam]

But your comments about taxi drivers and mother in laws was.

it's a familiar derogatory comment used since many years with slight variations by traders. variations are:

-every taxi driver and house maid,

-your neighbour and your neighbour's dogs,

-the chap who reads your gas/water/electricity meter,

-the chap on the bar stool next to you.

history has taught me that it applies very often. anyway, let's wait and see. if Mamdame Yellen does not act i don't see a further high-flying USD vs. emerging market currencies even though nearly all my assets are denominated in USD.

[Berkshire]

The current price of the baht or the USD already reflects the economic uncertainties. If someone knew where the currencies were going they would be trading the currencies on the forex market. They don't because NO one knows what the next step is with any certainties.

It's like the current cost of oil. It is what it is. A barrel of oil is worth X today. If people knew the price tomorrow, than oil would reflect that today but they don't.

What I'm trying to say is. Stay with the baht because it what it is. If you knew the USD was going to be 35 six months ago people would have bailed out of the baht then. The market is never wrong. On any given day, that's what a barrel of oil or the Thai baht is worth. Going to USD from the baht now, makes no sense unless you know something every currency trader in the world doesn't know.

Agree 100%, often shortened as: “What everybody knows, is already in the price”.

You often hear “analysts” proclaim that X will go up in price when Y happens, and it’s not unusual the opposite actually happens, as another adage says “buy on the rumor, sell on the news”. Translated to the current situation, people are moving to USD because they expect it will go up in price (once interests are raised), this new demand makes it go up in price. Once the interests are raised, the USD has already found its new price, and that’s when those who moved to USD wants to take their profit and sell their USD, causing demand to actually go down…

Of course as soon as a pattern emerges, someone will try to make money from understanding it, and thus break the pattern. E.g. if my above analysis was all there was to it, then the right thing to do now is to short the USD, but there are probably already people doing that, which means they’ll have to buy USD at some point in the future…

Agree with both you guys. Of course we expect the USD to strengthen when the US fed raise interest rates....but it's possible that this expectation is already baked into the current value. And yes, once it actually does happen, the USD may actually weaken once the speculators have made their profits. But the currency market doesn't work the same way as the stock market, so who knows.

It's a cycle. For example, the weakened baht could improve exports/tourism, which will in turn improve Thai GDP and the Thai economy, which will result in robust economic growth, which will result in inflation and the Thai gov raising interest rates, and ultimately, a stronger baht. Just a simplistic explanation, but an example of the typical business cycle.

[Traveling Sailor]

How is a more expensive USD automatically a loss if you live in Thailand?

he thinks in USD, does his "accounting" in USD and therefore arrives at a perceived loss.

to the OP:

if you are willing to forego the peanuts amount of interest you get in THB then change your Baht into cash USD and keep them under the mattress. that is if you are expecting a further Baht weakening. you are even better off than opening a foreign currency account which does not bear interest but costs fees.

Not good advice for bed wetters...

Why not? Nothing better than a zip lock bag for keeping your money nice and dry. And, the bags come in many sizes.

[Linzz]

But your comments about taxi drivers and mother in laws was.

it's a familiar derogatory comment used since many years with slight variations by traders. variations are:

-every taxi driver and house maid,

-your neighbour and your neighbour's dogs,

-the chap who reads your gas/water/electricity meter,

-the chap on the bar stool next to you.

history has taught me that it applies very often. anyway, let's wait and see. if Mamdame Yellen does not act i don't see a further high-flying USD vs. emerging market currencies even though nearly all my assets are denominated in USD.

What you're trying to say is the market is hard to predict with any certainty by using such analogies, I get it.

But trading is management not gambling otherwise the banks and hedge fund managers that move the currencies would just go to the casino or consult their mother in laws or neighbor's dogs and they don't do that, so the derogatory anecdotes are inspired by dabblers and retail traders of which 95% lose.

If you care to google "rate hike 2015" you will see the general consensus.from JP Morgan, Bloomberg etc It's no guarantee of course but it's a guide.You obviously have faith in the USD or you would not have by your own admission nearly all your "assets denominated in USD"

You could exchange them into THB if you think the USD will fall, but I dare say you will not.

[SheungWan]

But your comments about taxi drivers and mother in laws was.

it's a familiar derogatory comment used since many years with slight variations by traders. variations are:

-every taxi driver and house maid,

-your neighbour and your neighbour's dogs,

-the chap who reads your gas/water/electricity meter,

-the chap on the bar stool next to you.

history has taught me that it applies very often. anyway, let's wait and see. if Mamdame Yellen does not act i don't see a further high-flying USD vs. emerging market currencies even though nearly all my assets are denominated in USD.

What you're trying to say is the market is hard to predict with any certainty by using such analogies, I get it.

But trading is management not gambling otherwise the banks and hedge fund managers that move the currencies would just go to the casino or consult their mother in laws or neighbor's dogs and they don't do that, so the derogatory anecdotes are inspired by dabblers and retail traders of which 95% lose.

If you care to google "rate hike 2015" you will see the general consensus.from JP Morgan, Bloomberg etc It's no guarantee of course but it's a guide.You obviously have faith in the USD or you would not have by your own admission nearly all your "assets denominated in USD"

You could exchange them into THB if you think the USD will fall, but I dare say you will not.

Since currency can be purchased forwards or options taken out on a forward purchase, the future can be managed ie risk can be managed.

[Naam]

But your comments about taxi drivers and mother in laws was.

it's a familiar derogatory comment used since many years with slight variations by traders. variations are:

-every taxi driver and house maid,

-your neighbour and your neighbour's dogs,

-the chap who reads your gas/water/electricity meter,

-the chap on the bar stool next to you.

history has taught me that it applies very often. anyway, let's wait and see. if Mamdame Yellen does not act i don't see a further high-flying USD vs. emerging market currencies even though nearly all my assets are denominated in USD.

What you're trying to say is the market is hard to predict with any certainty by using such analogies, I get it.

But trading is management not gambling otherwise the banks and hedge fund managers that move the currencies would just go to the casino or consult their mother in laws or neighbor's dogs and they don't do that, so the derogatory anecdotes are inspired by dabblers and retail traders of which 95% lose.

If you care to google "rate hike 2015" you will see the general consensus.from JP Morgan, Bloomberg etc It's no guarantee of course but it's a guide.You obviously have faith in the USD or you would not have by your own admission nearly all your "assets denominated in USD"

You could exchange them into THB if you think the USD will fall, but I dare say you will not.

Since currency can be purchased forwards or options taken out on a forward purchase, the future can be managed ie risk can be managed.

currency forwards and options when the money is in THB with a Thai bank? neither today nor in 10 years from now.