Thai Baht likely to weaken further this week

[Prbkk]

With today's devaluation of the RMB the Baht can only go lower against the USD.

[yuv06]

With today's devaluation of the RMB the Baht can only go lower against the USD.

Yuan devaluation http://www.nationmultimedia.com/breakingnews/Baht-falls-on-yuan-devaluation-30266359.html?

[chiang mai]

Predictable since January 2015. Likely to remain bt35-bt36 to end of year.

Depending on the political and human trafficking situations in 2016, value of baht could improve or worsen. Junta behavior and policies through end of 2015 will set the trend for the baht in 2016.

This is not the time for foreign investment. Vietnam and Malaysia are currently best regions in ASEAN for investments.

Politics and human trafficking have absolutely zero impact on the value of THB. In fairly recent times we've seen tanks on the streets and snipers shooting into crowds in Bangkok, THB never weakened, in fact, the opposite happened!

So what is your take on the THB weakening? Is it under attack like 97?

No it's not under attack, it's actually hugely difficult if not impossible to successfully attack THB from overseas because THB is a restricted currency that cannot be freely exported - there are limits to the amount of THB that overseas banks can hold and they are quite low. So any so called attack needs to be self administered, just like in 1997 when two factors came together - one was the huge amount of offshore (construction) loans denominated in USD and the second, was BOT's tying up their foreign currency reserves into long dated instruments (negating the possibility of any potential defense).

The current weakening is about a number of issues, primarily, USD strengthening and capital outflows in light of the rapidly improving US economic picture, lowered GDP/export forecasts resulting from a global slowdown and reduced investor confidence resulting from the lack of a coherent economic plan by government.

My ten cents on THB is that, against USD and GBP, it's very close to the bottom with far more upside than downside on the cards, however a number of possible external factors have the potential to impact that, the Chinese economy, EU stability, ISIS/war/terrorism being three of them.

Right on cue the Yuan is devalued.

[MaeJoMTB]

Right on cue the Yuan is devalued.

What happened to all your predictions of 35bht/gpb then?

Changed your mind or still sticking to them?

[chiang mai]

Right on cue the Yuan is devalued.

What happened to all your predictions of 35bht/gpb then?

Changed your mind or still sticking to them?

Only in your dreams has GBP been forecast at 35, shame on you for making unnecessary mischief.

As for what's happening currently: I reckon this is a great opportunity to buy THB against GBP because the longer term is certainly sub 50 and mid/low 40's is very likely. For my part, despite recently being nearly "all in", I went back into GBP at a good time and then this week have started to come back into THB, a few days ago at 54.6x (something). The alternatives: holding USD or GBP when the rate increase is already factored into USD and there isn't one in sight for GBP, no thank you.

Edited August 11, 2015 by chiang mai

[MaeJoMTB]

Right on cue the Yuan is devalued.

What happened to all your predictions of 35bht/gpb then?

Changed your mind or still sticking to them?

Only in your dreams has GBP been forecast at 35!

YOU predicted 35/gbp .......... old age got your memory.

Amazing that old guys can make silly predictions, then when proven completely 100% wrong bang on as if they are some sort of financial wizards.

[chiang mai]

Right on cue the Yuan is devalued.

What happened to all your predictions of 35bht/gpb then?

Changed your mind or still sticking to them?

Only in your dreams has GBP been forecast at 35!

YOU predicted 35/gbp .......... old age got your memory.

Amazing that old guys can make silly predictions, then when proven completely 100% wrong bang on as if they are some sort of financial wizards.

Talking of failing memories: prove it, post the link/quote you speak of, otherwise be quiet and walk.

[CMguy]

I will make an old guy prediction,40 baht to 1 USD by this time next year,but keep in mind, my "prediction" is based on.. 30% guess and 70% hope. So if I fall short, i must not of been hoping hard enough.

[huawei]

Right on cue the Yuan is devalued.

What happened to all your predictions of 35bht/gpb then?

Changed your mind or still sticking to them?

Only in your dreams has GBP been forecast at 35, shame on you for making unnecessary mischief.

As for what's happening currently: I reckon this is a great opportunity to buy THB against GBP because the longer term is certainly sub 50 and mid/low 40's is very likely. For my part, despite recently being nearly "all in", I went back into GBP at a good time and then this week have started to come back into THB, a few days ago at 54.6x (something). The alternatives: holding USD or GBP when the rate increase is already factored into USD and there isn't one in sight for GBP, no thank you.

What about continued possibility of devaluation by China..then shouldn't be in THB.

[NeverSure]

No, Thailand keeps US treasury bill reserves to back its international trades. Few will accept or pay in baht for imports or exports. If it sold its US treasuries it would be out of the import/export biz.

The US hasn't been "printing money". This statement is written repeatedly by reporters and foreign politicians who never managed a nation's money. There aren't more $USD in the world today than there were years ago other than to provide for inflation.

The US has been engaged in quantitative easing or QE which is done by increasing the percentage of depositors' money banks may loan. This along with lower interest rates makes borrowing more money and spending it into the economy cheaper and allowable. This "increases the money supply" available to the general economy and that can be reversed by "tightening money". When the Fed next wants to tighten money it will increase interest rates to discourage borrowing and it will decrease the percentage of depositors' money banks may loan.

"Printing money," 555.

Exactly. Thailand and many other nations must maintain an adequate amount of foreign reserves to have money to engage in international trade. If that money was spent Thailand would be out of biz.

Cheers.

It's the vernacular term that has been going on to describe quantitative easing. The supply of usd to the market has been increased. A common term for this is printing money. I.e. You print more u increase the supply thus u make it worth less. Thus the USD has been weakening for 8 years, and finally QE is now being reduced thus the USD is strengthening.

I would say QE is a fancy way of printing money, which is a vernacular term for saying boosting the money supply.

Either way, the USD Has to devalue over the long term. This amount of debt is unsustainable. Then see how strong the baht gets in another 5years..

In some ways, they tried printing money and that wasn't enough so they went onto quantitative easing. They swapped cash for illiquid assets in the market.

Either way, anyone who reckon the USD will keep its value in 10 years time is delusional. The only way out is continued devaluation.

Not true. Not true at all.

The US has engaged in QE which has nothing to do with creating new USD in any way. Not by printing. FYI the Fed doesn't print money anyway, the Dept. of the Treasury does so there's mistake one.

"Printing money" is the vernacular only among those who are ignorant of the system.

The Fed increases the money supply available to the private sector in the economy by increasing the percentage of depositors' money that banks may loan, and then lowering the interest rate at the Fed Window to entice people to borrow it. This stimulates spending including investment. It has stimulated the real estate market by getting interest rates on home loans to almost record lows.

Bringing up debt is one way of dodging the issue of "printing money" but it just that - an irrelevant dodge. BTW, worry about the UK's debt. It's almost as large as that of the US as a percentage of GDP, but the UK doesn't have the economic engine to sustain it.

You may not like me and you may not like what I say, but you could consider not taking on a real banker when you decide to discuss things you don't understand.

Cheers.

[Thai at Heart]

No, Thailand keeps US treasury bill reserves to back its international trades. Few will accept or pay in baht for imports or exports. If it sold its US treasuries it would be out of the import/export biz.

The US hasn't been "printing money". This statement is written repeatedly by reporters and foreign politicians who never managed a nation's money. There aren't more $USD in the world today than there were years ago other than to provide for inflation.

The US has been engaged in quantitative easing or QE which is done by increasing the percentage of depositors' money banks may loan. This along with lower interest rates makes borrowing more money and spending it into the economy cheaper and allowable. This "increases the money supply" available to the general economy and that can be reversed by "tightening money". When the Fed next wants to tighten money it will increase interest rates to discourage borrowing and it will decrease the percentage of depositors' money banks may loan.

"Printing money," 555.

Exactly. Thailand and many other nations must maintain an adequate amount of foreign reserves to have money to engage in international trade. If that money was spent Thailand would be out of biz.

Cheers.

It's the vernacular term that has been going on to describe quantitative easing. The supply of usd to the market has been increased. A common term for this is printing money. I.e. You print more u increase the supply thus u make it worth less. Thus the USD has been weakening for 8 years, and finally QE is now being reduced thus the USD is strengthening.

I would say QE is a fancy way of printing money, which is a vernacular term for saying boosting the money supply.

Either way, the USD Has to devalue over the long term. This amount of debt is unsustainable. Then see how strong the baht gets in another 5years..

In some ways, they tried printing money and that wasn't enough so they went onto quantitative easing. They swapped cash for illiquid assets in the market.

Either way, anyone who reckon the USD will keep its value in 10 years time is delusional. The only way out is continued devaluation.

Not true. Not true at all.

The US has engaged in QE which has nothing to do with creating new USD in any way. Not by printing. FYI the Fed doesn't print money anyway, the Dept. of the Treasury does so there's mistake one.

"Printing money" is the vernacular only among those who are ignorant of the system.

The Fed increases the money supply available to the private sector in the economy by increasing the percentage of depositors' money that banks may loan, and then lowering the interest rate at the Fed Window to entice people to borrow it. This stimulates spending including investment. It has stimulated the real estate market by getting interest rates on home loans to almost record lows.

Bringing up debt is one way of dodging the issue of "printing money" but it just that - an irrelevant dodge. BTW, worry about the UK's debt. It's almost as large as that of the US as a percentage of GDP, but the UK doesn't have the economic engine to sustain it.

You may not like me and you may not like what I say, but you could consider not taking on a real banker when you decide to discuss things you don't understand.

Cheers.

This qe was undertaken by purchasing bonds and other assets from banks and other institutions. They swapped illiquid assets for cash in the system.

This is dragged directly from the economist magazine as a quote.

To carry out QE central banks create money by buying securities, such as government bonds, from banks, with electronic cash that did not exist before. The new money swells the size of bank reserves in the economy by the quantity of assets purchased—hence "quantitative" easing.

Read more at http://www.economist.com/blogs/economist-explains/2015/03/economist-explains-5#mbhpLhtpwCHLxYBM.99

Call it what you like, it pumps liquidity into the market and thus boosts the money supply. It is inflationary.

It is money that is printed electronically......

From another source....

Definition: Quantitative easing (QE) is a massive expansion of the open market operations of a central bank. The bank buyssecurities from its member banks to addliquidity to capital markets. This has the same effect as increasing the money supply. In return, it issues credit to the banks' reserves to buy the securities.

Where do central banks get the credit to purchase these assets? They simply create it out of thin air.

Continue Reading Below

Only central banks have this unique power. It has the same effect as printing money.

And straight from the Bank of England site

How does QE work?

The Bank of England electronically creates new money and uses it to purchase gilts from private investors such as pension funds and insurance companies.

http://www.bankofengland.co.uk/monetarypolicy/Pages/qe/qe_faqs.aspx

QE involves BUYING ASSETS from the market and swapping them for cash. How is this cash created? It is created electronically. Call it a printint press or call it a keyboard, USD or GBP are created to buy assets from the market, which boosts the money supply, and puts cash into institutions hands who would rather lend it than sit on it. It is essentially creating liquid assets/cash without printing them, although that is essentially splitting hairs on the definition.

Edited August 11, 2015 by Thai at Heart

[NeverSure]

This qe was undertaken by purchasing bonds and other assets from banks and other institutions. They swapped illiquid assets for cash in the system.

This is dragged directly from the economist magazine as a quote.

To carry out QE central banks create money by buying securities, such as government bonds, from banks, with electronic cash that did not exist before. The new money swells the size of bank reserves in the economy by the quantity of assets purchased—hence "quantitative" easing.

Read more at http://www.economist.com/blogs/economist-explains/2015/03/economist-explains-5#mbhpLhtpwCHLxYBM.99

Call it what you like, it pumps liquidity into the market and thus boosts the money supply. It is inflationary.

It is money that is printed electronically......

From another source....

Definition: Quantitative easing (QE) is a massive expansion of the open market operations of a central bank. The bank buyssecurities from its member banks to addliquidity to capital markets. This has the same effect as increasing the money supply. In return, it issues credit to the banks' reserves to buy the securities.

Where do central banks get the credit to purchase these assets? They simply create it out of thin air.

Continue Reading Below

Only central banks have this unique power. It has the same effect as printing money.

Not true. Not true at all.

The US has engaged in QE which has nothing to do with creating new USD in any way. Not by printing. FYI the Fed doesn't print money anyway, the Dept. of the Treasury does so there's mistake one.

"Printing money" is the vernacular only among those who are ignorant of the system.

The Fed increases the money supply available to the private sector in the economy by increasing the percentage of depositors' money that banks may loan, and then lowering the interest rate at the Fed Window to entice people to borrow it. This stimulates spending including investment. It has stimulated the real estate market by getting interest rates on home loans to almost record lows.

Bringing up debt is one way of dodging the issue of "printing money" but it just that - an irrelevant dodge. BTW, worry about the UK's debt. It's almost as large as that of the US as a percentage of GDP, but the UK doesn't have the economic engine to sustain it.

You may not like me and you may not like what I say, but you could consider not taking on a real banker when you decide to discuss things you don't understand.

Cheers.

And straight from the Bank of England site

How does QE work?

The Bank of England electronically creates new money and uses it to purchase gilts from private investors such as pension funds and insurance companies.

http://www.bankofengland.co.uk/monetarypolicy/Pages/qe/qe_faqs.aspx

QE involves BUYING ASSETS from the market and swapping them for cash. How is this cash created? It is created electronically. Call it a printint press or call it a keyboard, USD or GBP are created to buy assets from the market, which boosts the money supply, and puts cash into institutions hands who would rather lend it than sit on it. It is essentially creating liquid assets/cash without printing them, although that is essentially splitting hairs on the definition.

Edit: Mods please, this is on topic as the topic is about the relationship of values between the USD and the baht. The OP is difficult to discuss in a vacuum that excludes the global relationships of the valuation of money and especially the USD. Thanks.

This is totally incorrect, consisting of oft repeated fallacies.

"How does QE work?

The Bank of England electronically creates new money and uses it to purchase gilts from private investors such as pension funds and insurance companies."

You are talking about England which does loan itself money by buying its own bonds. That is lawful in England but not in the US. The only way the US Fed can get more money is by borrowing it by selling Treasuries on the open market.

Why are you quoting things about England when you said the US "prints money"?

You don't even know the difference between "currency" and "money". In the US "money" is expressed as M1 and M2, terms you might google. You could print currency but money includes deposits in banks, cash, cash equivalents and so on. Increasing the money supply has nothing to do with "printing" currency and yet you pontificated that the US has been "printing money".

Until you at least learn that:

1. The laws and processes in England are different than in the US and

2. Unless you learn that increasing the money supply is not the same as increasing the currency supply ("printing") you should leave this discussion to the bankers.

You have no hope of understanding what the value relationship between the baht and the USD is or will be because you can't define "money".

Cheers.

Edited August 11, 2015 by NeverSure

[Thai at Heart]

This qe was undertaken by purchasing bonds and other assets from banks and other institutions. They swapped illiquid assets for cash in the system.

This is dragged directly from the economist magazine as a quote.

To carry out QE central banks create money by buying securities, such as government bonds, from banks, with electronic cash that did not exist before. The new money swells the size of bank reserves in the economy by the quantity of assets purchased—hence "quantitative" easing.

Read more at http://www.economist.com/blogs/economist-explains/2015/03/economist-explains-5#mbhpLhtpwCHLxYBM.99

Call it what you like, it pumps liquidity into the market and thus boosts the money supply. It is inflationary.

It is money that is printed electronically......

From another source....

Definition: Quantitative easing (QE) is a massive expansion of the open market operations of a central bank. The bank buyssecurities from its member banks to addliquidity to capital markets. This has the same effect as increasing the money supply. In return, it issues credit to the banks' reserves to buy the securities.

Where do central banks get the credit to purchase these assets? They simply create it out of thin air.

Continue Reading Below

Only central banks have this unique power. It has the same effect as printing money.

Not true. Not true at all.

The US has engaged in QE which has nothing to do with creating new USD in any way. Not by printing. FYI the Fed doesn't print money anyway, the Dept. of the Treasury does so there's mistake one.

"Printing money" is the vernacular only among those who are ignorant of the system.

The Fed increases the money supply available to the private sector in the economy by increasing the percentage of depositors' money that banks may loan, and then lowering the interest rate at the Fed Window to entice people to borrow it. This stimulates spending including investment. It has stimulated the real estate market by getting interest rates on home loans to almost record lows.

Bringing up debt is one way of dodging the issue of "printing money" but it just that - an irrelevant dodge. BTW, worry about the UK's debt. It's almost as large as that of the US as a percentage of GDP, but the UK doesn't have the economic engine to sustain it.

You may not like me and you may not like what I say, but you could consider not taking on a real banker when you decide to discuss things you don't understand.

Cheers.

And straight from the Bank of England site

How does QE work?

The Bank of England electronically creates new money and uses it to purchase gilts from private investors such as pension funds and insurance companies.

http://www.bankofengland.co.uk/monetarypolicy/Pages/qe/qe_faqs.aspx

QE involves BUYING ASSETS from the market and swapping them for cash. How is this cash created? It is created electronically. Call it a printint press or call it a keyboard, USD or GBP are created to buy assets from the market, which boosts the money supply, and puts cash into institutions hands who would rather lend it than sit on it. It is essentially creating liquid assets/cash without printing them, although that is essentially splitting hairs on the definition.

Edit: Mods please, this is on topic as the topic is about the relationship of values between the USD and the baht. The OP is difficult to discuss in a vacuum that excludes the global relationships of the valuation of money and especially the USD. Thanks.

This is totally incorrect, consisting of oft repeated fallacies.

"How does QE work?

The Bank of England electronically creates new money and uses it to purchase gilts from private investors such as pension funds and insurance companies."

You are talking about England which does loan itself money by buying its own bonds. That is lawful in England but not in the US. The only way the US Fed can get more money is by borrowing it by selling Treasuries on the open market.

Why are you quoting things about England when you said the US "prints money"?

You don't even know the difference between "currency" and "money". In the US "money" is expressed as M1 and M2, terms you might google. You could print currency but money includes deposits in banks, cash, cash equivalents and so on. Increasing the money supply has nothing to do with "printing" currency and yet you pontificated that the US has been "printing money".

Until you at least learn that:

1. The laws and processes in England are different than in the US and

2. Unless you learn that increasing the money supply is not the same as increasing the currency supply ("printing") you should leave this discussion to the bankers.

You have no hope of understanding what the value relationship between the baht and the USD is or will be because you can't define "money".

Cheers.

I still cannot see why the effects in the UK or USA are fundamentally different. QE is QE.

At the end of the day, the liquidity of the market is changed and long terms rates are modified. Liquid assets(cash) are supplied to the market in return for long term assets.

The supply of money is increased. Yes m1, m2, been there done that. For everyone who claims QE isn't increasing the money supply there is another claiming it is. Yours is not the only valid opinion because u shout loudest.

The USD has weakened because liquidity has been pumped in via QE. Turn it off and the USD will strengthen.

[Anon999]

Predictable since January 2015. Likely to remain bt35-bt36 to end of year.

Depending on the political and human trafficking situations in 2016, value of baht could improve or worsen. Junta behavior and policies through end of 2015 will set the trend for the baht in 2016.

This is not the time for foreign investment. Vietnam and Malaysia are currently best regions in ASEAN for investments.

Politics and human trafficking have absolutely zero impact on the value of THB. In fairly recent times we've seen tanks on the streets and snipers shooting into crowds in Bangkok, THB never weakened, in fact, the opposite happened!

So what is your take on the THB weakening? Is it under attack like 97?

No it's not under attack, it's actually hugely difficult if not impossible to successfully attack THB from overseas because THB is a restricted currency that cannot be freely exported - there are limits to the amount of THB that overseas banks can hold and they are quite low. So any so called attack needs to be self administered, just like in 1997 when two factors came together - one was the huge amount of offshore (construction) loans denominated in USD and the second, was BOT's tying up their foreign currency reserves into long dated instruments (negating the possibility of any potential defense).

The current weakening is about a number of issues, primarily, USD strengthening and capital outflows in light of the rapidly improving US economic picture, lowered GDP/export forecasts resulting from a global slowdown and reduced investor confidence resulting from the lack of a coherent economic plan by government.

My ten cents on THB is that, against USD and GBP, it's very close to the bottom with far more upside than downside on the cards, however a number of possible external factors have the potential to impact that, the Chinese economy, EU stability, ISIS/war/terrorism being three of them.

The GBP will continue to strengthen on the basis that the BoE will increase interest rates in the first qtr of 2016. It is now flirting with 55 against the Baht and looks unlikely to weaken this side of the New Year.

[Thai at Heart]

This qe was undertaken by purchasing bonds and other assets from banks and other institutions. They swapped illiquid assets for cash in the system.

This is dragged directly from the economist magazine as a quote.

To carry out QE central banks create money by buying securities, such as government bonds, from banks, with electronic cash that did not exist before. The new money swells the size of bank reserves in the economy by the quantity of assets purchased—hence "quantitative" easing.

Read more at http://www.economist.com/blogs/economist-explains/2015/03/economist-explains-5#mbhpLhtpwCHLxYBM.99

Call it what you like, it pumps liquidity into the market and thus boosts the money supply. It is inflationary.

It is money that is printed electronically......

From another source....

Definition: Quantitative easing (QE) is a massive expansion of the open market operations of a central bank. The bank buyssecurities from its member banks to addliquidity to capital markets. This has the same effect as increasing the money supply. In return, it issues credit to the banks' reserves to buy the securities.

Where do central banks get the credit to purchase these assets? They simply create it out of thin air.

Continue Reading Below

Only central banks have this unique power. It has the same effect as printing money.

Not true. Not true at all.

The US has engaged in QE which has nothing to do with creating new USD in any way. Not by printing. FYI the Fed doesn't print money anyway, the Dept. of the Treasury does so there's mistake one.

"Printing money" is the vernacular only among those who are ignorant of the system.

The Fed increases the money supply available to the private sector in the economy by increasing the percentage of depositors' money that banks may loan, and then lowering the interest rate at the Fed Window to entice people to borrow it. This stimulates spending including investment. It has stimulated the real estate market by getting interest rates on home loans to almost record lows.

Bringing up debt is one way of dodging the issue of "printing money" but it just that - an irrelevant dodge. BTW, worry about the UK's debt. It's almost as large as that of the US as a percentage of GDP, but the UK doesn't have the economic engine to sustain it.

You may not like me and you may not like what I say, but you could consider not taking on a real banker when you decide to discuss things you don't understand.

Cheers.

And straight from the Bank of England site

How does QE work?

The Bank of England electronically creates new money and uses it to purchase gilts from private investors such as pension funds and insurance companies.

http://www.bankofengland.co.uk/monetarypolicy/Pages/qe/qe_faqs.aspx

QE involves BUYING ASSETS from the market and swapping them for cash. How is this cash created? It is created electronically. Call it a printint press or call it a keyboard, USD or GBP are created to buy assets from the market, which boosts the money supply, and puts cash into institutions hands who would rather lend it than sit on it. It is essentially creating liquid assets/cash without printing them, although that is essentially splitting hairs on the definition.

Edit: Mods please, this is on topic as the topic is about the relationship of values between the USD and the baht. The OP is difficult to discuss in a vacuum that excludes the global relationships of the valuation of money and especially the USD. Thanks.

This is totally incorrect, consisting of oft repeated fallacies.

"How does QE work?

The Bank of England electronically creates new money and uses it to purchase gilts from private investors such as pension funds and insurance companies."

You are talking about England which does loan itself money by buying its own bonds. That is lawful in England but not in the US. The only way the US Fed can get more money is by borrowing it by selling Treasuries on the open market.

Why are you quoting things about England when you said the US "prints money"?

You don't even know the difference between "currency" and "money". In the US "money" is expressed as M1 and M2, terms you might google. You could print currency but money includes deposits in banks, cash, cash equivalents and so on. Increasing the money supply has nothing to do with "printing" currency and yet you pontificated that the US has been "printing money".

Until you at least learn that:

1. The laws and processes in England are different than in the US and

2. Unless you learn that increasing the money supply is not the same as increasing the currency supply ("printing") you should leave this discussion to the bankers.

You have no hope of understanding what the value relationship between the baht and the USD is or will be because you can't define "money".

Cheers.

I still cannot see why the effects in the UK or USA are fundamentally different. QE is QE.

At the end of the day, the liquidity of the market is changed and long terms rates are modified. Liquid assets(cash) are supplied to the market in return for long term assets.

The supply of money is increased. Yes m1, m2, been there done that. The UK has up to m5. Largely the same definition. For everyone who claims QE isn't increasing the money supply there is another claiming it is. Yours is not the only valid opinion because u shout loudest.

The USD has weakened because liquidity has been pumped in via QE. Turn it off and the USD will strengthen.

[Aforek]

YOU predicted 35/gbp .......... old age got your memory.

Amazing that old guys can make silly predictions, then when proven completely 100% wrong bang on as if they are some sort of financial wizards.

Thai visa is full of ridiculous economists who believe they know everything ( for instance, Euro is dead or it will not last or it will lower to 30 bahts for one euro ( now, it's 39 and nothing shows it will lower ) : I come and read the " economic rubric " of Thaivisa only to laugh !

as we say in my country, " ridiculousness doesn't kill "

Edited August 11, 2015 by Aforek

[chiang mai]

Right on cue the Yuan is devalued.

What happened to all your predictions of 35bht/gpb then?

Changed your mind or still sticking to them?

Only in your dreams has GBP been forecast at 35!

YOU predicted 35/gbp .......... old age got your memory.

Amazing that old guys can make silly predictions, then when proven completely 100% wrong bang on as if they are some sort of financial wizards.

What I actually said at the time, all those years ago, was that GBP/THB would hit 40, +/- 10% and so it did, it hit 43. Sadly though, some people took that to be a forecast of 35 and this has now become urban myth on this forum, proving yet again that most people can't read and comprehend well at all. But I'll sit here and wait for your "proof" and I'll be reminding you from time to time.

EDIT to add: and here's something you CAN quote me on, with my full support and it's exactly the same thing today as I said all those years ago, GBP/THB will trade again at 40, +/- 10%, it's already been there once recently. This time, try not to screw up the quote and remember that doesn't mean 35!

Edited August 11, 2015 by chiang mai

[chiang mai]

Right on cue the Yuan is devalued.

What happened to all your predictions of 35bht/gpb then?

Changed your mind or still sticking to them?

Only in your dreams has GBP been forecast at 35, shame on you for making unnecessary mischief.

As for what's happening currently: I reckon this is a great opportunity to buy THB against GBP because the longer term is certainly sub 50 and mid/low 40's is very likely. For my part, despite recently being nearly "all in", I went back into GBP at a good time and then this week have started to come back into THB, a few days ago at 54.6x (something). The alternatives: holding USD or GBP when the rate increase is already factored into USD and there isn't one in sight for GBP, no thank you.

What about continued possibility of devaluation by China..then shouldn't be in THB.

That's possible of course but I see that as unlikely given that it was already undervalued against USD. But to be clear, I'm not advocating that anyone should be "in" THB for the sake of investment or simply a gamble, I live here and I need THB to live hence for people like me, now is a good time to secure the longer term supply of THB for living costs.

[yuv06]

This Is Not A Drill: India, Russia And Thailand Prepare For Currency War http://www.zerohedge.com/news/2015-08-11/not-drill-india-russia-and-thailand-prepare-currency-war?

[chiang mai]

Ahh yes, Zerohedge, you're not actually Midas are you, he loves anything they say, nutter.

[yuv06]

Ahh yes, Zerohedge, you're not actually Midas are you, he loves anything they say, nutter.

Nope I'm not

[yuv06]

Right know it is 35.40 real time you can check out link also show other currencies http://www.forexdirectory.net/thb.html

[chiang mai]

Ahh yes, Zerohedge, you're not actually Midas are you, he loves anything they say, nutter.

Nope I'm not

Not a serious question, I was being light hearted when I wrote that.

[digibum]

This might sound simplistic, even stupid, as I'm no economist, but if the Tha Govt wants to stop the baht from weakening, why not just raise interest rates. Personally I need to see the baht back around 29 - 30 baht to the AUD. When the Oz Govt raises interest rates, the AUD strengthens against the USD, which in turn sees the THB increase against the AUD. As I said sounds simplistic, and to most with an economics background most likely quite stupid. Actually I don't know why everything has to be gauged against the USD. Why don't countries just go back to setting their own rate of exchange (the way it used to be) instead of having the currency constantly fluctuating because of the poor economic decisions of the US and Europe. Once upon a time, you always new what your exchange rates would be, and you could plan accordingly. Now, you have no idea what's going to happen.

The currency exchange rate does not dictate monetary policy. If Thailand wanted to spur economic growth, they would lower interest rates...which is what they're doing. This makes money cheaper and increases the money supply in the economy. Indirectly, it does make the baht weaker and aids its export and tourism industries. Somebody wins, somebody loses. Over time, they may have to deal with inflation, at which time, they would increase rates to make money more expensive.

I think the problem is that lower interest rates won't have much of an impact on demand. They already made money fairly cheap which is why your average Thai is up to their neck in consumer debt. Cars, appliances, homes, etc are strangling domestic demand. Thais citizens can't buy anymore. They're spent. Household debt in Thailand is nearly 90% of GDP.

Can cheap money spur business growth? Domestic demand is already choking on debt. Exports? Unlikely as exports are currently falling. Even if there was a push to spur more exports, most of that growth is going to come from foreign investments. It's going to be from Toyota building another factory, not from selling more rubber or rice. And foreign investment has options today that put a lot of competitive pressure on Thailand.

Thailand has fired most of their short-term bullets. Their only real hope is if they can figure out a long-term strategy that digs them out of the hole they've spent several decades digging themselves into.

[NeverSure]

I still cannot see why the effects in the UK or USA are fundamentally different. QE is QE.

At the end of the day, the liquidity of the market is changed and long terms rates are modified. Liquid assets(cash) are supplied to the market in return for long term assets.

The supply of money is increased. Yes m1, m2, been there done that. For everyone who claims QE isn't increasing the money supply there is another claiming it is. Yours is not the only valid opinion because u shout loudest.

The USD has weakened because liquidity has been pumped in via QE. Turn it off and the USD will strengthen.

"I still cannot see why the effects in the UK or USA are fundamentally different. QE is QE."

Of course you can't see it and QE in one place isn't QE in another based on local laws, policies, and philosophies. The UK loans itself money by issuing bonds and then buying them itself - a feat you don't want to try at home. This is not at all how its done in the US because it's illegal and you were talking about the US "printing money" when you didn't even know you were talking about currency. Its the UK that's running itself into a ditch with a national debt to GDP ratio that's almost as high as the US but without the engine to sustain it. The UK doesn't have the buyers for its bonds that the US does so it - wait for this - buys them itself.

"At the end of the day, the liquidity of the market is changed and long terms rates are modified. Liquid assets(cash) are supplied to the market in return for long term assets."

That's not true and you should give it up. I already told you that the increased liquidity comes from allowing banks to loan a higher percentage of depositors' money. That has nothing to do with long term rates. Current rates are influenced, not set, by what the Fed offers to pay at its Overnight Window, influencing banks to either lend to the Fed or to the marketplace. When banks are awash with liquidity due to changed regulations, they want to loan that money. The Fed won't pay much so the banks compete for actual loans in the general marketplace, lowering interest rates. End of.

(The Fed lends money to banks that are over loaned and borrows from banks that have excess capital at its overnight window to keep bank liquidity in balance and banks within regulation. It's the bankers' bank.)

The supply of money is increased. Yes m1, m2, been there done that. For everyone who claims QE isn't increasing the money supply there is another claiming it is. Yours is not the only valid opinion because u shout loudest.

If you'd "been there done that" you'd know that M1 and M2 are the measure of the money supply and that's not just my opinion. You are simply wrong. You said the Fed was printing money which would affect the currency supply but it hasn't, and now you want to say that this falsehood has something to do with the money supply which it doesn't.

If the Fed raises interest rates and tightens up the amount of depositors' money banks can loan the money supply will shrink. Increasing the money supply is temporary and is done to stimulate. That money supply shrinks when the Fed stops QE and raises interest rates.

The USD has weakened because liquidity has been pumped in via QE. Turn it off and the USD will strengthen.

The USD has weakened? It has been strengthening against the standard basket of currencies ever since the Fed began QE after the debacle of 2007 - 2008!! If/when the Fed raises interest rates by tightening credit back up in banks while offering to pay more interest at its Overnight Window, the value of the USD normally would increase even more.

You're up against a real banker while trying to be an internet bright guy and to me you are completely off base. I'm not writing this for your benefit but rather in case anyone else might be interested. You aren't teachable.

Cheers.

Now I'm out of this thread because you wear me out. You're too much work and I write this only in case someone else is interested because I don't see where you will learn anything.

Bye.

Edited August 11, 2015 by NeverSure

[chiang mai]

What happened to all your predictions of 35bht/gpb then?

Changed your mind or still sticking to them?

Only in your dreams has GBP been forecast at 35, shame on you for making unnecessary mischief.

As for what's happening currently: I reckon this is a great opportunity to buy THB against GBP because the longer term is certainly sub 50 and mid/low 40's is very likely. For my part, despite recently being nearly "all in", I went back into GBP at a good time and then this week have started to come back into THB, a few days ago at 54.6x (something). The alternatives: holding USD or GBP when the rate increase is already factored into USD and there isn't one in sight for GBP, no thank you.

What about continued possibility of devaluation by China..then shouldn't be in THB.

That's possible of course but I see that as unlikely given that it was already undervalued against USD. But to be clear, I'm not advocating that anyone should be "in" THB for the sake of investment or simply a gamble, I live here and I need THB to live hence for people like me, now is a good time to secure the longer term supply of THB for living costs.

And Goldman agrees, China is simply moving ahead of the US Fed move hence this is unlikely to be the start of a devaluation war - zerohedge remains, well, nutters basically.

http://www.bloomberg.com/news/articles/2015-08-11/goldman-says-china-yuan-move-is-attempt-to-get-ahead-of-the-fed

[Jessi]

Right know it is 35.40 real time you can check out link also show other currencies http://www.forexdirectory.net/thb.html

Not long to go now and it will be back to 40B = $1.

[yuv06]

Asian currencies recover after yuan-cut rout

http://www.nationmultimedia.com/business/Asian-currencies-recover-after-yuan-cut-rout-30266504.html?

[yuv06]

Thai finmin says not worried about recent fund outflows

http://www.reuters.com/article/2015/08/13/thailand-outflows-idUSL3N10O2F020150813?rpc=401

[yuv06]

Right know it is 35.40 real time you can check out link also show other currencies http://www.forexdirectory.net/thb.html

Not long to go now and it will be back to 40B = $1.

Seems THB has stabilized