Uncertain Times

[GOLDBUGGY]

Actually it is probably a bad time to buy US Dollars. I think it is a bit overpriced. There is talk that the US Interest Rates may go up soon, and that would prop up the Dollar some. But I think a lot of that is already built into the Dollar. If Interest Rates don't go up as expected, then look out below.

If you are concerned about the Baht then I think a safer bet is in the Canadian and Australian Dollar. Both have pretty well bottomed out now. When you are down like this the only way is up. But don't expect much action there until mining and oil prices go up. Nobody knows when that will be so this is the bad part about that.

I think I would worry more that the US Dollar would come down more than the Thai Baht right now, so perhaps the best thing to do in this case is nothing.

[RBOP]

Looking into my crystal ball its too late to buy US$ as its already quite strong against most currencies (buy low sell when high). So if you have US$ now is the time to buy Baht not buy US$ with Baht. But any political unrest would devalue the Baht but would also quickly recover as we have seen before.

[1FinickyOne]

Not sure how much you are playing with but make sure to figure in the cost of the transactions, especially if you are going to trade it back to baht at a later date…

We can all speculate on the markets but at any given point, there are an equal number of buyers and sellers…

Good luck whichever way you go..

[DogNo1]

There are so many moving elements in the world economy that prediction is speculative fancy. Remember when everyone was sure that the price of real estate could only increase because there is a limited amount of land? At the same time, the quants calculation that credit default swaps were virtually risk-free because they counter-balanced each other? Remember when Social Security going broke was a huge problem in the 1970's?

So far as the national debt of the US is concerned, I wonder if all of the hand-wringers have researched the historical percentage of the national debt in relation to GDP?

Relax. Spend conservatively and be prepared to ride out currency and market fluctions. Life is always a win some, lose some proposition.

[Asiantravel]

The US debt at the end of 2014 was a tad over $18 trillion. Check a funny graphs below:

http://demonocracy.info/infographics/usa/us_debt/us_debt.html

Meh, and GDP is a bit over 17 Trillion. The vast majority of the debt is future social security obligations. It can be changed with a few alterations to benefits....politically difficult, but if things get out of hand it'll be done. It's like having a salary of 80k a year and still owing 80k on your house and car. Not unmanageable

“US Debt Is 3 Times More Than You Think” Warns Former Chief US Accountant

In a shocking admission for most of mainstream America, the former U.S. comptroller general says the real U.S. debt is closer to about $65 trillion than the oft-cited figure of $18 trillion, thanks to unfunded liabilities which simply cannot be ignored. As The Hill reports, unless economic growth accelerates, he warns, “you’re not going to be able to provide the kind of social safety net that we need in this country,” adding unequivocially that Americans have “lost touch with reality” when it comes to spending.

http://investmentwatchblog.com/stop-the-yellen-fed-chair-defends-no-rate-policies-global-debt-defaults-near-milestone-us-debt-is-3-times-more-than-you-think-warns-former-chief-us-accountant/

[Asiantravel]

When the US starts raising interest rates, hot money that flowed here back in the QE period, will flow back to the US for the higher yields, and higher security. The US dollar will probably strengthen, and the Baht weaken. Hopefully, Thailand will take measures to ensure it doesn't weaken too much!

There may be a nominal rate increase in December, but it's doubtful that there will be much more any time soon. Realistically the market, not the Fed, sets rates and it has already priced in the small increase. The dollar may still rise but I doubt it will be because of the Fed, at least in the near term.

Currency rates tend to be cyclical & self-correcting over time. Many people seem to pursue the buy-high-and-sell-low mentality with currency and stocks. Everyone who hoarded the Euro for its strength and safety when it was strong now find themselves on the wrong side of the trade.

I've been reading some articles lately saying the fed may be forced to raise rates faster and quicker than anticipated. The US economy is doing quite well.

http://news.morningstar.com/all/dow-jones/us-markets/201512046926/us-employers-added-211000-jobs-in-november-update.aspx

The US economy is doing quite well. ????????

J.P. Morgan And Citigroup Agree That The U.S. Economy Is Steamrolling Toward A Recession

http://seekingalpha.com/article/3736806-j-p-morgan-and-citigroup-agree-that-the-u-s-economy-is-steamrolling-toward-a-recession

94,446,000 Americans NOT In Work Force

http://www.breitbart.com/big-government/2015/12/04/94446000-americans-not-work-force/

Edited December 7, 2015 by Asiantravel

[maewang99]

ummm... isn't this a bit backwards? the Baht is at all time lows once again, at least against the US dollar it is. I wouldn't worry at all. Thailand is still running trade surpluses, relatively low public debt, is about to upgrade some of it's infrastructure.... and with stuff that makes sense.. trains instead of planes..... and it's domestic economy is very sustainable... people here make due with a lot less stuff than in the west. and if you are like me and have future pension benefits that are based in US dollars or another developed country.... you need to worry about being diversified as to fx rates because if we swing back to something more normal historically... we're talking about a US dollar that is worth only 20 or 15 baht..... not 36 as if it were Tum Yung Gung crisis time again... it ain't. it just ain't. this swings both ways and we may have swung too far enough already over the Fed rate rise game.

Edited December 7, 2015 by maewang99

[mrfaroukh]

If the Baht devalue is the blessing for me as I only transfer as much money I need when I come to Thailand.

[MyFriend You]

I've always said, no matter what the Baht is trading at with any currency, that 5 baht plastic bag if Cha Dum Yen will still cost 5 baht. If you live local, you have nothing to worry about, but if you hang out in the Emporium in Bangkok, you will be hurting or are already.

[lannarebirth]

When considering THB, I think its important to think about time frames. If your time horizon is short term, ie: 6 months or less, then no one really knows. Looks like its in the middle of a 6%-8% band. Could move up or down. If your time horizon is longer, ie: years; I think its a pretty good buy. Possible upside 20 THB:$USD. possible downside 40 THB:$USD (maybe a higher 1-2 day spike which you won't catch) over the long term IMO.

[Gutenberg]

we're talking about a US dollar that is worth only 20 or 15 baht

Very unlikely in the next 10 years.

[craigt3365]

When the US starts raising interest rates, hot money that flowed here back in the QE period, will flow back to the US for the higher yields, and higher security. The US dollar will probably strengthen, and the Baht weaken. Hopefully, Thailand will take measures to ensure it doesn't weaken too much!

There may be a nominal rate increase in December, but it's doubtful that there will be much more any time soon. Realistically the market, not the Fed, sets rates and it has already priced in the small increase. The dollar may still rise but I doubt it will be because of the Fed, at least in the near term.

Currency rates tend to be cyclical & self-correcting over time. Many people seem to pursue the buy-high-and-sell-low mentality with currency and stocks. Everyone who hoarded the Euro for its strength and safety when it was strong now find themselves on the wrong side of the trade.

I've been reading some articles lately saying the fed may be forced to raise rates faster and quicker than anticipated. The US economy is doing quite well.

http://news.morningstar.com/all/dow-jones/us-markets/201512046926/us-employers-added-211000-jobs-in-november-update.aspx

Please explain why the Fed would be "forced" to raise rates, The Fed wants to raise rates to get inflation up and to have ammo for the next recession. Don't know why they will be forced.to raise rates.

I think you answered your own question!

[suzannegoh]

When the US starts raising interest rates, hot money that flowed here back in the QE period, will flow back to the US for the higher yields, and higher security. The US dollar will probably strengthen, and the Baht weaken. Hopefully, Thailand will take measures to ensure it doesn't weaken too much!

There may be a nominal rate increase in December, but it's doubtful that there will be much more any time soon. Realistically the market, not the Fed, sets rates and it has already priced in the small increase. The dollar may still rise but I doubt it will be because of the Fed, at least in the near term.

Currency rates tend to be cyclical & self-correcting over time. Many people seem to pursue the buy-high-and-sell-low mentality with currency and stocks. Everyone who hoarded the Euro for its strength and safety when it was strong now find themselves on the wrong side of the trade.

I've been reading some articles lately saying the fed may be forced to raise rates faster and quicker than anticipated. The US economy is doing quite well.

http://news.morningstar.com/all/dow-jones/us-markets/201512046926/us-employers-added-211000-jobs-in-november-update.aspx

Please explain why the Fed would be "forced" to raise rates, The Fed wants to raise rates to get inflation up and to have ammo for the next recession. Don't know why they will be forced.to raise rates.

I think you answered your own question!

Except that's a bit backwards. All other things being equal, raising rates should reduce inflation not inrease it.

[craigt3365]

The US economy is doing quite well. ????????

J.P. Morgan And Citigroup Agree That The U.S. Economy Is Steamrolling Toward A Recession

http://seekingalpha.com/article/3736806-j-p-morgan-and-citigroup-agree-that-the-u-s-economy-is-steamrolling-toward-a-recession

94,446,000 Americans NOT In Work Force

http://www.breitbart.com/big-government/2015/12/04/94446000-americans-not-work-force/

Good gosh. What a bunch of drivel. The first one seems to contradict it's own title! LOL

In the short term, the note says that the 6-month likelihood is only 5%, but within a year it stands at 23%, in two years 48%, and in three years the "eye-popping" 76%.

Economies do go up and down. So easy to predict a downturn in the future. And we've been in a fantastic bull market for many years. Time for a slowdown. I put a downturn at 100% certainty sometime in the future. My best prediction. LOL

This is a much better article, from a reputable organization:

http://www.theatlantic.com/business/archive/2013/02/why-the-us-government-never-ever-has-to-pay-back-all-its-debt/272747/

We borrow in a currency we control, so we can never run out of it; we can always inflate as a last resort. This money-printing escape hatch protects us from the kind of self-fulfilling run -- where markets push up borrowing costs on fear of default, which, perversely, makes default more likely -- that had plagued Europe before ECB chief Mario Draghi promised to do "whatever it takes" to save the euro. The worst we have to fear is some kind of replay of 1992, with rising interest payments forcing some combination of tax hikes and/or spending cuts. There's a little bit more to fear than fear itself, but not too much more.

The last sentence sums it up quite nicely.

[lcp0761]

When the US starts raising interest rates, hot money that flowed here back in the QE period, will flow back to the US for the higher yields, and higher security. The US dollar will probably strengthen, and the Baht weaken. Hopefully, Thailand will take measures to ensure it doesn't weaken too much!

The US Federal Reserve has said it will raise the interest rates later this month, long over due, which should add international confidence to the US Dollar.

[fletchsmile]

My strategy for years now has largely been to protect myself from currency movements that might cause a problem to me. That means making sure I'm not at the mercy of market timing on exchange rates. So I don't generally try and make money from currencies but try and make my money from other means.

So for me it's never an either or, and I'm never particularly bothered about which way rates go. I keep money where I came from, where I am now in Thailand in THB in Thai assets, and then some offshore in Singapore. SGD is a nice currency to hold if you're based in Thailand.

FWIW I think THB could maybe weaken a little bit more from here vs USD. That said I think the main story over the last few years has been a strengthening USD, and expect that to change next year, and USD will start heading downwards again after a few months..... until the next crisis

Structurally though, the US will never be as important again (relatively) and is past its peak. Ultimately that'll translate into its currency.

If (and when) USD loses its status as the world's main currency that will be a shock to have protected yourself against. Probably won't happen in the next few years, but if (and when) it does be prepared. Hard to see it happening soon, but then again shocks often arrive when you least expect them

Edited December 9, 2015 by fletchsmile

[MauiSteveBKK]

Seems To Be A Fair Amount Of "Speculation" That The USA Dollar & Economy Will Fall.

Let's See:

+ Russian economy in the toilet. No hard currency. Putin hurting with low oil prices, too.

+ China economy not doing so good either. Geeeez.

+ Greece can't pay a single invoice.

+ Most of Eastern Europe "tilting" to insolvency.

+ Gulf Oil Countries -- hurting BIG TIME with oil now at its lowest.

+ South America -- Brazil & Columbia particularly hurting with economic recessions.

+ Mexico is well ... duh ... Mexico.

Hey Folks ... The Good 'Ol US of A is doing just fine.

Now back to the numb & dumb speculation.

[craigt3365]

Seems To Be A Fair Amount Of "Speculation" That The USA Dollar & Economy Will Fall.

Let's See:

+ Russian economy in the toilet. No hard currency. Putin hurting with low oil prices, too.

+ China economy not doing so good either. Geeeez.

+ Greece can't pay a single invoice.

+ Most of Eastern Europe "tilting" to insolvency.

+ Gulf Oil Countries -- hurting BIG TIME with oil now at its lowest.

+ South America -- Brazil & Columbia particularly hurting with economic recessions.

+ Mexico is well ... duh ... Mexico.

Hey Folks ... The Good 'Ol US of A is doing just fine.

Now back to the numb & dumb speculation.

The US dollar will be the main currency for the rest of the lives for most of us. For better or worse.

[Asiantravel]

The US economy is doing quite well. ????????

J.P. Morgan And Citigroup Agree That The U.S. Economy Is Steamrolling Toward A Recession

http://seekingalpha.com/article/3736806-j-p-morgan-and-citigroup-agree-that-the-u-s-economy-is-steamrolling-toward-a-recession

94,446,000 Americans NOT In Work Force

http://www.breitbart.com/big-government/2015/12/04/94446000-americans-not-work-force/

Good gosh. What a bunch of drivel. The first one seems to contradict it's own title! LOL

In the short term, the note says that the 6-month likelihood is only 5%, but within a year it stands at 23%, in two years 48%, and in three years the "eye-popping" 76%.

Economies do go up and down. So easy to predict a downturn in the future. And we've been in a fantastic bull market for many years. Time for a slowdown. I put a downturn at 100% certainty sometime in the future. My best prediction. LOL

This is a much better article, from a reputable organization:

http://www.theatlantic.com/business/archive/2013/02/why-the-us-government-never-ever-has-to-pay-back-all-its-debt/272747/

We borrow in a currency we control, so we can never run out of it; we can always inflate as a last resort. This money-printing escape hatch protects us from the kind of self-fulfilling run -- where markets push up borrowing costs on fear of default, which, perversely, makes default more likely -- that had plagued Europe before ECB chief Mario Draghi promised to do "whatever it takes" to save the euro. The worst we have to fear is some kind of replay of 1992, with rising interest payments forcing some combination of tax hikes and/or spending cuts. There's a little bit more to fear than fear itself, but not too much more.

The last sentence sums it up quite nicely.

so funny.

you refer to the articles as drivel and yet you simultaneously post an article which suggests endless money printing will save the USA

if that was the case why hasn't it worked in Japan -Abenomics is a complete failure? In fact can you provide an example of just one instance from history where a country adopted this strategy and where it ended successfully?

[IMA_FARANG]

I have little choice.

I receive a monthly pension in Dollars, which I am powerless to change as it is a U.S. government source.

If I asked them to change that to another currency they would just laugh at me.

So I don't really have a choice.,

As the American comedian W.C. Fields once said. "Sometimes you just have to grab the Bull by the tail and face the situation".

[craigt3365]

It's worked so far!

You can't compare the Japanese economy to the US economy. Too many differences to go into here.

[Gutenberg]

... duh ...

These kind of argumentation shows always the level of education.

[IMA_FARANG]

Actually it is probably a bad time to buy US Dollars. I think it is a bit overpriced. There is talk that the US Interest Rates may go up soon, and that would prop up the Dollar some. But I think a lot of that is already built into the Dollar. If Interest Rates don't go up as expected, then look out below.

If you are concerned about the Baht then I think a safer bet is in the Canadian and Australian Dollar. Both have pretty well bottomed out now. When you are down like this the only way is up. But don't expect much action there until mining and oil prices go up. Nobody knows when that will be so this is the bad part about that.

I think I would worry more that the US Dollar would come down more than the Thai Baht right now, so perhaps the best thing to do in this case is nothing.

----------------------------------------------------

In my opinion, the Aussie Dollar is to dependent on commodity prices, especially thing like metals and Iron Ore....and they are on there way down. Increasing supply and dropping demand right now.

[Asiantravel]

It's worked so far!

You can't compare the Japanese economy to the US economy. Too many differences to go into here.

well you don't need to spend much time to find a host of economic commentators that are screaming their warning that just because it's worked so far it doesn't mean it can go on indefinitely (now even including the IMF and the BIS).

And if you don't have time to go into the many differences between the two economies then at least can you answer the second part of my question and just provide one instance from all of history where a country has relied on inflating its way out of debt and by doing this they resolved their debt problems successfully?

Edited December 9, 2015 by Asiantravel

[rumesh]

Really, it is a little bit an incomprehensible post.

[lannarebirth]

Seems To Be A Fair Amount Of "Speculation" That The USA Dollar & Economy Will Fall.

Let's See:

+ Russian economy in the toilet. No hard currency. Putin hurting with low oil prices, too.

+ China economy not doing so good either. Geeeez.

+ Greece can't pay a single invoice.

+ Most of Eastern Europe "tilting" to insolvency.

+ Gulf Oil Countries -- hurting BIG TIME with oil now at its lowest.

+ South America -- Brazil & Columbia particularly hurting with economic recessions.

+ Mexico is well ... duh ... Mexico.

Hey Folks ... The Good 'Ol US of A is doing just fine.

Now back to the numb & dumb speculation.

Regardless, the USD:THB is a niche trade. It is not correlated with the USD:EUR, USD:CAD, USD:AUD trade which often trade opposite to $USD.

[DogNo1]

Well, the first thing to learn about the Japanese economy is that its objective is more stasis than growth. There are many other unique aspects to the economy that can be read about in books that be Googled.

[Gutenberg]

Regardless, the USD:THB is a niche trade. It is not correlated with the USD:EUR, USD:CAD, USD:AUD trade which often trade opposite to $USD.

Are you sure?

I comparing always EUR/USD and EUR/THB and the THB is basically just a follower of the USD.

http://finance.yahoo.com/echarts?s=EURUSD

http://finance.yahoo.com/echarts?s=EURTHB

Edited December 10, 2015 by Gutenberg

[Asiantravel]

Well, the first thing to learn about the Japanese economy is that its objective is more stasis than growth. There are many other unique aspects to the economy that can be read about in books that be Googled.

'the Japanese economy is that its objective is more stasis than growth '

does it really matter at this stage?both countries are up to their neck in debt with no way out.

and America only achieved its so-called growth through debt creation .

http://www.centralbanknews.info/2014/06/debt-fueled-economic-growth-not.html

[fang37]

It is time for another World War!