Report spotlights effects of Thailand’s rising household debt

[rooster59]

Report spotlights effects of Thailand’s rising household debt

THE NATION

 

 

ALLIANZ GROUP yesterday unveiled the seventh edition of its “Global Wealth Report”, which puts the asset and debt situation of households in more than 50 countries under the microscope.

 

Given the thin financial cover of many Thai households, maintaining efforts to reduce the debt burden is absolutely necessary, the study found.

The report says global financial assets climbed by 4.9 per cent in 2015, just a whisker above the growth rate of economic activity. In the three previous years, financial assets grew at twice that pace, with an average rate of 9 per cent.

 

Full story: http://www.nationmultimedia.com/business/Report-spotlights-effects-of-Thailands-rising-hous-30296647.html

 

 

-- © Copyright The Nation 2016-10-01

[BigBadGeordie]

"With loan growth regularly surpassing that of gross domestic product in the last 10 years, households' debt-to-GDP ratio increased from 45.1 per cent to 81.6 per cent in the period."

 

But at least they have "happiness", and a new iphone and pick-up (for now).

[williamgeorgeallen]

a large part of this is low interest rates encouraging people buying stuff under finance especially houses. i have many friends back in nz struggling under massive mortgages along with car loans etc. is a hard life, especially if you want to have kids.

[elgordo38]

29 minutes ago, williamgeorgeallen said:

a large part of this is low interest rates encouraging people buying stuff under finance especially houses. i have many friends back in nz struggling under massive mortgages along with car loans etc. is a hard life, especially if you want to have kids.

Looking back and if I had to make a choice I would pass on the kids. Not just because of personal greed but because I would not want to expose them to the world that exists today plus the unknown of tomorrow. 90% of the worlds population is breathing unfit air. I would really shop for a cheap rental apartment close to public transit. I just read that 100,000's of teachers you know the people that educate your children are in debt over their head and a new "soft" loan is being created for them here in the LOS. I wonder if this new "credit" will be used to payoff the "old" credit already existing or just used to extend the good life. It seems teachers are having a hard time controlling their spending habits. We will not even discuss the financial shape of the poor and uneducated. 

[trainman34014]

One of the biggest problems with Thai debt is that there is a massive 'Government Official' workforce.  This title applies to just about everyone who works for the Government from the PM down to the lady that cleans the toilets in the local Tambon office.  Teachers who work in State Schools naturally come under this heading.

 

All of these 'Government Officials' are bombarded with information from the banks on loans; my wife was a Midwife for 25 years and retired 8 years ago but still receives offers of soft loans on a weekly basis because even though she is retired she is still registered for all the perks available.   We do not want them or need them and have asked the banks on many occasions to stop sending this junk mail but still it arrives continually.   Basically, they make it far too easy for people to get into massive debt and the Thai's are generally people who love nothing more than to be bragging to each other about their latest new gas guzzling gigantic Pick-up truck or the latest electronic masterpiece, new fancy Spirit House emblazoned with coloured lights, holiday to Nakon Nowhere or fake designer clothes.   The weak minded are easy prey for Corporate Bankers and lets face it; how many Thai's do you know that know the concept of a 'Budget' ?

[metisdead]

Off topic posts have been removed.  This is not about bank bailouts in the US, OZ or NZ. 

[Scotwight]

Thailand comes in 45th in the global ranking and eighth in the Asian ranking of net per capita financial assets. Per capita gross financial assets amounted to 6,070 euros; however, after subtracting liabilities, net financial assets of the average Thai shrank to a mere 1,920 euros (Bt74,500). The respective amount was only lower in India and Indonesia.

 

And you wonder why women are cheap in Thailand and will continue to be for the foreseeable future.  

Edited October 1, 2016 by Scotwight

[Colabamumbai]

If they want to give me their car, I will give them a loan.

[Srikcir]

Thailand’s household debts have increased to 298,005 baht per household which is the highest in nine years, according to the findings of the University of Thai Chamber of Commerce. (2016-09-16)

http://englishnews.thaipbs.or.th/household-debts-jump-highest-level-nine-years/

 

But you won't hear the Prayut government accepting any of the fault. According to the government, the high household debt is due to global economic conditions beyond Thailand's ability to control. Yet the Thai banks are planning their own growth on increasing credit card debt.

[Asiantravel]

1 hour ago, Srikcir said:

Thailand’s household debts have increased to 298,005 baht per household which is the highest in nine years, according to the findings of the University of Thai Chamber of Commerce. (2016-09-16)

http://englishnews.thaipbs.or.th/household-debts-jump-highest-level-nine-years/

 

But you won't hear the Prayut government accepting any of the fault. According to the government, the high household debt is due to global economic conditions beyond Thailand's ability to control. Yet the Thai banks are planning their own growth on increasing credit card debt.

 

 

" But you won't hear the Prayut government accepting any of the fault. "

 

I am certainly not a fan of the military government but I do believe the current prime minister should be acknowledged for at least recognising the problem regarding debt when he addressed this in his national broadcast way back in June 2015 although it is quite evident his plea fell on deaf ears.

 

“ All companies should know better and stop thinking how to maximize profits without considering the negative social impact of people’s debts. You cannot issue too many credit cards to one person without understanding the person’s capability to pay off the debts. This is when NLPs transpire. How is the government supposed to find a solution to this problem when profits are made by private companies and commercial banks while people are in debt?  The government is asking for cooperation in return. Please help our people save money. Do not encourage them to spend more than what they actually have. There are two sides to having a credit card and insurance. Credit cards and insurance make your business grow, more dividend to stockholders, and more bonuses. On the other hand, people who spend will suffer with more debts hanging on their heads. Some people even commit suicide because they cannot pay back what they owe. As you see, everything is interconnected. Everyone only looks to maximize their own benefit while the government holds all the burdens. We need to learn to help and support each other. The government will never be reassured as long as the economy is still unstable. I have been worried since the first day I took office. Low-income people have been suffering for a long time, even long before I became prime minister. “

http://www.thaiembassy.org/islamabad/en/news/4251/57103-National-Broadcast-by-General-Prayut-Chan-o-cha,-P.html

[Srikcir]

3 hours ago, Asiantravel said:

the problem regarding debt

2014-08-19 : Junta chief Prayuth Chan-ocha told the National Legislative Assembly yesterday the proposed [2015] budget would not leave problems or debt for the country in the long run - as he would only be in power for one year. http://www.nationmultimedia.com/politics/NCPO-aims-to-avoid-debt-30241210.html

Certainly the Thai financial industry has done little to ween Thais off easy debt by waiving debt restrictions to issue even more credit cards.

But Prayut hasn''t helped either. In 2015 and 2016 Prayut has provided a bevy of soft loans and debt forgiveness payments for farmer, consumer and loan shark debts that do not encourage savings and debt reduction. In the long run the problems of achieving an economic recovery after the military coup and preceeding government shutdown were complex and required long-term solutions - something coup leaders typically do not have time to accomplish.

[MROLL320]

Getting  mortgages on houses that probably won't last the duration of the loan is never good....  

[ExpatOilWorker]

17 hours ago, Srikcir said:

Thailand’s household debts have increased to 298,005 baht per household which is the highest in nine years, according to the findings of the University of Thai Chamber of Commerce. (2016-09-16)

http://englishnews.thaipbs.or.th/household-debts-jump-highest-level-nine-years/

 

But you won't hear the Prayut government accepting any of the fault. According to the government, the high household debt is due to global economic conditions beyond Thailand's ability to control. Yet the Thai banks are planning their own growth on increasing credit card debt.

 

True, but NPL is at a near 9 years low: https://www.bot.or.th/English/Statistics/Graph/Pages/NPL.aspx

 

[Cake Monster]

And household debt figures for the next Q, and into next year will be even more horrendous.

 

Today you can purchase a car for as little as a down payment of 40,000 Baht, and can pay off the balance on finance over 84 months - yes 84 months - thats 7 years !!!!!

 

its a well known, and documented fact, that buying a new car is the worst possible way to spend money.

 

A new car depreciates in value quicker than any other asset you may own, and after 7 years of finance, I hate to calculate the total cost of the cars purchase over that period, but the asset is only worth about 25 percent of its initial value

 

Utter madness from the lenders and the borrowers