Baht depreciation expected

[SheungWan]

10 hours ago, talahtnut said:

A brief example: In New York gold is approx $1300..on a dry desert island it is worth the same, but you would sell it for the price, of a bottle of water.   Price and worth?

And I would be laughing at you.

The price of gold in New York is not the price of gold on a desert island. Too many unknowns on the mythical island scenario. Again, price and worth are beyond you. For others, a brief study of the difference between exchange value and use value not a bad place to start. And a historical (not a mythical) reference point would be an examination of the economics of the Klondyke during the gold rush. Basic living things were at a premium. That is the only lesson to study.

[lannarebirth]

I wouldn't want to have to build a raft out of gold bullion bars.

[talahtnut]

5 hours ago, SheungWan said:

The price of gold in New York is not the price of gold on a desert island. Too many unknowns on the mythical island scenario. Again, price and worth are beyond you. For others, a brief study of the difference between exchange value and use value not a bad place to start. And a historical (not a mythical) reference point would be an examination of the economics of the Klondyke during the gold rush. Basic living things were at a premium. That is the only lesson to study.

You've just said the same the basic thing as I, but padded it out with waffle to sound posh and clever.

Edited March 18, 2018 by talahtnut
addition

[jerry921]

IMHO the value, worth, utility, advisability, uniqueness, buoyancy and edibility of gold is completely irrelevant to the thread topic - Baht exchange rate with other fiat currencies.

Edited March 18, 2018 by jerry921

[simoh1490]

6 minutes ago, jerry921 said:

IMHO the value, worth, utility, advisability, uniqueness, buoyancy and edibility of gold is completely irrelevant to the thread topic - Baht exchange rate with other fiat currencies.

Stay tuned, there'll be a discussion on the weather soon.

[talahtnut]

28 minutes ago, simoh1490 said:

Stay tuned, there'll be a discussion on the weather soon.

Its going to be wet.

[spidermike007]

On 11/26/2016 at 11:26 AM, frankv42 said:

 

No hope for Dems in 2018. There are 25 Democrat Senate seats, and only 8 Republican up for election.  The House has a large Republican majority.  4 interest rate increases in 1 year when there is little inflation now? That would be unprecedented, don't see that happening.

Wrong. The GOP will be slaughtered in November. Blood in the streets. The democrats will field the largest turnout in a century. If nothing else, just to be able to say enough, to the deflector in chief. Tiny Don, will either serve out his remaining 2 years as a lame duck without any power, or he will be forced to resign in disgrace, be jailed, or will be impeached. Any of those outcomes, are choices he has worked very hard to achieve.

 

As far as the Thai baht depreciating, it is about time. We all look forward to that!

[joeyg]

I struggle to understand economics.  What I've read on financial forums is that some how the bhat is somehow artificially held in a strong position.  Maybe someone else can explain this that understands it better.

 

[talahtnut]

58 minutes ago, joeyg said:

I struggle to understand economics.  What I've read on financial forums is that some how the bhat is somehow artificially held in a strong position.  Maybe someone else can explain this that understands it better.

 

Economics is the science of how to get things wrong.

[SheungWan]

7 hours ago, joeyg said:

I struggle to understand economics.  What I've read on financial forums is that some how the bhat is somehow artificially held in a strong position.  Maybe someone else can explain this that understands it better.

https://www.bloomberg.com/news/articles/2017-06-29/thailand-copes-with-super-baht-20-years-after-currency-crashed

[Naam]

16 hours ago, talahtnut said:

Economics is the science of how to get things wrong.

an excellent example is the economic loser Warren Buffet who does not invest in gold.

[talahtnut]

1 hour ago, Naam said:

an excellent example is the economic loser Warren Buffet who does not invest in gold.

Hi Naam,  Buffet is certainly not a loser,  that is because he does not invest in gold.

[jerry921]

It's always really hard to tell when a Klingon is being sarcastic, because Klingons always seem so serious. Especially if you're a cat, since sarcasm is always lost on cats.

[joeyg]

13 hours ago, SheungWan said:

https://www.bloomberg.com/news/articles/2017-06-29/thailand-copes-with-super-baht-20-years-after-currency-crashed

Very good read, thanks...

[talahtnut]

9 minutes ago, jerry921 said:

It's always really hard to tell when a Klingon is being sarcastic, because Klingons always seem so serious. Especially if you're a cat, since sarcasm is always lost on cats.

Don't knock the pussy...Cats are clever enough not to be enslaved by humans.

[EricTh]

The Thai baht is getting stronger and stronger, there'll be less and less people making Thailand a retirement home.

[Naam]

4 hours ago, EricTh said:

The Thai baht is getting stronger and stronger, there'll be less and less people making Thailand a retirement home.

there'll be less and less riff-raff... which is good for Thailand.

[talahtnut]

1 hour ago, Naam said:

there'll be less and less riff-raff... which is good for Thailand.

You talking about me again?

[jerry921]

For people in the US trying to decide whether to retire in Thailand, particularly for people retiring before 65, I think the cost of US healthcare will be more important than the exchange rate, unless they are rich enough that costs don't matter at all.

 

If the exchange rate drops by 3 Baht/USD in the next year, that's equivalent to about 10% increase in Thai prices. That would imply an exchange rate of 27/$. Then another 10% the year after that would take it to 24.3/$. It's really hard for me to imagine two more changes like that following the drop there's already been all the way down from 36/$, but it might occur. Three more years of appreciation gets even harder to imagine without it causing some sort of economic brake failure or water buffalo pandemic.

 

But I have no trouble at all imagining 20% increases per year in US health care premiums. And at my age and on my budget, the cost of Obamacare would be 1/4 to 1/3 of my living expenses if I were living in the US and buying it (I'm actually living in Mexico for now, but reconsidering back to the US or to Thailand).

 

So a 10% increase on costs overall is worse than a 20% increase on 1/3 of expenses, but I don't see the THB appreciation continuing forever whereas I see no end to the price increases for medical care.

 

Disclaimer: your math may vary (cause mine might be wrong).

 

 

 

[Stargeezr]

Baht is strong today, but won"t  last forever. The one thing I noticed however is that in most of

North America, where the interest rates are low, lots of the people are maxed on their credit cards,

bought new cars houses, etc, with the lowest amount down, and are generally still drowning in debt.

 When the interest rates do go up, these people will be bankrupt in a week, not in a month or two, like

they would have been if they had planned better for the future.  I think this is a world wide problem as

credit is so easy to get. Glad I am not in this boat, only because of my money aware wife.

Geezer

[simoh1490]

3 hours ago, jerry921 said:

For people in the US trying to decide whether to retire in Thailand, particularly for people retiring before 65, I think the cost of US healthcare will be more important than the exchange rate, unless they are rich enough that costs don't matter at all.

 

If the exchange rate drops by 3 Baht/USD in the next year, that's equivalent to about 10% increase in Thai prices. That would imply an exchange rate of 27/$. Then another 10% the year after that would take it to 24.3/$. It's really hard for me to imagine two more changes like that following the drop there's already been all the way down from 36/$, but it might occur. Three more years of appreciation gets even harder to imagine without it causing some sort of economic brake failure or water buffalo pandemic.

 

But I have no trouble at all imagining 20% increases per year in US health care premiums. And at my age and on my budget, the cost of Obamacare would be 1/4 to 1/3 of my living expenses if I were living in the US and buying it (I'm actually living in Mexico for now, but reconsidering back to the US or to Thailand).

 

So a 10% increase on costs overall is worse than a 20% increase on 1/3 of expenses, but I don't see the THB appreciation continuing forever whereas I see no end to the price increases for medical care.

 

Disclaimer: your math may vary (cause mine might be wrong).

 

 

 

Wow, one of the very very few posters on TVF taking a realistic view on Baht exchange rates going forward, well done!

 

I remember when I first came here to live in 2004 the exchange rate against GBP was around 75 or so, it dropped slowly from that point until today when it's around 43. Throughout that journey almost 100% of British expats. believed the rate would only ever go back up - when it hit 60 people thought the next step was 65, at 50 they thought 55, at 42 they continued to think 50! It's human nature I suppose that people translate hope into a forecast and ignore the likelihood of the opposite and of reality. FWIW I continue to anticipate THB at sub 40 within two years and against USD I also expect to see it reach sub 30. Lots of things could happen on both sides of the exchange rate equation to derail all that but on balance, I think we'll see a stronger Baht going forward.  

 

For long term expats it means a different lifestyle than they anticipated or a return to their home country and we've seen that happen in spades on this forum over recent years. For would-be expats the exchange rate changes the dynamics of Thailand as a retirement destination - the decision was easy when the rate against GBP was 74, at 50 it's boderline, at 40 it's highly questionable and at 35 it's probably a non-starter. It would be border line tragic to imagine a retiree plan and invest for retirement in Thailand at age 60, only to see it all needing to be undone and done again at age 70, an age when it may not be possible or feasible to go back.

[talahtnut]

7 hours ago, jerry921 said:

For people in the US trying to decide whether to retire in Thailand, particularly for people retiring before 65, I think the cost of US healthcare will be more important than the exchange rate, unless they are rich enough that costs don't matter at all.

 

If the exchange rate drops by 3 Baht/USD in the next year, that's equivalent to about 10% increase in Thai prices. That would imply an exchange rate of 27/$. Then another 10% the year after that would take it to 24.3/$. It's really hard for me to imagine two more changes like that following the drop there's already been all the way down from 36/$, but it might occur. Three more years of appreciation gets even harder to imagine without it causing some sort of economic brake failure or water buffalo pandemic.

 

But I have no trouble at all imagining 20% increases per year in US health care premiums. And at my age and on my budget, the cost of Obamacare would be 1/4 to 1/3 of my living expenses if I were living in the US and buying it (I'm actually living in Mexico for now, but reconsidering back to the US or to Thailand).

 

So a 10% increase on costs overall is worse than a 20% increase on 1/3 of expenses, but I don't see the THB appreciation continuing forever whereas I see no end to the price increases for medical care.

 

Disclaimer: your math may vary (cause mine might be wrong).

 

 

 

You're lucky you haven't got the UK pound. However, I must concur with

the view of simoh1490 which I believe is about as good as you will get.

If your heart is really set on Thailand, and depending on your finances

you might consider buying some form of business venture here.

Highly risky..and bang goes your retirement.

But it can be done..if you are a gamer.

Best of luck with your retirement plans.

 

 

[simoh1490]

Every time I used to talk about the subject of a stronger Baht, posters would accuse me of talking down the Pound, as though mere mortals can do such a thing -  they did it at 70, at 60 and again at 50, I was expecting a job offer from Carney but it never came.

[talahtnut]

5 minutes ago, simoh1490 said:

Every time I used to talk about the subject of a stronger Baht, posters would accuse me of talking down the Pound, as though mere mortals can do such a thing -  they did it at 70, at 60 and again at 50, I was expecting a job offer from Carney but it never came.

Try Philip Hammond!

[jerry921]

30 minutes ago, talahtnut said:

You're lucky you haven't got the UK pound. However, I must concur with

the view of simoh1490 which I believe is about as good as you will get.

If your heart is really set on Thailand, and depending on your finances

you might consider buying some form of business venture here.

Highly risky..and bang goes your retirement.

But it can be done..if you are a gamer.

Best of luck with your retirement plans.

 

 

Thanks, but no thanks, if I had that kind of energy I'd have kept on working a few more years. What energy I have I put toward reading financial and economic stuff to invest better. Personally, my most useful insight is that I know I'm a hedgehog and the wall street people are foxes. Or, as Dirty Harry says, "A Man's got to know his limitations".

 

How much of Thailand's economy depends on trade, as opposed to tourism, and how much of that is with the US, and how much with China? Everybody's wringing their hands about this trade war thing, but so far I think Trump's being pretty incremental about it, and it's a lot more sturm than drang. So far.

 

And what happens to bilateral trade between Thailand and China if the US does really ignite a big trade war?

[simoh1490]

20 minutes ago, jerry921 said:

Thanks, but no thanks, if I had that kind of energy I'd have kept on working a few more years. What energy I have I put toward reading financial and economic stuff to invest better. Personally, my most useful insight is that I know I'm a hedgehog and the wall street people are foxes. Or, as Dirty Harry says, "A Man's got to know his limitations".

 

How much of Thailand's economy depends on trade, as opposed to tourism, and how much of that is with the US, and how much with China? Everybody's wringing their hands about this trade war thing, but so far I think Trump's being pretty incremental about it, and it's a lot more sturm than drang. So far.

 

And what happens to bilateral trade between Thailand and China if the US does really ignite a big trade war?

As I recall, exports to the US accounts for 11.2% of Thai total exports - exports represents 68% of Thai GDP. A trade war with the US means zip, the US needs allies in the region and it doesn't have many left.Thailand exports to China represents 12.4% of GDP.

 

http://www.worldstopexports.com/thailands-top-10-exports/

http://www.worldstopexports.com/thailands-top-import-partners/

[talahtnut]

25 minutes ago, jerry921 said:

Thanks, but no thanks, if I had that kind of energy I'd have kept on working a few more years. What energy I have I put toward reading financial and economic stuff to invest better. Personally, my most useful insight is that I know I'm a hedgehog and the wall street people are foxes. Or, as Dirty Harry says, "A Man's got to know his limitations".

 

How much of Thailand's economy depends on trade, as opposed to tourism, and how much of that is with the US, and how much with China? Everybody's wringing their hands about this trade war thing, but so far I think Trump's being pretty incremental about it, and it's a lot more sturm than drang. So far.

 

And what happens to bilateral trade between Thailand and China if the US does really ignite a big trade war?

Thailand trade can be easily googled.

As for the US China trade war..its all about 'if'.. The sensible option is 'talking'.

I expect the threats and bluster is all showmanship.

 

[oldhippy]

4 hours ago, simoh1490 said:

As I recall, exports to the US accounts for 11.2% of Thai total exports - exports represents 68% of Thai GDP. A trade war with the US means zip, the US needs allies in the region and it doesn't have many left.Thailand exports to China represents 12.4% of GDP.

 

http://www.worldstopexports.com/thailands-top-10-exports/

http://www.worldstopexports.com/thailands-top-import-partners/

QUOTE: exports represents 68% of Thai GDP.

 

I hope you do not mean that 68% of Thai GDP is exported - a very common mistake, even amongst economists.

 

 

[simoh1490]

4 minutes ago, oldhippy said:

QUOTE: exports represents 68% of Thai GDP.

 

I hope you do not mean that 68% of Thai GDP is exported - a very common mistake, even amongst economists.

 

 

What a truly bizarre thought, no, I certainly don't mean that!

[oldhippy]

Just now, simoh1490 said:

What a truly bizarre thought, no, I certainly don't mean that!

Good on you, but many (most?) people do.

And same goes for tourism being x% "of" GDP.