Thb vs. GBP/ USD redux

[mogandave]

THB has been flat?

[chiang mai]

9 hours ago, mogandave said:

THB has been flat?

 

Against GBP it's traded in a +/- one baht range for the past six months, 44.2 to 45.3, that's only 3% at best so pretty flat to me.

[hugh2121]

14 hours ago, Baerboxer said:

 

Can you please provide details of the 18% fall? 

 

AFAIR the initial drop was around 12% against the dollar. Reducing in further steps to the 120 - 125 where it sits now.

 

The affects have not really filtered through to the economy fully yet. Yep, things will get worse - imports costing more, rising inflation, weakening pound. Especially as the Tory government seems clueless, without a real plan and divided on what the objectives are. With no real opposition with an intelligent input things don't bode well.

 

And all because some clowns stoked up racist emotions and lied about figures with false promises.

 

 

 

 

In Jan £/$ was about 1.48.

Today it is about 1.23.

All of this fall was not immediate it's true but it can mostly, if not all, be attributed to Brexit vote and PM's announcement of March 2017 for Article 50 causing BoE to further cut interest rates and weaken the £ even more. It is all thanks to ignorant people who voted Leave.

That's my opinion, if anyone disagrees then they have their opinion and I have mine.

Currently the £ is down around 17% against the dollar Year To Date.

Source, bbc.co.uk/business/currencies. These are the mid market rates, not exchange rates.

[hugh2121]

23 hours ago, almodeller said:

What currency exchange rate in £ sterling does immigration use to calculate the required 65,000 Thai baht needed per month?

At Sri Racha office they always ask me what the exchange rate is.

Edited December 28, 2016 by hugh2121

[Rdrokit]

This chart is usually spot on. Has the volatility rates. Red = down and Blue = up.

 

http://www.ratesfx.com/predictions/pred-thb.html

[almodeller]

I will rephrase the question does anyone know what currency exchange website  the Thai Immigration services uses to calculate the correct currency to achieve the required amount such as xrates.com, bankerexchangerates.com, expedia.com etc ? 

Rates today xrates £=44.26, KK bank £=42.792, BB bank £=43.34 THB

[mogandave]

5 hours ago, chiang mai said:

 

Against GBP it's traded in a +/- one baht range for the past six months, 44.2 to 45.3, that's only 3% at best so pretty flat to me.

 

So both the GBP & the THB are flat, that's good news.

[chiang mai]

1 hour ago, almodeller said:

I will rephrase the question does anyone know what currency exchange website  the Thai Immigration services uses to calculate the correct currency to achieve the required amount such as xrates.com, bankerexchangerates.com, expedia.com etc ? 

Rates today xrates £=44.26, KK bank £=42.792, BB bank £=43.34 THB

 

Immigration does not do the calculation, the banks who write the letters to Immigration on behalf of visa applicant do and they use their own individual rates.

[YeahSiam]

2 minutes ago, chiang mai said:

 

Immigration does not do the calculation, the banks who write the letters to Immigration on behalf of visa applicant do and they use their own individual rates.

 

I'm expecting another iteration of his question before the day's out.

[chiang mai]

Just now, YeahSiam said:

 

I'm expecting another iteration of his question before the day's out.

 

In the interests of civility I hope not.

[Rdrokit]

21 minutes ago, chiang mai said:

 

Immigration does not do the calculation, the banks who write the letters to Immigration on behalf of visa applicant do and they use their own individual rates.

That is not correct as when I went for my last visa extension the proof of income I have was a letter from my embassy and the amount was in US dollars. The clerk at Thai Immigration did his own calculation to baht from a chart but I do not know where the amounts on the chart came from.

[chiang mai]

22 minutes ago, Rdrokit said:

That is not correct as when I went for my last visa extension the proof of income I have was a letter from my embassy and the amount was in US dollars. The clerk at Thai Immigration did his own calculation to baht from a chart but I do not know where the amounts on the chart came from.

 

For US citizens using the embassy letter approach: the issue of exchange rate is moot since they are able to obtain that letter on the basis of self certification and can therefore conjuror up a sufficiently high enough number to make the exchange rate irrelevant. Other nationalities must obtain the bank letter as stated earlier.

 

[mogandave]

2 hours ago, Rdrokit said:

That is not correct as when I went for my last visa extension the proof of income I have was a letter from my embassy and the amount was in US dollars. The clerk at Thai Immigration did his own calculation to baht from a chart but I do not know where the amounts on the chart came from.

 

The amounts on the chart come from the bank.

[watcharacters]

1 hour ago, chiang mai said:

 

For US citizens using the embassy letter approach: the issue of exchange rate is moot since they are able to obtain that letter on the basis of self certification and can therefore conjuror up a sufficiently high enough number to make the exchange rate irrelevant. Other nationalities must obtain the bank letter as stated earlier.

 

 

 

 

Sorry I don't see how it's moot.

 

Nothing has really addressed the lads question about his qualifying for an extension based on a conversion rate website.   I stated he'd  be looking closely at the edge if he depends on that but  it's up to the individual, I'd say.

[chiang mai]

Just now, watcharacters said:

 

 

 

Sorry I don't see how it's moot.

 

Nothing has really addressed the lads question about his qualifying for an extension based on a conversion rate website.   I stated he'd  be looking closely at the edge if he depends on that but  it's up to the individual, I'd say.

 

Either he is a US citizen using the self certification method, in which case the point is moot because all he needs to do is self certify at a high number, the exchange rate is therefore not a huge factor that can't be easily overcome.

 

If he's not a US citizen and he needs to use a bank letter like the rest of us, the exchange rate used will be the one supplied by the bank.

[tso310]

The 18% drop was I believe split into 2 parts. First the Brexit vote and then the Flash Crash dropped it to the current level. Traditionally the baht has always been strong against sterling during the winter especially the first quarter of the year. Too many variables this summer. Brexit negotiations start, import elections in Germany and France. Oil price starting to climb.

[Craig krup]

On 12/27/2016 at 0:25 PM, Baerboxer said:

And all because some clowns stoked up racist emotions and lied about figures with false promises.

 

 

it was the Remain campaign that lied. Immigration - unchecked EU migration - does not benefit the UK economy. The average EU migrant would not qualify for a Tier 2 visa, and nor would the average member of the indigenous population. The British state costs £11,000 per head per year. The top 29,000 income tax payers pay 14% of all income tax. All that matters is GDP per head, minus the cost of having someone in the country, and - as the Oxford University Migration Observatory reports make clear - the UK has imported a demographic time-bomb, and the longer the migration had gone on the worse the final explosion would be. As it is we've already put ourselves in a position where there will have to be massive cuts per head in both transfer payments and state services. Tax credits - massive welfare paid through HMRC to make people feel better about it - and £8,000 secondary school places, will soon become history. Be in no doubt, some of the Leave voters had awfully good reasons for their position. 

 

As the the pound-baht, the ultimate determinant of the value of a currency is purchasing power parity. I'm about to head to Aldi in the UK and buy fifty pounds of winter veg. Two kg of potatoes, or 1kg of carrots, or 1kg of parsnips, or 500g of sprouts will cost me 8.36 baht, or 19p. I can go to the pound shop and buy twelve bog rolls for 44 baht, or fancy pro-enamel toothpaste for the same price. I spent the summer in Udon and as far as I can see the baht is ludicrously overvalued against the pound, and anyone who thinks otherwise can easily back their judgment with cash. You could get lucky - maybe the pound will fall to forty, or below. But purchasing power parity is the ultimate driver. All currencies have to be redeemed for goods and services in the country in which they're legal tender, and all those goods and services have to be roughly comparable - 44 baht has to buy you what one pound or a dollar twenty two will buy you. If it doesn't there will be a snap at some point, and half the world's online experts will lose all their money while the other half make gains. The "house" - the brokers and spread betting firms - will, of course, make steady money whatever happens, standing by while the dumb gamblers strut the casino. 

 

Edited December 28, 2016 by Craig krup

[chiang mai]

"the baht is ludicrously overvalued against the pound".

 

You understand little about UK economics and even less about Thai economics, prepare your self and your finances for a sub 40 Pound Baht.

 

 

[Craig krup]

21 minutes ago, chiang mai said:

"the baht is ludicrously overvalued against the pound".

 

You understand little about UK economics and even less about Thai economics, prepare your self and your finances for a sub 40 Pound Baht.

 

 

 

"yourself" - one word. I did first year Economics and an Honours paper on Government and the Economy at a decent uni, I worked as an accountant and I'm a pretty successful private investor. 

 

As I say, the web's awash with spread-betters and "experts" who are exactly the characters Saul Bellow described in "Seize the Day". If you haven't read it I'd strongly recommend it. 

[mogandave]

How Does the price of gold in Thailand compare to the price of gold in GB or the US?

 

that should give a clear idea of the value or over-value of the Baht.

[Rdrokit]

31 minutes ago, mogandave said:

How Does the price of gold in Thailand compare to the price of gold in GB or the US?

 

that should give a clear idea of the value or over-value of the Baht.

A baht of gold is 19,500 baht or about $549 US (using 35.5/dollar), Now "Raw" gold or bullion (standard purity of Thai gold is 96.5% a little over 23 K): 1 baht = 15.244 grams x 0.965 = 14.71046 grams, or 0.47295236 troy ounce (mass). Gold was at $1144 US today so .4729 of $1144 is $541US. Pretty close if my math is correct.

Edited December 28, 2016 by Rdrokit

[Craig krup]

1 hour ago, mogandave said:

How Does the price of gold in Thailand compare to the price of gold in GB or the US?

 

that should give a clear idea of the value or over-value of the Baht.

 

If there was a price anomaly in one thing then arbs - people making arbitrage plays - would exploit it, buying where it's cheap and selling where it's expensive. That has to happen except where there are controls, and then - of course - you know they're trying to manipulate markets. One of my relatives used to drive back from Italy in the 70s with the inside of the car hanging with gold for exactly this reason: the Italians liked to pretend that x amount of Lira equaled y amount of gold, but they didn't want you buying the stuff and taking it out of the country. 

Edited December 28, 2016 by Craig krup
Typo

[champers]

I predict that the Euro will fall off a cliff in 2017 as a number of EU countries have the same idea as Brexiters. The Pound will recover somewhat.

[chiang mai]

5 hours ago, Craig krup said:

 

"yourself" - one word. I did first year Economics and an Honours paper on Government and the Economy at a decent uni, I worked as an accountant and I'm a pretty successful private investor. 

 

As I say, the web's awash with spread-betters and "experts" who are exactly the characters Saul Bellow described in "Seize the Day". If you haven't read it I'd strongly recommend it. 

 

You have that supposed education in economics and the best rebuttal you can come up with is to grammatical error and recommend a book by a fiction writer, that's interesting and speaks volumes!

 

Your statement that the Baht is ludicrously overvalued against the Pound is based on what, fundamentals, debt, potential, a passing thought late one night! BOT spends more of its foreign currency reserves trying to keep the lid on the Baht than on any other single activity and has been doing so for the past six or more years - governement debt levels (expressed any way you wish) are low, it continually runs a current account surplus, unemployment is very low, bank NPL's are low, there is a readily available workforce, governement is not burdened by costly social welfare programs or unions and foreign currency reserves are higher than most countries around the world. The UK economy on the other hand is the exact opposite of all of those things, no matter that GDP per capita is far higher, the Baht could easily become sub 40 to the Pound within twelve/twenty four months, as sure as eggs is eggs it isn't going back to 50, 60 or 70 so I suggest strongly that if you have an economic interest in Thailand you act accordingly. Here read up on the Thai economy: 

 

http://www.tradingeconomics.com/thailand/indicators

 

There will no charge on this occasion for filling in the gaps in your economics education.

 

[mogandave]

9 hours ago, Craig krup said:

 

If there was a price anomaly in one thing then arbs - people making arbitrage plays - would exploit it, buying where it's cheap and selling where it's expensive. That has to happen except where there are controls, and then - of course - you know they're trying to manipulate markets. One of my relatives used to drive back from Italy in the 70s with the inside of the car hanging with gold for exactly this reason: the Italians liked to pretend that x amount of Lira equaled y amount of gold, but they didn't want you buying the stuff and taking it out of the country. 

 

I thought you were making an agument that the Baht was over valued due to purchasing power, yet gold is the same price in GB, TH or US, using any currency. 

 

It is my position that currency valuation is determined by market perception, and for that reason, it is not possible for a currency to be over or under valued.

[mogandave]

5 hours ago, chiang mai said:

 

You have that supposed education in economics and the best rebuttal you can come up with is to grammatical error and recommend a book by a fiction writer, that's interesting and speaks volumes!

 

Your statement that the Baht is ludicrously overvalued against the Pound is based on what, fundamentals, debt, potential, a passing thought late one night! BOT spends more of its foreign currency reserves trying to keep the lid on the Baht than on any other single activity and has been doing so for the past six or more years - governement debt levels (expressed any way you wish) are low, it continually runs a current account surplus, unemployment is very low, bank NPL's are low, there is a readily available workforce, governement is not burdened by costly social welfare programs or unions and foreign currency reserves are higher than most countries around the world. The UK economy on the other hand is the exact opposite of all of those things, no matter that GDP per capita is far higher, the Baht could easily become sub 40 to the Pound within twelve/twenty four months, as sure as eggs is eggs it isn't going back to 50, 60 or 70 so I suggest strongly that if you have an economic interest in Thailand you act accordingly. Here read up on the Thai economy: 

 

http://www.tradingeconomics.com/thailand/indicators

 

There will no charge on this occasion for filling in the gaps in your economics education.

 

 

The only thing sure is that nothing is sure.

[chiang mai]

1 minute ago, mogandave said:

 

The only thing sure is that nothing is sure.

 

Agreed. But I'm pretty sure you will understand forecasting, analysis of fundamentals, risk and probability etc, when you look at the picture in those terms the balance of probability leans towards a stronger Baht rather than a weaker one.

[YeahSiam]

12 hours ago, Craig krup said:

 

"yourself" - one word. I did first year Economics and an Honours paper on Government and the Economy at a decent uni, I worked as an accountant and I'm a pretty successful private investor. 

 

As I say, the web's awash with spread-betters and "experts" who are exactly the characters Saul Bellow described in "Seize the Day". If you haven't read it I'd strongly recommend it. 

 

I'll take the opinions of spreadbetters and trading experts with real world life experience over that of a bunch of green academics with economics degrees right up the wazoo whose forecasts are so consistently proven wide of the mark that many consider them to be contrarian indicators.

 

 

[mogandave]

If I believed that I would empty my US bank accounts and move it all to Thailand.

 

When I got here, the THB/USD was 45, since then it's been as strong as 29 and it's at 36 now, which is conciderable weaker than it was a year ago.

 

I'm about 10% in Baht, and think it will be fine, but only a fool would think it not a risk.

[chiang mai]

3 minutes ago, mogandave said:

If I believed that I would empty my US bank accounts and move it all to Thailand.

 

When I got here, the THB/USD was 45, since then it's been as strong as 29 and it's at 36 now, which is conciderable weaker than it was a year ago.

 

I'm about 10% in Baht, and think it will be fine, but only a fool would think it not a risk.

 

I've been hearing similar stories for ten years or more, no more than 10%, the risk is great etc. etc. FWIW I went from 10% THB ten years ago to today where I'm about 80%, at one point fairly recently I was close to 90% (of liquid assets and I'm heavily into low risk TD's etc). I'm now in a position where I have sufficient living expenses in Thailand for the next ten years or more and my UK income (in Pounds and USD) services my UK property holding costs and visits. During those ten years I've watched GBP/THB go from 70 to 42, the benefit of which has made economic risks of living here very very low indeed. 

 

Ok so this is not about boasting or bragging, it's about making the point that making a switch out of a "safe" home currency requires a little bit of courage and also a confidence in your particular assessment of the economies involved. In the case of GBP/THB the writing has been written in big bold letters in the sky for years.