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Nearly one-third of tourism-related businesses 'may shut down permanently'


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1 hour ago, VBF said:

Thanks but a little unsure what you're staying here...or you might be making 2 separate points?

 

If you mean the Thais are only allowing Thai companies to provide the cover, then we're in agreement and it ain't gonna fly!

 

If, on the other hand, you're saying that there are no western companies offering the requisite cover, then not so. 

There are many UK companies now including Covid cover - see my topic:

 

I can understand the confusion, unless things have changed, there are no western ins cos offering coronavirus ins on their own, although it is covered on some health ins, and it has to cover up to 100.000 Bt or something like that.

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I hope that the tourism related business that uses the ugly and racist double pricing policies will fall and shut down first for good...

How is this not already occurring. Tourism is dead and will be for a long time. Is he really that blind.  Domestic tourism will be the only source of redistributing money around the country and will n

No worries. Tourism is only 9% of the Thai economy. Right? Right? 

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6 minutes ago, possum1931 said:

I can understand the confusion, unless things have changed, there are no western ins cos offering coronavirus ins on their own, although it is covered on some health ins, and it has to cover up to 100.000 Bt or something like that.

It's 100,000USD - the policy I've mentioned in my thread does...as does my existing policy which has just paid out over £2000 for my return to UK in March.

Things are changing so fast as people and organisations catch up, that confusion is inevitable.

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1 hour ago, hobz said:

This proves that the powers that be in Thailand wants a strong baht. 

 

Here's my reasoning: 

 

Before corona the government said that the reason they can't just print money to devalue the baht is because the U.S. would label them a currency manipulator. But with Covid-19 and one third of tourism going under etc, they have the perfect excuse to go on a massive money printing scheme that would 1. bail out everyone. 2. Devalue the way too strong baht (and thus encourage future tourism). 

 

why would they not do this unless they secretly want a strong baht? 

What am I missing? 

 

A central bank cannot just pick a number and devalue its currency at will, things don't work that way. The strength of a currency is determined by a series of factors include Foreign Currency Reserve levels, government debt levels and current account status, amongst other things.  If a central bank were to adjust the level of the Baht/Dollar exchange rate one morning and weaken it by say four Baht, lots of people would immediately send over USD and exchange it for Baht at the new attractive rate and by lunch time the Baht would have strengthened back to its previous exchange rate and BOT would have lost a bundle. And as you say, making that sort of adjustment, even if it were to work (which it wouldn't) would mean Thailand is indeed a currency manipulator.

 

In order to weaken the currency, other measures have to be taken which allows the value of the Baht to weaken more naturally on a lasting basis and printing money is not part of that picture either. The term "printing money: doesn't mean printing bank notes, it refers instead to the Central Bank extending credit to commercial bank balance sheets so that they can lend more.  But why would they do that, there is no need, commercial and retail bank balance sheets are in fine shape!

 

Finally the question of whether BOT secretly wants a strong Baht, personally I believe they and everyone in finance does because it's beneficial to many aspects of the economy - imports remain cheaper, fuel, oil and transportation costs remain cheaper as do energy costs. The flip side is exports remain expensive which in a downturn is not a good thing, but exporters have lived with 30 baht per Dollar before so there's nothing new there.

 

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1 hour ago, Trillian said:

But why would they do that, there is no need,

Because they claim that they want a weaker baht. 

And the tourist sector needs a bailout. Aren't those good enough reasons?

Like how the US "printed" tons of money and lent it to businesses to protect jobs recently? 

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2 minutes ago, hobz said:

Because they claim that they want a weaker baht. 

And the tourist sector needs a bailout. Aren't those good enough reasons?

Like how the US "printed" tons of money and lent it to businesses to protect jobs recently? 

So how do they make it weaker?

 

Forget printing money, that's a red herring in this discussion.

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19 hours ago, Jonathan Swift said:

white people pathetically whining about "racism" as if they have a clue what real racism is. Move to an American city for a year, live amongst non white people, observe, see real and in your face "ugly and racist",  see if you can learn something about it. You may not be so quick to throw  that word around in Asian countries. Now, pause to run to your dictionary and learn something. A policy may be "discriminatory" but it is not necessarily racist as a result. Discrimination in various forms may or may not be the RESULT of racism. Does the policy single out specific race, or just non Thais? THAT is not racist, it is nationalist and protectionist. Its purpose and roots are in economic interests of a relatively poor country when dealing with outsiders of better financial means, it is not rooted in hate. It is rooted in the mostly true idea that foreigners can afford to spend more because they are generally much better off financially. It is discriminatory and detrimental to tourism but hardly true evil, as racism is. Meanwhile your own attitude is inappropriately malicious toward your own imaginary bad guys. Discontinuing double pricing is a good idea, but wishing that businesses shut down when they like everyone else are just trying to make a living shows a total ignorance of the culture and of the delicate balancing act of the economy. It shows no respect or compassion to good people that would lose their jobs should that happen. Those businesses are following the lead of the government. You sound like a racist yourself. I hope you don't actually live here. If you do, please leave. I love it here, and the so called  "double pricing" such that it exists has virtually no tangible affect on me, my life, and my happiness here. And I am in a very low income bracket by western standards, $1600 a month US. 

So you think Ezzra is white? Also why is it you think white people cannot be offended by racism? take a leaf out of your own book and do some research on the history of global slavery and racism. all racism and discrimination is wrong, white people, black people, Asian people all have the right to protest against it.. 

 

i think i understand where you are coming from but your views are twisted.

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22 hours ago, Antonymous said:

Don't be mean.

 

You should see his sister.

 

image.png.f0431365f5a9b42783b3847232106963.png

Is she single? Can maybe do a wedding online so I can gain entry back into LOS???

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15 hours ago, Trillian said:

So how do they make it weaker?

 

Forget printing money, that's a red herring in this discussion.

Inflating money supply doesn't make a currency weaker? Even better reason to print money and bail everyone out.

 

When I say print money and bail everyone out I mean the central bank will add huge amounts of credit to banks and the banks will be forced to lend this money to any business or person that needs a bailout. The loans will be "forgivable" , meaning they won't have to be paid back. 

This is called inflation (inflating the money supply) and would weaken the THB purchasing power and exchange rate.

 

It's what the US is doing.. the reason the dollar is not collapsing as a result is that it's the world's reserve currency. If Thailand did the same they THB would weaken. Ofcourse depends on the amounts inflated I assume. And other factors as well as you pointed out. Is that correct or too simplified the way I see it?

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11 minutes ago, hobz said:

Inflating money supply doesn't make a currency weaker? Even better reason to print money and bail everyone out.

 

When I say print money and bail everyone out I mean the central bank will add huge amounts of credit to banks and the banks will be forced to lend this money to any business or person that needs a bailout. The loans will be "forgivable" , meaning they won't have to be paid back. 

This is called inflation (inflating the money supply) and would weaken the THB purchasing power and exchange rate.

 

It's what the US is doing.. the reason the dollar is not collapsing as a result is that it's the world's reserve currency. If Thailand did the same they THB would weaken. Ofcourse depends on the amounts inflated I assume. And other factors as well as you pointed out. Is that correct or too simplified the way I see it?

You can't apply the US model of USD to Thailand and the Baht, the two are totally different economies and currencies. USD is a reserve currency, the Baht is a minor boutique currency that is restricted, not fully convertible and cannot be freely exported, the US economy is worth USD 21 trillion vs Thailand at USD 530 bill. 

 

Increasing the money supply in Thailand via bank lending does what exactly to a restricted currency that cannot  be exported, even if it's effectively a cash giveaway? It would increase BOT debt because they would be the ones who have to shoulder the cost of the giveaway but it wouldn't increase government debt. 

 

Thailand has increased the money supply, it has doubled in the past the years yet it continues to suffer from ultra low inflation, a major reason being the current account has always shown a surplus which has fuelled the rise in foreign currency reserves:

 

https://tradingeconomics.com/thailand/current-account

 

https://tradingeconomics.com/thailand/money-supply-m1

 

 

 

 

 

 

 

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31 minutes ago, Trillian said:

You can't apply the US model of USD to Thailand and the Baht, the two are totally different economies and currencies. USD is a reserve currency, the Baht is a minor boutique currency that is restricted, not fully convertible and cannot be freely exported, the US economy is worth USD 21 trillion vs Thailand at USD 530 bill. 

 

Increasing the money supply in Thailand via bank lending does what exactly to a restricted currency that cannot  be exported, even if it's effectively a cash giveaway? It would increase BOT debt because they would be the ones who have to shoulder the cost of the giveaway but it wouldn't increase government debt. 

 

Thailand has increased the money supply, it has doubled in the past the years yet it continues to suffer from ultra low inflation, a major reason being the current account has always shown a surplus which has fuelled the rise in foreign currency reserves:

 

https://tradingeconomics.com/thailand/current-account

 

https://tradingeconomics.com/thailand/money-supply-m1

 

 

 

 

 

 

 

Thanks for your reply. The key to what you're saying is that because there is export limits on THB, the Thai central bank could inflate the THB infinitely without the THB being devalued?

So if Zimbabwe just had export restrictions they could keep printing Zimbabwe dollars without crashing the currency? 

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35 minutes ago, Trillian said:

You can't apply the US model of USD to Thailand and the Baht, the two are totally different economies and currencies. USD is a reserve currency, the Baht is a minor boutique currency that is restricted, not fully convertible and cannot be freely exported, the US economy is worth USD 21 trillion vs Thailand at USD 530 bill. 

 

Increasing the money supply in Thailand via bank lending does what exactly to a restricted currency that cannot  be exported, even if it's effectively a cash giveaway? It would increase BOT debt because they would be the ones who have to shoulder the cost of the giveaway but it wouldn't increase government debt. 

 

Thailand has increased the money supply, it has doubled in the past the years yet it continues to suffer from ultra low inflation, a major reason being the current account has always shown a surplus which has fuelled the rise in foreign currency reserves:

 

https://tradingeconomics.com/thailand/current-account

 

https://tradingeconomics.com/thailand/money-supply-m1

 

 

 

 

 

 

 

Why doesn't Thailand simply print 1000000000000 trillion THB and buy all the world's gold reserves and usd reserves. What's the downside since the THB cannot be devalued by printing it?

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3 hours ago, hobz said:

Thanks for your reply. The key to what you're saying is that because there is export limits on THB, the Thai central bank could inflate the THB infinitely without the THB being devalued?

So if Zimbabwe just had export restrictions they could keep printing Zimbabwe dollars without crashing the currency? 

Not quite! Of course QE can help devalue a currency but Thailand has no appetite to take on debt or the inflation that would follow, if they get the scale of it wrong - the government had to be coerced by the IMF to operate a larger budget deficit for goodness sake because they are so risk averse.

 

BOT has no remit to initiate QE and successive governments have shied away from issuing debt which is why their borrowings are so low at 42% of GDP (53% post bail out). And unless productivity gains can be released in the Thai economy, QE would only lead to higher inflation, Thailand has had great difficulty increasing productivity which is why the whole money printing concept is a non-starter. 

 

When I refer to the Baht not being fully convertible I do so in the context of making it weaker. One way the country could weaken the Baht is to make it fully convertible but even today the country is reluctant to do that for fear that speculators will take a position against it, another throwback to the '97 crash.

 

Almost 96% of government debt is in THB, only 4% is in foreign currency loans. If Thailand were to borrow in USD this would mean selling THB for USD which would result in a weakening of the currency and this is exactly what is intended with the high speed rail link contract with China which is to be paid in USD. Thailand is in the process of fixing a forward rate on that loan at a time when the Baht is strong and USD is weak, that is sensible borrowing which may help weaken THB and be the precursor to further loans along the same lines.

 

 

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