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george

The Thai Economy Is In Crisis

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Government urged to stimulate investment for economic survival

BANGKOK: -- The Thai economy is in crisis and the government must stimulate state and private investment to make consumption recover if it wants to see the country weather the economic crisis, a leading economist warned Friday.

Supavut Saichua, president of Phatra Securities Plc, said the Bank of Thailand's decision to decrease its economic growth estimate for this year to 3.8-4.8 per cent lived up to many parties' expectations.

The company projected the country's gross domestic product (GDP) would grow only 3.7 per cent this year.

In his personal view, he said, what is important now is not how much the GDP would expand. Rather, it is how much the investment and consumption would increase while exports are expected to decline in the second half of this year.

Previously, many parties projected the investment would recover in the second half of the year. But now they shared a common view that the investment and consumption would pick up next year.

He said the political development and the economic policy are key to determining whether the economy would recover.

In next two months, he projected, political tensions are likely to escalate significantly, fuelled by four concerns including a final decision on the dissolution of several political parties by the Constitutional Tribunal, the anti-draft constitution movement, expected strong resistance from supporters of the ousted prime minister Thaksin Shinawat facing legal actions in many lawsuits, and anti-government demonstrations by people affected by the economic downturn.

Dr. Supavut said he was concerned should the economy grow less than 4-5 per cent annually for several consecutive years, Thailand's unemployment would mount.

"The only way for economic survival is to stimulate both state and private investment," the Phatra executive said. "Depending chiefly on exports will not help sustain overall economic growth.

"To strengthen the economy, we have to increase production capacity, investment in new machinery and competitiveness. Once investments recover," he said, "consumption will improve."

He charged that the government had not paid attention to the economic stimulus since it viewed the economy was still able to grow by itself .

In addition, some state policies, such as an amendment to the Foreign Business Act and the central bank's capital controls, had discouraged foreign direct investment.

Regarding the baht movement, he said, it depended on the demand and supply of the US dollar in the market.

He believed the baht could not weaken until the central bank intervened in the currency movement or there was a further political crisis which shook people's confidence.

--TNA 2007-04-27

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BANGKOK: -- The Thai economy is in crisis and the government must stimulate state and private investment to make consumption recover if it wants to see the country weather the economic crisis, a leading economist warned Friday.

This seems a bit overblown. If the Thai economy is in crisis today, how would one describe its state in late 1997?

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BANGKOK: -- The Thai economy is in crisis and the government must stimulate state and private investment to make consumption recover if it wants to see the country weather the economic crisis, a leading economist warned Friday.

This seems a bit overblown. If the Thai economy is in crisis today, how would one describe its state in late 1997?

I wasn't living in Thailand in 1997 but as I recall it was limited to economic issues.

I don't think it's overblown one bit to describe the situation now as another crisis -and in fact I think it's

even worse now than in 1997 because now we have bitter divisions between the Thai people themselves-

and speculation that will be unrest........

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not there yet, but with the US GDP coming in at a paltry 1.3% , its only a matter of time before Thailand takes it on the chin....

Four Asian nations hit by 1997-98 financial crisis face vulnerability

Thailand now faces greater risks due to a decline in the ratio of foreign reserves to short-term debt and an increase in short-term capital inflows.

http://www.iht.com/articles/2007/04/19/news/currency.php

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scaremongering again

no scaremongering Forkinhades - just fact :o

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not there yet, but with the US GDP coming in at a paltry 1.3% , its only a matter of time before Thailand takes it on the chin....

Four Asian nations hit by 1997-98 financial crisis face vulnerability

Thailand now faces greater risks due to a decline in the ratio of foreign reserves to short-term debt and an increase in short-term capital inflows.

http://www.iht.com/articles/2007/04/19/news/currency.php

I agree with you. but maybe not got the same reason.

Thailand is facing another financial crisis vulnerability because huge hedge funds and investment banks have taken position on the thai baht. As such Thailand is now at the mercy of those forign speculators that can decide to draw out and repeat the same crisis as in 97. Unfortunatly this is now a problem not only for thailand but for the whole world. the Huge fund mangers have only one consideration and that is to make more and more profits. they dont care if they can ruin a country or devestate an economy while doing so.

All the economical factors are in favour for thailand to continue growth but a bunch of greedy speculators can realy rock the boat.

there is no way to stop this as if you put limitations on short-term capital inflows the speculators are going to go to the govermants and complain about thailands monitary policy and thailand does not want tpo upset the americans or the europeans. so at the end of the day a few greedy managers are basicly running the world.

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In the late 1997 baht depreciated by 200%, government collapsed, tough IMF conditions were imposed, 56 financial companies were forcibly closed with losses in trillions of baht and the next year the economy shrinked by 20%.

Now THAT's a crisis.

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The above (post #8) is interesting, but well, if a country like Thailand managed itself better and didn't make the asinine decisions of late, then it wouldn't be in such a vulnerable position. The 97' debacle was also a sef-made mess and then the vultures circled and came in.

Edited by mbkudu

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Thailand is going nowhere quite quickly......

Some 4,000 protest Thailand's junta

Thailand's economy is seen rising 3.8-4.8 pct in 2007, the lowest growth in six years.

The protest movement is also beginning to create an odd coalition of allies, with some pro-democracy groups who last year demonstrated against Thaksin now joining forces with his allies in protesting against the junta, they said.

http://www.forbes.com/business/feeds/afx/2...afx3661883.html

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not there yet, but with the US GDP coming in at a paltry 1.3% , its only a matter of time before Thailand takes it on the chin....

Four Asian nations hit by 1997-98 financial crisis face vulnerability

Thailand now faces greater risks due to a decline in the ratio of foreign reserves to short-term debt and an increase in short-term capital inflows.

http://www.iht.com/articles/2007/04/19/news/currency.php

I agree with you. but maybe not got the same reason.

Thailand is facing another financial crisis vulnerability because huge hedge funds and investment banks have taken position on the thai baht. As such Thailand is now at the mercy of those forign speculators that can decide to draw out and repeat the same crisis as in 97. Unfortunatly this is now a problem not only for thailand but for the whole world. the Huge fund mangers have only one consideration and that is to make more and more profits. they dont care if they can ruin a country or devestate an economy while doing so.

All the economical factors are in favour for thailand to continue growth but a bunch of greedy speculators can realy rock the boat.

there is no way to stop this as if you put limitations on short-term capital inflows the speculators are going to go to the govermants and complain about thailands monitary policy and thailand does not want tpo upset the americans or the europeans. so at the end of the day a few greedy managers are basicly running the world.

Highdiver, You hit the nail on the head! I have posted multiple times on this subject but most people here just don't get it. When the hedge funds decide to get out of their investments and change their baht back in to euros and U.S. dollars then the Thai baht will do an absolute backflip. People don't realize the size and scope of these funds to change capital markets overnight and ruin a small countries economy as well, and you are correct that absolute greed is the only thing that motivates these people. It is truely unconsionable how governments both in the U.S. and Europe have been bought off and make no attempt to have any regulation or oversight on these hedge fund criminals. A good example was the democratic debate in south carolina yesterday, the moderator asked john edwards and hillary clinton the same question about what they would do to institute some oversight on the hedge fund industry if elected and both candidates completely dodged the question and talked about something else. The next question in the debate was directed toward chris dodd (a senator from conneticut that the hegde fund industry has in its back pocket) and you could see senator dodd sweating bullets thinking that he might be getting the same question on the hegde fund industry, but sadly the moderator seeing that he was not going to get a straight answer about hedge funds from these candidiates, changed the line of questioning and you could see the immediate relief on chris dodds face. Just as Jesus overturned the carts of the moneychangers in the temple, we need someone in power with a strong loyal following to turn over the carts of the hedge funds and watch as the cockroaches scrurry, if something isn't done soon then I feel that the price to pay will be devestating.

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not there yet, but with the US GDP coming in at a paltry 1.3% , its only a matter of time before Thailand takes it on the chin....

Four Asian nations hit by 1997-98 financial crisis face vulnerability

Thailand now faces greater risks due to a decline in the ratio of foreign reserves to short-term debt and an increase in short-term capital inflows.

http://www.iht.com/articles/2007/04/19/news/currency.php

I agree with you. but maybe not got the same reason.

Thailand is facing another financial crisis vulnerability because huge hedge funds and investment banks have taken position on the thai baht. As such Thailand is now at the mercy of those forign speculators that can decide to draw out and repeat the same crisis as in 97. Unfortunatly this is now a problem not only for thailand but for the whole world. the Huge fund mangers have only one consideration and that is to make more and more profits. they dont care if they can ruin a country or devestate an economy while doing so.

All the economical factors are in favour for thailand to continue growth but a bunch of greedy speculators can realy rock the boat.

there is no way to stop this as if you put limitations on short-term capital inflows the speculators are going to go to the govermants and complain about thailands monitary policy and thailand does not want tpo upset the americans or the europeans. so at the end of the day a few greedy managers are basicly running the world.

Highdiver, You hit the nail on the head! I have posted multiple times on this subject but most people here just don't get it. When the hedge funds decide to get out of their investments and change their baht back in to euros and U.S. dollars then the Thai baht will do an absolute backflip. People don't realize the size and scope of these funds to change capital markets overnight and ruin a small countries economy as well, and you are correct that absolute greed is the only thing that motivates these people. It is truely unconsionable how governments both in the U.S. and Europe have been bought off and make no attempt to have any regulation or oversight on these hedge fund criminals. A good example was the democratic debate in south carolina yesterday, the moderator asked john edwards and hillary clinton the same question about what they would do to institute some oversight on the hedge fund industry if elected and both candidates completely dodged the question and talked about something else. The next question in the debate was directed toward chris dodd (a senator from conneticut that the hegde fund industry has in its back pocket) and you could see senator dodd sweating bullets thinking that he might be getting the same question on the hegde fund industry, but sadly the moderator seeing that he was not going to get a straight answer about hedge funds from these candidiates, changed the line of questioning and you could see the immediate relief on chris dodds face. Just as Jesus overturned the carts of the moneychangers in the temple, we need someone in power with a strong loyal following to turn over the carts of the hedge funds and watch as the cockroaches scrurry, if something isn't done soon then I feel that the price to pay will be devestating.

if you have proof that this is actually happening, then, let us all see it. otherwise, all this conspiracy stuff is old stuff, and the only thing it does is make foreigners more anti-american.

on the other hand, since you seem to think this is true, perhaps you can tell us all what thailand can do to stop this so-called conspiracy being implemented by evil rich americans?

your conspiracy theories are making it so that win or lose, america will look like the one to blame.

jesus, can't someone in this world take the blame for something THEY did for once?

yeah. maybe I am naive about all the evil in this world. so, please enlighten me. but some more constructive thought would help instead of just all the accusations. thank you.

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I think a lot of people here are underestimating how hard it is to manipulate currency markets.

In terms of some sort of economic crisis, even this lower GDP number is 3 times the GDP growth that the USA is currently experiencing.

With a Coup, The Tsunami, FBA, 30% Currency regulation etc... I'd say its doing pretty ###### fine actually. Some people are just naturally a little negative and look for things to fail, so they can say "I told you so".

I could start a thread with the title "THAILAND GROWS 3 TIMES AS QUICKLY AS THE USA" but it really doesn't mean anything even though it would be a true statement.

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I get email all the time from people overseas asking about quote, "how safe is it to visit thailand now?"

do you want to know why people are scared to come to thailand now? I'll be very blunt, and to the point. no bullshit.

1) the coup, (like who in the right mind won't be scared when they hear of a coup??!?)

2) the bombings in bangkok, (again, who wouldn't be scared to come to thailand after hearing of the bombings??!?)

3) the bombings down south, (need I say more??!?)

4) the rising baht, (what the <deleted>#k, from 42 to 34 like within a year. that's 20%+. not such a deal now right??!?)

5) the anti-american sentiment, (yes, it exists, and more so than you want to believe.)

6) the abbott protests, (many thais believe western nations are evil corrupt capitalists. so, why should foreigners come??!?)

7) the changing property laws, (what home owner would want to come back to thailand after being told to <deleted>#k off.)

does a foreigner need any more reason to NOT come to thailand??!?

so, tell me.. who is to blame for all the above things happening? evil rich americans???

get real. the only ones to blame for the current problems are thais. either for allowing the above to happen, or being involved.

just to let you know, I am telling most of my friends who are asking to DO come back. but honestly, I am sure there are

more out there who have nobody like me to advise them.

..is there a crisis about to occur?

in my opinion - yes. ..but I am just one person who can do nothing. one speck in this universe.

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