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The Thai Economy Is In Crisis


george

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It won't be long before the dollar starts rising and this will be the key trigger harpooning the carry trade and causing emerging markets to fall.

And what makes you think the Dollar will start rising ? And, what do you mean by "it won't be long"...any time frame you wish to share with us ?

LaoPo

It will "not be long before" the USD takes a further dive when even amercians relise that the USD is a wortless currency...

2 decades of spending and a debt of 9 trillion have to come to an end.

When the Chinese start to pull the plug which they are talking about already

- I am wondering if it will be like watching domino's fall one after another.........................

The Chinese won't pull the plug; not in their interest.

But, the domino effect is already here but didn't start in China but the US with the sub prime crisis. It's not over yet, by far.

In the US consumer 'spending' is already slowing, slowly but surely, but first the papa's and mama's have to buy Xmas presents. If they will beat last year's Santa Claus spendings remains to be seen.

In the long term lower spending is painful -BUT NECESSARY- for the US and the rest of the world (Asia and China in particular) as Asian exports will slow accordingly.

LaoPo

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It won't be long before the dollar starts rising and this will be the key trigger harpooning the carry trade and causing emerging markets to fall.

And what makes you think the Dollar will start rising ? And, what do you mean by "it won't be long"...any time frame you wish to share with us ?

LaoPo

It will "not be long before" the USD takes a further dive when even amercians relise that the USD is a wortless currency...

2 decades of spending and a debt of 9 trillion have to come to an end.

When the Chinese start to pull the plug which they are talking about already

- I am wondering if it will be like watching domino's fall one after another.........................

The Chinese won't pull the plug; not in their interest.

But, the domino effect is already here but didn't start in China but the US with the sub prime crisis. It's not over yet, by far.

In the US consumer 'spending' is already slowing, slowly but surely, but first the papa's and mama's have to buy Xmas presents. If they will beat last year's Santa Claus spendings remains to be seen.

In the long term lower spending is painful -BUT NECESSARY- for the US and the rest of the world (Asia and China in particular) as Asian exports will slow accordingly.

LaoPo

the only way for Asian exports to slow down will be when westerners will be prepared to work for the same salaries as Asians.

untill that time American and Europeans who want to eat, and buy cloths will continue to buy from Asia.

Thailand is a producer. it produces cheap food cheap cars and cheap cloths. and even cheap pahrmacuticals and as long as the wages in thailand are a 10th of an employee in the west the price of Thai exports can still compete anf thai exports will grow.

the strong baht will effect the buyers who willnow pay more for those items but they will still buy them as it is cheaper to buy from thailand then to produce on your own in the west.

We discussed this a few months ago in detail and the basics have not changed.

The Americans have spent the last 20 years acumulating a debt that is now over 9 trillion. there is no way they can pay it back.

they have also made that debt well hidden and resold it over and over again knowing that this bubble will one day explode.

The US is definatly in for a ride as we discussed a few months ago. followed by Europe who mainly exports to America expensive items.

and those will be the first that Americans will deduct.

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the only way for Asian exports to slow down will be when westerners will be prepared to work for the same salaries as Asians.

untill that time American and Europeans who want to eat, and buy cloths will continue to buy from Asia.

It's not the only way, Highdiver.

An (Oil)-crisis, worsening sub prime- and even a combination with an upcoming Credit Card crisis will slow down Asian exports severely.

LaoPo

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the only way for Asian exports to slow down will be when westerners will be prepared to work for the same salaries as Asians.

untill that time American and Europeans who want to eat, and buy cloths will continue to buy from Asia.

It's not the only way, Highdiver.

An (Oil)-crisis, worsening sub prime- and even a combination with an upcoming Credit Card crisis will slow down Asian exports severely.

LaoPo

Dear Laoapo

I think you wil find this very interesting as should others.

and thanks for Lana for the link in another thread.

you have to see this its amazing.

part 1 is about subprime

http://nl.youtube.com/watch?v=SJ_qK4g6ntM

part 2 is about bankers

http://nl.youtube.com/watch?v=axAjb6fDsPY&NR=1

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Well I don't think there is a problem. All this sub prime stuff. All George has to do is get the treasury to print up a few hundred billion and bail out the banks. The US hasn't backed the dollar with anything since the 70's so what is a few billion more. :D Sounds a bit unreasonable dosen't it? But then that is what they did in the 80's for the savings and loan industry. Make sure you don't have over $100,000 in any account as that is all that is insured. :o

Until the 70's the US dollar was back by gold. Now it is backed by faith. The entire world gold above ground is valued at $3.4 trillion. The US debt is $9 trillion.

So does anyone see a logical end to the sub prime fiasco?

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Economic growth for Thailand is on the low side in comparison with other regional countries:

Although:

"In Thailand, where domestic consumption and investment have languished amid political turmoil following a military coup, elections later this year may spur growth in 2008, the report said."

``Clearer policy direction from the new government after the December elections should help improve investor sentiment and raise investment growth next year,'' the lender said. ``Exports of goods and services remain the key driver of growth this year and will remain so next year.''

The following table contains the World Bank's April estimates of growth, as well as revised forecasts for 2007 and projections for 2008.

April's Nov.'s Estimates

Estimates & Forecasts

2007 2008 2007 2008

East Asia 7.3 7.1 8.4 8.2

China 9.6 8.7 11.3 10.8

Southeast Asia 5.5 5.7 5.7 5.8

Indonesia 6.3 6.5 6.3 6.4

Malaysia 5.6 5.8 5.7 5.9

Philippines 5.6 6.0 6.7 6.2

Thailand 4.3 4.5 4.3 4.6

Newly Industrialized 4.6 5.0 5.1 5.1

Hong Kong (SAR) 5.3 5.1 5.8 5.2

Singapore 5.5 5.6 7.4 6.4

South Korea 4.5 5.0 4.8 5.1

Taiwan (China) 4.1 4.6 4.6 4.6

Small Economies 6.0 5.8 6.4 6.2

Vietnam 8.0 8.0 8.3 8.2

From: http://www.bloomberg.com/apps/news?pid=206...amp;refer=china where the figure are better readable

LaoPo

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  • 2 weeks later...

i tried to reserve a hotel room for a friend in Samui and all the hotels are nearly fully booked for 3 months of the high season.

it seesm that exports are going up further and tha 2007 will be a very good year.

i just wanted to know ..... Where ios the crisis???

what has has happened to all our dooms day brigade?? its not going to be the same with out them..

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i just wanted to know ..... Where ios the crisis???

what has has happened to all our dooms day brigade?? its not going to be the same with out them..

We are here, dear HD. Don't worry. :o The Mother Of All Threads will be kept alive... For a very long time.

As for myself, I'm waiting for the BOT on november 30 when they will publish the details about october exports (with many goodies like indexes of volume, price etc.).

I will get back to you, after a few charts. I promise.

:D

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Thai Current Account Surplus May Narrow as Spending Recovers

By Suttinee Yuvejwattana

Nov. 29 (Bloomberg) -- Thailand's current account surplus probably narrowed in October as reviving confidence ahead of an election next month to restore democracy led consumers to spend more on imports.

The surplus dropped to $1.56 billion from $1.81 billion in September, based on the median of 12 economists' estimates in a Bloomberg survey. September's excess was the highest in six months. The Bank of Thailand report is due tomorrow at 2:30 p.m. in Bangkok.

Thailand's central bank has kept its key interest rate unchanged at the last two meetings as local demand started to pick up after five consecutive cuts from January. The military- backed government has set Dec. 23 for a national election to restore democracy after the September 2006 putsch.

``Consumer spending has started to pick up and should gain more momentum as elections draw closer,'' said Nuchjarin Panarode, an economist at Capital Nomura Securities Pcl in Bangkok. ``The bottoming interest rate encourages people to buy big-ticket items.''

Thailand's central bank expects the current account to turn to a deficit next year as exports slow along with global demand and imports climb as private and public investment recover. The current account balance comprises the difference between exports and imports of goods, services, investment income and remittances.

Consumption Recovers

A private consumption gauge is close to its highest level in a year. It fell to the lowest level in 18 months in January. An index of business sentiment is at the highest level since December after touching a record low in April.

Manufacturing production probably accelerated to 10 percent in October from 9.3 percent a month earlier, based on the median of 15 estimates in a Bloomberg survey.

Thailand's trade surplus narrowed to $1.5 billion in October from $1.97 billion a month earlier, the Commerce Ministry said on Nov. 21. Exports last month rose 26.7 percent from a year earlier to a record $14.5 billion, compared with a 10.4 percent increase in September. Imports jumped 20.2 percent to $13.02 billion, accelerating from a 7.4 percent gain in the previous month.

The following table shows* estimates for the current account balance in October. The year-on-year percentage change in manufacturing production is also for October.

* http://www.bloomberg.com/apps/news?pid=206...&refer=news

LaoPo

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i just wanted to know ..... Where ios the crisis???

what has has happened to all our dooms day brigade?? its not going to be the same with out them..

We are here, dear HD. Don't worry. :o The Mother Of All Threads will be kept alive... For a very long time.

As for myself, I'm waiting for the BOT on november 30 when they will publish the details about october exports (with many goodies like indexes of volume, price etc.).

I will get back to you, after a few charts. I promise.

:bah:

We are here, dear HD. Don't worry... :D:D its great to see you again. where is bingo?? he decided to try his luck in the economy section.... :D and MID where is that great optimist???

As per BOT and november... thats the same thing that we did in October waiting for the September data that was even better then expected. :D

when is the new thread of Thailand in crisis 2008 coming out??

it seems the tourist high season is going to hit thailand with extra force this year..

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another stellar endorsement by the business community......not

highdiver, counting the number of farangs on barstools is not an accurate measure of economic health unless you are a bargirl or bar owner

Office rentals off 26 pct

The low take-up was a result of delayed expansion plans a low number of new start-ups due to a weak economy, political uncertainty and concerns about foreign ownership of companies in the services sector.

http://www.bangkokpost.com/topstories/tops...s.php?id=124207

Edited by bingobongo
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  • 2 weeks later...

Dollar Gains Against Thai Baht

The US dollar edged up against the Thai Baht in early Asian trading on Tuesday. The pair that closed Monday's deals at 33.64 surged to 33.6550 at about 10:35 pm ET. This set a 5-day high for the dollar-Baht pair.

Source: Nasdaq - 18 December 2007

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another stellar endorsement by the business community......not

highdiver, counting the number of farangs on barstools is not an accurate measure of economic health unless you are a bargirl or bar owner

Office rentals off 26 pct

The low take-up was a result of delayed expansion plans a low number of new start-ups due to a weak economy, political uncertainty and concerns about foreign ownership of companies in the services sector.

http://www.bangkokpost.com/topstories/tops...s.php?id=124207

Typical Bangkok Post they misquoted them, what they should have said was demand has dropped by 26%. This has not yet led to major softening in rents, although there has been little to no growth this year at all.

However I believe that further softening could be possible if current levels of demand are sustained given the new supply on the horizon.

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  • 3 weeks later...

well the 2007 crisis ......:o is over!!!

can our mods open a new thread for the 2008 crisis??

where are the dooms day brigade??? bongo is the last one and he is still defending his "short" campaign from august.

It seems they left the forum once the elections were done.

i wonder if the dooms day brigade was a influenced by exiled thais???

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well the 2007 crisis ...... :o is over!!!

can our mods open a new thread for the 2008 crisis??

where are the dooms day brigade??? bongo is the last one and he is still defending his "short" campaign from august.

It seems they left the forum once the elections were done.

i wonder if the dooms day brigade was a influenced by exiled thais???

I will answer you diver.

OCT, NOV, & DEC, - I have sold more product at better margins than the preceeding 15 months put together.

Hypothesis - People are sick & tired of waiting for an end to "one man's ambition" & are just getting on with their lives / business etc.

Confirmed sales orders are slackening this month but potentials are at a record high.

Cheers,

Soundman.

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man highdiver, you linger like stink on sh@@, inflation is not a good thing when it comes to living expenses genius........oh by the way, how did that election turn out? let me guess, the election mess is also good for the economy going forward? lol

Higher costs spur price hikes

Oil, raw-material expenses surge

http://www.nationmultimedia.com/2008/01/09/business/business_30061610.php

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i just wanted to know ..... Where ios the crisis???

what has has happened to all our dooms day brigade?? its not going to be the same with out them..

We are here, dear HD. Don't worry. :o The Mother Of All Threads will be kept alive... For a very long time.

As for myself, I'm waiting for the BOT on november 30 when they will publish the details about october exports (with many goodies like indexes of volume, price etc.).

I will get back to you, after a few charts. I promise.

:D

Now its January 2008, it would be a great time for us to see your 'charts' regarding exports.. You did promise. :D

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As for myself, I'm waiting for the BOT on november 30 when they will publish the details about october exports (with many goodies like indexes of volume, price etc.).

I will get back to you, after a few charts. I promise.

:o

Now its January 2008, it would be a great time for us to see your 'charts' regarding exports.. You did promise. :D

Indeed. Thanks to remind me. :D

I've no shame to admit that I was wrong.

Actually, I was wrong for exports for the whole 2007 year.

However... however... I do maintain that exports is the only remaining growth engine for Thailand (difficult to deny this, private consumption and investments remains weak), even if the gvt tries to push public expenses (at this date the "mega projects" are still not financed by the JBIC's loans...).

Add to this the pressure on the THB (33 this morning !)... The inflation... and the obvious recession that is cooking in the US.... Plus I believe we all agree that the idea "elections = confidence and economy back on track" was pure bullshit.

The political crisis is even deeper than before. Nothing is solved.

Therefore, what can we expect from a -ghost- government ?

The crisis will continue in 2008. And economy is following.

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The political crisis is even deeper than before. Nothing is solved.

Therefore, what can we expect from a -ghost- government ?

The crisis will continue in 2008. And economy is following.

that goes without saying. the Baht weakens each and every day and will soon have reached its absolute lows vs. major currencies. a weak currency fetching sh*tty low interest rates is the best indication how sh*tty an economy is.

p.s. get that pound of salt ready to sprinkle on my remarks :o

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  • 2 weeks later...

"A slow economy and shrinking consumer confidence and spending caused sales in the local motorcycle market to plunge last year, according to the market leader, AP Honda Co.

Motorcycle sales, based on registrations with the Land Transport Department, fell by 17% from 1.93 million units in 2006 to 1.59 million last year. (Bangkok Post)"

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Well I don't think there is a problem. All this sub prime stuff. All George has to do is get the treasury to print up a few hundred billion and bail out the banks. The US hasn't backed the dollar with anything since the 70's so what is a few billion more. :D Sounds a bit unreasonable dosen't it? But then that is what they did in the 80's for the savings and loan industry. Make sure you don't have over $100,000 in any account as that is all that is insured. :o

Until the 70's the US dollar was back by gold. Now it is backed by faith. The entire world gold above ground is valued at $3.4 trillion. The US debt is $9 trillion.

So does anyone see a logical end to the sub prime fiasco?

This is simply the crux of the whole matter for the whole world.

The $US is a Fiat currency with only marginal real value, but a trading value based on nothing more than pure faith. The USA owes nothing, ZERO, to the rest of the world for its ever escalating debts while it can simply print more money that the rest of the world has faith in. Its like owning the mint, the bank and at the same time having an unlimited credit line. If faith in the $US collapses a lot of smaller countries like Thailand will be hurt far more than USA itself.

There are proposals by some economists to base a world trading currency on a common denominator such as a basket of international currencies and some others that include a mix of precious commodities such as gold and oil into the composite. Basing a world trading economy on one countries currency is a very dangerous experiment that is gradually coming to a close. And not with too much of a crunch for the little countries like Thailand I hope.

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  • 2 weeks later...

Chamber of Commerce requests new govt. to maintain 30% capital reserve requirement

Chairman of the Thai Chamber of Commerce Pramont Sutheewong (ประมนต์ สุธีวงศ์) says FED’s 0.5% interest rate cut will not affect Thailand’s economy much in a short-term period. He also calls on the new government to maintain the 30% capital reserve requirement and prepare measures for fluctuations of the baht currency after the requirement is lifted.

The chairman also suggests BoT to adjust the country’s interest rate in line with FED’s rate, adding that the global economic situation is deteriorating.

Mr Pramont affirms the new government should carefully consider before deciding to withdraw the 30% reserve requirement.

Source: Thai National News Bureau Public Relations Department - 31 January 2008

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Chamber of Commerce requests new govt. to maintain 30% capital reserve requirement

Chairman of the Thai Chamber of Commerce Pramont Sutheewong (ประมนต์ สุธีวงศ์) says FED’s 0.5% interest rate cut will not affect Thailand’s economy much in a short-term period. He also calls on the new government to maintain the 30% capital reserve requirement and prepare measures for fluctuations of the baht currency after the requirement is lifted.

The chairman also suggests BoT to adjust the country’s interest rate in line with FED’s rate, adding that the global economic situation is deteriorating.

Mr Pramont affirms the new government should carefully consider before deciding to withdraw the 30% reserve requirement.

Source: Thai National News Bureau Public Relations Department - 31 January 2008

Isn't it funny how many people were up in arms when the 30% RR was kept in place by the BOT for so long? Now Chairman of the Thai Chamber is starting to see why the BOT kept them in place. Since one of the PPP's main economic policies was to abolish these controls, the real world is starting to hit home with some of these guys as to the potential impact on the THB if capital controls are lifted while USD rates are declining.

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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?

The best ever 57 to the dollar.

Boy that was a vacation to remember... :o

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