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What Will The Flooding Do To The Baht?


radioman

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Wondering what effect, short, medium, longer term, the current flooding in Thailand might have on the currency? Interested to hear opinions. My own, uneducated, guess would be it should devalue give the possible trade fall of likely over the next few months.

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Every time I think that the Bht/NZD will improve in my favour, when there's a disaster/coup etc, it doesn't.

 

I think you're right, Takky has not decided yet.

 

I saw an article with Takky saying he'd never return to politics last week/days, and the Journo believed him !

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Bird Flu

 

Sars

 

Yellow Shirts

 

2009 Finacial Crisis

 

Red Shirts

 

Massive Flood

 

 

 

 

Nothing seems to affect the THB rate of exchange as you would think it should.

 

Agreed, but other than the flood nothing stopped the productive businesses generating revenue, well tourism okay (and not to be ignored), but I suspect that will be as affected by the flood as it was by any of the other 'incidents'. That there are now more manufacturing business essentially off the map for now makes me think there might be more pressure. Thailand needs to look cheap now to capture that reconstruction investment. But we'll see, no doubt.

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baht is more or less locked to the $(us). not really moving in any significant direction of its own since years...

versus euro etc it did move all the way from 50 to below 40 & then settling around its current 42-43.

again rather stable so yeah very likely it only moves on orders from the desert king lol ;)

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Per my econ guru...

 

The dollar has been rather stabile against the baht this past week.

The floods will impact rates only in that fewer exports means fewer dollar profits to be repatriated meaning the baht should not strengthen. (go down)

 

Currencies have been stronger against the dollar since last Friday on euro concerns.

 

This will not impact the baht much.

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Per my econ guru...

 

The dollar has been rather stabile against the baht this past week.

The floods will impact rates only in that fewer exports means fewer dollar profits to be repatriated meaning the baht should not strengthen. (go down)

 

Currencies have been stronger against the dollar since last Friday on euro concerns.

 

This will not impact the baht much.

iland flooding hits Dell, chip makers

 

By Benjamin Pimentel

Oct 20, 2011 18:09:17 (ET)

 

SAN FRANCISCO (MarketWatch) -- The flooding in Thailand that disrupted Western Digital's operations took a toll Thursday on stocks across the tech sector, most particularly on PC makers and chip firms.

 

Shares of Dell (DELL, Trade ) , Intel (INTC, Trade ) and Nvidia (NVDA, Trade ) felt the heat a day after Western Digital (WDC, Trade ) offered more details of what its Chief Executive John Coyne described as "a disaster of unprecedented scale."

 

"The overall impact to the people of Thailand is immeasurable, and our hearts go out to them in these trying times," Coyne told analysts. "Full recovery will be a multi-quarter challenge."

 

Shares of the hard disk drive maker were up 5% Thursday, but have fallen more than 9% this week.

 

Dell fell 5.4% to close at $15.05, making the stock one of the worst performers on the S&P 500 (SPX ) , where the tech sector was the hardest hit. Intel closed trading down 2.6% while Nvidia was off more than 5% by the close. Both Intel and Nvidia are key chip suppliers for the PC market.

 

In an e-mail, Dell spokesman David Frink said the company expects "minimal impact to supply through the end of our third fiscal quarter, and currently are working with our hard drive suppliers to address potential impact for the remainder of the year."

 

"We won't speculate on future scenarios or actions we might take," he added.

 

However, FBN Securities analyst Shebly Seyrafi said in a note, "We see PC companies, especially Dell, most impacted by the disaster in Thailand."

 

Seyrafi also said data storage companies EMC Corp.(EMC, Trade ) and NetApp Inc (NTAP, Trade ) could also be "negatively impacted ... but should be less so as enterprise drives are more profitable, so less likely to be constrained, and they are more tied to Seagate than Western Digital."

 

Seagate, a Western Digital rival, is scheduled to report results after Thursday's closing bell. Seagate (STX, Trade ) shares were up a fraction to locse at $12.06. EMC shares were up a fraction to close at $23.81, while NetApp slid 2.1% to close at $37.72.

 

Barclays analyst Ben Reitzes also said in a note that "the situation in drives could have implications for PC makers H-P and Dell in terms of higher component prices and shortages."

 

Shares of Hewlett-Packard (HPQ, Trade ) traded down about 1% to close at $24.74.

 

Meanwhile, shares of Marvell Technology (MRVL, Trade ) retreated 2.8% to close at $13.32. In a note, Nomura Equity Research analyst Romit Shah said the impact from the disaster on Marvell is "big."

 

"Overall, we estimate that the flooding in Thailand could negatively impact Marvell by $175 million in revenue and $0.16-0.18 in earnings per share," Shah wrote.

 

Another Barclays analyst, Blayne Curtis, also wrote that the disaster was "most negative for Marvell, but LSI [was] also at risk."

 

"It is still unclear to what extent the shortages for key components will lower the overall hard disk drive total addressable market, which impacts both Marvell and LSI," Curtis wrote.

 

Shares of LSI (LSI, Trade ) were up 1.3% by the close of trading Thursday, but have fallen about 8.5% this week.

 

On the other hand, the flooding may have a positive impact on semiconductor capital equipment companies, said Barclays analyst C.J. Muse who wrote, "There are few companies in our coverage that have meaningful leverage to hard disk drives."

 

Muse cited Teradyne Inc (TER, Trade ) , a testing equipment manufacturer shares of which were up more than 4% at last check.

 

Also impacted by the flooding is chip maker ON Semiconductor which on Wednesday said that its Sanyo Semiconductor division's Thailand operation has suffered disruptions due to the disaster. Shares of ON Semiconductor (ONNN, Trade ) slipped about 1% on Thursday. The stock has lost roughly 17% this week.

 

Intel Corp. shares were the hardest hit on the Dow Jones Industrial Average ($INDU ), which was up a fraction. An Intel spokesman said the flooding has not directly affected the company, saying the chip maker has "a small number of employees there" who are all okay."

 

In a call with analysts last week, Intel Chief Financial Officer Stacy Smith also said the company doesn't expect the disaster to have an impact on PC market sales in the fourth quarter, saying "a combination of alternate supplied and inventory levels will carry us through."

 

But Evercore analyst Patrick Wang speculated in an e-mail that hard disk drive supply constraints "could potentially present a bottleneck to fourth quarter and first quarter builds and negatively impact Intel's fourth quarter guidance."

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Thailand flooding hits Dell, chip makers

 

 

Already seeing plenty of concern on various DiY Audio forums - you dont realise just how much silicon comes out of Thailand until the supply chain begins to constrict. An amp builder has already taken my deposit, so I just have to keep my fingers crossed that he got his components before this reached crisis point.

 

As for the baht, I agree with what has been said earlier, but the last thing any of us need is a run on the baht. I wasn't in the thick of it in the 90s, but it doesnt sound like fun - even if the currency is artificially high, I'd prefer that to another currency crisis.

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