bouncing baht

[Palatkik]

>I'm not sure I am following what you are saying.

 

I suck out 10,000B from a Bangkok ATM with my US Citicard and it costs me 303USD at the offshore rate (33/USD) plus a 1% transaction fee ie total 306USD.

 

I wire 281USD from the same Citibank account to a Thai bank which uses the onshore rate(35.5/USD), I get 10,000 B in my Thai bank account to spend. Citi doesn't seem to charge me wire fees (not sure why) but if they did these would be small compared to difference is the forex rates when dealing with much larger sums than 10,000B I think?

 

[Denarius]

To keep the baht low BoT is selling baht, more bahts on the market buying the same number of products cause inflation, so by issuing bonds with higher interest rates they are borrowing back the bahts instead.

 

That is a common misconception about inflation which has been propagated by governments and banks. It is well engrained now, and the true original definition of inflation has almost been lost. The increase in the price of products is not inflation, but is the result of inflation. What you were describing would be better called price inflation, though that is not exactly correct either. Inflation is not higher prices on goods and services nor is it caused by higher prices.

 

Inflation is purely a monetary phenomena caused by the banks printing of fiat currency. When you inflate something you make it bigger (you can't make prices bigger). Banks make the money supply bigger by printing more money. The central bank causes inflation of the money supply.

 

Then they say that they will increase interest rates to combat inflation. How nice of them. They were the ones that created inflation in the first place. Itâ??s just a con game.

 

 

[Denarius]

>I'm not sure I am following what you are saying.

 

I suck out 10,000B from a Bangkok ATM with my US Citicard and it costs me 303USD at the offshore rate (33/USD) plus a 1% transaction fee ie total 306USD.

 

I wire 281USD from the same Citibank account to a Thai bank which uses the onshore rate(35.5/USD), I get 10,000 B in my Thai bank account to spend. Citi doesn't seem to charge me wire fees (not sure why) but if they did these would be small compared to difference is the forex rates when dealing with much larger sums than 10,000B I think?

 

OK, I understand now. I can't explain why the bank would not charge you the wire fee, but consider yourself lucky. My bank charges me $45 or more for wiring around the same amount.

 

That is interesting that there is that much difference between how you get the money there.

 

 

 

[elef]

There're many definitions of inflation and one is not absolutely correct and none is wrong. Study economics if you want to know more. Some info:

 

Link

 

Link2

 

Link3

[Palatkik]

OK, I understand now. I can't explain why the bank would not charge you the wire fee, but consider yourself lucky. My bank charges me $45 or more for wiring around the same amount.

 

That is interesting that there is that much difference between how you get the money there.

 

 

 

Wire fees aside - mine were 35USD for any amount when I had them. I would transfer larger amounts to incur the fee just once anyway which then becomes negligible vs the amount transferred anyway. The increase in baht you get for your dollar increases to up to 6% or more due to there being two forex rates.

[Denarius]

I know what the standard definitions are.

 

I agree with Mish's definition, from your first link:

 

Conclusions

 

The logical outcome of the above discussion is that a proper definition of inflation or deflation must be built on the foundation of a sound definition of money supply that distinguishes between money itself and credit. The definition should also ensure that the horse and the cart are in their proper places.

 

With the above in mind:

 

Inflation is best described as a net expansion of money supply and credit.

[Orangutan]

Guy's,

 

There are differences in the exchange rates from ATM's. To test this last week I withdrew 10,000 baht from Siam Commercial Bank, and exactly 2 minuets later (the times are on the ATM receipts) I withdrew 10,000 baht from Siam City Bank.

 

When I got home I checked my U.S. bank withdrawals online. Siam Commercial Bank paid me at 33.2 baht, and my new favorite Siam City Bank paid me at 35.7 baht.

 

It pays to know what bank ATM has the better rates.

 

-O

[cavanami]

Tuesday

02 Mar 2007

10:30 AM (BKK time)

 

Just back from Citibank, in Bangkok.

 

Went to take out 20,000 Baht from the ATM inside

Citibank and was quoted:

 

20,000 > $606 USD!!!

 

That is only 33 Baht to the USD.

 

So, the ATM at Citibank give the offshore exchange rate...WTF!!!

[Flashermac]

So where is the bottom? Is it time to buy dollars? If so, where is a reputable currency investment company???

[elef]

Your guess is as good as any expert's. Maybe your wife has a fortuneteller?

 

But probably the dollar will be weak as long as the war in Iraq is going on, so my guess is not before GWB is out.

 

Remember that it depends on many factors, one is fundamental economics, one is shorttime speculators and one is masspsychology.