buddha Posted March 9, 2007 Report Share Posted March 9, 2007 my complete n00b outlook: These articles suggest that all restrictions placed on the baht will be lifted on March 15th. That would mean [i think] that anyone who made a major investment into the Thai baht will be able to dump the currency on the 15th without any penalty. The first article states: "Those rules, which penalized investors withdrawing funds within a year, aimed to curb baht gains after exporters complained the currency's 16 percent gain last year hurt sales and profits. The Bank of Thailand last week said it would lift most of the restrictions by March 15." The second article states: "In December, Thai regulators required banks to lock up 30 percent of new foreign currency deposits without interest for a year to stop investors from speculating on gains in the baht. Investors who investments earlier than a year had to pay a 33 percent penalty on the reserved amount." Ok so on the 15th i would expect a major sell off by institutions, corporations, and possibly the government. http://www.bloomberg.com/apps/news?pid=20601080&sid=a0C7PhdsBpUo http://www.bloomberg.com/apps/news?pid=20601080&sid=asJsgGsO1RZg Link to comment Share on other sites More sharing options...
Bkkbound04 Posted March 9, 2007 Report Share Posted March 9, 2007 The £/baht figure is bouncing daily from 63 to 68 .. far more than I've ever known..I wish i knew how to make money ... JP Link to comment Share on other sites More sharing options...
nordicman Posted March 9, 2007 Author Report Share Posted March 9, 2007 And also the yen Link to comment Share on other sites More sharing options...
ThaiHome Posted March 10, 2007 Report Share Posted March 10, 2007 Ok so on the 15th i would expect a major sell off by institutions, corporations, and possibly the government. Actually there will probably be a large buying spree as foreign investor buy into various funds they have been unwilling to with t30% withholding. Expect the baht to take large jump. TH Link to comment Share on other sites More sharing options...
buddha Posted March 10, 2007 Report Share Posted March 10, 2007 a jump which way ThaiHome? Link to comment Share on other sites More sharing options...
Flashermac Posted March 10, 2007 Report Share Posted March 10, 2007 Off of the nearest balcony? Link to comment Share on other sites More sharing options...
buddha Posted March 10, 2007 Report Share Posted March 10, 2007 haha....don't think for a second it doesn't cycle through my mind continually. Link to comment Share on other sites More sharing options...
HeartThais Posted March 10, 2007 Report Share Posted March 10, 2007 I agree. Here's what happened in plain english. The reserve requirement was specifically designed to curb f/x speculation. What they're worried about is f/x speculators buying up the currency and then dumping all at once. But then of course, the thai stock market crashed because legitimate investors and businesses were scared off as well. So they came up with another idea which is to allow 100% hedge on loans instead of required reserve. So if a Brit wants to invest in thai business by extending a loan, all the money can go to the thai business as long as the Brit buys a contract that will reverse any future gains he makes by receiving baht loan payments. Theoretically, that would let true investors invest and keep speculators out. But the fact that offshore exchange rate shows a stronger baht means that people are still bullish about the Thai economy. Which probably means that the baht will probably continue to strengthen after the curbs are lifted. Btw, I don't think all the curbs will be lifted. It looks like there will most likely still be a 3-month hold in place and continued hedging requirement. Oh well.... It has to happen at some point. You can't expect to have a standard of living advantage forever. Link to comment Share on other sites More sharing options...
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