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Thailand faces deflation


Faustian

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Treasury reserve falls to Bt52 billion at end of December

 

The treasury reserve has fallen to Bt52 billion at the end December, which is enough for paying one and a half months of salaries to government officials, the permanent secretary for Finance said Friday.

 

Suparat Kawatkul, the permanent secretary for Finance Ministry, disclosed the treasury reserve figure to the special House committee vetting the mid-year supplementary budget bill.

 

The figure apparently shocked members of the ad hoc House panel, including Phichet Phanwichartkul, who asked Suparat to explain why the reserve was very low.

 

Suparat explained that the reserve was low because the Finance Ministry tried to cut cost by not borrowing cash to keep as reserve.

 

Suparat said the Finance Ministry could borrow from foreign banks to boost up the treasury reserve.

http://www.nationmultimedia.com/breakingnews/30094601/Treasury-reserve-falls-to-Bt52-billion-at-end-of-December

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Govt approves B270bn in loans

 

PM The cabinet on Tuesday endorsed the Finance Ministry's plan to borrow 200 billion baht from local banks and 70 billion baht from overseas, in an attempt to revitalise the economy.

 

According to Public Debt Management Office deputy director-general Chakkrit Parapuntakul, loans from local banks will be used to increase the liquidity of state enterprises. However, they will have to draft their financial plans and propose them to the Ministry of Finance before the funds can be released.

 

Their short-term credit lines will be no more than 18 months, but the cabinet will consider if the timeframe needs to be extended for each case.

 

The 70-million-baht loan will be from the World Bank, the Asian Development Bank (ADB) and the Japan International Cooperation Agency (Jica). However, public hearings will have to be held and parliamentary approval will be needed in accordance with Article 190 of the 2007 Constitution before the government can approach the three international firms.

 

After borrowing the 70-million-baht loan, the countryâ??s public debt would rise from 36 per cent to 42 per cent of the gross domestic product (GDP) this year, Mr Chakkrit concluded.

http://www.bangkokpost.com/breakingnews/136171/govt-approves-b270bn-in-loans

 

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Hmmm, maybe Gadfly or one of the others can explain to me...but as Thailand "falls" so are a lot of other countries. So in relative terms, will Thailand fall worse? the same? or will it all just sort of even out in the long term?

 

I mean ok great Thai condo prices fall, but if the USD/UK Pound Euro etc also take a crap, and no one has the money to buy them "cheap" and it all stays more less relevant, what is the difference? I have no clue what is going on in the world economy...

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Bernie Madoff is the visible clue to what happened. Credit, sub-prime mortgages, derivatives, the whole ponzi scheme came crashing down. Now US tax-payers pay to fix it.

 

I actually think countries like Thailand will come through OK if they can avoid civil unrest. Especially the people who didn't mortgage the family rice-fields. Most people are used to not having a lot of cash.

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Not sure of the Fiscal situation in Thailand, however, from my observations Thailand seems quite secure. Believe it or not, they have very tight rules with regards to banking investments (some of you will testify that a lot of them are bizarre) however very little money was invested in overseas (primiarily American sub-prime mortgages), this has left them relatively unscathed.

 

The biggest problem for Thailand is that their currency is unusally strong versus the £ and $ leaving their export market very much exposed.

 

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debts in thailand?

a lot of middle class Thais with own houses, condos, cars finance this with loans, not many have enough cash! many have several credit cards and use them to their limits!

as long as their income always go up yoy as in the last couple of year, no problem! once it doesn't or they loose their job, houses, condos, cars go to the bank!

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