Archive for October, 2008

BOI, new investment projects : – 20 % on nine months

Thailand’s Board of Investment has cut its investment support target this year, after the US financial storm caused new investment applications to drop 20 per cent in the first nine months. However, it is believed that the crisis will not have a severe affect on Thai industrial firms.
[…]
Regarding a 20 per cent year-on-year fall in the value of new investment projects seeking incentives in the first nine months of 2008, she said the drop stemmed from the global financial crisis. As a result, the agency has decided to cut the target amount for investment support for this year to between 450 billion and 500 billion baht, down from an earlier projection of 650 billion baht.
(TOC)

So long for those “grand” dreams on unlimited and continuous growth… Foreigners investors were supposed to pour never ending amounts of fresh USD into the thai economy. And they were supposed to say “thank you” too ! πŸ˜‰

Every year, as well as exports, we would have +10 or +15 % growth… That was the textbook. What went wrong ? asked panicked and confused people.

They seem to be surprised. They’re lost.

Pump pump it up : government to pump in extra 100 billions THB

The government will increase the mid-year budget for fiscal 2009 by Bt100 billion, to help drive economic growth as it bids to minimise a potential surge in unemployment resulting from the world economic slowdown.

In addition, it will extend the tax incentives granted to the property sector by another year, from March 2009 to March 2010.

They agreed that more public spending was needed to shore up a sagging economy hit hard by the global financial crisis, in which currencies have also become highly volatile.

Previously, the government set expenditure at Bt1.835 trillion for fiscal 2009 starting October 1, 2008, against revenue projected at Bt1.585 trillion.

This implied a budget deficit equivalent to 2.5 per cent of gross domestic product (GDP).

Suchart said the budget deficit would increase to 3.5 per cent of GDP, or an additional Bt100 billion. (Nation)

Okay… they won’t go very far with 100 billions (the 12 swedish jet fighters were bought for 35 billions THB πŸ˜‰ ).

Last february, Samak The Cook added already 110 billions (read here)…

Difficult to blame Thailand for such stupid policy (spread some free money here and there and praying Buddha for a “boost”)… all the countries are currently playing the same game, and with amounts far larger.

“In the future, the PAD may be attacked with RPG rockets, M79 grenades”

You want to understand why Thailand is totally fxxxd up right now ?

Here is what a “general” (ah ah ah ah) can say in public…

Gen Kattiya Sawadiphol, a specialist of the Army, Thursday denied that he was behind the bomb attack against the People’s Alliance for Democracy.

But he said the PAD would face more attacks and PAD guards would be killed everyday if the it did not stop occupying the Government House.

In the future, the PAD may be attacked with RPG rockets, M79 grenades,” Kattiya sad.

He said many groups were dissatisfied that the PAD became blatant and armed its guards as well as showing disrespect to many senior persons. (Nation)

I really do hope that it’s a translation mistake from Nation… Or even a hoax (or the reporter was on heavy drugs and was hallucinating).

As for the “disrespect to many senior persons“, the general should be careful with his words… and should remember that the Queen has given her moral support to PAD’s protesters

Watch out little general… Would you fire “RPG rockets” at people protected by the Queen ? πŸ˜‰

UPDATE
Bangkok Pundit has details about the incidents last night (grenade attack against PAD… 9 wounded, and 1 dead)

Chart, currencies : THB is tied to the US dollar

We have some very strong winds on the currencies front since a few days.

The USD explodes against many currencies (but not versus the Yen)… And what about the THB ?

People seem puzzled to see that the Euro, the Australian Dollar, the British Pound are all going down against the THB. Violently.

The thai currency seems “in levitation”… Insulated. Protected from the world’s problems… πŸ˜‰ And protected from its… own internal issues.

A political crisis since 2005 ? No problem. We don’t have a proper government ? Mai pen rai. Protesters occupy the government’s house ? Never mind. We will have a freaking institutional crisis when the King will pass away ? Peanuts. The country’s economy rely on exports, and exports are about to take a big hit ? Not an issue.

I mean if one currency should go by the drain it would be, it should be the THB ! πŸ˜‰

Here is a a new chart. it works with pairs linked to USD and THB. For instance USDEUR and THBEUR.

Then we have a few time periods for comparison : 1 month ago, 2 month ago etc. And the % of change of the exchange rate compared to october 28, the point of reference.

Let’s take an example.

Yesterday, USDAUD was at 1,633 (1 USD = 1,633 AUD). One month before, USDAUD was at 1,204. it means that a that time the USD was 26,3 % lower than yesterday.

The THBAUD was yesterday at 0,047 (1 THB = 0,047 AUD). One month before, it was at 0,035, that’s 25 % lower (we can say if you prefer that the THB increased by 25 % in just one month).

You get it ?

We can see that between the USD and THB against other currencies, we have a rather amazing correlation ! Particularily on the short periods (1 month, 2 months and 3 months)

I think it’s clear : the THB is in a way “tied” to the US Dollar. It’s not really a surprise. The Bank Of Thailand has a long tradition of “exchange rates manipulation”… oops sorry, “exchange rates management”. Yeah, that sounds much better. Click here to see all my articles about this issue.

I know, I know they are not alone. Far from it ! πŸ˜‰ Several countries… are playing the same game.

But… I would like to say that if there are a lot of technical reasons to explain the (current) violent explosion of the USD… those reasons are nowhere in the picture as far as the THB is concerned !

To have a THB moving in parallel to the USD is totally artificial.

Now… how this could be possible ? We know that the forex is so big that any interventions is likely to fail. In 1997 for instance, the pathetic attempts from the BOT to prevent the THB to go down.. failed. And it started the asian crisis.

But 2008 is totally different. I started to explain my theory on this article (look at the comments).

Basically, the task of the BOT is easier today because :

-the THB has been insulated from the hot money and speculators by several factors (capital controls from december 2006 to march 2008, the political crisis since 2005, the fact that it was pointless to take risks with the THB when it was possible to make 100 % winning bets on AUD, NZD, JPY, etc)

-the THB is a non-market as far as volume is concerned. By small interventions, on shore, the BOT is able to manage more or less exchanges rates, or to curb the trends.

-no volume, no opportunities, no leverage, no future, no need : a non market. πŸ˜‰

-the THB has been ignored. Put on the side.

-therefore, in times of deleveraging, the thai currency suffers less.

(If you wish to check the datas for the chart, exchange rates and the % of change, here they are).

Lese-majeste hysteria : “32 cases under investigation”

You have to relocate an Asean summit in Chiang Mai… because you’re a chicken-little afraid of protesters in Bangkok ?

Everybody is laughing at you because you don’t even have a proper office to work… protesters are occupying the government’s house since august and you have to relocate to an old airport ?

You’re start to feel the heat of the coming economic downturn ?

You lost face big time when the Queen supported your opponents ?

You’re a mere and alleged Prime Minister, brother in law of a convicted fugitive ?

You know more than everybody else that your days are numbered and that nobody is listening to you ?

You’re so lame and so tired ?

In a nutshell, you’re totally and pathetically screwed ?

Lit up the Reichstag baby ! Unleash the power of the “lese-majeste hysteria” Bring in more cases ! Everybody could be virtually accused of lese-majeste. And even if they aren’t guilty, they could… be guilty. It’s enough. And as the Great Architect create a Great Firewall to isolate the lese-majeste websites. Beijing is your best friend and model.

It will help newspaper to sale copies, it will give you a cheap but convincing “brevet of good royalism”. You need medals, even in chocolate. A thai official with no medals is like a som tam without chili. It will divert public’s attention. With a little help you could even start a mini war with Cambodia, along the border. πŸ˜‰

Poor little country… so insecure and so immature…

The Central Investigation Bureau is trying to wrap up 32 cases on lese majesty, including the alleged insult involving former PM’s Office minister Jakrapob Penkair, CIB commissioner Lt General Worapong Chewpreecha said Wednesday.

Of the 32 cases, four reports have been forwarded for the prosecution review. Some 15 ongoing probes involve offensive messages posted in various Web sites. (Nation)

And it’s important to note that the hysteria is perfectly shared by… The Democrats ! πŸ˜‰

Meanwhile, Democrat MP Peerapan Saliratvipak said he would sponsor draft amendments to the 2007 Computer Offences Act.

Peerapan said his draft was designed to overhaul and boost the efficiency of law enforcement to detect smears against the monarchy on the Internet.

At present, the Information and Communications Technology Ministry and police often pass the blame to each other on the jurisdiction to uncover the offences, he said.

Authorities concerned have the mandate and the technological know-how to detect offensive messages, but they try to shift the blame instead of doing their job, he said.

He also criticised a ministerial proposal to spend up to Bt500 million to build a firewall for the Internet gateway to screen and block messages uploaded abroad, arguing that equipment was already in place. (Nation)

The last sentence is… tasty. πŸ˜‰

Internet : Thailand wants to build a firewall to protect the monarchy

The world is falling a part with an inane financial crisis. Thailand has no government. The alleged Prime Minister doesn’t even have an… office (occupied by PAD’s protesters since 2 months), the government is obviously attacked (the Queen going to the funerals of a PAD protester killed)… but it’s still important to save face, to pretend, to be more royalist than the King himself.

Even though it would lead to act like a good democracy such as… China. Mai pen rai.

Go Thailand ! Go deeper into the Rabbit Hole.

The Ministry of Information and Communications Technology (ICT) plans to spend about 100 million to 500 million baht to build a gateway to block websites with contents defaming the royal institution.

ICT Minister Mun Patanotai said exactly 86 per cent of those websites are from foreign countries. He said his ministry will give more attention to websites violating lese majeste laws than pornographic, obscene and terrorist websites.

According to the minister, thousands of the websites have been found to have information offending the monarchy, but they could not be revealed because Internet users would visit them once they are known.

The minister added the more such websites are suppressed, the more they grow, but police will continue to penalise the offenders nonetheless.

Prime Minister and Defence Minister Somchai Wongsawat had discussed this with the intelligence units, the Telephone Organization of Thailand (TOT) and the Communications Authority of Thailand (CAT), Mr Mun said. (Bangkok Post)

Are thai exports falling… by 30 % ?

Those people drive me crazy : unable to write something clear, that makes sense.

After “we will have a growth of 5 % next year”, after “let’s devaluate the THB” and after the tasty “we are insulated”… now it’s : exports are falling by 30 % !

Talk about a U-Turn.

The Federation of Thai Industries (FTI) warned that Thailand’s export output has plunged 30 percent and the slump could prolong till the beginning of 2009, which could leave up to one million people unemployed in the industrial sector.

FTI deputy chairman Thaveekij Jaturajarernkul said after the meeting with FTI provincial chiefs nationwide that the industrial sector may cut 10 to 15percent of employees, or approximately 900,000 to one million people out of about six million in total. Around 700,000 new graduates would also have more difficulties in finding jobs each year, he noted.

This is due to the global economic recession, and many industrial segments of the country have experienced lower sale orders by about 30 percent from the United States, the European Union and Japan.

β€œMany factories have lifted their overtime (OT) and reduced the number of workdays from six to five. Some factories have to lay off 10 percent of their staff, and the consequences should be more apparent by January 2009,” Mr Thaveekij said. (Bangkok Post)

The point is : exports ARE NOT DOWN, at least not in september. Not yet.

So does the FTI have some preliminary figures for october ? Is the president of FTI having a nervous breakdown ? Or is it a translation issue from Bangkok Post ?

We need exactness.

Bottom line : the Bank of Thailand will publish exports datas for september on october 31. And we will get figures for october… on november 30. Until then, we shall remain cautious.


Thailand Crisis

Coup, Economic slowdown, Terror In the South... The situation is worsening in Thailand. Bumpy road like often before.

But this time, it's different.

The key to understand the present turmoil is the inevitable... succession of King Bhumibol.