Chart, Business Sentiment Index : historic lows in october

Here is an update of the chart Business Sentiment Index with october data.

(Source Bank Of Thailand, table EC_EI_005)

Index = 50 indicates that business sentiment remains stable
Index > 50 indicates that business sentiment has improved
Index < 50 indicates that business sentiment has worsened

This index is compiled by the BOT from a survey of 800 businesses.

In october, we are at historic lows… with 38,3.


We can see clearly a decoupling since may 2008. What is even more worrying is the “expected BSI”. It is now frankly under the 50 reading.

The mood is already dark. But it will get darker in the coming months.

22 Responses to “Chart, Business Sentiment Index : historic lows in october”

  1. 1 Bob 4 December 2008 at 2:44 am

    I just came back from breakfast at the JW Marriott. Apart from 2 other resident expats, it was empty. Not a tourist in sight.
    The staff said that occipancy rate is 18% and she had heard that the Oriental is down to 4%.
    The tourists are (nearly) all gone.

  2. 2 FDL 4 December 2008 at 3:23 am


    The US economy depends on the US consumer to fuel its growth. 75% of US economy is consumer-driven and 70% of consumer-spending is debt-financed, approximately. How to get the American consumer to buy some more if he/she had been fully tapped out and in the meantime the bank loan losses keep piling up, and US and global companies start getting seriously shaky because of sudden collapse in global consumer demand?

    Is depression inevitable? . . . nobody really knows.

    In the meantime Thailand muddles on with its own alphabetically serial economic stimulus plans.

  3. 3 ThaiCrisis 4 December 2008 at 5:41 am

    -Bob : It’s confirmed by… their “marketing” operations.

    They slashe prices.

    That goes against the thai motto : when things get bad, increase your prices in order to recoup your lossses.

  4. 4 ThaiCrisis 4 December 2008 at 5:47 am

    -FDL : it looks inevitable. On a daily basis horrific news and data are pilling up. Someday, I’m thinking : “it can’t be true, it has to be a hoax”. It’s like the scenario of a very bad horror movie.

    The key point that many people ignore is… unemployment.
    Mish does a superb job on this subject, with several analysis on job reports in the US.

    It is soaring. And will continue to do so.

    So to summarize for the US : no job, no house, no credit…. No consumption. The game is over.

    All the data point to this (the striking drop of car sales, the drop of general consumption, house market etc.).

    Depression looks inevitable.

  5. 5 chinesethai 4 December 2008 at 7:01 am

    All the charts are not relevant to me now even if it points to even negative numbers. It’s irrelevant. Everyone knows that depression looks inevitable. But “Where is the bottom?”. That’s more relevant.

  6. 6 ThaiCrisis 4 December 2008 at 8:08 am

    That’s a weakness shared by many people. You’re just too impatient, looking every day for the “bottom”, because you’re so afraid to miss it.

    That’s a very strong bias.

    It shows that you don’t really grasp the scale of the problem we have.

    Stock markets have fallen by 50 % in one year ? Apparently you think that they’re going to take back those 50 %… it’s just a matter of the right date, the famous “bottom”. Like a sprinter waiting for the sound of the gun to start the race (again).

    Give it time. It’s like a good wine. Let it grow, slowly, at its own pace.

    If you think that we are going to enter into a “depression” (and not a “recession”), then your time scale should be… years.

    Right now, only 15 months since the beginning (the apparent beginning) of the bank and credit crisis. It’s peanuts.

    The real economy has just started to be contamined (mass layoffs in the US, drop of the consumption, drop of exports in emerging countries etc.). One month or 2 months !

    It’s not peanuts, it’s atoms of peanuts.

    So you should stop being obsessed by the “bottom”, because anyway you’re not going to see it anytime soon. Sit back, relax, and enjoy the show.

    There should be no shame to say : “I can’t take a proper decision right now, it’s too early, I don’t have enough data to proceed”.
    And mai pen rai, if you miss a few % of the “rebound” !

    Of course, if you’re a gambler, you can surely continue to play. But then, you rely only on… luck.

  7. 7 bill 4 December 2008 at 8:26 am

    I checked out some data on the BOT website. Did I read it correctly; 1.1 Trillion THB ($27.8 billion USD) property credit outstanding with 77% of it residential as of 12/31/07? Is that a lot considering they estimate 1 million potential job losses next year in a country with a TOTAL POPULATION of 66 million? Ouch…

  8. 8 chinesethai 4 December 2008 at 8:39 am

    Well, it doesn’t mean that people who ask such question don’t really grasp the scale of the problem. Fact is that, despite able to measure the exact scale of the problem, everyone of us as a nano unit of the economy can’t do anything about it, can you? You might get shaken in the beginning but after series after series of bad news, whether how worse it is getting is no longer relevant. We can be just watching, protecting ourselves, and finding an opportunity.

  9. 9 Insanity 4 December 2008 at 8:39 am

    The worldwide monatory system is collapsing. Now, by the nature of the system, it means that the countries which were used as substitutes for production from Europe and the United States, for example, are now collapsing, because the purchases from other countries are collapsing, as in the case of China, where the collapse of China is a potential time-bomb for the entire planet. Because if the collapse of China’s exports continues at the present rate, this will be a time-bomb for the entire system.

  10. 10 ThaiCrisis 4 December 2008 at 8:41 am

    -> Bill : thank you to provide a link so we can have a look.

    As for their “forecast” of “1 million jobs lost” next year… we should remain cautious… Thais have the same creativity than US banks when it comes to forecasts (and even… past accounting).

  11. 11 ThaiCrisis 4 December 2008 at 8:47 am

    -CT : I agree with you about the “habituation” principle.
    And that’s very dangerous. People are getting totally anesthetized…

    A 1/10 of the current daily news would have create terrible shockwaves 2 years ago. Now, the markets need “stronger doses”, like a drug addict, to react.

    Other issue : the “large numbers” syndrome.

    Again, habituation… what it is now a billion US ? A 100 billions ? A trillion ? Nobody care anymore.

    Those 2 issues create a kind of a bias, preventing us to correctly assess the gravity of the situation.

  12. 12 ray 4 December 2008 at 9:24 am

    so much for the ” we are immune to sub prime crisis ” .. thailand is an export/tourism dirven economy. has always been and always will be.. now the pad/udd showdown is postpones the people have a chance to look at their finances and they will be shocked. i do agree with thaicrisis that there is no point in looking for the bottom( i used to do that) because in 2009 there will be alot of new historic lows.
    we still hav enot seen the decline in real estate prices in bangkok as yet.
    as for hotel occupancy its in the dumps. and the timingh for hte seizure of the airports could not have come at a worst time ie. beginning of the high season.
    in the nation news channel a financia analyst said the central bank has cut 100 points but it is up ti the commercial banks what they do with their lending rates!!!!!
    this is thailand.

  13. 13 Insanity 4 December 2008 at 10:34 am

    The King is sick (breaking news on Bloomberg TV). He will not be addressing the Nation

  14. 14 Insanity 4 December 2008 at 10:39 am

    King not giving much-anticipated birthday speech

    His Majesty the King has assigned HRH Crown Prince Maha Vajiralongkorn to represent him to grant an audience to his subjects at the Dusidalai Hall at 5:15 pm Thursday on the occasion of His Majesty’s 81-year-old birthday.

    Some 20,000 subjects, representing senior government officials and other groups, gathered at the Dusidalai Hall to wish His Majesty a happy birthday.

    The Crown Prince said his Majesty was not well.

    The Nation

  15. 15 Bedwyr 4 December 2008 at 10:50 am

    *** STOP PRESS ***

    Bedwyr calls it correctly.

    “If HMK dies or is obviously incapacitated, I still think there will be huge problems. All eyes will be on him on Thursday/Friday. My money is on a outside chance no-show – on some pretext. Partly because in Thailand, many β€˜rumours’ turn out to be true.

    This from the Nation a few minutes ago:

    “His Majesty the King has assigned HRH Crown Prince Maha Vajiralongkorn to represent him to grant an audience to his subjects at the Dusidalai Hall at 5:15 pm Thursday on the occasion of His Majesty’s 81-year-old birthday.

    Some 20,000 subjects, representing senior government officials and other groups, gathered at the Dusidalai Hall to wish His Majesty a happy birthday.

    The Crown Prince said his Majesty was not well.

    The plot thickens. HMQ is now in charge, again, as Bedwyr called it. The shit a lot closer to the fan, and a melt-down of the Thai sense of identity is about to happen. I would suggest that civil war is now almost inevitable though who can tell the timetable?

    This is a potentially very serious bit of news for what is says about the state of health of HMK. Look at the BKK Post pictures of him inspecting the guard. Anyone else see anything wrong? Look again – more closely. Look at the posture and facial expression.


  16. 16 Bedwyr 4 December 2008 at 11:03 am

    *** STOP PRESS ***

    Bedwyr calls it again.

    This from in the past hours:

    As Bangkok Post reports that the Thai military is holding secrets talks with Nevin, a leader of the 30 or so now axed by the courts PPP party MPs, and the Thai E News went into a very long expose of how leading businessmen calling for Nevin to support Mar, the Democrat Party head as the PM are in-fact long-time anti-Thaksin key men, Nevin is sitting tight, counting his blessings.

    Bedwyr previously warned to watch closely what Newin would be doing.


  17. 17 ThaiCrisis 4 December 2008 at 11:12 am

    Like I said on Bangkok Pundit… the King was (apparently) very well tuesday during the military parade.

    Sick or… embarassed, the line could be thin.

    We were all waiting with great impatience (and expectations) this speech… Too much probably.

    Anyway, I think it’s going to be easy to find out :
    -if the speech delivered by Crown Prince is totally empty, neutral… then it will be a sign for the “embarassement”.

    -if the speech is a real one (like the King used to do the previous years), then it would be a sign of “not being well”

    There could be though a third… “wild card” :
    -if the speech is neutral… it could mean also “not feeling well… at all

  18. 18 Bedwyr 4 December 2008 at 11:29 am

    @TC: I don’t agree. I think you have it exactly the wrong way around. I think that if the speech is not empty, then it is a sign that you are right and he is only unwell.

    If the speech is empty it is because he did not write it. If he did not write it at this moment in Thai history, it can only be because he cannot. Embarrassment does not apply because all Thais were waiting for his words with impartiality.

    I accept what you say about the military parade. I see something else in the photographs but a photo is only a snapshot in time and does not necessarily reflect reality. Never-the-less, walking and looking formal is OK but unless you can see what he is thinking, then walking and looking formal is irrelevant – bearing in mind the rumours about his comprehension and decision-making capability. perhaps I will be proved wrong but I suggest the weight of circumstantial evidence is in my favour.


  19. 19 Bedwyr 4 December 2008 at 1:04 pm

    Throat blockage. Abdominal (alimentary) blockage. Saline drip that is a food drip not a saline drip. No fever.

    This is not trivial boys and girls. Perhaps Thais are about to start feeling very cold and alone…

    Interesting. I have a friend who is a numerologist – he believes in this shit so he sent it to me. Hey, who am I to argue? Might be true…

    9th 10-year cycle of age
    9th 7-year cycle of reign
    9th month of the Thai year commences on 13/12/08
    9th year of the 2nd millennium CE
    9th in the Chakri dynasty

    Luna (change) conjunct with Venus (love/nature)and Jupiter (authority)

    Hey! Don’t send the white coats after me – I didn’t write it!


  20. 20 Eddie 4 December 2008 at 2:29 pm

    Anyone had a look at ThaiVisa ‘The King is Unwell’.

    Its enough to make you puke. I truly didn’t realise there were so many obsequious farangs.


  21. 21 ThaiCrisis 4 December 2008 at 2:31 pm

    Yes for all issues related to monarchy ThaiVisa is not a very good place to talk or to find informations…

    “obsequiousness” is the word.

    And it’s an understatement because according to the forum regulations… you can’t speak about it. Period. Case closed if I may say !

    They don’t understand that speaking about the health of the Head of State (thai constitution) is not equal to “disrespect” or “lese-majeste”… But rather it should be a duty.

    But anyway, everybody is free to set the rules in his own castle. ThaiVisa has chosen its rules. Fair enough.

  22. 22 Bedwyr 4 December 2008 at 2:57 pm

    Well, they do a lot of business with Thais and are under the microscope.

    There is no nerve in the body so sensitive as the hip-pocket nerve.

    ‘Twas revolting though. To see so many brown noses.


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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.

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