Exchange rate : the BOT is lying… “USD-THB is not the whole picture”


An interesting article in Bangkok Post with some fresh statements from Tarisa, the governor of the Bank Of Thailand.

Put on the side the usual sleep good bullshit about “room for fiscal policy”, interest rates cuts, blabla etc.

But one line is striking about… exchange rate.

On exchange rate policy, Dr Tarisa said the baht had been stable relative to regional currencies. A policy to push the baht weaker would only hurt confidence.

A weak currency shows that a particular country has a confidence problem,” she said.

The baht has been supportive for international trade. It has weakened against our trade partners and trade competitors. Comparing the baht against the dollar does not represent the whole picture.

It’s interesting because it’s the first time Tarisa says so clearly that she doesn’t mind a “strong” THB (when I write “strong”, everything is relative of course). Let’s reformulate : the BOT says it wouldn’t like a “weak” currency.

However, the last sentence is a lie, a fantasy.

The exchange rate USD-THB is everything, is the whole picture, as far as trade is concerned, as I showed here (chart).

81 % of thai exports are paid… in USD. 😉 And those are… BOT statistics.

International trade for Thailand means US Dollar. Period. Like it is so for the neighbouring countries.

Tarisa tries obviously to lull us to sleep, to divert attention. Who is going to be fooled by this gesticulation ? She’s losing her nerves.

Come on Tarisa, let’s swallow the red pill.

Month after month, the pressure is going to increase on thai exports (november and december are only an appetizer of what will happen in 2009)…. and the pressure will increase on Tarisa’s shoulders… because precisely of the exchange rate USD-THB ! (to weaken the THB versus USD would… immediately “boost” exports)…

Let’s see how she will handle the pressure… 😉

[exactly like I said… the pressure for a “weaker THB” is increasing. A lot. Read my article about GDP shrank 3,5 % on Q4…]

3 Responses to “Exchange rate : the BOT is lying… “USD-THB is not the whole picture””

  1. 1 antipadshist 29 January 2009 at 2:33 pm

    WEF 2009 summit in Davos

    seems like they do not propose with anything useful.

    Brainstorming session

    this at least provides some glimpse on the more like informal opinions rather than official (politicised?) speeches.

  2. 2 James 30 January 2009 at 8:35 am

    This currency debacle seems to be an Asian “face” issue. You know, saving face? Having a weak baht symbolizes there are problems in Thailand or that they are trying to remain as highly competitive as they can in this horrible economic environment!?! USD/THB needs to be at least 1/40. Euro should tumble to parity late this year, if Baht is still up there and China weakens their currency, Thailand better step up before its too late.

  3. 3 antipadshist 30 January 2009 at 2:42 pm

    fresh news

    from Davos:
    Barrick chairman speculates China will dump dollars for gold
    the value of the (U.S.) currency has to go down


    Russia no longer holds U.S. agency debt

    “Russia has fully exited its holding of U.S. mortgage agency debt. Russia had held the debt as part of its gold and forex reserves, the world’s third largest. But it started reducing the holding last year, and not replacing any maturing paper with new.”

    NAU & Larger Plan
    January 28th

    also this is an interesting video(s):

    Gold Dinar

    the speaker mentioned that Ron Paul has written a letter to Tresury Dep and Fed. to explain WHY IMF prohibits to link national currencies to gold – he has been waiting 5 years and got no any answer !

    I recommend to watch the whole playlist – all the parts from 1 to 7, because this guy explains VERY CLEARLY and plainly what’s actually going on with global monetary system.

    well, I am not sure about “Messayah” and such – but all the religious stuff apart (for those who are not into Islam) – clearly things mentioned are very evident:

    1) dollar is screwed;
    2) global crisis is a direct result of that;
    3) electronic money are on the rise;
    4) gold is HIGHLY speculated – its trade is totally controlled;

    and of course it is not a news or a big secret anymore that US (and West) protect the state of Israel and condone ANYTHING it does.

    The Arab Summit, The Golden Dinar

    it is interesting to see whether Islamic countries would be able or not to create their own Gold currency as an alternative to Dollar Almighty and ANY Fiat paper money ! Saddam has merely tried to move from petro-dollar to petro-Euro – and he was hanged, his country invaded, bombed and raped. what will happen if really Islamic countries adopt REAL Gold currency ? 😉

    related stuff (although as I know the planned currency will be Khaleeji – not exactly Dinar):

    Gulf agrees money union by end of ’09
    30 Dec 2008

    “Oil-rich Gulf states agreed on Tuesday on the final draft of an accord on a monetary union which they intend to launch next year, an official statement said. Five members of the six-nation Gulf Cooperation Council have “adopted the monetary union accord, which includes the legal and organisational framework,” said the statement issued at the end of the annual GCC leaders summit in Muscat. “It also adopted a system governing the monetary council,” the statement said. The GCC groups Saudi Arabia, Kuwait, Qatar, Bahrain, the United Arab Emirates and Oman, which had previously announced it would not participate in the scheme. GCC finance ministers meeting on Tuesday during the summit had drafted the final version of the monetary union accord which is intended to be implemented next year, followed by the launch of a single currency, a GCC official said…

    The accord provides for the creation of a monetary council ahead of establishing a GCC central bank which will be charged with issuing the future single currency and completing the technical steps of the monetary union. The official did not provide a date for the launch of the single currency which was originally set for 2010 ”

    Gulf Arab leaders agree on monetary union
    Dec 31, 2008
    “Arab rulers were poised yesterday to announce a pact that paves the way for a unified currency for the world’s biggest oil-exporting region.
    The union would enable GCC countries, most of whom peg their currencies to the US dollar, to have the option of adopting a more flexible foreign exchange regime, facilitate trade and shield their economies against global pressure.
    The GCC is an economic and political bloc of US-allied oil producing nations.”

    Arab Summit Represents Kuwait’s Initiative
    “Kuwait … implemented timely anti-inflationary measures by being the first Arab state to depeg its currency from the dollar


    December 9, 2008

    Malaysia revives gold dinar proposal to OIC

    “MALAYSIA wants Organisation of the Islamic Conference (OIC) member countries to reconsider the use of the gold dinar for trade, especially with uncertainties in the international currency market.
    Second Finance Minister Tan Sri Nor Mohamed Yakcop said Malaysia would attempt to hold discussions with the OIC countries so that the issue of using the gold dinar could be studied in depth.
    Former prime minister Tun Dr Mahathir Mohamad proposed the use of the gold dinar in global trade in 2002. He discussed with Bahrain, Libya, Morocco and Iran the use of gold dinar as payment in commercial dealings with Malaysia.

    that was after 97/98 Asian finansial crisis, idea now renewed with USD collapsing and screwing the whole world.

    Hedging with the gold dinar

    Inflation-proof currency: the gold-dinar

    Crisis solutions back to basic

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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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