Chart, credit : the party is over, growth is decelerating

(Source Bank Of Thailand, table FI_CB_015_S3).

Time to update the charts about total credit and type of debtors, at commercial banks.

The total amount (outstanding) of credit was 7 576 billions THB in april, a + 8 % compared to april 2008 (but far lower than +18 % y-o-y we had in january).

My bet : in a few months, the trend will turn negative. The recession virus is infecting, slowly but surely, the thai credit system.

(Credit = Overdraft + Loans + Bills)

CREDITAPRIL2

Now with amounts :

CREDITAPRIL1

CREDITAPRIL3

The “plateau” is visible… Despite the hysterical calls from the government for the banks to lend more, to pump up more cash into the system… it’s obvious : banks won’t take the risks.

This basic, fundamental rule, is totally forgotten : during recession it makes no sense to :

-borrow more money (in order to invest, to increase production capacities when precisely demand is falling)
-and to lend more money (because risks are increasing)

… unless interest rates are very high (to pay for the risks)…

The clowns (all over the world) think that they can make businesses and individuals borrowing more money, and force banks to lend more during a recession… and at the same time keeping interest rates super low.

6 Responses to “Chart, credit : the party is over, growth is decelerating”


  1. 1 jeplang 30 June 2009 at 7:15 pm

    TC,just to nitpick:
    chart 1 does not cover the period jan 2006 to april 2009,as the other charts do.
    in chart 2 the sums[government +business+ individuals ]don’t add up.Anything missing?

    What would the graphs be like if you covered a much longer time span?

    Is it any wonder it is called a dismal science?

  2. 2 ThaiCrisis 30 June 2009 at 11:30 pm

    No, nothing perverse. Just a typo in the title of the first chart : it’s from “january 2007” not “january 2006” like I wrote.

    And why the time line is different from the 2 others ? Because it has a year on year % of change calculation.

    My point : I’ve got the data from january 2006. Therefore, for a y-o-y % of change, I can only start the chart from january 2007.

  3. 3 james 1 July 2009 at 4:31 am

    same thing is happening in China and U.S..

  4. 4 antipadshist 1 July 2009 at 6:27 am

    here is a message from BOT :

    BOT says economy has bottomed out
    http://www.nationmultimedia.com/2009/07/01/business/business_30106426.php

    “The economy has already bottomed out and business confidence is back on track despite lingering risk factors, the Bank of Thailand said yesterday.”

    green shoots again ? 😉

  5. 5 Lothar 1 July 2009 at 2:51 pm

    It’s the same fuck everywhere when they can’t find any optimistic number the media is going back to “confidence” indicators.

    And even if it is bottomed out the effects on real life will worsen for a long time as too many are just trying to stay in business by using up there savings and credit lines.

    This is a very long L shape recession, with a flat period of many years. And if we see a Peak-Oil effect it can get more then just worse.

    Thats why i decided to move back to germany and survive the crisis there – much better opportunities then staying in THailand right now.

  6. 6 Affacturage 14 July 2009 at 4:46 pm

    It is suggested that the recession could continue for years – like the Great Depression or “the lost decade” in Japan – because the remedies being used (e.g., near zero interest rates, massive deficit spending, and bail outs for collapsing firms) will perpetuate the underlying problems instead of solving them. Time will tell, but I am inclined to agree that there could be another dip in 2010.


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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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