Archive Page 2

Burma style or bluff ? Army to Reds : “Leave now or you might get hurt”

Back to basics.

Pathetic bluff of desperate and clueless officials… Or real threat, like good old Burma ?

Army spokesman Colonel Sunsern Kaewkumnerd warned that the protesters’ time to move out was “running out“.

The government will be very decisive but in the beginning of the operation there may be chaos.

If there is a crack down, innocent people might get hurt,” he said. “If we move in, we will attempt to arrest the leaders.”

“The government will be very decisive but in the beginning of the operation there may be chaos.”

The warnings echoed other calls in recent days for protesters to leave the city centre. (BBC)

[sorry folks for my long silence, but I was on vacations… in Thailand during the first crackdown].

State of emergency : crackdown likely

I wrote in a title on march 14 :

Amid the Red Sea, Internal Security Law, soon state of emergencyโ€ฆ Abhisit praises the โ€œrecovery of the economyโ€

Well, It’s done.

The Prime minister declares a state of emergency in Bangkok and Nonthaburi and some districts of Samut Prakan, Pathum Thani, Nakhon Pathom after red-shirt protesters invade the grounds of the parliament on Wednesday, forcing cabinet members and MPs to flee. (Bangkok Post)

No easy way out. The ridiculous “historic talks” of last week couldn’t produce anything positive. The situation is totally locked.

The military apparatus needs to stay in control, before the royal succession. They can’t allow fresh elections.

And on the other hand, the opposition is still there (and is probably growing) and still accuses Abhisit to have stolen power thanks to a parliamentary coup in december 2008 (I remind you that a bunch of MP, friends of Thaksin, changed allegiance and voted for Abhisit… Abhisit and the Democrat Party lost every elections).

Since the riots last april, the Red Shirts have improved their tactics, with very large rallies, peaceful, blocking not an airport (that was the PAD in november 2008) but a few important areas in Bangkok.

Anyway. The crackdown is now likely. The government wants to shut down a TV station used by the opposition. And the Red Shirts leaders could face arrest.

I remind you that Abhisit declared the state emergency in april 2009, leading to this

Twelve months after : the same actors. The same causes. And probably : the same effects.

More than ever, the situation in Thailand is totally blocked.

Abhisit loses face as Court says : “you already have power to evict protesters, why do you ask us ?”

The Civil Court on Monday refused to issue an injunction to force red-shirt protesters to leave Ratchaprasong intersection as requested by the government.

The court reasoned that the director of the Internal Security Operations Command (Isoc) already has the authority under the Internal Security Act, which has been imposed in the capital, to order red-shirts out of the area without having to seek the court injunction.

The court explained that the ISA empowers the Isoc director to prevent activities that affect national stability and the director has the right to carry out actions that would bring the country back to normalcy.

Prime Minister Abhisit Vejjajiva is the director of Isoc.

Protesters who were still occupying the intersection cheered loudly upon hearing the court’s decision.

Red-shirt leader Jatuporn Prompan said this is the victory of the red-shirts and justice has been served. (Bangkok Post)

Unstoppable. Abhisit is so totally freaked out… and so hypocrite that he’s losing his nerves and making big mistakes.

His government imposed the ISA, a special law that allows the security apparatus to… well maintain order. It’s a PC version of the state of emergency.

But the problem is : ISA is dirty. It wouldn’t be very nice, very friendly to see army units marching onย  thousands of protesters, sitting peacefully on the streets. So, instead, let’s ask a… Court.

Abhisit tries to hide behind a Court, to avoid his own responsabilities.

He tries to avoid this :

(pictures taken during last april riots)

From a tactical point of views, the Red Shirts have made great progress since last april…

The government is in a dead-end position when confronted to thousand of protesters sitting “Gandhi style”. If the Red Shirts manage to keep the pressure on the long run then Abhisit is going to be in a real hot bed.

Chart, exchange-rate and holding of US Treasuries : more for more

In august 2009, here what I wrote on the chart with USD-THB exchange rate and thai holdings of US Treasuries.

The BOT fantasy : buying more and more USD (via US debts) in order to maintain the exchange rate USD-THB.

Well, 5 months later, where are we ?

Higher US Treasuries holdings… and higher THB. Well done guys ! ๐Ÿ˜‰

But I agree, you could also see the half full glass here : It means, if the BOT haven’t piled up USD, the THB would have been even stronger.

I remind you the obsession of virtually every asian central banks : weaken their local currencies versus the US Dollar, in order to boost, stimulate their dear exports.

Each countries use different tools, but with the same cheap short term obsession : the Beggar thy neighbour policy. China for instance sets the exchange-rate (It’s much more convenient) because China is an authorian (to use the word “communist” would be an insult to Karl Marx…) state and because they don’t give a rat shit about what other countries and other people think.

For that matter, it’s a shame to see Geithner the slave to bow in front of the Chinese, and to delay the report on… (the alleged as they say !) currency manipulation by China (read here).

Even the Euro Zone is doing the same. The Great Greek Drachma Drama (copyrighted myself)ย  is… very convenient to say the least (on the short term, eventhough It’s a catastrophy on the medium term) to create a little bit of distrust… and to lower the Euro versus the Dollar. Enough to “boost” the famous german exports…

Boost. Stimulation.Throught debts and cheap (depressed) currencies. It’s the Dildo Economy on Prozac.

The whole freaking planet is running toward the Zero (as far as exchange rates are concerned). Happy and Stimulated. ๐Ÿ˜‰ Have a Viagra, please.

Voila. Thailand is happy with a (small) recovery in exports… in order to please the clowns Korn and Abhisit so they can use the words “GDP growth” and “recovery”, leading to surplus. And those surplus are used to buy… US debts… allowing to keep a relative control on the USD-THB exchange rate. But meanwhile, those surplus and this fake “GDP growth” excite foreign money, oceans of liquidities… Leading to inflows (buy buy buy thai stocks !)… leading to a higher THB… leading to the need to further depress the THB if they want to continue to boost exports… with surplus… etc. etc.

It’s not even a vicious circle anymore. It’s a clown circle. A bozo circle.

Last but not least : the view with % of change year on year. I agree : the BOT seems to slowdown. But it’s too early to say.

(Source Bank Of Thailand, and US Treasury).

Chart, credit : total up… but down for businesses

Time to update our charts about… credit.

You know the motto : credit is the Grand Master Flash. The blood that flows into the veins of the Green Shoots’s Economy.

No credit = no money = no honey. ๐Ÿ˜‰

This is why the clowns all the over the world are so totally obsessed with credit. They want you and the businesses to eat, to swallow, to digest credits, the more is the better.

Credit is the super charged drug for an inane and twisted economic system.

Anyway, enough of the big words. Let’s go back to our study : Thailand.

Total outstanding credit (at commercial banks) is going up. Total in january 2010 : 7 926 billions THB.

Party time Miam Miam !

But… credit for businesses is going down. I mean it’s obvious : the recovery is so strong, the Green Shoots are so Green that companies don’t need credit. They don’t have to invest. ๐Ÿ˜‰

Individuals ? Going up very slightly. The big question mark is the group “Domestic Banks and Financial Institutions” that is responsible for the growth of total credit.

Let’s have a look inside this group.

60 % of the total outstanding credit amount of the group “Domestic Banks and Financial Institutions” = “Specialized Financial Institutions”, according to the BOT. Great. I mean, it’s very clear. ๐Ÿ˜‰

What are they ? Who are they ? I don’t have a clue.

If we look at the weight of each group. Businesses represent now 45 % of the total outstanding credit at commercial banks (versus 60 % 4 years ago). Individuals, flat at 29 %. And we see the strong growth of the group “Domestic Banks and Financial Institutions” (20 % in february).

So let’s recap and what we should think about this ?

-commercial banks and “financials institutions” are borrowing from…ย  commercial banks.

-is it a way to blurr the situation, to prevent a honest assessment, or to makeup the statistics ?

-or is the proof that the system is perverted : banks are reluctant to give loans to businesses (too dangerous, because of the crisis)… they prefer to fuel the money into weird financial black boxes ? We don’t have indication on how the money is used after by those “Domestic Banks and Financial Institutions”.

-or is it the illustration of an evolution of the thai financial system : commercial banks are stepping back, and they let “specialized institutions” to deal with customers ?

I don’t have the answer.

I could just say : being old school, I still believe that a bank that doesn”t give a credit (because it can’t or because it refuses) to a business… is not a healthy sign.

A last one, before to hit the road :

(I didn’t represent the % of growth year on year of the group “Domestic Banks and Financial Institutions” on this chart, because It would be way too high). Businesses are still down 7,7 %, compared to january 2009.

(Source Bank Of Thailand, table FI_CB_015_S3).

Astonishing vote buying : the government… eases debts of 510 000 farmers

What a joke (but a relief for half a milion of poor farmers) !

The government is introducing a debt moratorium scheme for farmers worth 80 billion baht which is seen as a strategy to appease grass roots people as political divisions continue to widen.

The plan was released as tension mounted after a second round of negotiations between red shirt demonstrators, most of them farmers in northern and northeastern provinces, and the government failed on Monday.

A government committee on easing farmers’ debts is planning to submit the scheme to cabinet next month.

The ad hoc committee met on Monday to discuss a debt moratorium scheme for about 80,000 farmers who are members of the Farmers’ Reconstruction and Development Fund (FRDF) and 430,000 farmers who are not FRDF members.

The 510,000 debtors in the farm sector have a total principal debt of more than 80 billion baht.

The debt moratorium will be limited to 2.5 million baht each, said Khunying Supatra Masdit, an adviser to the prime minister, who sits on the committee.

She said the new debt restructuring scheme will help clear farmers’ debts owed to financial institutions within 15 years. (Bangkok Post)

Let’s summarize. Farmers are against your government and they fuel opposition rallies. You have a problem. So you erase their debts. Simple.

Let’s not play with words there… The Abhisit’s plan is like a big eraser. The point is (and it’s a valid point for the whole world) : those debts can’t be repaid. In full.

But 80 billions THB. That’s not a small amount…

Nice move.

Again, It’s going to be a serious relief for those people. But let’s not forget : someone will pay. That’s the trick. The thai tax payers, eventually.

Anyway. Where are the supporters of the rule of law, democracy and good governance principles ?

Where are the people who were criticising Thaksin, the TRT and the PPP for their vote buying policies ?

Well, I guess, we could say : same same, but… not different.


Change with Abhisit ? Yes We Can(‘t). As usual.

Talk Comedy : why Abhisit would agree to a dissolution… in 9 months ?

Exactly like predicted, the “historic talks” between the government and the Red Shirts were inconclusive… It’s of course an understatement.

There is nothing to negociate, obviously.

But something is strange. Abhisit said he would agree to a House dissolution, but only in 9 months. Why such time frame ?

And this is non negotiable too.

Democrat Deputy Secretary-General Chamni Sakdiset, one of the government representatives attending talks with with the anti-government group, notes that a timeframe of nine months for a house dissolution proposed by the PM is non-negotiable.ย  (PRD)

What could change in 9 months ? Is it just a mean to gain time ? 9 months just to avoid to say “never” ? ๐Ÿ˜‰

Abhisit could have said : a dissolution is possible once we have amended the charter for instance. Did he go too far by giving a time line ?

From the government/army perspective… 9 months is no better than tomorrow or next week. They don’t want fresh elections. Period. Way too risky.

So why speaking about 9 months ?

Do they think that something could happen ?

Only one thing could “transform” the 9 months in “never”, at least delay a lot the time frame : the royal succession.

Anyway, the frustration, on both side, is surely huge. It’s very difficult to see any compromise, any significant move before the Big Event.

Think about it : the political circus started at the beginning of 2006 ! Four years. And counting.

It’s hopeless.

From a tactical point of view, the government/army should give a few ministers to the opposition, in a “national unity” logic. That would be a smart move.

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.