Money does not stink
The year 2008 is still quite etched in the memory of many. It was the period when you received more than 50 baht for a euro. Times change; the euro has depreciated against the baht or should we say that the baht has risen?
The grumbling of foreigners living in Thailand erupted. We've gotten used to it a bit by now and are resigned to it. The euro is slightly rising again and there is a stabilization phase around 38 against the Thai currency.
Currency rate
How does a currency rate actually come about and why do you see small differences almost every day? In fact, quite simply, you may think of a currency as a commodity that has to do with supply and demand that determines its price. We pass over a very gray past when money was hardly known and barter trade flourished. At a later stage, precious metals such as bronze, silver and gold came into the picture as a means of payment as the predecessor of our banknote.
The Gold Standard
In 1944, 45 countries laid the foundations for world financial trade, equating 3 grams of gold with one US dollar.
All other countries were pegged to the dollar and in effect this meant that those countries had to build up the necessary gold reserves to back their currency. This so-called Gold Standard is now very outdated. After World War II, free trade between countries exploded. Some countries no longer maintained the agreed margin of 10 percent above or below the agreed margin to the dollar. In 1971, US President Nixon rescinds the agreement and decouples the dollar from other currencies.
Supply and demand
By 1973 most currencies had been released and the rate was determined by supply and demand from the market. Exchange rates can be determined by supply and demand, but the government, financial institutions, multinationals, export and import companies can also play an important role. For example, the euro, as well as the dollar and yen, spoke of one flexible exchange rate because the government has no influence on the price and it is determined by the market. For example, you can call the baht, which the government can influence and not, as many think, is linked to the dollar, a managed currency.
Government influence
With the Thai baht, the government can influence the exchange rate because it can determine the national economy. This may be the case, for example, if imports or exports are disproportionate to gross domestic product. (GDP) If products are too expensive, there is no market for them and that can lead to lower economic growth and higher unemployment.
Popularly said: if Thailand becomes too expensive, it will be a less attractive country for foreign pensioners who will then seek refuge in a cheaper country. An unstable currency, and I don't want to say that about the Thai bath, is associated in certain countries with a possible unstable financial situation.
There are other aspects that can affect the exchange rate. What about the economic growth of a country and what does the balance of payments look like? In short, how do you view a certain country.
Example
The recent elections in England and the loss of the Conservatives left a bitter aftertaste for May and her diminished negotiating position on Brexit caused the pound to fall in value by 1½ percent. There was quite a bit of talk about the euro about a number of weak countries, including Greece in particular, which did not do the euro any good.
Finally: for many, currency trading is an interesting activity that involves billions of dollars every day. One last question: would you, dear reader of this unsurpassed Thailand blog, exchange your property in euros for the Thai bath? I am more than curious about your opinion.
As long as the army is in power in Thailand, I would not exchange my euro for the Thai Baht.
They spend money enthusiastically, and apparently too much, as they talk about raising taxes all the time.
That cannot benefit the exchange rate of the Thai Baht.
Furthermore, if I'm not mistaken, they still have the deficits from the banking crisis of about 20 years ago somewhere on the balance sheet.
And a new real estate crisis seems on the way.
So no.
I will stick to the Euro for a while, although I don't think the situation with that free money in Europe is great either.
As soon as the debts bought by the ECB are reduced again (if that ever happens), interest rates will rise and economic growth in Europe will collapse again.
It is not clear to me what will happen, if the ECB never pays off that bought-up debt.
This probably means that the “rich” European countries pay more interest on their government bonds and the “poor” countries pay less.
A constant subsidy from the “rich” member states in Europe to the “poor” member states, in other words via the ECB.
Only exchange Euros into ThB per month what I need!
Someone with (surplus) money (whatever currency that may be) can best convert his money into acquisition of land
As far as I learned about the new crypto currency during my instructive lessons, there are two things I learned….
The Thai Baht has hardly risen, but the Euro has fallen and not only against the baht.
And the other thing is that since 1971 the US has not had the dollar backed by gold http://buygoldandsilversafely.com/gold/what-really-backs-the-us-dollar/
so it is basically a money based on promises that are never kept. The dollar from then is now worth many times less.
Would I prefer baht over Euro? No yes and no no here. Spreading is my motto. If I had enough, I'd rather convert some of it into crypto money, into Euro, Thai Baht and Dollar….also probably gold and silver.
I recently read that if you converted $1000 into bitcoins not so long ago, it would be worth millions now.
see: Mike Meloney part 4.
the biggest scam in history of mankind-hidden secrets of money.
The video has been viewed more than 6.000.000 times.
Good Dutch translation.
https://www.youtube.com/watch?v=iFDe5kUUyT0
recommended !!!!
Money does stink, and not just a little.
The ECB will continue to circulate money until our money is worth 2% less per year.
Go to ons geld.nl and sign up for the newsletter.
ons geld.nl has had discussions in the 2nd chamber about a new money system.
Highly recommended for everyone: Irma Schiffers and
Ronald Bernard part 2 revelations by insider.
https://www.youtube.com/watch?v=9MX99tN7-uE
With an inflation rate of 2%, the state automatically pays off half of its national debt every 25 years. Why else did you think capitalist countries have that 2% inflation target? The foundation of our capitalist system since the abandonment of the gold standard has been hot air with confidence.
This repayment only applies if there is a balanced budget. The norm is that EU countries spend no more than 3% on public expenditure than they receive, so the national debt increases more every year. That 2 percent is therefore incorrect.
As long as you cannot freely transfer Thai Baht outside Thailand, I would never dare to convert all my savings. One day this will change with the further development of Thailand. I remember that the same problem once existed for the Spanish peseta and that has all changed.
Addition: Part 1 can also be viewed on vimeo.
https://vimeo.com/212237317
Only suitable for people with a strong stomach, really to make you sick.
Yes, money stinks.
For these reasons, among others, I have created a Bitcoin wallet, with which I can buy Bitcoins from my Dutch bank account.
In addition, I also created a wallet with which I can buy and sell Bitcoins from my Kasikorn account.
Exchanging Bitcoins between the two wallets is very fast and cheap.
In the wallet itself, I also benefit from the increase in value of the Bitcoin itself. This was worth € 10 500 years ago and is already worth € 2.400, with the expectation that it will rise to well over € 3.000.
Bitcoin has already surpassed gold this year.
Please note that the government or banks in both the Netherlands and Thailand cannot influence Bitcoin.
Answer to the question:
In the setup as I described above, I will shift money to Baht, Euro or Bitcoin when it is favorable.
Please take a moment to view this explanation of Bitcoins.
https://m.youtube.com/watch?v=gKC2oelL878
A tulip bulb used to have about the same value as a canal house in Amsterdam.
That hype didn't last very long and that's how it will end with bitcoin, I suspect.
I wouldn't burn my fingers on it.
A very nice explanation, this video! Thanks for posting.
Today I had a conversation with someone about Bitcoin and the altcoin. Unfortunately, there are also many companies that abuse the lack of knowledge about this. They lure people into investing with their new superman. I was also “caught in” that way, but because I wanted to know more, I came across bitcoin in no time. I have never invested in the other one and never will. This one is called Onecoin. You will not find them on coinscap but they promise their investors to enter the market in 2018.
Beware of these types of companies. A company that only markets cryptocurrency for its exchange value is not doing it right at all. All cryptocurrency in circulation is a BY-PRODUCT of a protocol such as the blockchain. It is never a product in itself that just has value.
These kinds of videos are worth gold!
Owners of Bitcoins can be compared to participants in a Ponsi case. The more it becomes known, the more demand there will be. So people with a Bitcoin have an interest in the demand for Bitcoins increasing so that the price = value increases. Given the limited number of Bitcoins and the hype surrounding this maximization, many people are eager to participate to take advantage of the scarcity. This only works well as long as there is greater demand than supply, in the longer term. Over time, people have seen it again with Bitcoin or want to cash in on the investment. Then you get a reverse hype, namely a progressive fall in the price because of decreasing interest and greater supply than demand. For now it's a hype and in a few years it will be over. It is not for nothing that new cryptocurrencies are constantly being created with the aim of making large price gains in the beginning. In the end it goes on until the question is over and it collapses. Same as the Ponsi investments. People do what they find interesting, but it is of course just gambling on a price increase. I like that too, but it's nothing for the long term, these Bitcoins, but for now it's interesting to speculate.
Dear Ger, I understand your thinking and it is correct when it comes to the growth of new cryptocoins. However, the technology and the open character of the blockchain and the possibility to program money are the major changes compared to the current centralized money management. And I expect a lot from that. For now I use the Bitcoin to make transactions between my wallets.
Ger, what you describe sounds like you heard the bell ringing, but you don't know where the clapper hangs.
Yes, Bitcoin increases in value as more people buy, and many people speculate on this increase in value.
But, sorry, a ponzi system is quite different. Mr. Carlo Ponzi, after whom the system was named, was an American immigrant in the US in the 20s and 30s.
He invited friends and anyone with money to invest with him, upon which he would then pay out a hefty profit. He maintained this for a number of years, until the government got involved, people lost confidence and stopped investing. He always paid the profits from newly invested funds.
Since then there have been others who have done such a thing. The last most famous kept that system going for 20 years.
The biggest ponzi system, however, is run by the government and you participate in it whether you like it or not. Debts that the government has to cover with funds that are not intended for this purpose. With our taxes on anything and everything, we are the stupid investors who pay these debts.
Of course you can make money with bitcoin and altcoin, but you can also do that with the trade between currencies such as the Yen, Dollar, Euro and so on.
What 90% do, however, is they buy bitcoins in large numbers now, but want to sell in a panic when it drops in price, causing the price to drop even further with the huge supply. Smart people only buy then and enjoy the low price.
I can name the companies you describe: Onecoin, Swisscoin, Platincoin and a few more. These companies are making a cryptocurrency that is now really based on nothing but the imagination of the managers. They have zero monetary value and nothing beyond. They attract naive investors, embroil them in a ponzi system, where reckless recruiters make a lot of money and the unsuspecting investors never see their money again.
There are also plenty of companies that offer 3, 4, 7% interest PER DAY if you start investing with them with your newly purchased bitcoin. In doing so, they also make good use of the unaccustomed enforcement of bitcoin. For example, I know one where you can start with 0,02 bitcoin and you have 30 days to earn 0,05 bitcoin. You will never achieve that at 4%
And that's how people are fooled.
What stands behind real bitcoin and altcoin like Ethereum, Litecoin or Dash are people, not companies, creating a system to transfer information in any digital form safely, quickly and cheaply from point to point with no intermediate. The cryptocurrency is just a by-product of that. Not a counterfeit coin put on the market.
Yes, Bitcoin has been on the rise for quite some time now. But to buy or sell bitcoin you need a wallet.
Which wallet is easy to use and also safe? Several have already been robbed of their bitcoins due to insecure wallets.
Dear Djoe, I can give you information about the wallets I use. Perhaps more convenient via email:
[email protected]
As far as I'm concerned, coins.co.th. one of the easiest. Have a look here: https://www.thailandblog.nl/lezersvraag/bitcoin-retour/
There I listed the benefits.
My answer to your question at the end of the article is: spread. So keep money in Europe as well as money in Thailand. My confidence in the euro is not that great, due to the weak southern European countries (Spain, Portugal, Greece and to a lesser extent France). Not much needs to be done and the euro is in free fall. On the other hand, the Thai banking regime does not have much tolerance for sending money from Thailand to other countries. In fact, both currencies are surrounded by rather uncertain factors. Hence my policy of spreading the money over both countries. If I didn't live in Thailand, I definitely wouldn't buy Thai paddles.
Editors, I wrote from my tablet and once again see the most stupid words. Superman must be currency or cryptocurrency,
Have transferred all my funds to Thailand, partly on a tax-free term account, the rest on a EURO account, and my pension will also be paid directly into my Thai bank account.
I live in Thailand and consider it my homeland, in good days and bad. So it is normal that it is also the home country for my capital.
In Thailand there is a withholding tax of 15% on interest payments received. Is this tax deducted from your Thai income tax return or are there really tax-free term accounts? If so, at which bank?
Why keep your money in currencies other than Thai Baht if you live in Thailand? Has anyone ever thought about what will happen to the Euro if Italy runs after Greece? Or France? Or Spain? Isn't it utopia! What if more countries decide to leave the EU or Euro? Finland has already suggested this and in the Netherlands Euro sentiment is also weakening every year. With regard to the Euro, one thing is clear: It is on quicksand!
@ corret
In fact, it is about securing the value of your money (that you own).
This can be done in currency (Eur or Baht or US$), but it is wiser to use the money to purchase land. Land generally retains its value and (depending on its location) that value only increases.
Others invest in gold… but that has a bit more risk.
Land has always been the best investment (better than homes that need regular maintenance) 🙂
Unfortunately , buying land in Thailand is not possible for foreigners .
TonyM
I know how the situation is in Thailand…. but I wrote in generalities.
Acquisition of land in the name of a Thai wife (if there is one) is a possibility, but I would not sign for it myself.
Plots of land on/near the coast are the most interesting (for investment). But (as always) there is an exception to everything 🙂
I do suppose that purchasing plots of land should only be considered if the price is right (that requires knowledge of the area in which the land is located).
Otherwise, it often takes a very long time before there can be any question of making a profit.
Remember that the topic is about securing your assets rather than making a profit.
There only needs to be one good buyer for your plot of land, but if there happens to be (or not) a serious buyer, everything stops for a while. But you can start advertising with it (that makes sales).
The more attractive a location, the faster a buyer will be found. And sometimes you have to be lucky.
35 years ago, my Thai wife, very reluctantly, bought a piece of land outside Chiangmai to later build her family home. The costs were then 10.000 guilders and, according to the Land Office, the value is now around 5 million Baht for the country alone. Not a bad investment and we are still married. So it can go well.
According to analysts, the Thai bath is kept artificially high. We are currently waiting for a serious devaluation of 30 – 50 percent!!
GBR
The Thai currency is kept artificially high so the bubble effect will last for a while as Thailand has a balance surplus
But the bubble effect will certainly come…..
TonyM
Just explain to the laymen how you got this wisdom. The economy is growing every year, exports are greater than imports every year so there is more demand nasr baht than supply. to support the baht if it becomes too weak, this build up was a result of the crisis in 200 to prevent another devaluation. So the baht will get stronger. Because the government cannot intervene because it has no desired resources for this.
Dear bloggers.
Nothing is written about ratings. and this surprises me. not that these are beatific
Are but still.eg Greece has junk status.the best is AAA
Or triple A. There are several authoritative offices that determine the ratings
Make it public. FITCH is a very big one in the world.
Which all financial institutions take into account
If you want to know how the Thai bath is doing, ask for its ratings.
You might get red ears. the financial world. Always shows.
Good luck
According to
The vast majority of people (Thai, expats) do not or not at all depend on any exchange rate, whether it be for houses, jewellery, holiday destination, emigration or daily shopping. Unless it concerns changes of hundreds of percent per year, as in Zimbabwe. A very small minority is working on it every day. Their financial success is based on so many factors that they themselves cannot estimate. It is no less than a lottery and many more people participate in it.