What happened?

http://www.npr.org/templates/story/story.php?storyId=7626834

I heard the Chinese stock market dived today and it caused the DOW to go with it down 416 points.  Apparently the Chinese government changed some policy because  it got “nervous that too many Chinese people are investing too much in the stock market […]  Beijing’s central government is terrified that if the stock market collapses, the whole economy will fall apart. So over the weekend, Beijing instituted some changes. It announcing plans to calm down stock market trading, to make it less frenzied.”  However these changes scared everybody thus causing this great fall at 9% overnight.  Wasn’t this what they were trying to avoid? 

Thai stock market rate of return

I wrote an email to someone asking about the average rate of return for the Thai stock market.  Hopefully he will take time out of his busy schedule to answer me.

?

Since the Chinese keep buying dollars to devaluate their currency, why doesn’t the US government buy up yuan?

baht February 19, 2007

Today February 19, 2007 1usd = 33.21 thai baht.  (x-rates.com).  Looks like it’s appreciating slowly over time. 

34.78, 35.13, 34.08, 33.4, 33.21

the holy grail?

After obsessing over this I think I found the answer to the foreign currency deposit account in the US question.  I’m so excited.  Apparently big US banks don’t want to bother with accounts denominated in Foreign currency because it’s a “headache.”  But there are a few less well-known banks that do it.  I dunno.  Someone else read it and explain it to me, but I’m pretty sure this article can answer our question.  [http://www.grantspub.com/articles/notthedollar/]
-Jasmine

Baht February 13, 2007

Today one USD is worth 33.4 Thai baht.  It’s slowly strengthening in relation to the dollar.  I remember when it was at 42 baht per dollar for a while the last time I was there in 2003.  This must not be good for Thailand’s exports to the US.  Furthermore, according to the State Dept. the US is its number one export market.  I only managed to find Thai export rates to the US up to 2002.  I want to know how the appreciation has affected its trade with the US since.  I’ll keep this as a reference and keep looking.

Table 3. U.S. Merchandise Trade with Thailand: 1997-2002 ($millions)http://www.us-asean.org/Thailand/thailand-RS21478.pdf

about the baht

I guess I should talk more about the currency I chose, too.

The Thai Baht

All I know is the King Bhumibol’s image is on all the cash and the money is really pretty and has water marks and clear windowlike portions and everything.  Really pretty money if any of you like collecting currency.  Other than that I know nothing so I found this informative information on the good old internet: 

“The Thai Baht, like the Japanese Yen  & European Euro, floats against the value of the US dollar in international currency markets.”

• “Thailand was amongst the first of the Asian economies to feel the pinch of over zealous expansion.”

• “The baht fell from $1 = 25 to $1 = 35 pretty much overnight.”

• “In 1997 many high-rise construction projects were halted & there was  huge amounts of vacancy in Bangkok office buildings ..  which resulted in huge amounts of defaulted loans.”  (Not a good year for my uncle’s hotel business.  Ooh if anyone wants to go to Chiang Mai, Hat Yai or Samila beach (the Samila hotel is absolutely gorgeous.  It’s right on the beach.  For more info just google Samila beach or go to http://www.hotelthailand.com/hatyai/special/bpsamila/index.html) tell me.  I need to throw more business his way.  Plus I have a minor share in his business.) 

• “1997: Incomplete 30 story new office buildings with canvas over the ‘windows’ seemed to be everywhere.”  (If you go on a riverboat ride in Bangkok you can still see these sad, skeletal buildings.  I guess it would cost money to tear them down so why not just leave them up half done?)

• “Even the BTS (I think it stands for Bangkok Mass Transit System), was in limbo because of a contract negotiated in Baht.  The rapid devaluation of the Baht left the Japanese contractor holding huge amount of Baht worth 40% less than they were when the contract was negotiated.”

  • “All BTS sky train, construction stopped at the 85% complete stage ..the incomplete project looked pretty complete from the ground but inoperable for over 2 years.”  (Sky train now in operation and is awesome.  Do NOT drive or take a ride in any earth-bound vehicle in Bangkok.  Sky train is the way to go.)

  • “The initiative launched in Chiang Mai, Thailand, in May 2000, in the wake of the 1997 Asian financial crisis, involved wealthier countries such as Japan, South Korea and China making emergency foreign currency loans to Asean nations in the event another currency crisis ever menaced these nations.”

  • “ASEAN: Singapore, Malaysia, Indonesia, Thailand, the Philippines, Brunei, Laos, Myanmar, Vietnam and Cambodia.”  (Thailand is known as the fifth Asian Tiger.  I think the other ones are Indonesia, Malaysia, Singapore, and the Philippines.)

    “What it is doing is try to insulate this region from the kind of turbulence it faced in 1997, the Asian countries would prefer less influence from the IMF because in 1997 the Asian countries feel the advice they got from the IMF was not correct and led to a lot of suffering” said Ifzal Ali, chief economist of the ADB.” (ADB=Asian Development Bank.)

    • “The 10 Asean and three East Asian Financial ministers ( or Asean +3, China, Japan, South Korea + 10 member Association of Southeast Asian Nations ) set up a system of bilateral currency swaps so that a member Asian country hit by a foreign exchange crisis, like the one in 1997, can borrow borrow foreign currency from the positive trade balance $$s of other the member nations.”  (Would that help if crappy investments were made?) 

    • “This could be viewed as a step towards setting up an “Asian Monetary Fund”.”

    • “The initiative now covers some 16 bilateral agreements totaling almost $40bn between Asean nations and the three East Asian economic giants.”

  • info from:  http://www.csmngt.com/thailand_history.htm

Baht

Today Tuesday, February 6, 2007, one USD is worth 34.08 Thai Baht.

Last week it was 34.78, then 35.13, now 34.08.  So I guess if it’s vacillating up and down but only by like a fraction of a baht, it’s pretty stable.

Thai baht

February 1, 2007 one USD = 35.13 THB (baht).  It went up from yesterday.  Sell Sell!

Too much capital?

So I just read an artical called “Liquidity flooding venture capital market; competition to heat up” and I still don’t think I understand it.  Basically it says that too much capital is bad.  “In entrepreneurial circles, the existence of excess capital is generally considered a good thing. But according to the panelists, having too much capital on hand can often lead to poor decision-making and inefficiency.”  And then Ken Elefant of Opus Capital says, “There’s a lot of money in the market which is going to make it very competitive, especially for Series C and D funding.”  First of all, what are series C and D funding?  If there’s so much capital out there, why would it make it more competetive to get funding?  Wouldn’t competition be more intense when there’s not enough capital to go around?  Also, if excess capital really is a problem, couldn’t firms put a ceiling on how much funding they receive or is it too tempting just to take as much as they can get?