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Money matters: A look at Thai baht
Graham Macdonald
MBMG International Ltd.
We recently researched the recent history of Thai baht
exchange rates and this is what we uncovered - Thailand adopted a floating
exchange rate regime (similar to now) prior to 1963. However, this regime
was ended on 20 October 1963 and Baht was linked to U.S. dollar at a rate
B20.80 per U.S. dollar. Prior to this Baht had included a gold standard
but to allow the Bank of Thailand to retain the pegged exchange rate, the
gold content of Thai Baht had to be reduced for several times. This
process basically prevented volatility in Baht value against the US$ but,
especially when the Nixon administration caused the depreciation of the
US$ in 1971 which in turn caused the deprecation of the Baht, it added to
Baht volatility against other currencies and also caused reduction of the
country’s gold reserves. To avoid further reduction of gold reserves, the
BOT introduced a band of up to 4.5% fluctuation range in May 1972 and then
up-valued the official rate to B20.00 per U.S. dollar in July 1973.
In March 1978, the Baht’s link to U.S. Dollar was broken as the exchange
rate regime was changed from one that was pegged to the U.S. dollar to a
system pegged to a weighted basket currency of Thailand’s major trading
partners (which is what China claims to be doing currently). Initially the
basket comprised of US$, West German mark, Swiss Franc and Japanese Yen.
Again, the Effective Rate was allowed to float within a limited range
(Controlled Floating Rate). In 1979, the Vietnamese invasion of Cambodia
and subsequent Chinese retaliation caused a flight of capital from
Thailand. In attempt to ease this liquidity crunch, the interest rate of
Non-resident Foreign Currency Accounts was permitted to float, the
interest rates on Baht accounts were also boosted and a number of currency
controls were relaxed. By 1981 the then soaring US$ had increased the
costs of imports while depressing the receipts of exports. In response
Thailand twice devalued the Baht initially by 1.08% to B21.00 per US$ and
then in July that year by 8.7% to B23.00. Between the years 1984 and 1990,
the basket of currencies was revised twice ultimately being composed of 10
currencies of Thailand’s major trading partners. In addition to the
original components Sterling, Malaysian Ringgit, Hong Kong Dollar,
Singapore Dollar, Brunei Dollars, Indonesian Rupiah and Philippine Pesos.
In November 1984 Thai Baht underwent the biggest devaluation that it had
experienced changing from B23.00 to B27.15 per U.S. dollar, representing
devaluation by 14.8%. During the period of 1984-1997, the Exchange
Equalization Fund (EEF) defended the Baht value against the U.S. Dollar by
using some monetary and financial measures in line with the pegged
exchange rate regime. These interventions by the Central Bank were
intended to assist exports and stop capital outflow. A “managed float” was
used to control the currency, but market forces led to the collapse of
this system amid the Asian currency crisis in 1997.
Since 2 July 1997, Thai Baht has been freely floated with value of the
Baht determined by market forces. The Bank of Thailand intervenes in the
market only when necessary, in order to prevent excessive volatilities and
achieve economic policy targets. Part of the attraction of the floating
regime is the enhanced flexibility and efficiency in monetary policy
implementation. This allows Thailand to operate within the terms of the
free markets and is intended to increase confidence of both domestic and
international investors. Initially, to protect the domestic economy
against speculating. a two-tier currency market was created to separate
exchange rates for investors who bought Baht in domestic and overseas
markets, although by January the following year this had been unified,
creating a genuine traded value for Thai Baht at any given time.
From 1979 until the free-float was implemented Baht exch rates were as
follows -
31 December 1979 20.425
31 December 1980 20.630
31 December 1981 23.000
31 December 1982 23.000
31 December 1983 23.000
31 December 1984 27.150
30 December 1985 26.650
31 December 1986 26.130
30 December 1987 25.070
30 December 1988 25.240
29 December 1989 25.690
28 December 1990 25.265
30 December 1991 25.255
30 December 1992 25.520
30 December 1993 25.540
30 December 1994 25.090
29 December 1995 25.190
31 December 1996 25.550
That’s the past, going forwards we expect the Baht to continue to ply a
gradually depreciating mid-path between the currency performance of
Thailand’s major trading partners, most notably US$ and Euro, but not
forgetting Yen. Therefore the clues to Baht’s performance this year come
from its own economic performance and from that of the US, Japan and the
Eurozone. In the course of this research we also tried to evaluate the
accuracy of published forecasts for THB rates over the last 10 years. In
general the performance of forecasters has been poor. Few people have
accurately forecast what has happened, i.e. the strengthening of Baht
during the two years following Baht bottoming out, the weakening of Baht
again once it had touched 36, and the couple of bouts of strengthening and
one bout of further weakening since then. We expect the current short term
strength to follow its course but then once Baht has become clearly
overbought expect a further bout of weakness.
By 2015 capital flows mean that we should expect a Baht that looks 10%
weaker against its weighted basket than today. This is potentially
interesting for investors - but only if you can pick a currency with a
clearly weaker prognosis than Baht (such as US$) and only if your
borrowing requirements match the term of that prognosis (say 2 years) and
only if you can afford the risks of currency markets behaving as
irrationally as they always have in the past, should you even contemplate
buying Baht assets with anything other than Baht liabilities. Buying Thai
property with loans in, e.g. Singapore Dollar, could prove to be much more
expensive than many borrowers might realize. Caveat Emptor!
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The above data and research was compiled from sources believed to be
reliable. However, neither MBMG International Ltd nor its officers can accept
any liability for any errors or omissions in the above article nor bear any
responsibility for any losses achieved as a result of any actions taken or not
taken as a consequence of reading the above article. For more information please
contact Graham Macdonald on [email protected]
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Snap Shots: Irving Penn
– the B&W Master
by Harry Flashman
While Irving Penn is one of the best photographers America has produced
and handled all media, formats and films, for me, his Black and White
work stands out as some of the most spectacular photographs of his era.
He had an eye for photo and design that was unique, so it is worthwhile
spending a little time to look at this great man and his works.
He was born in 1917 in Plainfield, New Jersey. Realizing early that his
talents lay somewhere in the artistic world, he enrolled at the age of
17 in a four year course at the Philadelphia Museum School of Industrial
Art, where he trained for a career as an art director. At this stage he
had no thoughts of becoming a photographer.
 Pablo
Picasso by Irving Penn.
His first art work experience was as an office boy and apprentice artist
for Harper’s Bazaar magazine drawing shoes.
After graduation he had positions as an art director, but he was not
happy or convinced that this was all that life was going to offer him,
so he went to Mexico for a year to devote himself to painting.
One year was enough to convince Penn that he was not going to make it as
a painter and he returned to New York and took a job with Vogue magazine
as a junior art director. His work was noticed by the senior art
director, but the staff photographers could not deliver the pictures
that Penn saw in his mind, which encouraged him to take the photographs
himself.
This was the start to a great career. He continued with Vogue, with just
a small break for the war effort, and his first exhibition of magazine
covers was held in 1947 at the Metropolitan Museum of Art in New York.
For me, his work is unique because of his use of light and other devices
to isolate his subject from the background. One example of this was his
series, taken against a totally plain background, of workers in their
working clothes with their tools of trade being the main item to lead
the viewer to the industry concerned.
 An
example of Penn’s work.
He is also the master of side lighting to produce a dramatic atmosphere
to his photographs. Look at the shot of Picasso for example. The pose,
the close up aspect, the one dramatic eye fixing you, the Spanish hat as
the clue – all these items are true art director material – but Irving
Penn was an art director who could take the photograph as well.
His use of photographic equipment was also very varied. Since he would
envisage a shot before he took it, he would then work out what he felt
would be the best equipment to use to produce the shot. His formats were
also varied, from 35 mm Leica and Nikon, through to medium format (6x6)
Rolleiflex or Hasselblad and then all the way through to giant 8x10
Deardorff plate cameras.
His talents have not gone un-noticed. He was voted as one of the top ten
photographers in the world in 1958 and has had his work exhibited
internationally as well as some sell-out shows in his native America.
Included in these are those in the Museum of Modem Art, the Metropolitan
Museum of Art, the Addison Gallery of American Art, the Baltimore Museum
of Art and at the Museum of Modern Art in New York (1975) and at the
Metropolitan Museum (1977). Published books include ‘Moments Preserved’
(1960), ‘Worlds in a Small Room’ (1974) and ‘Flowers’ (1980).
Irving Penn and his extraordinary capacity for work, versatility,
inventiveness, and imagination in a number of fields including editorial
illustration, advertising, photojournalism, portraits, still life,
travel, and television is someone who truly is a “Master Photographer”
and studying his work one wet afternoon will go a long way towards
improving our own photography.
Modern Medicine: Rectal bleeding and frog’s bottoms
by Dr. Iain Corness, Consultant
Little Johnny was overheard by his teacher describing to his
classmates how to insert a firework in a frog, saying, “You slip it up its
ass.” The teacher immediately said, “Rectum, Johnny, rectum.” “Wrecked ‘em?
Blew ‘em to bits, more likely!” replied Johnny!
So after that irreverent (but not totally irrelevant) beginning let’s look
at rectal bleeding, without using a mirror. The rectum is the last portion
of the large bowel that ends just before the anus. Bleeding from this area
can be a herald sign of a mild or life-threatening matter, which is why all
episodes of rectal bleeding must be investigated.
Depending upon how high up in the gastro-intestinal tract is the cause of
the bleeding, it may be seen as black, tarry stools, maroon stools; bright
red blood on or in the stool, blood on the toilet tissue, or blood staining
the water in the toilet bowl bright red. Treatment can range from relief of
symptoms and let Mother Nature do the rest, to antibiotics, blood
transfusion, or even surgery. It all depends on the cause.
There are many potential causes, including Hemorrhoids (piles) which are
swollen rectal veins in the anal and rectal area. They can cause burning,
painful discomfort, as well as bleeding. External hemorrhoids are small
swellings that are easy to see (with the mirror) and quite painful; however,
internal hemorrhoids are usually painless. A feeling of incomplete emptying
may be noted with bowel movements. Treatment focuses on relieving these
symptoms with the use of stool bulking agents and softeners, and if
necessary, ligation of the bleeding piles.
Rectal fissure is another. This is a tear in the lining of the rectum caused
by the passage of hard stools, which can lead to mild rectal bleeding of
bright red blood. Exposed nerves and vessels result in moderate to severe
pain.
Diverticulosis, I dealt with a few weeks ago, and these little pockets on
the bowel wall can also bleed. The stools are dark red or maroon. Pain is
usually absent but surgery is required in up to 25 percent of these
patients.
Bloody diarrhea is often seen in Bacterial dysentery, which we have all had
to a greater or lesser degree. Responsible organisms include Campylobacter
jejuni, Salmonella, Shigella, Escherichia coli, and Clostridium difficile. A
most unsavory bunch! The treatment depends upon the organism, but generally
intravenous fluid replacement and an anti-spasmodic and broad spectrum
antibiotic will bring this under control.
Another common cause of rectal bleeding is Inflammatory bowel disease
especially in young adults - typically those younger than 50 years of age.
Bleeding occurs in small to moderate amounts of bright red blood in the
rectum, usually mixed in with stool and mucus. Associated symptoms include
fever and abdominal cramps. This condition generally settles with steroids.
The list does not stop there, as there are also conditions like
Angiodysplasia, which is a vascular problem that involves enlarged veins and
capillaries in the wall of the right colon. In the elderly, these areas
become fragile and can bleed.
Of course, the one that everyone worries about is bowel cancer. We lump
these together under the general heading of tumors and polyps. Polyps bulge
out from the lining of the colon. Bleeding occurs when large polyps develop.
They can be hereditary, and are usually harmless, but some types can be
precancerous.
Both benign and malignant tumors are frequently found in the colon and
rectum. Those people older than 50 years are most affected; however, tumors
can be found in younger people. It should also be noted that less than 20
percent of people with tumor or polyps will have rectal bleeding. However,
when bleeding does occur, it is usually slow, chronic, and minimal.
Diagnosis requires careful evaluation with colonoscopy.
Rectal bleeding from a traumatic cause is always a critical concern. Rectal
damage from a gunshot wound or foreign body insertion can result in
extensive infection or rapid and fatal blood loss.
And yes, there’s more! A common source of bleeding is hemorrhage from the
stomach or duodenum. This can occur after someone has swallowed a foreign
body that causes injury to the stomach lining or bleeding stomach ulcers.
The list does go on, but these conditions are rare; however, the message is
that rectal bleeding must always be investigated, unless Little Johnny is
the culprit.
 Heart to Heart with Hillary
Dear Hillary,
I read your article published in the 24th of February’s edition of the
Pattaya Mail and it disturbed me. It was regarding your reply to Delboy. It
is frightening to me that someone would hold such a low opinion for the
future of children in Thailand. Is the outlook really that bleak – or maybe
you have just forgotten yourself – or just given up hope of a better fate
for the people of Thailand.
I would really like to here (sic) from you and maybe you might deem my
feelings worthy of printing. I would be interested to find out your ethnic
origin as I would find it hard to believe that a farang would be so candid
with a disrespectful view of a people.
Matthew
Dear Matthew,
Goodness me, Petal! Were we reading the same newspaper? My light-hearted
reply, I shall print again. Delboy was bemoaning the fact that the farangs
dress so badly and wrote (in part) “Seriously though, I’m lucky enough to be
a volunteer teachers assistant at Anubaan Chiangmai, but I notice a large
percentage of the children aren’t really interested in learning English. Do
you think it could be that the Farang they see around town puts them off?
Delboy”.
I replied in similar vein, “Dear Delboy, Glad to see you are back in
Thailand, and enjoying it as much as ever. Probably the reason that the
children aren’t interested in English communications is they’re not old
enough to know how to use an ATM yet. Give them a couple of years. Teach
them “Herro sexy man!”, “Sit dow pleez”, “Wun moah beeyah?” and they’re
ready for a long and fruitful association on the economic front with
farangs, no matter how they are dressed.” Please read it again, Matthew. Do
you think I am being disrespectful? Have you never passed by a beer bar, and
heard those words, “Herro sexy man! Sit dow pleez. Wun moah beeyah?” And
ponder on my words, “on the economic front with farangs”.
Quite the contrary to what you are suggesting, I believe that the children
of Thailand do have a better future than yesterday’s children who have now
grown into adults. With appropriate education, the young will not need to
make money from the bar trade, but will have worthwhile and well paying
careers. But by the same token, there are certain young ladies making far
more than me every month! If money is your only yardstick, then “Herro sexy
man! Sit dow pleez. Wun moah beeyah?” is also a well paying career.
And as to my ethnicity? Petal, Hillary is a child of the universe.
Dear Hillary,
Once again I have to ask for your help. I’ve done it again, falling in love
with a Thai woman who has happily ripped me off, while smiling. No wonder
they call this place the land of smiles. With what they’ve got out of me,
half of Issan should be smiling, or at least financially better off. I
thought I had met Miss Right. She always seemed so pleased to see me, but I
think it was my bank account she was smiling at. I know I did not know her
very long, but I honestly thought it would be better for us to be together
while we got to know each other better, and keep her away from the bars.
That was a dumb idea, as all it did was get her to know my financial state
better, which is now a lot worse when she left taking as much as she could
carry, and then some, what with motorcycle and house in her name. This is
really just a warning for other poor saps, as I know you can’t get the money
and stuff back for me. But how do you get some honest company round here?
Sam the Sucker
Dear Sam (the Sucker),
Some people are slow learners, my Petal. There is nothing wrong with that,
but you should know yourself better by this stage in your life. I am sorry
that your Miss Right turned into Miss Nothing Left, and I appreciate your
trying to warn others to be more careful, but you are the person you should
be warning, before all others. If you must take Miss Right as a live-in
companion, that’s fine, but why make her the owner of property bought with
your hard-earned money? Sure, it is easier, rather than going through the
legals of having holding companies and other ways of retaining ownership,
but it leaves you vulnerable, doesn’t it? And if Miss Right turns out to be
Miss Wrong, there you go again. When you analyze it, she did not rip you off
– you ripped yourself off! When you put yourself in the cage full of lions
(and lionesses really) you must expect to be bitten. But surely by now it
would be ‘once bitten, twice shy’? I am not suggesting that you have to live
like a monk on your own, but I am saying that you have to be a little
smarter and remain in control of yourself, your property and your finances.
And that is the very best advice (and help) I can give you, Petal. Best of
luck in the future.
Psychological Perspectives: Is your workplace “psychologically healthy?”
by Michael Catalanello,
Ph.D.
Have you ever thought about how aspects
of your work environment might be affecting your psychological health?
Perhaps there were times that you felt that your job was draining you of
energy or making you “crazy.” On the other hand, if you are fortunate, you
may have felt that your work situation was invigorating, making a
substantial contribution to the quality of your life, to your ultimate
fulfillment.
There is now a large body of research indicating how policies and practices
in the workplace can have a dramatic impact upon the psychological health,
performance, and productivity of employees. As a result, some organizations
have made it a priority to provide innovative programs designed to have a
favorable impact upon their employees’ mental and emotional health.
Experts in the field have identified five categories of psychologically
healthy workplace practices: employee involvement; health and safety;
employee growth and development; work-life balance; and employee
recognition. Workplaces that institute practices that positively impact
upon these areas have been shown to provide positive benefits to both the
employer and employee.
Employees who are consulted by management and involved in decision making
processes usually feel more empowered in their work. Toward this end, some
organizations have instituted self-managed work teams, or engaged in
participative decision making with employees. Providing structured
opportunities for suggestions and input from employees is another way of
increasing employee involvement.
Obviously, employees have lives and responsibilities apart from their work.
Employers can promote the psychological health of their workers by helping
them balance the competing demands of their lives. For example, some
organizations allow flexible work arrangements, such as flextime and
telecommuting. Some offer childcare and eldercare for employees’ family
members. Programs like these can make a big difference for employees trying
to balance the demands of work and their private lives.
Another way of encouraging psychological health in the workplace is to
provide regular opportunities for employees to upgrade their job related
knowledge and skills. Employers can promote this by offering regular
workplace in-services, tuition reimbursement, leadership development,
career development, and counseling programs. By offering opportunities for
educational advancement, organizations can better attract and retain high
quality employees.
Companies can also provide programs to promote the physical health and
safety of their workers. For example, a mental health organization for
which I once worked used to provide CPR training, workplace safety,
accident prevention, and fire-fighting instructions to all of its employees
on a regular basis. Some organizations offer their employees programs to
help them quit smoking, increase cardiovascular fitness, or reduce weight.
Health and safety programs can result in greater productivity and
reductions in healthcare costs, absenteeism and accident/injury rates.
Management recognition of employees for outstanding contributions to the
organization can also go a long way toward promoting a psychologically
healthy workplace. Employee contributions can be recognized through
monetary forms, such as fair monetary compensation, attractive benefits
packages, performance-based bonuses and pay increases. Non-monetary forms
of recognition, such as employee awards and recognition ceremonies can also
be useful.
Communication obviously plays a vital role in any organization. Ideally,
communication should flow freely from the bottom of the organization up to
the top management, as well as from the top to the bottom. Some
organizations provide regular on-going opportunities for employees to
provide feedback to management through surveys, town hall meetings, focus
groups, and an organizational culture that supports open communication.
Organizational policies and programs that promote a psychologically healthy
workplace pay dividends to the organization, as well as the individual.
Individuals within organizations that provide for employees’ psychological
health typically report greater job satisfaction, higher morale, and a
stronger commitment to the organization. Corporate attention to employees’
psychological health have also demonstrated increased productivity, reduced
absenteeism, and reduced employee turnover. In fact, research has
demonstrated that, all things being equal, an organization that makes the
psychological health of its workers a priority is more likely have a
healthy bottom line than one that doesn’t.
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Dr. Catalanello is a licensed psychologist in his home State of Louisiana, USA, and a member of the Faculty of Liberal Arts at Asian University,
Chonburi. You may address questions and comments to him at [email protected], or post on his weblog at
http://asianupsych.blogspot.com
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A Female Perspective: Discussions and Arguments
with Sharona Watson
Am I alone as a woman in thinking that men
sometimes seem incapable of having a serious discussion? Instead of having a
pleasant conversation, where two people are putting different views, things
can quickly degenerate into a slanging match, which before you know it
becomes a bona fide argument.
When you have a disagreement with your partner, what would you call it? A
discussion or an argument? It can be the most trivial thing, or a pretty big
issue, it doesn’t seem to matter. In the end, especially if the woman is
making her point forcibly, or ‘winning the argument’, the male seems to
react very badly. It doesn’t seem that they like being proved wrong by a
woman.
Doesn’t seem to matter what the subject is either. Take washing the dishes
as an example. I grew up in a country with hardly any water, so you learned
to be very frugal with water use. There are only two things which need to
happen when I’m washing dishes: firstly, the dishes need to be clean.
Secondly, I need to use as little water as possible. Actually, I find it
difficult to understand how any dispute can arise from such a tedious chore.
But here comes Andy (admittedly a few years back) trying to tell me to wash
up another way, saying ‘his way’ used less water. I mean, have you got
nothing better to do than to watch me wash up?
Anyway, the obvious answer was to put it to the test, which we did. And I
used less water. Then he said, “Yeah, OK but you break more plates your way”
and went into a pathetic sulk. I thought to myself, “That’s it, isn’t it?
Men just have to have things done their way”.
I have put that theory to the test a few times, just for fun. On those rare
occasions that Andy is allowed to watch football, I might throw in a remark
about such and such not being a very good player. He reacts immediately,
with something like, “What do you know about football?” Then he sees that I
can’t keep a straight face and he laughs.
We had a great discussion recently about ‘perceptions’. Andy came into the
house raving about some beautiful coloured shadow and insisted that I take a
look. At first I couldn’t see it, until I held up a piece of white paper
with a whole in it and looked at the shadow through it. Now, if you can
prove something to me, I’ll happily change my view. Can men say the same? If
you think about that colour in shadow thing, I suppose you could say that a
person’s ability to understand something, whether it’s an object, subject or
a situation, is limited by their education and their experience of it? Only
when they experience it for themselves or are clever enough to believe the
evidence of their own eyes, can they share another person’s understanding.
I think women are always inviting men to understand things in a different
and often richer way and that men’s reaction is often to resist, just
because we are women. That’s why they come to us all sheepish so often,
apologising for their behaviour and telling us we were right all along.
Then there’s the situation where a man and woman are discussing something
and the man suddenly claims that you’ve already had that conversation and
you both decided on something that you haven’t. He’s playing dirty now,
implying that your memory is going funny and usually tying this into his
idea that a woman can’t control her chemicals. If you want a discussion to
turn into an argument, men, this one will work every time.
Perhaps more worrying is when you do have a discussion about something and
then you both remember it differently. Then, one evening, the woman is
getting ready to go out and the man is surprised and says he had no idea
they were meant to be going anywhere. It’s all down to communication, I
suppose. But communication doesn’t always explain behaviour.
A discussion should involve consideration of a question or an issue with
both people giving their opinion. For it to become an argument something has
to disappear from the discussion and I think the thing which disappears is
called respect. As far as I can see, the most obvious signs of this
happening are someone interrupting you and not listening to what you are
saying. Listening is definitely a skill and it needs practising.
Sometimes, even when I’m not being interrupted, I wonder whether the person
I am talking to is really listening to what I am saying, or whether they are
just waiting for the opportunity to carry on from where they left off last
time they were talking. I’ve noticed that my husband is much better at
listening to other people than he is with me, or at least it seems that way.
Sometimes I wish he’d do me the same courtesy.
On the other hand, (maybe because he comes from a medical family) he has
lots of patience. But when he loses it, he loses it. But it takes a lot to
put him in that condition. He thinks he’s lost his Englishness and become
more Israeli and that I’ve done the opposite, that we’ve swapped cultural
pieces of each other. I don’t think I’ve become English at all. It’s true
that when we argue, it’s kind of passionate and “Mediterranean”, waving our
hands all over the place. Come to think of it, our discussions sometimes
sound like other people’s arguments.
They say in Israel that two people equal three opinions and it can seem like
that in our house. But when it’s all over and the dust has settled, the
important thing is that you make up. You say sorry if you need to say sorry
and you admit you were wrong when you were wrong. Or as I say to Andy,
“After twenty minutes we decide I was right!”
Next week: Motherhood
[email protected]
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