It’s been in the news that the THB continues to strengthen versus the USD and people are going on and on how this is negative for exports (agreed) bad for the economy (yes GDP #’s will look weak because of the weight of exports, but longer term I’m not sure) and how the country will fall apart if the currency doesn’t weaken.

And here’s the short term chart that has everyone worried.

I wonder

  1. Isn’t it a positive that country’s money gets stronger relative to others?
  2. Shouldn’t a country focus on continuing to improve its fundamentals which allows the holders of its currency to benefit?
  3. I would be rather pi$$ed to be a local in Malaysia given how their wealth has devalued relative to other countries.

Then I always like to point to this chart, it’s still far away from the 25 level (yes I know that was a peg). But I’ve long argued that I wouldn’t be surprised to see the THB reach 25 again in my lifetime.

  1. Now 21.4 to AUD but in 1993 was 16/17.
    Could approach this again.
    Yes, people and those in Finance markets. have short term memories
    Baht and other SEA will also be influenced if Chinese currency has big moves

    • I have often wondered, could global manufacturing shift back to Europe/US for low cost labour as Asia continues to get wealthier on a relative basis and those continents become viewed as low cost manufacturing.

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