Chapter 900 The Situation in Thailand

"We'll wait, it's not suitable to enter the market for the time being." Fu Rongqi made a decision.

"Why?" Fu Guangzheng was puzzled.

"Because the Thai government hasn't intervened yet. When the Thai government takes action, there will inevitably be another battle between dragons and tigers. The government of a country will not have nothing to do." Fu Rongqi began to teach Fu Guangzheng his experience.

"Then we wait now?"

"Yes, wait."

After waiting for more than a month, the Thai government really intervened and pulled back the exchange rate that had fallen a bit. It was already the beginning of May, and Feng Yu had already returned to Xiangjiang. Naturally, Kirilenko followed.

"Feng, how long do we have to wait?" Kirilenko's patience is limited. It has been more than a month. They have lost hundreds of millions of dollars, and the exchange rate of Thai baht is only 25:1. The money they have earned is not enough. It pays a lot. Fortunately, Thailand's stock market is still slowly falling. If their stock index futures are delivered, most of the shortfall of 22 will be filled.

"When Soros and the others can't help it, he will take the initiative to contact us. Only by selling the Thai baht on a large scale at the same time can we suppress the Thai baht with a thunderbolt." Feng Yu is very calm, if it is as Kirilenko thinks Simple, there are more than that for foreign exchange funds.

"But why did you start shorting Malaysian ringgit again?" Kirilenko couldn't figure it out. Why did you start dabbling in the markets of other countries without suppressing the currency of one country? ?

"You must not know that the country with the most frequent trade with Thailand is Malaysia. The debts between the two countries are very large and complicated. When Thailand's economy encounters serious problems, Malaysia's economy will inevitably be affected."

The reason why history calls this Asian financial turmoil is because the economic models of East Asian countries were similar at that time, and the trade exchanges between them were frequent, forming a complete chain.

When a certain link is broken, the entire chain is broken, and these interconnected countries will be damaged to a certain extent, and then it will be much easier to suppress.

Kirilenko nodded half-understood. Anyway, he saw that he was losing money every day. If it wasn't for the futures contract, he would have asked for withdrawal. Without Feng Yu, Kirilenko would not have attacked Thailand even if Soros had invited him. The country's economy looks very good.

How rich is Thailand now? The per capita GDP exceeds 3,000 US dollars, which is many times that of China. It seems that there is a prototype of a developed country, right?

But strangely,

Thailand's per capita debt exceeds US$1,500, which means that Thailand's overall debt ratio exceeds 50%.

Thailand's economic development is inseparable from foreign investment and the export of domestic manufacturing. The export of domestic manufacturing accounts for more than 42% of GDP. This is a considerable proportion and an absolute pillar industry.

This ratio is reflected in many countries in Southeast Asia that are close to the sea. After all, sea freight is the most mainstream mode of international transportation.

The second point is that Thailand's real estate industry is very prosperous, and it is also their second pillar industry. Among them, foreign investment accounts for a large proportion. Luxury hotels and office buildings have sprung up, and holiday villas and golf courses are constantly being built.

In Bangkok alone, there are two international conference centers and four international conference centers under construction. The number of hospital beds is more than three times the actual need. Real estate speculation has become a shortcut to get rich quickly and insurance.

But there is a huge hidden danger, that is, the vacancy rate of houses is extremely high, exceeding 20%. In other words, so many houses were built not for living or need, but for speculation.

This model is very similar to the economy of the United States and the island countries in the late 1980s. With real estate and exports as the pillar industries, a false prosperity and a real estate bubble will quickly form.

It is worth mentioning that among the foreign investment in real estate speculation in Thailand, island countries account for a huge proportion, or in other words, investment in island countries occupies a huge proportion in the whole of Asia.

When the US real estate collapsed, the disaster was transferred to the island country, and then the US developed rapidly again through high-tech, and the real estate has also recovered. But the island country’s real estate has not yet recovered, but smart island country businessmen have also found a good way, that is, in other countries in Southeast Asia, copy the illusion of the former real estate glory, and then they can make money from it.

This time they have learned how to behave. As long as they retreat when the real estate is at its peak, they can make a lot of money, and then throw the mess to the governments of those countries. In this way, they not only made money, but also hit the economies of other countries, ensuring the status of the island country as the economic leader in Asia.

Another interesting point is that Thailand's financial liberalization, in order to promote the development of the capital market, canceled the securities transaction tax, reduced the company's dividend tax, and even provided financial support to securities companies.

Interest rate restrictions were abolished, interest rates were marketized, and the short-term lending market developed rapidly. Foreign exchange is open to the outside world, and the upper limit of foreign exchange remittance by foreign investors is US$500,000, which makes Thailand's foreign exchange reserves seriously insufficient.

Perhaps seeing the benefits of the development of the financial industry in other countries, Thailand has opened up offshore financial services. Thailand's 50 commercial banks, including 35 foreign-funded banks, have obtained deposits and loans from abroad, and then in Eligibility for Thai and foreign loans in foreign currency.

This also makes it easy for Soros and Feng Yu to borrow Thai baht.

Of course, it is also very important that Thailand allows non-residents to open Thai baht accounts in commercial banks in Thailand, make deposits and borrow money, and can freely convert them. Thailand's capital projects have basically been liberalized.

In this way, in the short term, a large amount of foreign capital inflows can be obtained, which will allow the country's economy to develop rapidly. May also give the financial crisis, planted a major hidden danger.

For example, they do not control the scale of foreign debt of financial institutions, and the supervision of financial institutions is in name only. Domestic stocks and bonds are completely open to the outside world, giving international speculators great opportunities.

Then there are no restrictions on their foreign investment, and they are even very welcome, thinking that this is the prosperity of their own economy.

Enterprises can borrow externally, and the scale of external debt is huge. Their national debt ratio exceeds 50% of GDP, which is a good illustration of the problem. It seems that the company is developing well and its assets have increased gratifyingly, but it has not been taken into account. After excluding the money owed to others, it is still a loss!

And the country that owes the most foreign debts to Thailand is the island country. The island country is also the country that has opened the most banks in Thailand and even in the entire East Asia. The island country's investment in Thailand has already exceeded 10 billion US dollars.

In fact, even if Soros and the others do not attack Thailand, then Thailand's economy will not survive the millennium. When the island country withdraws from the real estate and financial industries, it will bring economic collapse to Thailand.

... (To be continued.)