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As the title of this video suggests, we are discussing when 1 or 2 Baht makes a difference, only an idiot would want inflation. What are we talking about here? 

Look some time ago, I remember reading about how the inflation of 1 to 2 Baht - this was in a different article, I was just reading it - and I sort of retained the information, that they said that the cost of Ramen here in Thailand on the street, street level, street food is very important, especially here in Bangkok. Office workers, folks in the trades, basically all the Thais, not to say everybody, but a large cross-section of folks here in Thailand eat street food especially here in the city, and especially people who work in the city, at least one meal a day, street food is integral if you will, to living in the city. I mean I had street food this morning for breakfast - I had Khao Moo Krob - so I mean this is just something people are intimately aware of. And look, the fact of the matter is notwithstanding the fact that Thailand is probably doing better than many other nations here in Southeast Asia, the yearly salary for most folks that work in Thailand, the yearly wage for the vast majority folks of Thailand is quite insubstantial compared to the West. 

Meanwhile though we also have a very sophisticated economy as well. There is a growing middle class; I'm not saying everyone is somehow destitute or anything of that nature. That being said, there is a disproportionate amount of pain if you will, felt by the lower economic strata of Thai society from inflation, especially when one or two Baht in terms of Ramen costs, really makes a difference for you. Anybody who would want any kind of inflation in that environment, I have got to question their sanity. 

I was thinking of this when I was reading a recent article from the Bangkok Post, bangkokpost.com, the article is titled: Cabinet demands Baht rate cut today. I love this. There's this back and forth between the Cabinet and the Bank of Thailand and I found myself over here in Thailand in a similar position to where I found myself for quite a number of years and even maybe now, although I think things are shifting in the United States, where I have sort of been on Jerome Powell's side of all people; I was sort of on the side of the Fed who seemed to be wanting to correct it to sort of a sound monetary policy and honestly, sound fiscal policy quite frankly as Powell has brought up the fact that it is the deficits in the United States that are the real problem. Swerving back here to Thailand, again there's this push especially from the current "Core Coalition Party" so-called, that one, they are trying to push this narrative that we have got all sorts of economic problems that demand that we do all sorts of Keynesian stuff - basically print money - to solve it. Now last year and before, well not even '24, if you go back into '23 for the bulk of that year going into '24 for the bulk of that year, they tried to push the "oh we're in a disaster, we need digital money. Give us a trillion Baht, okay maybe a half a trillion Baht and we'll do this magical rain dance or something and then these magical beans are worth something, but you're in debt for half a trillion, but we give you magical bean money and it can't be spent everywhere, it has parameters on what you can buy, it can be turned on and off, but you're still in debt for real money, but you get this fake money" and it was all based on this narrative that we are in a disaster. This Keynesianism nonsense is the same. All of this notion, "we need to cut, lower rates, basically just having a have a less sound monetary policy, weaken our own currency in order to stay competitive in the international markets". Well here's the problem. The season changed. We're not in the post-Bretton Woods system; we are not even in the post-Petrodollar system from Nixon. We are in some kind of weird limbo we really haven't seen since the Louvre and Paris Accord some years ago and I would even argue we are really in a situation that the world hasn't seen since the USSR came apart in 1991. I view this purely from an economic if you will trade capital transfer mechanism perspective. I'm not out here being Chicken Little saying the whole system is going to come apart. I don't think it is. I don't even think the banking system is going to come apart. I think it's going to change dramatically because the fact of the matter is, the West has not produced nearly at the pace with which they consume from the East and that trade and balance is going to rectify; that's just a fact of economics, it's inevitable okay. But the point I'm trying to bring up is, Thailand needs to be on a different course than she would have normally been on for roughly the last hundred years based on the geo-economic situation as it is.

On top of that, we seem to have this "Core Coalition Party" that seems hell-bent on telling us we are in a disaster to put us in a financially detrimental situation that would seem to benefit those that perhaps have interests or connections with the so-called Core Coalition Party. I don't know, but at the end of the day, I do know trading half a trillion Baht for a bunch of “Digital "magic beans" is not good practice, just as a matter of course. Now the BoT is saying oh there's a big fight that they are saying we are in a disaster; we need to loosen up our monetary policy at precisely a time where in my opinion, we should not be doing that at all. We should be keeping dry powder; we should be staying vigilant; we should be staying conservative internationally to not be out running around half-cocked. The era of "beggar thy neighbour" from a currency standpoint is largely over. And by the way, those who are sitting around saying well the dollar is the cleanest dirty shirt and all of this stuff. Well one, there are new systems; there are parallel systems. There's mBridge, BRICS is doing their stuff, there's new protocols everywhere. BIMSTEC is out there, we have talked about that system Cisco has; we have talked about the CIPS system, C-I-P-S. Again, there are multiple different protocols that are being rolled out. It's not a different currency per se, it's just there are different options if you will in the world. The world is changing and my point in this is perhaps this is not the time to pursue these wild money printing theories and go off on this tangent of sort of an orgy of debauching the currency at a time when we really should be vigilant and conservative, to try and figure out what the best move next is for Thailand's national interest. 

That said, quoting directly: "The Cabinet has sent a letter to the Bank of Thailand urging a cut in interest rates to help ensure inflation stays within the targeted range," but here's the funny part. From their perspective, they want inflation to rise into that targeted range. And first of all, I've never agreed with this notion that BoT or any Central Bank sets a targeted inflation rate. Inflation is by definition theft. It is taxation by other means and it's by subterfuge, so people don't know the value they're losing, the taxes that they're effectively paying as they're paying them. So the notion that there is any type of “target inflation rate”, it's like saying there's a "target theft rate" out there. But meanwhile, okay set that aside and say okay if you understand banking, inflation can be good. From a banker's perspective that might be true, but here's the thing. Okay, do we want to raise inflation on the lowest strata of society even if it is a good thing from a banking standpoint." Quoting further: "Speaking after the weekly Cabinet meeting on Tuesday, Deputy Finance Minister Paopoom Rojanasakul said the Cabinet resolved to send a letter to the Central Bank ahead of Wednesday's Monetary Policy Committee meeting." He said the letter focused on the Cabinet's concern that the inflation rate would dip below the target range of 1-3%." So the Finance Minister, excuse me, the Deputy Finance Minister of Thailand is concerned inflation is too low, and this person is supposedly from the "Core Coalition Party" who cares so much about "populism". Now in a country where 1 to 2 Baht for Ramen makes a difference, what kind of person thinks it's a good idea to raise inflation when it's trending downward? And meanwhile for anybody that ever thinks it through, deflation for the average man is a good thing. What if production increased to Ramen and it cost a Baht less to get Ramen tomorrow for every Thai in Thailand, that would be a boon to many people at the lower end of the socioeconomic strata. I know it's hard to understand where those people are coming from when you are in your high Ivory Tower at the Finance Ministry. And it's difficult for me to understand where anyone's coming from that a Baht or 2 for Ramen makes their difference, but if it does, you need to think about that for a minute. What kind of person thinks it's a good idea to raise inflation on those folks? What kind of populism is that? That said, quoting further: "Thailand’s headline inflation rate has been persistently low for an extended period, with a rate averaging 0.4% last year, the lowest level in four years." Wouldn't that be something to be celebrating? They want to impose more inflation on people that for the last 4 years have had their livelihoods completely taken from them as a result of Government Policy that was a result of nonsense, that was flouted about by a Communist at the World Health Organization. This is the policies that we are going to pursue here after 4 years and a miracle here in Thailand; the folks that were actually operating here during that time managed to get inflation lower and the Government's idea is, let's jack that back up. What a brilliant plan!