Wednesday, November 4, 2009

Move to more serious topic

First I would like to talk the “Triumph” case ( from KrungThep Turakit). It’s very tedious and very usual case, like other 100 or 1000 cases before but now we have a better evolution. Let’s brief, the case is about the outsourcing business from Europe/USA and use the cheap labor in Thailand to be the based for the manufacture. But because of the outnumbered of cheap labor in China in the globalization era, the parent company decided to move the industrialized part to the cheapest-labor country. It’s the truth that we would like to accept. In addition to the law of economic, the owner of the outsourcing company in Thailand also neglect how to protect the employee. THEY SIMPLY CLOSE THE COMPANY AND GET AWAY.

It is almost 1 week since the last update. Today I will take about 3 stuffs. Let’s cut through the point because I have in a bad mood.

It’s very easy solution for the owner. Once in Thai motto says “The rich people fall on the cotton bed”. However, it’s very pity that “the poor people fall on the concrete or even some people feel like they fall from the roof”. As I said the better transformation is they have their own brand, “Try Arm”. To tell you the truth, it sound funny at the first time that I heard it. It’s also sound like the second or third grade brand. Though, it’ not the point that I would like to present. I would like to illustrate that even though the brand look simple, ridiculous, and funny, it is the first small step that Thai society should make - build our own brand and if we don’t we will still be the economy slave for the foreign companies forever. Actually, I personally don’t hate the foreigner ;-).

Long Term "Rough Rice" prices

Medium Term "Rough Rice" prices

Let’s move to the second issue which is about the price of the “Rough Rice” – Kao Ploug. I have some experience in trading in the commodities market such as Rubber, Rice, and Gold. Usually the trend of the whole commodities market move in the same way. This mean if gold goes up, silver goes up, rice goes up, and oil goes up. However, this is just my assumption and if you want to know exactly, you have to build the correlation of each asset in the matrix. To be more deeper details, the commodities prices are inverse with the Dollar price (Dollar index which is the dollar basket – www. If the dollar still depreciates (Thai baht appreciate – Bath Stronger), this will make the commodities prices edge higher. Let’s think this way, I am a rich man and have USD100. I don’t want my money to lose value due to the currency rate. I have to do something. I have to put my money somewhere or investing in some products which can preserve my money at least. There are many ways such as converting in to Australian dollar, Chinese Yuan, and New Zealand Dollar or keeping in term of gold, silver, rice, and oil. This is one of the reason that the commodities prices have the strong outlook. Let’s look at the pictures – Gold/Rice/Dollar. I think it’s a full of text I will put the third issue that I would like to make a point next time. Good luck. ;-)

Long Term Gold Prices

Long Term Dollar Index

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