Almost a year ago I lost a long member which had invested millions in smaller cap Thai stocks. He started to panic on me in June/July 2009. I took the time to write him a long letter making the case that it would be a huge mistake to bail out now -because while Thailand has its problems and political issues all so well reported, it does not have the debt levels of the West! The public and private debt levels of the West is what is the real global trauma.
To no avail, Morgan Stanley in Hong talked him into it and ever since he trades ETF's with them, yes at good commission rates. Had he not bailed out his Thai port. of value shares then, it would be worth more then double today. I am sorry I was not more effective against those big boys whom always claim to know it better in the big cities.
Here below is how I dared to wrote the broker there today which regularly comes to Bangkok scaring big Thai investors/nationals to diversify out of Baht and Thai shares.
To Morgan Stanley, Hong Kong.
Hi Praf,
No doubt you are still making the rounds in Bangkok often, so trying to convince rich Thai's here how terrible things are in Thailand -and how they should buy EU's or invest in stale market performers ETF's?
I remember a year ago how your analyst there kept adamantly calling for a weaker Baht currency; yet just the opposite happened as its now for some time one of the strongest currencies in Asia. I guess fear sells best. But here its the performance what counts, in above average market returns -besides professional pride. If only big investors would judge me on that!
In the meantime the smaller cap value investing theme has continued with triple digit gains over the past 12 months in stocks which are among the least leveraged and have the highest dividens. And which have no exposure to tourism, really the only sector which took a short earnings hit here during the mid May political uprising.
Best Regards,
Paul Renaud.
PS. Below is a joke which is going around that boarders on being the nouvea Western reality.
MUST READ : U.S.A BUSINESS :
It is the month of August, on the shores of the Black Sea ..It is raining, and the little town looks totally deserted. It is tough times, everybody is in debt, and everybody lives on credit. Suddenly, a rich tourist comes to town. He enters the only hotel, lays a 100 Euro note on the reception counter, and goes to inspect the rooms upstairs in order to choose one.
The hotel proprietor takes the 100 Euro note and runs to pay his debt to the butcher. The butcher takes the 100 Euro note, and runs to pay his debt to the pig grower. The pig grower takes the 100 Euro note,and runs to pay his debt to the supplier of his feed and fuel. The supplier of feed and fuel takes the 100 Euro note and runs to pay his debt to the town's prostitute that in these hard times, gave her "services" on credit. The hooker runs to the hotel, and pays off her debt with the 100 Euro note to the hotel proprietor to pay for the rooms that she rented when she brought her clients there. The hotel proprietor then lays the 100 Euro note back on the counter so that the rich tourist will not suspect any thing. At that moment, the tourist comes down after inspecting the rooms, and takes his 100 Euro note, after saying that he did not like any of the rooms, and leaves town. No one earned anything. However, the whole town is now without debt,and looks to the future with a lot of optimism.....And that, ladies and gentlemen, is how the United States is doing business today!
--
Renaud & Associates Ltd.
Unbiased Thai Equity Research.
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Paul A. Renaud.
- from Morgan Stanley, USA - to over 20 years on location analyzing the Thai Stock Market.
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E-mail: paulren@thaistocks.com or, paularen@gmail.com
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