Prices are 'rising' only for spendthrifts
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Re: "If deflation is looming, why are prices still rising?", Letters, June 11, and "Debt-ridden Thailand being sucked into whirlpool of deflation", Overdrive, June 5.
I disagree with the claim that prices are rising. They are stable in some areas, falling in others. There are three reasons for this.
Energy: I recall paying Bt40-Bt50/litre for Benzene 91/95, just three or four quarters ago. Now bio-fuels and the energy market glut mean that reasonably cheap energy is here to stay, for the near term certainly. Housing: The glut in many property markets, including in Thailand, means residential rates are staying flat in the medium range/budget market. I work in the property-rental business and quality apartments and flats are very affordable and abundant as the oversupply reaps gains for renters/buyers while hurting investors and wealthier sellers/landlords.
Food: Thailand is a food bargain-basement paradise. Sure, if you have meals delivered or eat fast food from multinational chains, or eat at the cinema or in the major malls and hotels, it’s going to cost you dearly compared to the lower-priced hypermarkets and local sellers.
The euro is in the dumps, not the dollar, so comparing the Thai economy via the euro isn’t rational. Just read the latest EU/ECB Greek-drama news to see where that one is heading, with the Europeans on the verge of their second recent major recession in lieu of a turnaround. You’re just speaking anecdotally. Villagers need financial-management education. Most Thai households are neck-deep in debt. Welcome to the new normal.
Niels Jeffreys
