[Vnbiz] Vietnam's position on economic issues
Craig Stevenson
cstevenson2000 at gmail.com
Mon Jun 9 04:44:43 PDT 2008
Gold down slightly, SBV rate holding at Gold shops.
On Sun, Jun 8, 2008 at 12:52 PM, Shane Wall <
shane.wall at translingualexpress.com> wrote:
> [ Vietnam Business Forum ]
>
> Anh Craig,
> It seems to be a 'taboo' to talk about the "herd mentality" here
> nowadays! Rumor, speculation and opportunistic behavior are rampant now.
> To say otherwise is to ignore reality.
>
> I joined the throngs. But I sold my 1.9 taels of gold ... and used
> the proceeds to help fund some more rice paddy acquisitions and land
> improvements for my wife and son's long-term future. Given the most
> recent issues about food security and all the macro-measures that
> different Governments have taken on the international level, the actual
> land was cheaper than it was 6 months ago. And it's good dirt too!!!
>
> Of course I am not complaining about the current situation ... it
> suits me perfectly because I am looking at a 10-15 or 20 year
> time-frame. All those "short-term" gain chasers are now losing their
> shirts ... and helping me pay for my wife and son's future. I like this
> "free-market" stuff! :-)
>
> Shane
> ----------------------------------------------------------------------
> Mr. Shane Wall
> Managing Director
>
> Trans Lingual Express
> 188/16 Nguyen Thuong Hien St,
> P.1, Q. Go Vap, HCMC,
> Vietnam
>
> Mail: shane.wall at translingualexpress.com
> Web: www.translingualexpress.com
>
> Ph: +84 (8) 588 1701
>
> Mbl: +84 (090) 9484 753 (English)
> Mbl: +84 (090) 7885 375 (Vietnamese)
>
>
>
> Craig Stevenson wrote:
> > [ Vietnam Business Forum ]
> >
> >
> >
> > ------------------------------------------------------------------------
> >
> > Very openly, on Thursday they offered between 18,000 and 18,500, even
> > at those rates, buying Gold just seemed terribly expensive. On
> > Friday, 16,200. We all know that the Mafia, government officials, and
> > powerful people can do pretty much what they want everywhere around
> > the world, and, of course, Vietnam is no exception, but for common
> > folk, such as me, the rate was 16,200 at Gold shops and they were out
> > of dollars, and I had dollars, but I was trying to buy a necklace and
> > at those prices, the price was just too much.
> >
> > A tael = 37.5 grams
> > An ounce on the gold market worldwide = 31.1 grams (normal ounce 28.4
> > grams)
> >
> > Nearing 19,000,000 a tael, and we have a significant, 10% or more,
> > rate above, already exorbitant, worldwide gold prices, too rich for my
> > blood, at least my taste.
> >
> > I figure I'll wait it out. As everyone else should. Hopefully,
> > short term excess leads to better choices among the people (ie less
> > Chinese imports) and no borrowing for speculation (either Real Estate
> > or Stock Market) and better allocation of capital (for what purpose
> > would oil companies and banks run resorts and high-rise developments,
> > and how could they compete with world-class hoteliers and property
> > managers, they can't, why bother, but to solidify the wealth, power,
> > and position of select groupings of elites. Hopefully the economy
> > gets better at allocating capital and becomes less dependent upon
> > feeding a consumptive frenzy among some groups of people. It amazes
> > me that the guys and girls who serve me Pho have nicer cell-phones
> > than I do, how could that be, it is a dangerous push toward
> > consumption, and an emphasis of image before substance, sorry, but it
> > is a precious waste of resources.
> >
> > Craig
> >
> > On Sun, Jun 8, 2008 at 9:12 AM, Tran Dinh Hoanh <tdhoanh at gmail.com
> > <mailto:tdhoanh at gmail.com>> wrote:
> >
> > [ Vietnam Business Forum ]
> >
> >
> > Dear Craig & CACC,
> >
> > I am glad you say "it seems," Craig. Of course, everything must
> > "seem" to look official. I imagine you will never see a sign with
> > the free market rate anywhere in Vietnam (except probably in some
> > small ares of the country where no one knows who the SBV is and no
> > one cares about what the SBV says). All the signs at all the
> > exchange places have the official rate (That is how the rate is
> > OFFICIAL!).
> >
> > (The daily rate shown on VNExpress is always the official rate,
> > which of course gives me very little news value. The only way I
> > know the free market rate is that once in awhile, VNExpress has an
> > article on the exchange rate. Other than that, most of the time,
> > I am blinded on this matter).
> >
> > If you want to sell your USD at the gold shop at the offical rate,
> > the shop is happy. Buying at the official rate is a diffdrent
> > thing though. Chances are the answer is "Sorry, we're out of USD
> > already. Want some gold instead, sir?"
> >
> > When government really enforces the official rates, only regulars
> > in the "market network" are able to do business with each other at
> > the free market rate. If at the gold shop, then it is in the back
> > of the shop, not the front. However, where government may harass,
> > most of the free market exchanges are not at the shops, but at
> > more private locations.
> >
> > As a matter of terminilogy, there is a recent noticebale change.
> > Since the beginning of time, it has always been "black market
> > rate" (gia cho den). But very recently, probably within several
> > weeks or several months, the new term pops up on the media--"gia
> > tu do" (free price) or "gia do la tren thi truong tu do" (the USD
> > price on the free market). This could be a subtle sign of a very
> > significant change in policy. Probably the "black market" was
> > slowly allowed to become (legally tolerated) free market.
> >
> > I think the SBV now is trying to reverse its own (quiet) policy,
> > which, I repeat, is not very wise move. I think the SBV shoul
> > just let the market work and utilize the exchange rate to push
> > export. If it wants it can use the offical rate to help import
> > and to withdraw some VND circulation to reduce inflation pressure,
> > until it runs out of USD to do that, then it can simply let the
> > market take over. Holding the VND too high against the USD not
> > only distorts the economy so much (which makes more difficult the
> > planning for all other things like export, import, price controls,
> > inflation control, etc.) but also greatly increases the chance for
> > speculative currency attacks from international players. Don't
> > give them the reason to form a wolf pack.
> >
> > Have a great day!
> >
> > Hoanh
> >
> > On Sun, Jun 8, 2008 at 2:52 AM, Craig Stevenson
> > <cstevenson2000 at gmail.com <mailto:cstevenson2000 at gmail.com>> wrote:
> >
> > [ Vietnam Business Forum ]
> >
> >
> > FYI, at least yesterday, it seems that the Gold Shops, at
> > least in Hanoi, were trading at official SBV rate, VND to USD.
> >
> > And Gold is way to high....
> >
> > Craig
> >
> > --
> > Tran Dinh Hoanh, Esq., LLB, JD
> > Washington DC
> >
> >
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