• 25 Apr 2008 at 2:21 PM

I’m Just Eating Rice In An Equity Traders’ Paradise

Traders in Thailand may be about to receive some much needed tax relief. Speaking to a conference of economics reporters in Bangkok, Thai finance minister Suapong Subwonglee (I’m sorry, that’s what names are like here) said the government is considering waiving capital gains taxes for bond traders. this tax exemption is already enjoyed by equity traders, and the differential tax treatment creates exactly the kind of market distortions you would expect. The sting of capital gains taxes for debt trading is being felt even more now that we’ve got a global credit crunch under way.
The proposed reform has its critics, of course. Some worry the move might encourage irresponsible debt trading, perhaps triggering the kind of losses seen in US and European investment banks. Thai banks have largely avoided these losses, save for some CDO missteps.
What’s more, this is Thailand and that means there are religious implications to the timing of everything. Some have said the timing of this tax change is particularly inauspicious. Astrologers have been cited in the major daily papers, and there is talk of the “dark god” Rahu.
Most of this kind of economics–if that’s what it is–is beyond me. But then again, in the US Democrats seem to spend more time talking about trade policies in churches than Thai politicians do in temples. Does Jesus care more about economics than Buddha?

–John Carney, DealBreaker’s editor in chief, is enjoying his vacation in Thailand despite the evidence to the contrary provided by all these posts.

  • 23 Apr 2008 at 11:46 AM

Rice Price Shock: Just Think Happy Thoughts!

Just because you are very far from Wall Street doesn’t mean the pie is no longer situation in the sky. Just a day after Vietnam shocked this part of the world with record setting prices for kind-of-crappy rice, traders and analysts began spreading the word that rice prices are bound to come back down to earth once those damned little Philipinos have bought their share.
Rice futures don’t care, however, and continue to rise based on fears that exporting countries may impose curbs to keep domestic supplies high and prices low. Governments all across South East Asia fear the popular backlash from high domestic rice rpices. China already has quotas in place, as do Egypt, Vietnam and India. Thailand could be next.
Some savvy investors say global food trends–corn being turned into fuel, for instance–are driving up demand for rice. As other grains and carb sources are chewed up by the green revolution, the world may increasingly turn to rice (already the most popular food on the planet). More corn in the gas tank means less rice in the curry.
Related: Sam’s Club limiting sales of rice [Reuters]
–John Carney is eating all the rice he can.