Thailand History

Back to Expanded History

The money and capital markets were still underdeveloped in the mid-1980s. One striking fact was that the money market was very rudimentary and there was practically no open market for short-term securities; the only investors in treasury bills and government bonds were commercial banks and a few other financial institutions, which had to hold them until maturity. Certificates of deposits did not exist, and, for all intents and purposes, promissory notes issued by the finance companies were nonnegotiable. In order to increase the liquidity aspect of government bonds, in April 1979 the Bank of Thailand established the government bond repurchase market. In reality this was only a brokerage window at the central bank for institutional investors and, therefore, did not help to achieve the desired objective of open-market operation. Thus, Thai interest rates were determined, to a significant degree, by international forces rather than central bank sales and purchases of government securities.

The Security Exchange of Thailand (SET) had combined the functions of securities market and securities commission, providing the legal framework for underwriting and trading of corporation shares of common stocks and bonds as well as government securities. In 1974 the SET assumed the functions of the Bangkok Stock Exchange, which never had been very active. In 1976 the SET had an upsurge because of expansionary monetary policy. In 1978 the SET collapsed, however, because of massive speculation, easy margin finance of up to 70 percent of a transaction, unpreparedness and inexperience of the brokers as well as the investors, and inadequate regulation and supervision of the market and such activities as inside trading and manipulation. The government created at that time two special public funds to purchase securities in order to limit the negative effects of price swings in the SET. Many investors, however, held on to their investments that had declined in value in order to wait for a better price, thus decreasing normal stock market activity. The hesitation to trade in the market created a surplus problem for the SET, further damaging investor confidence. Some economists suggested that more specific regulations and supervisory systems were needed in order to revive the SET and restore public confidence.

Back to Thailand History

All Countries
Afghanistan Akrotiri Albania Algeria American Samoa Andorra Angola Anguilla Antarctica Antigua and Barbuda Argentina Armenia Aruba Australia Austria Azerbaijan Bahamas Bahrain Bangladesh Barbados Belarus Belgium Belize Benin Bermuda Bhutan Bolivia Bosnia and Herzegovina Botswana Brazil British Indian Ocean Territory British Virgin Islands Brunei Bulgaria Burkina Faso Burma Burundi Cabo Verde Cambodia Cameroon Canada Cayman Islands Central African Republic Chad Chile China Christmas Island Clipperton Island Cocos (Keeling) Islands Colombia Comoros Congo, Democratic Republic of the Congo, Republic of the Cook Islands Coral Sea Islands Costa Rica Cote d’Ivoire Croatia Cuba Curacao Cyprus Czech Republic Denmark Dhekelia Djibouti Dominica Dominican Republic Ecuador Egypt El Salvador Equatorial Guinea Eritrea Estonia Eswatini Ethiopia Falkland Islands Faroe Islands Fiji Finland France French Guiana French Polynesia Gabon Gambia, The Gaza Strip Georgia Germany Ghana Gibraltar Greece Greenland Grenada Guadeloupe Guam Guatemala Guernsey Guinea Guinea-Bissau Guyana Haiti Holy See Honduras Hong Kong Hungary Iceland India Indonesia Iran Iraq Ireland Isle of Man Israel Italy Jamaica Jan Mayen Japan Jersey Jordan Kazakhstan Kenya Kiribati Korea, North Korea, South Kosovo Kuwait Kyrgyzstan Laos Latvia Lebanon Lesotho Liberia Libya Liechtenstein Lithuania Luxembourg Macau Macedonia Madagascar Malawi Malaysia Maldives Mali Malta Marshall Islands Martinique Mauritania Mauritius Mayotte Mexico Micronesia Moldova Monaco Mongolia Montenegro Montserrat Morocco Mozambique Namibia Nauru Nepal Netherlands New Caledonia New Zealand Nicaragua Niger Nigeria Niue Norfolk Island Northern Mariana Islands Norway Oman Pakistan Palau Panama Papua New Guinea Paraguay Peru Philippines Pitcairn Islands Poland Portugal Puerto Rico Qatar Reunion Romania Russia Rwanda Saint Helena, Ascension, and Tristan da Cunha Saint Kitts and Nevis Saint Lucia Saint Pierre and Miquelon Saint Vincent and the Grenadines Samoa San Marino Sao Tome and Principe Saudi Arabia Senegal Serbia Seychelles Sierra Leone Singapore Slovakia Slovenia Solomon Islands Somalia South Africa Spain Sri Lanka Sudan Sudan, South Suriname Svalbard Sweden Switzerland Syria Taiwan Tajikistan Tanzania Thailand Timor-Leste Togo Tokelau Tonga Trinidad and Tobago Tunisia Turkey Turkmenistan Turks and Caicos Islands Tuvalu Uganda Ukraine United Arab Emirates United Kingdom United States (US) Uruguay Uzbekistan Vanuatu Venezuela Vietnam Virgin Islands Wake Island Wallis and Futuna West Bank Western Sahara World Yemen Zambia Zimbabwe