Connect with us


Phuket Investor: Excuse me, what is QE3?



PHUKET: Being a regular on the sun soaked shores of Phuket, watching the many boats sail by on a frequent basis, one may start thinking that QE3 is a new luxury cruise liner replacing the old QE2 that was recently decommissioned.

Not the case. In the never ending roller-coaster ride that is the world of finance, this is the latest brain child that, it is hoped, will start to shore up the world economy and give the markets the stability they long for.

It is worth revisiting what QE actually is. Quantitative Easing (or QE for short) is essentially a form of pumping money back into a faltering economy to try to boost spending and lending.

This may sound all well and good; however, with every plus side there is a downside. If we look at one country’s currency strength, the more in demand it is, the harder it is to “get your hands on”, and the more valuable it becomes.

In the case of Quantitative Easing, if you are putting money back into the economy, albeit through purchasing bonds, the new QE3 will look towards purchasing mortgage backed securities and you are in essence increasing the amount of funds available to the economy, which means that they become easier to get. Get where I am going with this?

Indeed the value of the asset will decrease. As QE3 would suggest, this is the third time this course of action has been taken, which has given the markets the injection they needed and also given investors more confidence that governments will do whatever it takes to get markets up and running once again. So, what will the fallout from this be? And, how would you potentially be able to profit from it?

Well firstly, with the FED in the US saying it would “buy US$40 billion of mortgage backed debts per month”, a fund or investment into mortgage backed securities could be a wise move. An example of one fund, for instance, is the Doubleline Total Return Bond Fund (DLTNX). This fund invests in mortgage backed securities and while it is not renowned for capital growth it has a very attractive 7.36% dividend payment, which in my book is not too bad and could be well worth a look.

Another repercussion of the QE3 will no doubt be the weakening of the US Dollar, this in itself presents an opportunity to invest in areas such as gold, as with a weakening US Dollar this has become something of an investor’s safe haven.

The price of gold is high but you can expect it to climb a little further with this news. QE3 is sure to prop up the markets for the short term. But in the future, is this the solution? I am not too sure. However, as said earlier, it now seems that there is a common consensus that whatever needs to be done will be done and this can only be good for markets on the whole, and for your portfolios in general.

The old problems still remain, so will Europe remain intact? And, with more money pumped into the US economy, there will also follow inflation fears, but as an investor myself I still believe that the future is looking brighter than it was 12 months ago and there are still profits to be made by making the right investment decisions. For portfolios based in USD, maybe an investment in gold could be a good hedge against what will probably be an impending weakening in the US Dollar.

This article was written by Anthony Lyman, senior financial consultant for the Montpelier Group. For any investment advice or questions, please contact

— Anthony Lyman


Get more from The Thaiger

Join the conversation and have your say on Thailand news published on The Thaiger.

Thaiger Talk is our new Thaiger Community where you can join the discussion on everything happening in Thailand right now.

Please note that articles are not posted to the forum instantly and can take up to 20 min before being visible. Click for more information and the Thaiger Talk Guidelines.

Archiving articles from the Phuket Gazette circa 1998 - 2017. View the Phuket Gazette online archive and Digital Gazette PDF Prints.

Follow Thaiger by email:

Press Room12 hours ago

Best island boat tours from Phuket – must-visit islands and unforgettable experiences you should not miss out on

Thailand13 hours ago

Thailand News Today | Foreigners anger Chiang Mai locals for kissing in temple

World13 hours ago

Former Coventry footballer seriously ill in Thai hospital

Crime14 hours ago

Weapons used by jealous Thai man to murder and chop up lover found

Guides14 hours ago

Foodie Zone: Should you try Keto diet? 2022

Chiang Mai14 hours ago

River in Chiang Mai overflows, floods spread

Join the conversation on the Thaiger Talk forums today!
Thailand14 hours ago

3-year jail term for carrying crops, fruit & veg into Japan

Thailand15 hours ago

Bank repossesses the wrong house in central Thailand

Thailand15 hours ago

Innocent man jailed 7 months for 15.8 million baht theft demands justice

Weather15 hours ago

Thailand’s cold season expected to hit in late October

Thailand16 hours ago

ฺThai boxer blackmails 20 women into sending nude pics

World16 hours ago

South Korea gives North Korea a warning

Visa16 hours ago

Philippines offers attractive alternative to Thailand’s 10 year LTR visa

Phuket17 hours ago

Thousands join Chinese ceremony at Phuket Vegetarian Festival

Coronavirus (Covid-19)17 hours ago

Bang Sue’s Central Vaccination Centre officially closed

Thailand1 year ago

Morning Top Stories Thailand | Police to end protests, Human Trafficking | September 14

Thailand2 years ago

Thailand News Today | Thai Airways in rehab, All go for Songkran | March 4

Tourism2 years ago

Phuket’s nightlife. Yes, bars and clubs are still open | VIDEO

Phuket2 years ago

Thailand News Today | Covid passport talks, Thai Airways heads to court | March 2

Tourism2 years ago

Phuket Thai food treats you need to try | VIDEO

Thailand2 years ago

Thailand News Today | Bars, pubs and restaurants ‘sort of’ back to normal | Feb 23

Tourism2 years ago

In search of Cat & Dog Cafés in Phuket Town | VIDEO

Thailand2 years ago

Thailand News Today | Gambling crackdown, Seafood market to reopen, Vlogger challenge | Jan 21

Thailand2 years ago

Thailand News Today | Covid testing for visas, Business impact, Vaccine approval | January 19

Thailand2 years ago

Thailand News Today | Weekend Bangkok bombs, Thailand fires, Covid update | January 18

Thailand2 years ago

Thailand News Today | Stray car on runway, Indonesian quake, 300 baht tourist fee | January 15

Thailand2 years ago

Thailand News Today | Governor off respirator, sex-trafficking arrest, condo prices falling | January 14

Thailand2 years ago

Thailand News Today | Chinese vaccine, Thailand ‘drug hub’, Covid update | January 13

Thailand2 years ago

Thailand News Today | Bangkok may ease restrictions, Phuket bar curfew, Vaccine roll out | January 12

Thailand2 years ago

Thailand News Today | Covid latest, Cockfights closed down, Bryde’s Whale beached | January 11