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From Matthias Knab: Doug Barnett, fund manager of Thai Focused Equity Fund, says fundamentals in Thailand have actually improved markedly over the last 3 weeks while prices have dropped, creating a buying opportunity:

Nothing wrong with Thailand, only foreign investor's portfolios:

• The only reason that the Thai market has corrected is due to selling by foreign investors. Since 27 July, foreigners sold a net $1.1 billion, selling every day except August 20.
• We believe this selling was brought on by problems, unrelated to Thailand, taking place in the foreign investor's portfolios, namely subprime/credit issues, over-crowding of  highly leveraged quantitative hedge fund strategies and possibly margin calls by these investors' prime brokers, all of which have led to a de-leveraging process across most global portfolios.

• Last Sunday, the draft constitution was approved in a referendum, paving the way to elections in December. In the last 7 elections, the SET index staged an average 15% rally in the 3 months preceding to the one month following the election, as politicians practice the art of money politics and some of that money flows into the stock market. We are now 4 months before the December elections.
• The Bank of Thailand continues to make a series of interest rate cuts, trying to stimulate the domestic economy and weaken the baht back in line wit......................

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