The Taiwan NT

You would have trouble even finding a bank that would exchange Asian currencies in Canada…it would be a bureau de change and they would rape you on the percentage.

Yep, even though there is a slight loss on the USD extra change the rates and charges in Taiwan are very fair, as I mentioned previously the rates at the airport are among the fairest in the world (try exchanging in HK or some European airports…just point a gun at me while you rob me thanks). Always remember to change your NTD before you leave Taiwan.

[quote]
If you try to get certain currencies in the branches or switch currencies like Asian currencies back to NTD they will sometimes let you know of this middle USD transaction[/quote]

I wasn’t very clear, sorry. I am not actually sure exactly what they mean but they often advise me not to change some currencies here into others as they get stuck with a USD exchange rate in the middle too…in practicality the effect is probably not large…need to look into it more.

So let me understand, if I want to bring Canadian money into Taiwan, it goes through from Canadian, to US, to Taiwan NT?? So if the USA dollar is lower, I lose money??

Once more (the question for anybody who might know): aren’t at least all currencies in western Europa, Canada, Australia, New Zealand, Japan, South Korea, Taiwan (and most likely many, if not most, other countries) referenced against the US$ a a standard procedure?

Anyway, as regards changing money in Taiwan, let me start with the Oanda data for some official conversion rates that i picked up earlier tonight:

TWD from/to:
JPY 2.59
CAD 0.0335
AUD 0.0325
NZD 0.0335
USD 0.0339
EUR 0.0235

USD from/to:
JPY 76.49
CAD 0.9896
AUD 0.9584
NZD 0.9862
EUR 0.6970

Next. from the above data i calculate a hypothetical double conversion: TWD via USD (0.0339) from/to
JPY 76.49 x 0.0339 = 2.593
CAD 0.9896 x 0.0339 = 0.0335
AUD 0.9584 x 0.0339 = 0.0325
NZD 0.9862 x 0.0339 = 0.03343
EUR 0.6970 x 0.0339 = 0.02363

Real exchange rates are of course “worse” (in both directions), since the banks have to get their cut: therefore, all someone would have to do show now that the sell/buy spread (the difference between actual buying and selling rates) for the TWD and any of the non-US$ currencies on my the above list is noticeably wider than (roughly twice as wide as) the spread for any of those currencies and just the US$, and we would have evidence that at that place customers would be charged two spreads instead of one when buying TWD with a currency other than the US$.

As far as my experience goes: here are my points for the graph: in Hualien in the last two years i have not seen any evidence of such a double-conversion in either the Bank of Taiwan, the Megabank, or the shop where i usually exchange money - and therefore i think that, if this has happened or is happening in other places, it amounts to no more than someone taking advantage of (foreign) customer who they think are at their mercy (welcome to the real world). :wink:

That’s not really fair, I have often been advised to exchange elsewhere when they had to go through USD conversion first. Also as I noted Taiwans Airport exchange rates are very fair.

I’ve always found that I get good rates when I withdraw money from my NT account through an ATM

Often ATM money withdrawal overseas from your Taiwan account is the most economic way to do it, the problem is it that it is not very reliable.

Sounds like the bank you very dealing with was not trying to take advantage of you but was perhaps unable (for some adminstrative reason) to do the kind of exchange some bigger banks can do…

[quote=“headhonchoII”]Yep, even though there is a slight loss on the USD extra change the rates and charges in Taiwan are very fair, as I mentioned previously the rates at the airport are among the fairest in the world (try exchanging in HK or some European airports…just point a gun at me while you rob me thanks). Always remember to change your NTD before you leave Taiwan.

[/quote]

And the reverse is true also. After trying to change some money in Taiwan (Baht and Phil Pesos) I’ve decided that I will either spend any money that I have before I leave the country or change it to USD’s before leaving.

You would have trouble even finding a bank that would exchange Asian currencies in Canada…it would be a bureau de change and they would rape you on the percentage.[/quote]

Sorry to grave dig, but this is not quite true. It’s especially untrue when you consider the fact that China Trust has metro Vancouver branches. What do you think the chances are that they will exchange TWD?

Sure, in Hong Kouver, it could very well be possible at a Taiwanese bank. Toronto also has a couple, but if you happen to be anywhere else, you might be a little hard pressed, imho.

The NTD is just an Illusion.
The NTD is not accepted in other countries.
The NTD is backuped by a basket of different currencies, mostly USD, Euro, AUD, CAD, YEN.
Taiwan itself have to import everything, steel, oil, food and so on, therefore forreign currencies are needed.
The NTD according to the real economy is totaly overvalued, the banks here just wanna catch up the foreign currencies, therefore they make the NTD strong to give you a a very big loss on the exchange rate and keep the interest rate higher then in USD, because they dont like the people are going to buy USD ( Older people prefer high interest rate and most rich people in Taiwan is the older generation, they believe what the TV and newspaper brainwash them )
The taiwan central bank can not hold the NTD for longer at that price because the export is going to die, there will be a huge devaluation of the NTD very soon.
Taiwans huge credit card and real estate bubble will burst sooner or later and most of the banks in Taiwan will be bankcrupt after that.
The central bank will print money for them and hyper inflation will kill this small island.
The income / price ratio in real estate is totaly out of control and made by central bank and government. You can take USA 2008 to see whats going to happen in Taiwan and most other countries wich haven´t crashed yet.
For me it looks like the Taiwan crash, that will come, is managed by the government to let china rescue Taiwan, and then takeover.

Keep your money in a government bank like Bank of Taiwan or Taiwan Cooperative Bank.
Better keep your money at home.
Also recently is a great chance to buy USD. Taiwan haven´t started to crash yet, but after the crash, there will be a huge devaluation according to the real economy.

Well, the Taiwan dollar as far as I know is backed by gold. The US dollar and the Euro is backed up by debt and empty promises. Chinese currency is backed up by what products China hopes the empty currencies of the Euro and US dollar will buy from it. The facade can only last for so long.

PLEASE give me all your unwanted currencies in any denomination !!

@ Super Hans

I would say the USD is backuped by oil, and Taiwan is wasting alot of it, but we will see for how long.

Staats, I’m interested to see your viewpoint although I believe it is quite extreme. The interest rate here is at a record low and nobody makes money from deposits, they put savings in foreign accounts like AUD. Taiwan has high foreign exchange reserves and low debt and a productive low cost economy , most of the manufacturing that would leave has gone already and in fact I have heard of production moving back to Taiwan from China.

Now the bad news. I agree Taiwan real estate is totally out of whack. The metrics are unbelievable with income to loan ratios of 11-20 years i.e. You need to spend all of your income for 11-20 years just to buy a house.
5 years is about the average in non bubble economies.
There is too much speculation and leverage and we know where that leads. Taiwan’s growth prospects do not warrant so much speculation especially the demographics and as you point out it does not have commodities although I think some commodity economies are in for a massive shock too… check what is happening to iron ore and copper pricing.

I have some questions as to the health of the export sector too. I have noticed many sectors are not profitable and that worries me. DRAM, LCD panels, LEDs, solar, optoelectronic storage and even brand names like Acer are losing money. This is a big problem that seems to be related to global overcapacity and a vicious battle of winner takes all by big players in Korea, Taiwan, Japan and China amid a global slowdown in demand.
This also impacts some banks in Taiwan who will need to write off multiple billion dollar loans.

I don’t know how things will play out but real estate needs to correct instead of keeping on inflating and sucking money into old peoples pockets and the govt instead of young people having a chance to get ahead.

That’s right, because compared to the US, UK and Europe Taiwan is a financial disaster zone :roflmao:

[quote=“headhonchoII”]Staats, I’m interested to see your viewpoint although I believe it is quite extreme. The interest rate here is at a record low and nobody makes money from deposits, they put savings in foreign accounts like AUD. Taiwan has high foreign exchange reserves and low debt and a productive low cost economy , most of the manufacturing that would leave has gone already and in fact I have heard of production moving back to Taiwan from China.

Now the bad news. I agree Taiwan real estate is totally out of whack. The metrics are unbelievable with income to loan ratios of 11-20 years i.e. You need to spend all of your income for 11-20 years just to buy a house.
5 years is about the average in non bubble economies.
There is too much speculation and leverage and we know where that leads. Taiwan’s growth prospects do not warrant so much speculation especially the demographics and as you point out it does not have commodities although I think some commodity economies are in for a massive shock too… check what is happening to iron ore and copper pricing.

I have some questions as to the health of the export sector too. I have noticed many sectors are not profitable and that worries me. DRAM, LCD panels, LEDs, solar, optoelectronic storage and even brand names like Acer are losing money. This is a big problem that seems to be related to global overcapacity and a vicious battle of winner takes all by big players in Korea, Taiwan, Japan and China amid a global slowdown in demand.
This also impacts some banks in Taiwan who will need to write off multiple billion dollar loans.

I don’t know how things will play out but real estate needs to correct instead of keeping on inflating and sucking money into old peoples pockets and the govt instead of young people having a chance to get ahead.[/quote]

I would like to know where these old people get all the money to buy all these properties. I know of a few friends whose parents buy a new property every couple of years and they have about 4 or 5 vacant properties now. Even Kaohsiung real estate went up 5% over last year as well due to them developing it to be another Taipei.

Probably bank loans, they leverage fully owned houses as collateral for new mortgages, using different names and different banks. The govt changed inheritance tax rules too a while back so a lot of money that was held overseas came back into Taiwan and ended up in the property market instead of more productive investment.

Taiwan’s economy is vulnerable from two main directions: (1) If the China boom stops, and (2) If other countries stop buying so much of what Taiwan makes, perhaps because of rising oil prices and/or domestic recessions. Both of these are eventualities rather than possibilities. If not for all this international trade, Taiwan would be just another island like Hainan.