The Rate of Inflation Under the Bush Administration
The CPI inflation calculator uses the consumer price index to measure the purchasing power of the US dollar and has been calculated every year since 1013. For example in 2000 it took 17.39 to purchase what $1.00 would purchase in 1913. In 2008 the figure stands at 21.57 one of the biggest hikes since the 1970’
s. This figure does not speak well for the economic policies of the Bush administration.
The current economic crisis faced by the US can, in part, be traced back to the deregulation frenzy of the GOP controlled congress of the 90’s with the partial cooperation of the Clinton administration. With many of the safeguards in place since FDR’
s New Deal rescinded many financial institutions began to engage in risky and sometimes irresponsible behavior. Many Forex traders say that this behavior puts the dollar at risk.
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Forex Traders and the US Dollar
The recent plan by the US to buy 700 billion dollars worth of toxic debt from US banks has thrown Forex markets and traders into a state of bewilderment. With rising oil prices and an unresolved presidential election the future of the US dollar is uncertain. Although banks made temporary gains fx traders and investors are concerned because investors are concerned about the price at which banks may have to sell their assets.
Forex Trading, the US Dollar and Politics
Investors and Forex traders worldwide are waiting to hear the details of the bailout which are unclear. Another complicating factor is the political nature of the bailout with the Bush administration and congressional Democrats differing on who and what should be bailed out. Said senate majority leader Harry Reid of Nevada, “The Bush Administration has called on Congress to rubber stamp its bailout legislation without serious debate or efforts to improve it. That will not happen.” To complicate matters even further some senate Republicans are calling the Bush plan ‘Totally Unacceptable.”
Congressional debate on the issue is expected to last well into next week.
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Forex Traders and the US Economic Crisis
The recent crisis in the US has Forex traders and investors in a serious quandary. Despite a short rally the dollar has been taking a serious beating on currency markets. The Forex market as a whole still remains a place where astute investors and fx traders can still find opportunities.
Political Haggling and the Markets
Unfortunately for international markets, political haggling over the details of the bailout are expected to last longer than predicted. The Bush administration faces some opposition from members of their own party and there are fears that the opposition will use this opportunity to tack on unrelated amendments to the bailout legislation. There are also fears that political maneuvers will delay a vote and effectively stop the 700 billion dollar bailout.
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Forex Trading and Political Events
There are many factors that affect Forex ma
Understanding Forex Trading
Understanding Forex trading begins with a quick definition of Forex trading. Forex is an abbreviation for ‘foreign exchange’ the market where currencies are bought and sold. The Forex market is a 24 hour a day market with no central location or facilities. Transactions are typically conducted through a system of electronic trading platforms giving access to anyone with a computer.
Currencies rise or fall in value due to variations in currency exchange rates. These changes are affected by many variables such as political or economic events such as oil prices or more recently the mortgage market. These events can bring about profound changes in Forex markets worldwide.
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Forex Trading On Margin
One of the attractive features of forex trading for investors is the ability to trade on margin. While margin trading is highly regulated in the stock and futures markets the forex markets remain decentralized and the amount of margin allowed is set by the brokerage firms themselves.
If an investor uses a margin account they are borrowing to increase the size of their account and achieve greater returns on their investment. Once an investor has found a broker a margin account is set up. In essence the investor is taking a short term loan from the broker and the funds can then be used to invest in and trade currencies. The investor sets up an account and the margin percentage is then negotiated between the broker and investor.
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