Hatts

The next time that you log into your forex trading system and place a trade, you might want to consider that renowned investor George Soros recently said that the global financial system has disintegrated, and there is no chance of a near-term resolution to succor panic-stricken investors. Speaking at a Columbia University dinner, Soros added that the Lehman Brothers bankruptcy last September was a turning point in the market, and now turbulence is more severe than it was during the Great Depression. In fact, Soros says, the current situation is not unlike the demise of the Soviet Union, only we have yet to find the prospect of a bottom for the chaos.

How do Soros’ comments have the potential to affect forex day trading, swing trading, and position trading? They don’t, at least not directly. But Soros’ comments, in addition to similar comments made by analysts and economists all over the world, influence investor psychology. Investor psychology is a subtle and enigmatic but very real force. When enough investors and traders, particularly those who place a lot of stock in fundamentals, decide to either buy or sell a currency, it sends ripples throughout the forex system and affects price movements. The “flight to quality” effect is a good example of investor psychology at work. When investors fear bad economic news, they flock to currencies that have a record of safety. Throughout the dark days of last fall, both the USD and the JPY benefitted from this effect, as the USD posted record gains against the EUR and the JPY posted record gains in nearly every one of its currency pairs.

However, just because the current sentiment is bullish or bearish doesn’t mean that you should automatically go long or short on the currency under discussion. Successful online currency trading takes into account both fundamental and technical data. A good trader knows when to listen to the experts, as well as when to ignore them.

The Bankruptcy Abuse Prevention and Consumer Protection Act was passed by the U.S. government in 2005, making it more difficult for individuals to declare bankruptcy. Unfortunately, federal lawmakers failed to anticipate the difficult economic times ahead, and the rampant unemployment, foreclosures, and deteriorating credit lines that are now preventing many Americans from making ends meet.

Having a high credit score is now more important than ever for individuals who want to obtain a loan or even secure a job. It always has been best to avoid bankruptcy if at all possible, because those who declare bankruptcy face a long road to achieving credit report repair at a level sufficient to re-establish high credit scores. So what about those individuals who have declared bankruptcy over the past several years? Do they have any hope of securing credit? Repairing credit after bankruptcy is not an easy process. Fortunately, depending on a person’s overall credit history, it isn’t impossible.

With time and the right assistance, many consumers can restore their credit. Some consumers declare bankruptcy before creating a long trail of late payments and write-offs. In addition, some individuals go on after the fact to responsibly pay bills in a timely manner, while others continue to default on payments or never make them at all. Depending on your long-term habits, a solid credit repair agency may be able to provide you with effective bankruptcy credit repair services. To find out, simply call a reliable agency like Vitesse Financial; they can assess your situation and recommend steps you can take. They keep rates reasonable and have years of experience helping clients restore their credit record.

Last month, the Reserve Bank of Zimbabwe introduced $50 billion and $20 billion notes in an attempt to curb the country’s 231,000,000% (yes, you read that correctly) hyperinflation and fight cash shortages. Zimbabwe’s currency has been losing about 100% value daily. In late December 2008, the bank’s then-new $10 billion note purchased 20 loaves of bread. Now, the latest government-issued notes have very limited purchasing power, about one to two loaves of bread. Currently, one USD equals about ZW$25 billion. Since the Zimbabwean currency has become virtually obsolete and unemployment has risen to 80%, most goods and services are bought and sold in foreign currencies. The bank has also licensed 1,000 shops to accept foreign currencies, but the economic outlook is indubitably bleak. For more forex education, visit 24FX.com. The site offers information, a trading platform, and a forex trading contest with monthly prizes.

The Fed’s December rate cut virtually to zero and its promise to buy toxic mortgage assets were intended to help shore up the economy, but these actions may also have the inadvertent consequence of devaluing the USD in forex trading. Dick Bove, an analyst at Ladenburg Thalmann, said, “"By cutting interest rates, the Fed makes dollar investments relatively unattractive. By indicating a willingness to, in essence, print more currency to buy assets of questionable nature, it is debasing the dollar by weakening its backing." While most economists expect the U.S. to show some signs of recovery in 2009, Bove’s estimation could prove to be the exception. And if the greenback does fail to regain some of its former strength, 2009 could be a difficult year for online forex traders of USD currency pairs.