http://www.forexconspiracyreport.com/politics-and-foreign-currency-trading/ Politics and Foreign Currency Trading Politics and foreign currency trading are often closely interwoven. When countries spend too much money it is often to buy votes to keep the governing party in power. When countries need to adopt austerity measures, the governing party often loses control because voters become disillusioned and angry. Someone once said that politics is the art of the possible. This is a useful thought to keep in mind for those seeking to make money from fluctuations in foreign currency rates. Bearing in mind the connection between politics and foreign currency trading, nations take two different routes in seeking to adjust the value of their currencies, on the Forex markets. One route is to simply buy or sell other currencies with their own. This can be done more or less behind the scenes. The other is to directly devalue a currency. This latter route causes people (voters) to wake up in the morning and discover that they bank deposits are now worth a tenth of what they were the night before. Such strong medicine is often needed and has often been used to correct currency imbalances and put nations on the road to economic recovery. Having a sense of how politics and foreign currency trading relate to each other can be profitable if a trader understands what a nation may or may not do with its monetary policy. Keeping the Value of a Currency Low Over the years Japan, followed by Taiwan and mainland China, has written the book on managing their currency. Japan has an export driven economy. It is poor in natural resources but has a well-educated and industrious work force. Japanese companies such as Toyota and Sony are world leaders in their fields. Thus Japan sells a lot of products to the rest of the world. Its major customers are North America and Europe, the largest and most prosperous economies. As money flows into Japan from across the world the value of Yen rises. If it rises too much this makes Japanese products less competitive in foreign markets. Therefore Japan buys foreign currencies, primarily dollars and Euros. They hold these foreign currencies as currency reserves and the purchase of dollars and Euros artificially drives up the price of the North American and European currencies and drives the Yen down. A less pricey Yen keeps Japanese products flowing and keeps employment high in Japan. Here the connection between politics and foreign currency trading is direct; keep the Yen low and the ruling political party stays in power. For those trading the Yen versus other currencies the relationship of politics and foreign currency trading is one of anticipating changes in Japanese monetary policy in response to political realities back in Japan. Considering that the Yen has typically risen against the dollar over the years, Forex trend trading of the Yen versus the dollar has often been a successful Forex strategy.

1. Politics and Foreign Currency
Trading
By www.forexconspiracyreport.com

2. Politics and foreign currency trading
are often closely interwoven.
http://www.forexconspiracyreport.com/politics-and-foreign-currency-trading/

3. When countries spend too much
money it is often to buy votes to
keep the governing party in power.
http://www.forexconspiracyreport.com/politics-and-foreign-currency-trading/

4. When countries need to adopt
austerity measures,
http://www.forexconspiracyreport.com/politics-and-foreign-currency-trading/

5. the governing party often loses
control because voters become
disillusioned and angry.
http://www.forexconspiracyreport.com/politics-and-foreign-currency-trading/

6. Someone once said that politics is
the art of the possible.
http://www.forexconspiracyreport.com/politics-and-foreign-currency-trading/

7. This is a useful thought to keep in
mind for those seeking to make
money from fluctuations in foreign
currency rates.
http://www.forexconspiracyreport.com/politics-and-foreign-currency-trading/

8. Bearing in mind the connection
between politics and foreign
currency trading,
http://www.forexconspiracyreport.com/politics-and-foreign-currency-trading/

9. nations take two different routes in
seeking to adjust the value of their
currencies, on the Forex markets.
http://www.forexconspiracyreport.com/politics-and-foreign-currency-trading/

10. One route is to simply buy or sell
other currencies with their own.
http://www.forexconspiracyreport.com/politics-and-foreign-currency-trading/

11. This can be done more or less
behind the scenes.
http://www.forexconspiracyreport.com/politics-and-foreign-currency-trading/

12. The other is to directly devalue a
currency.
http://www.forexconspiracyreport.com/politics-and-foreign-currency-trading/

13. This latter route causes people
(voters) to wake up in the morning
http://www.forexconspiracyreport.com/politics-and-foreign-currency-trading/

14. and discover that they bank deposits
are now worth a tenth of what they
were the night before.
http://www.forexconspiracyreport.com/politics-and-foreign-currency-trading/

15. Such strong medicine is often
needed and has often been used to
correct currency imbalances and put
nations on the road to economic
recovery.
http://www.forexconspiracyreport.com/politics-and-foreign-currency-trading/

16. Having a sense of how politics and
foreign currency trading relate to
each other can be profitable if a
trader understands what a nation
may or may not do with its monetary
policy.
http://www.forexconspiracyreport.com/politics-and-foreign-currency-trading/

17. Keeping the Value of a Currency
Low
http://www.forexconspiracyreport.com/politics-and-foreign-currency-trading/

18. Over the years Japan, followed by
Taiwan and mainland China, has
written the book on managing their
currency.
http://www.forexconspiracyreport.com/politics-and-foreign-currency-trading/

19. Japan has an export driven
economy.
http://www.forexconspiracyreport.com/politics-and-foreign-currency-trading/

20. It is poor in natural resources but
has a well-educated and industrious
work force.
http://www.forexconspiracyreport.com/politics-and-foreign-currency-trading/

21. Japanese companies such as
Toyota and Sony are world leaders
in their fields.
http://www.forexconspiracyreport.com/politics-and-foreign-currency-trading/

22. Thus Japan sells a lot of products to
the rest of the world.
http://www.forexconspiracyreport.com/politics-and-foreign-currency-trading/

23. Its major customers are North
America and Europe, the largest and
most prosperous economies.
http://www.forexconspiracyreport.com/politics-and-foreign-currency-trading/

24. As money flows into Japan from
across the world the value of Yen
rises.
http://www.forexconspiracyreport.com/politics-and-foreign-currency-trading/

25. If it rises too much this makes
Japanese products less competitive
in foreign markets.
http://www.forexconspiracyreport.com/politics-and-foreign-currency-trading/

26. Therefore Japan buys foreign
currencies, primarily dollars and
Euros.
http://www.forexconspiracyreport.com/politics-and-foreign-currency-trading/

27. They hold these foreign currencies
as currency reserves and the
purchase of dollars and
http://www.forexconspiracyreport.com/politics-and-foreign-currency-trading/

28. Euros artificially drives up the price
of the North American and European
currencies and drives the Yen down.
http://www.forexconspiracyreport.com/politics-and-foreign-currency-trading/

29. A less pricey Yen keeps Japanese
products flowing and keeps
employment high in Japan.
http://www.forexconspiracyreport.com/politics-and-foreign-currency-trading/

30. Here the connection between
politics and foreign currency trading
is direct; keep the Yen low and the
ruling political party stays in power.
http://www.forexconspiracyreport.com/politics-and-foreign-currency-trading/

31. For those trading the Yen versus
other currencies the relationship of
politics and foreign currency trading
is one of anticipating
http://www.forexconspiracyreport.com/politics-and-foreign-currency-trading/

32. changes in Japanese monetary
policy in response to political
realities back in Japan.
http://www.forexconspiracyreport.com/politics-and-foreign-currency-trading/

33. Considering that the Yen has
typically risen against the dollar over
the years, Forex trend trading of the
Yen versus the dollar has often been
a successful Forex strategy.
http://www.forexconspiracyreport.com/politics-and-foreign-currency-trading/

34. Regaining Value of a Currency
http://www.forexconspiracyreport.com/politics-and-foreign-currency-trading/

35. An all too common occurrence is
that nations spend too much and go
into debt.
http://www.forexconspiracyreport.com/politics-and-foreign-currency-trading/

36. There comes a point when they are
unable to finance the interest
payments on their debt.
http://www.forexconspiracyreport.com/politics-and-foreign-currency-trading/

37. When investors understand this they
demand higher interest rates in
order to continue to loan money.
http://www.forexconspiracyreport.com/politics-and-foreign-currency-trading/

38. This makes the financing problem
worse.
http://www.forexconspiracyreport.com/politics-and-foreign-currency-trading/

39. An all too common solution to this
dilemma is for the nation to address
the problem via foreign currency
exchange rates.
http://www.forexconspiracyreport.com/politics-and-foreign-currency-trading/

40. The nation decides to devalue its
currency.
http://www.forexconspiracyreport.com/politics-and-foreign-currency-trading/

41. If it takes the overnight route it risks
riots in the streets.
http://www.forexconspiracyreport.com/politics-and-foreign-currency-trading/

42. Therefore a more common solution
is to let the currency markets take
their toll and drive the value of the
currency down at a steady rate.
http://www.forexconspiracyreport.com/politics-and-foreign-currency-trading/

43. This can reach the same goal but
without the ruling party seeming to
be at fault. Having a sense of how
politics and foreign currency
http://www.forexconspiracyreport.com/politics-and-foreign-currency-trading/

44. trading relate in such a case gives
the trader an advantage in
predicting the value of the currency
in question in the months to come.
http://www.forexconspiracyreport.com/politics-and-foreign-currency-trading/