As the EUR/USD breaks 1.50, investors should take another look at foreign exchange. 100/barrel oil, $1,000 gold, and $10/bushel wheat are not anomalies, nor is there a bull market in commodities. The US dollar is losing its value and its relevance as a world reserve currency.
What determines the value of a dollar? The common belief is that purchasing power determines the value of money, which is partially correct, but that is not the entire story. In a world of floating currencies, money is also valued in terms of other money. Simply opening a bank account in Europe, and gaining a few % per annum interest, would have returned a US based investor over a 50% return in 5 years. There are a few ways to look at that, but they all point to the same conclusion: the value of the dollar is declining. The other logical observation is that by NOT investing in the Euro, an investor is actually LOSING 50%. This is a difficult mental leap for many to make as they don't see losses in their bank account, but as we see $4/gallon gas, $3/gallon milk and skyrocketing commodity prices, many are noticing. They only have to realize the simple fact: prices are not increasing the value of US Dollars is declining.
Who is not affected by a declining dollar? The poor, debtors, manual laborers, and tradesmen (because you can continue to perform your trade for dollars, pesos, or bananas if need be regardless of the continuing slide of the dollar tomorrow you may charge twice as much but so what?) But if you have any wealth; a house or a stock portfolio, denominated in dollars, the declining US Dollar should be the most important issue to you because that portfolio is losing value as the dollar does. In the worst case scenario, the Fed can default making US Dollars worthless overnight.
Best case, although unlikely it should be mentioned, the Fed could raise rates to 10%, Bush could declare a flat tax, open the borders to foreign investors by deregulation and providing tax incentives, pull out US Military from all foreign engagements, and be the banker of the world. This would catapult the US economy and the US Dollar to currently unimaginable success, but this is a farfetched fantasy. In reality, we are increasing our Military presence around the world, cutting interest rates, and regulating US markets, forcing even homegrown companies to look abroad.
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1. Lowest spreads in the forex market, No other broker offers such competitive spreads .
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Our devotion to our clients has made our firm a respected industry leader, that we have a strong commitment to maintain a long term relationship with our clients.
4. Low margin requirement.
5. Full Hedging capabilities.
6. Sigma is a registered financial institution, and registered with the European registration authorities. The regulations set out into notice by these agencies are created to help ensure the safety of our clients’ deposits.
7. We maintain enough liquid capital to meet the needs of the amount required to cover all client deposits, potential shift back and forth in the firm’s currency positions and outstanding expenses.
8. We put forward our financial information to regulatory bodies on a weekly and monthly basis.
9. In addition to all the above, Sigma holds all deposits with only highly reputable financial institutions. We are appreciate the trust of our clients place in us.
Please be aware of brokers that guarantee the safety of your funds or that claim that your funds will receive special protections such as FDIC insurance. Nobody can guarantee profits in Forex trading
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