Am I the only one who just noticed that it’s Wednesday? The holiday week with the free day is completely screwing me up.
Just to make this a relevant post:
Spend less!
Save more!
Invest!
Wee!
The no-pants guide to spending, saving, and thriving in the real world.
This is a guest post provided by ForexTraders.com
The foreign exchange market has literally exploded over the last 10 years. Before the 1990’s, the only players allowed to speculate in the forex market were banks, large hedge funds, and very wealthy individuals. The reason was simple. The minimum contract size was usually $100,000 and it ranged up to $1,000,000; therefore, most traders simply could not afford to trade in the market. The advance of technology and internet changed that. Today, traders can open an account with as little as $100 and begin trading in the spot fx market. This change has caused traders around the world to rush into the market and the Bank of International Settlements now estimates that average daily turnover in the fx market is around $4 trillion! Let’s examine a few of the top reasons why the fx market is drawing so many traders.
Leverage
In the United States, traders that engage in fx trading can leverage 50:1. Leverage was much higher in recent years, but government regulations have now capped leverage at 50:1 effective late October. This means that a forex trader can control a position of $50,000 with only $1,000 on deposit with his broker. Leverage is definitely a two-edged sword that can help a trader garner very quick and substantial profits, but it can also lead to debilitating losses and should therefore be used with caution.
Liquidity
The huge amount of volume that is present in the forex market each day makes it basically impossible for any single financial institution or even group of market participants to manipulate price movements. It also makes it much easier for large traders to enter and exit the market without trading against themselves, which is a common problem in the stock and commodity markets.
24 Hour Market
The forex market is a loosely connected network of international banks; therefore, the market never closes from Sunday evening until Friday afternoon. Liquidity simply flows from financial center to financial center as time zones open and close business operations for the day. This is a huge advantage for small, retail traders because those who still have full-time jobs can trade at night.
Small Initial Account Size
Traders can open accounts with as little as $1 at some brokers, and then trade positions where each 1 point movement is equivalent to $0.01 (in the U.S. this would be lower since the leverages are capped at 1:50). This will obviously never get a trader rich, but it does allow traders a very low risk entrance into the market. Traders generally need $20,000 in order to day trade the stock market. This very low account size at an online forex broker is a big draw for many traders.
Long Trends
The currency market tends to develop very clear, long trends. It is not uncommon for specific currencies to head in the same direction for 5+ years. Of course, there are many dramatic price swings that make real-time trading difficult and challenging, but a quick look at longer-term currency price charts makes it clear that currencies develop strong trends.
Macro Economics
The currency market is very big picture-based. This means there are not a million and one little things that a trader has to track as is common in other financial markets. Currencies react to major macroeconomic developments around the world. Seasoned fx professionals argue that this makes the job of economic analysis much different in the currency market.
Continued Growth and Volatility
The foreign exchange market is expected to continue to grow in coming years, and volatility is expected to remain quite strong as the world continues to move toward a more globalized economy. As globalization continues to change the world economy, investor interest in currencies will most likely continue to grow steadily.
Jason’s commentary: I’ve never looked into forex trading, mostly because I’m not in the “invest & grow rich” stage of my financial life. Have you invested in the forex market?
When I was little, the world was amazing. The first snowfall was among the best days of the year. Everything was worth exploring, in hopes of discovering something new and fascinating, and everything was fascinating.
Stepping on a crack had serious implications. The wishbone in a turkey earned its name. Blowing out all of the candles on a birthday cake could change your life. The idea of some dude half a world away, watching you, then sneaking into your house to dish our rewards and punishments wasn’t pervy and sick, it was wonderful.
Then, one day, it all changes.
Somebody–a classmate, a older brother, a neighbor–let’s it slip that Santa isn’t real, and the implications snowball. That day, the magic dies.
Wishing on a star? Over.
The Easter Bunny? Hasenpfeffer.
Growing up to be Superman? Welcome to the rat race.
It’s a sad day when kids stop believing in magic.
I don’t believe in lying to my children, but I also don’t believe in destroying their magic. It’s a balancing act.
When my son was 6, an older boy at daycare tried to kill Santa for him. He was upset.
“Dad, is Santa real?”
“What do you think?”
“I don’t believe in Santa.”
“Okay, I’ll let him know.”
“Nonononononono! Don’t tell him!”
Was it lying? Probably, but he obviously wasn’t ready to stop believing, so I let him continue. A year later, we had the same conversation, but the results were quite different.
“Dad, you’ve always said that you hate lying, so why did you let me believe in Santa?”
So I told him the truth. Magic is a frail thing that’s nearly impossible to reclaim and I wanted him to have that treasure for as long as possible. And, “Now that you know, you are in on the conspiracy. You’ve been drafted. Don’t kill the magic for anyone else.”
It was weird having him help me stuff stockings.
If you’ve got kids(and celebrate Christmas), how do you handle the Santa problem?
It’s a sad day when kids stop believing in Santa Clause, the Tooth Fairy, and fairies.
Not because I enjoy lying to my kids, but because–on the day they stop believing–a piece of their innocence is lost. An unforgettable, valuable part of childhood dies.
Believing in magic is a beautiful thing.
Do you remember the last time you looked around the world with a sense of wonder? When seeing a puppy form in the clouds was a miracle? When the idea of an ant carrying 1000 times its own weight was something worth watching? When the impossible goodness of a fat man squeezing down your chimney fills you with hope instead of making you call 911?
Do I believe in Santa?
Of course not, but I believe the concept of Santa is worthy of my children’s belief. I don’t want them to lose that innocence and wonder.
When my teenager was young, he asked if Santa was real. I responded by asking what he thought. When he told me he didn’t believe, I offered to let Santa know. His panic told me he wasn’t ready to give up the magic.
The day that conversation didn’t cause a panic, he looked hurt, like he’d lost something precious. He had.
His world of magic was gone.
The he asked why I had spent his lifetime lying to him. I told him the truth. I said I couldn’t bear to be the one to shatter his belief in magic before he was ready.
Then, I informed him that he was in on the conspiracy. He was not allowed to ruin it for anyone else. Not his sisters, not his friends.
That Christmas, my little boy helped me stuff stockings, which was an odd feeling.
The magic was over, but we still got to share the magic of his cousins and sisters.
I’m lazy.
Really, I am. When I get home from work, I want nothing more than to plop down on the couch, dial up a movie and ignore the world for a few hours. I need some downtime to relax.
While I am keeping the couch from flying away, my wife gets home, makes dinner, does the dishes, changes the cat litter and maybe vacuums the floor. Once dinner is cooking, she usually throws in a load of laundry. Three kids is a great way to guarantee a lot of laundry needs to get washed.
I have just two things to say about that:
I’ve never considered it a problem because I work my butt off on the weekend. My wife isn’t happy with the arrangement because I tend to do next to nothing during the week. I think it’s a good balance. I’m productive on the weekend, she’s productive during the week. Unfortunately, my habitual laziness has caused a bit of tension. We’ve had a few “discussions” about that balance. It’s obviously not working.
Over the past few weeks, I’ve been trying something new. When I get home from work I’ve been doing just 1 thing. I do one thing per day. One day, I fold laundry, another day I do the dishes. Some days, I pick a room to organize. It’s never very much, but it’s always something that needs to be done and, possibly most important, it looks like I’m doing more so my wife feels less abandoned to the housework. I’m not actually doing more, but it gets spread out over the week, so it looks like more. Slowly, surely, all of the work is getting done.
It’s not a perfect solution, but it seems to be working. More is getting done, my wife feels like I’m helping out more and I get more time on the weekends to pursue whatever I feel like pursuing. It’s a win for each of us.
How do you balance relaxation and a shared workload?
When we don’t have a meal plan, food costs more.
Our regular plan is to build a menu for the week and go to the grocery store on Sunday. This allows planning, instead of scrambling for a a meal after work each night. It also give us a chance to plan for leftovers so we have something to eat for lunch at work.
We work until about 5 every weekday. When we don’t have the meal planned, it’s usually chicken nuggets or hamburger helper for dinner. Not only is that repetitive, but it’s not terribly healthy. It is, however, convenient. If we plan for it, we can get the ingredients ready the night before and know what we are doing when we get home, instead of trying to think about it after a long day of work.
If we don’t plan for leftovers, we tend to make the right amount of food for the family. When this happens, there’s nothing to bring to work the next day, which means I’ll be hungry about lunchtime with nothing I can do about it except buy something. Buying lunch is never cheaper than making it. I can get a sandwich at Subway for $5, but I could make a sandwich just as tasty and filling for less than half of that, using money that is meant to be used for food. All during wrestling season, we make 30-inch sandwiches on meet nights for a cost of about $5, feeding ourselves and at least a couple of others who didn’t have time to make their dinner before the 5:30 meet.
No leftovers also means no Free Soup, which is a wonderful low-maintenance meal that leaves everybody full. Nobody ever gets bored of Free Soup. (Hint: Don’t ever put a piece of fish in the Free Soup, or the flavor will take over the entire meal.)
Unhealthy, repetitive food for dinner. Over-priced, low-to-middle-quality food for lunch.
OR
We plan our meals right and have inexpensive, healthy food that doesn’t get boring for every meal.
It seems to be a no-brainer. Except, I don’t have lunch today because we didn’t plan our meals and used the last of the leftover hamburger helper for dinner last night.
Update: This post has been included in the Carnival of Personal Finance.