I am a newbie, dont know much, but i hear, read, that the weak us dollar is no good for the world and therefore someone/something could step in and intervene. Could this happen is that possible, could the rate be fixed, and would that put and end to FX trading. Is anything i saying make sense, correct or possible. It is just on my mind. Please set me straight!
Well, if something like that were to happen, it would take the most powerfull force on earth. Which right now would be the United States. So even if the US came out and said, “ok from now on our currency is worth X.” Do you think that the rest of the world governments would stand by and allow that? No.
In my opinon, things would have to get very bad for FX trading to cease. Such as total world domination by a single country, or adoption of a worldwide currency. And if it makes you feel better, there will always be commodities, which can be traded similarly to currencies.
From your incomplete grasp on worldwide monetary policy, I would guess that you might be better off learning to profit from forex rather than worry about world domination or anarchy.
It’s a very sad story really. The US dollar used to be pegged to gold, and so it made sense for other currencies to be pegged to the US dollar. Then the US Gov’t couldn’t afford to hold enough gold reserves to cover all the money they were printing (debt creation), and they slowly weaned the US dollar off the gold standard.
This is great for us as currency traders, because the only way to value their currencies after that point was for them to float against each other on a foreign exchange market.
So my question for you is, what could they peg the US dollar to? They can’t afford to peg it to gold anymore, and pegging it to another currency would not provide any more stabilisation in the long run.