Tuesday, September 4, 2007

Why The Math Doesn't Always Work

I'm not going to go into length about this because it's SO SIMPLE.

The MATH doesn't always work because currency is driven by PEOPLE!

Currency is NOTHING if people don't give it value. If there is no 'dominant' belief about currency, it's value/worth, then currency is value-less. PEOPLE decide, in the end, what currency means to them, what it should mean to others.

Think about it. A Silver Dollar has little 'practical' use. You can't paint your car with it (but you can paint your car with it if you give it away), you can't eat it (well, you shouldn't eat it) but you can eat by giving it away in exchange for a food item...

See what I am getting at? People assign value to currency and human emotions control how people feel about different kinds of currencies.

Does this help to make you realize why you can't just go find a 'Perfect System' out there and expect the Math to do magic so that you can become rich by being involved in the Forex industry?

All that has to happen in your perfect system is for someone half-way around the world to BECOME EMOTIONAL about currency, enforce some kind of 'power' and CHANGE other peoples' opinions about the value of currency.

0 Comments: