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Do you know what Forex is? It’s a word I heard this morning on the subway, and instinctively This word intrigued me so much , especially that the two men who were discussing the subject seemed to be very serious about it , and seemed to be making a lot of money from it .

So as I am a good boy :p ,who likes to understand the new words he hears in the subway, I tried the best I can to find what it does actually mean , and this is what I found , I’m sharing it with you dear readers : “Forex is the contraction of the words Foreign Exchange, Forex is the nickname given to the universal exchange market, where currencies are traded against each other, at constantly variant exchange rates.”

The economic importance of Forex is that this powerful global market, which is essentially Interbank, is the second powerful world market in terms of overall volume, after interest rates.
It is nevertheless the most concentrated and the first in terms of liquidity. To give you an idea of the circulating liquidity on this market, the daily volume of trade in 2004, was 1900 billion U.S. dollar, with 600 billion in cash transactions .

Yes all this is good, but how to make money from Forex, frankly I do not know, I tried but it was too technical for me, I think it’s likely about understanding forex signals, but this must surely be the concern of people who know and understand what is Forex really , and that can easily interpret FOREX SIGNALS and make conclusions from them.

you know , i don’t give a damn about stuff related to business , finance or economy ,because i find it simply boring

when i watch the financial news on my TV set and see a whole lot of people in wall street  screaming and fighting like if they were struggling for their life , i simply change the channel

i mean , that what i used to do before , till recently heard about the economic crisis

and due to the fact that a lot of my blog visitor are directly affected with this crisis , i decided to write about it and try to explain how it happened :

so from what i understood , the economic crisis is a logical consequence of the housing bubble , a bubble is something that can happen with any market !!!

but the problem is that the main reason for this bubble is the subprime mortgage bubble ,((subprime what ???)  i explain

because after the 9/11 , In order to get the Economy going again , the FED decided to reduce the interest rates , to make cheap money available, so people can buy cars and houses again like prior to that period .

but because there were no regulations ,Banks could  sell on mortgages in large quantities  . and the problem is that the banks  could issue a mortgage and sell it without  checking whether the debtor can afford to buy it !!!

So lot of mortgages were sold to people who couldn’t afford to buy them . sometimes the debtors didn’t even know about the mortgage they obtained in order to sell more mortgages.

but the main reason of this crisis can be summed into :

People couldn’t buy mortgages anymore. Those who had bought the mortgage  for millions of dollars found that were worth nothing. and so once they needed money  pulled the mortgage from the stock market, and so everyone lost there.

therefore Banks did not have the possibility to  sell more mortgages and themselves had bought bundles that are worth nothing now . So they lost too.
and as a consequence they couldn’t lend money anymore and so people had no other choice than to stop buying.

it’s really a vicious circle, and the whole world economy is now affected by what happened in the US , but will Obama’s team find a solution to that ? and will the American economy become as strong as it used to be, before  9/11 ???

only time Will Be able to answer  This question