By James McKee
Europe is not the only continent looking to tighten its belt at the cost of the common man for the sake of an improved economy. Forex traders should take note of the fact that the United States at large has begun a very real effort to tamper with its economy by any means necessary. Among the proposed initiatives is once again raising the retirement age and lowering Medicaid benefits. The rest of the world is encouraging such measures due to the fact that many other countries are not creating money to solve their problems, they are cutting their budgets.
Among the proposed measures in the US are provisions that would make capital gains and dividends taxable as income as opposed to investment revenue. At current none of the markets are reacting to these proposals, however as their possible implementation date (2012) draws near we are sure to changes in the forex currency exchange and elsewhere. Many financial experts believe that in the short term the dollar will remain at current levels, however once these new measures are implemented the dollar may become even more unstable.
Too little too late is the phrase on the lips of many economists as the United States struggles to find a viable solution to the strife currently being experienced there by citizens at all levels. While other countries such as France and England have undergone pre-emptive strategies to stabilize their economy through difficult measures the United States just continues to print money that diminishes the value of the US dollar. Traders should take notice of these issues with the US dollar when considering it in a pair on the Forex currency exchange. Indicators are abound where the US dollar is concerned and all signs continue to point to instability and as the Federal Reserve’s recent decision truly soaks in it will certainly have an impact.
About the Author
Author is a Forex trader and financial analyst residing in Denver, Colorado. To stay up to date on all the latest developments in the financial world and beyond be sure to check out the forex exchange rates regularly.
