Greenspan and Currencies - Delusional?
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Thread: Greenspan and Currencies - Delusional?

  1. #1
    In 2004, former Federal Reserve Chairman Alan Greenspan made the following statement about currency trading at a speech before the Economic Club of New York:

    ”My experience is that foreign exchange markets have become so effective that virtually all appropriate information is embedded nearly instantly in exchange rates to the stage that anticipating movements in major currencies is seldom possible.

    ”...Despite extensive efforts on the part of analysts, to my knowledge, no model projecting directional moves in exchange rates is significantly superior to throwing a coin. I am aware that of the thousands that attempt, some are very profitable. So are winners of competitions.

    The appearing ability of a variety of banking organizations to make consistent profits from foreign currency trading probably derives not from their insight to future rate changes but from market making.”

    GOOD LUCK

  2. #2
    Hence that the market is arbitrary? Here we go again....doh!

    We're Delusional? Unfortunately most are because they aren't using proper Money direction, rely on lagging indiors and are totally undisciplined.

    You are delusional if you are not using good money management. Lets take Greenspan's coin toss statement. If the outcome of a coin toss is 50:50 (heads:tails) and your risk reward is at least 2:1 (Reward 2: Risk 1), at 50% wins and 50% losses, whose the loser? If you have at least a 50% advantage and are disciplined enough to follow it through? Regrettably, most traders are trying to win rather than handle risk and respecting the regulation of chance.

    Do you need 50% advantage to win overall? No. Look at the turtles for instance who had a reduction percentage of about 70%. The turtles strategy relied on basic qualities of the market. All markets fad and thats what the turtles capitalised on. Currencies are well-known for providing tendencies that were sustained.

    So to suggest that the markets cannot make you profitable is to suggest that the basic qualities of the market (supply/demand), are no more valid.

    Quote Originally Posted by ;
    In 2004, former Federal Reserve Chairman Alan Greenspan made the following statement about currency trading at a speech before the Economic Club of New York:

    #8220;My experience is that exchange markets are now so efficient that virtually all relevant information is embedded almost instantaneously in exchange rates to the stage that anticipating movements in major currencies is rarely possible.

    #8221;#8230;Despite extensive efforts on the part of analysts, to my knowledge, no version projecting directional movements in exchange rates will be significantly...

  3. #3
    Quote Originally Posted by ;
    So the market is random? Here we go again....doh!

    We are Delusional? Unfortunately most are since they are not using appropriate Money direction, rely on lagging indiors and are entirely undisciplined.

    You're delusional if you are not using good money management. Lets take Greenspan's coin toss statement. If the results of a coin toss is 50:50 (heads:tails) along with your risk reward is at least 2:1 (Reward 2: Risk 1), in 50% wins and 50% declines, whose loser? For those who have at least a 50% edge and are disciplined enough to follow it through? Unfortunately,...
    thanks for the answer. The problem is that in the event you've got a consistent strategy (3% each month?) Then you need to have the ability to work with a fund worth billions of dollars. And then within 20 years you'll be the richest person in the world. NOTHING WORKS CONSISTENTLY. Notice how you said the turtles'depended'. . .if you have discovered a consistent system with a risk to reward of 2:1, you my friend, if call up the major financial institutions of the world since you're destined for greatness. You will have the ability to select a small developing nation and eradie appetite.

    Hey I am not trying to be obtuse I am only trying to prove a point and wake up people from the false promises perpetuated by brokers, the press and the internet. You were cool on your response and I am not trying to attack you.

    You cited supply and demand. Greenspan is not saying that markets flatline. He is saying that you can't predict where a currency is going based on previous market data. So if it moves upward and it might have just as easily moved down, does this imbalance of supply and demand help you?

  4. #4
    Quote Originally Posted by ;
    over 20 years you'll be the richest person on earth

    select a small developing nation and eradie hunger.
    Lol, really naive comments, you're not the first to create them and that I doubt you'll be the last! Perhaps you have heard of a little thing called liquidity?

    By the way Greenspan was wrong about so many things, this is just one more example.

    There are plenty of traders making constant profits from this market by surveying historic data and harnessing the likelihood of future price direction, it's not rocket science

    Anyhow what's the story, why so skeptical?

  5. #5
    1:1 is much better, just takes lots, lots of display time learn to follow pa, imho.

    Quote Originally Posted by ;
    Thank you for the answer. The problem is that if you've got a consistent system (3 percent per month?) Then you should have the ability to work with a fund worth billions of dollars. And then within 20 years you'll be the richest person on earth. NOTHING WORKS CONSISTENTLY. Notice you stated the turtles'depended'. . .if you've found a consistent system using a risk to reward of 2:1, you my friend, should call up the major financial institutions of the world because you're destined for greatness. You will have the ability to pick a small developing country and eradie...

  6. #6
    Quote:
    Originally Posted by 137 https://www.forexsoutheast.asia/cryp...-pls-help.html
    In 2004, former Federal Reserve Chairman Alan Greenspan made the following announcement about currency trading at a speech before the Economic Club of New York:

    #8220;My experience is that exchange markets have become so effective that virtually all relevant information is embedded nearly immediately in exchange rates to the stage that expecting movements in major currencies is seldom possible.

    #8221;#8230;Despite extensive efforts on the part of analysts, to my knowledge, no version projecting directional moves in exchange rates is considerably...

    There is another Greenspan quote that clarifies the value of every thing else that he said...

    I figure that I must warn you, if I turn out to be particularly clear, you've probably misunderstood what I have said. Alan Greenspan

    Additionally,I have an observation about economists. In a group of 5 of these it is entirely feasible to listen to 6 different theories about what's occurred or what the future holds.


    Phil

  7. #7
    Ok, well I would say most traders are searching for consistency and when there is talk of consistency people are believing regular winners and perhaps losers. Traders should be thinking in terms of consistently following their principles, consistent implementation of orders etc etc.. The turtle method in respect of winning consistency is far from consistent. 8-9 months of consecutive losses and maybe 3 weeks worth of winners. This method doesn't rely on consistency. It relies on the structure of the market and its short bursts of trends whenevr they might happen. If they were not consistent in applying their principles then they would overlook these short bursts of the larger trends. The turtles depended on the market to get exactly what it has always performed for centuries. Its not about consistency.

    Most traders start off with very modest account and the only method to attain profits is to maintain the leverage little and progress gradually. So no they will not be wiping off world debt. But I'm certain that there are banks that could certainly wipe off a small states debts and erradie their poverty by accepting the amount of thousands of novice traders.

    I believe what you need to be arguing is that you will not be successful over night. It requires a while, maybe a long time for many people. There is an immense quantity of misinformation out there about Foreign Exchange trading, you've got every righ to be angry and it takes time to realise what's bullcrap and what is not. Hang on in there or do something different.

    Quote Originally Posted by ;
    Thank you for the answer. The issue is that if you've got a consistent strategy (3 percent each month?) Then you should have the ability to work with a fund worth billions of dollars. And then within 20 years you will be the wealthiest person in the world. NOTHING WORKS CONSISTENTLY. Notice the way you stated the turtles'depended'. . .if you've found a consistent system with a risk to reward of 2:1, you my friend, should call up the major financial institutions of the planet since you are destined for greatness. You'll have the ability to pick a small developing nation and eradie...

  8. #8
    I have submitted on this topic in different threads. I am not planning to travel that road to perdition. I will outline:

    The huge majority of retail traders will never accept that the market is random. Period. Double interval. This notion does not match up with their hopes, beliefs, and dre so it's discounted. There are several sound mathematical arguments that point toward randomness (short term) and NO mathematical arguments that encircle them. However, nobody actually even likes math so traders dismiss these agruments and continue to cling to their own comfortable belief system. Term randomness is evident by deductive logic that is simple. Logic is a close cousin to math, so let that be dammend also. My point is that what people believe is a thing. With regards to forex, many won't change their minds until they attain a pain threshold that is high enough to make that change occur.

    By the way, I never said you couldn't become rich trading forex. It is possible. This doesn't have anything to do with the randomness of short term currency moves.

    Kindest Wishes,

  9. #9
    Quote Originally Posted by ;
    The vast majority of retail traders won't ever accept that the market is arbitrary.
    And they would be right!

    The problem traders face isn't knowing whether it is going to be non random so trades need to be based on the premise that the market is arbitrary....ie the market isn't always arbitrary but we must exchange it as if it was.

    Markets often move in some spectacularly predictive ways with easily identifiable and exploitable patterns, maybe you simply have not seen them yet?

  10. #10
    Just checked out of your threads. So you pulled the plug on Forex this past year and you said you're successful from the e-mini. I'm interested to know why you changed to Currency Market and whether you are still trading the e-mini and how its going?

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