The American conservative website The American Thinker is publishing a new book titled,Forex Market Trading: The Economics of the Forex Trading Market, by John W. Mearsheimer and Lawrence M. Friedman, which is the first comprehensive look at the economics of forex trading.
The book will be published in the fall by Princeton University Press.
Mearsheimer, a former U.S. secretary of defense and a senior fellow at the Hoover Institution, will present the book in a wide-ranging discussion at the annual American Economic Association meeting in Atlanta, GA, on Thursday, Oct. 5.
Mearson, who has been a columnist for The American Interest since 1995, will also appear as a guest on CNBC’s Squawk Box on Wednesday, Oct 5, at 8:30 a.m.
He will be moderated by CNBC’s Brian Kelly.
The book’s first chapter, “Forex Markets,” was released in September 2015, and it examines the economics behind forex markets and the different trading models, which allow traders to maximize profits and minimize losses.
Moody’s Analytics, which has been in business since 2007, uses a number of trading models and has a long history of delivering solid, market-based ratings.
The models, along with the market’s volatility, have been blamed for the U.K. and Europe’s sovereign debt crisis.
Forex markets have been the subject of an extensive investigation by the U of T’s department of finance, which concluded that they “can be considered a high risk asset class” for investors.
Mearingheimer and Friedman examine the financial market and forex market from the perspectives of institutional investors, analysts, and market participants.
In their discussion, Mearshel and Friedman say there are three main elements to forex investing: hedging, volatility, and margin calls.
Hedging refers to the ability of a trader to buy and sell the currency in a given time period, while volatility refers to how much the trader is willing to pay for a specific security or security category, like a bond, stock, or ETF.
The second element of hedging is margin calls, which are the profits or losses a trader can expect when a stock or bond price drops in a particular direction or at a certain time, in which case the trader must sell their position in order to absorb the difference.
They have a long track record in the stock market, Mearson says.
Morsheds the role of foreX markets in the financial crisis, saying, “The fact that forex trades have become a very important factor in the collapse of the U, EU, and US economies was very clear.”
Forex markets are also used by international hedge funds to hedge against the risk of foreign currency devaluation, according to Mearsheim.
ForeX markets are the main means for hedge funds and institutional investors to hedge in an economy, and foreX trades, which Mearshman says are made on a regular basis, “have been very important in stabilizing the global economy.”
ForeX trading, Morshed says, is a highly effective means for the hedge fund and investment management industry to hedge the risk associated with the financial crises of 2008 and 2009, and also the financial meltdowns that followed.
Moreshed also cites the role foreX trading plays in the global economic crisis, pointing out that “in the last six months, the market has seen the most extreme trading activity in more than 10 years.”
Forexpression, a hedge fund, said in a statement that the recent rally in forex prices is “signaling a very strong and robust recovery from the crisis.”
Mearshel, who is known for his sharp, conservative style of writing, said the book focuses on three key topics: Forex trading, the economy, margin calls and volatility.
He also says the book is an attempt to better understand the role hedge funds play in financial markets.
Forexpression said it is trying to give readers a better sense of the financial markets and forext market from a new angle, and to make the book accessible to people who are not well versed in economics.
The authors say the book’s chapters on hedge funds, derivatives, margin call theory and the global financial crisis “offer insight into how the financial system functions.”
Mearshard said in an interview with CNBC that the book will explore some of the key points that Mearshells research has identified about the financial sector.
“Forexpressive is an ambitious, ambitious project that’s going to take a lot of work,” he said.
“There are a lot more pieces than just the book that we’re going to try to put together.”
Morshard said the authors are aiming to provide an “explanation” for why the financial services sector is in trouble and the “whyforexmarket” market is an attractive place to buy shares and hold them. M