One topic of great interest, especially among youth, is the Foreign Exchange or Forex: the market where currencies, domestic and foreign, are traded. Many students know in some vague sort of way that Forex is part of a grand scheme that also includes the notions of money and finance. 

But, if they proceed to interact with Forex, with only these vague notions, they do so at their own risk. We must take an approach from these very three concepts to better understand  this complex system. What do we mean by terms like  “money” and “finance”? And what on earth is Forex? Really? And, once we understand what they are, how should that comprehension shape our behavior?

It is no surprise that money and finance are complex and major topics in today’s society. 

We use the former mainly for buying and selling goods while we use the latter as a term and a method for investing in large sums of money. In today’s twenty-first century, interest in these subjects has grown exponentially.

 Commodity theory may help us in our understanding of money. According to the Stanford Encyclopedia of Philosophy, commodity theory propounds that money serves three functions. Money enables the purchase of trades or goods between parties. Money serves as a unit of measuring value. And money also provides a way to store value. If  money does not exist as a tangible good in society, the theory states, society becomes inefficient. Society actually functions better with money, the theory contends, because simpler systems, like bartering rely on what is called the  “double coincidence of wants.” Put simply, this is when two parties each hold an item the other wants. At some point, members of society figure out that using money is easier than bartering to address this need. 

 Finance, again according to the Stanford encyclopedia, is a sort of intellectual infrastructure that involves the study of money and how it is used. Finance offers two key functions to society. A system of finance can help maintain an effective payment system. Such a system can also ease  the efficient use of money. This aspect is best realized when those with lots of money and those without are brought together to create opportunities to buy and sell goods.

This brings us to Forex which, according to Investopedia, a website devoted to information about the world of finance, is the largest, most liquid market in the world, with trillions of dollars being exchanged every day. Forex has no centralized location. The market is an electronic network of banks, brokers, institutions, and individual traders. When people talk about Forex, they are talking about trading within the exchange. Forex is the process of changing one currency into another currency for a variety of reasons, usually for commerce, trading, or tourism.

Is Forex good or evil? It’s not so simple. I would argue that while Forex itself is not inherently evil, students who blindly put their faith in it, and throw themselves into it, to the exclusion of other academic and work pursuits, are headed for trouble.

One must look at the root of the Forex: money. Is money in and of itself good or bad?  At one point, cows were just as valuable as a silver coin, if not more. However, money in and of itself is not bad. Neither is the study of finance, money, or Forex. For the act of acquiring true knowledge of all things useful — such as the humanities, sciences, even money — and understanding one’s own existence is good. Yet, the acquiring of knowledge does not always justify the actions one partakes in. Actions, such as theft or betrayal, are not justifiable, for the true knowledge of those acts will advise one to do the opposite.

With that said, Forex has led people to enjoy some good outcomes. According to Investopedia, numerous people have had success with Forex. For example, Andrew Krieger, by trading, netted $300 million in profits for his employer at Bankers Trust. Investopedia adds, “From (George) Soros to (Bruce) Kovner, the common theme among this list of famous Forex traders is that they have profited mightily from their thoughtful trades, which coupled with self-confidence and an incredible appetite for risk, has cemented them among the best and richest investors in history.”

The successes of people like Krieger, Soros, and Kovner have to do with two ideas to be cognizant of: standards of professionalism and the understanding of risk. The trouble that can be brought by Forex does not arise because Krieger or other various traders make millions. The trouble arises because people, especially young people, see these extreme profits and  dive into the field without much thought.  Rather than being properly educated about this risky procedure like the professionals, they are doing this, from my understanding, because of fear. What are they afraid of? For one thing, they are gaining a taste of independence, which is both empowering and fear-inducing. For another, because of so much rapid technological change, there is a great deal of uncertainty about future career paths.

For young people thinking about their future, Forex offers a tempting path for financial success. Unfortunately, for those who make the leap into Forex without giving it sufficient thought, they seem to adopt a motto, be it conscious or unconscious: Money over everything.

In order to avoid this fate of losing one’s center, one must have knowledge of Forex, money, finance, and what makes a person happy — in essence, what makes that person “tick.” Blaise Pascal, a Christian philosopher, explains existence in a pessimistic sense. He wrote: “Whoever does not see the vanity of the world is very vain him[her]self.” Pascal goes on to say that, “If our condition were truly happy we should not need to divert ourselves from thinking about it.”  The unwillingness to learn the true knowledge of the subjects upon which Forex is founded, whether driven mainly by one’s fear, ignorance, or greed, is not only detrimental to one’s material possessions, but to the one thing humans cannot regain if they discard it: one’s character.

Forex is not an end, only a means. To view it as an end will mean a person is living off a false promise. The false promise is that money will make you happy and keep you safe. But there are two inborn errors with those conclusions.  Many in the possession of great luxuries will testify that money brings you neither happiness nor security. In addition to the vanity in this world, or call it the abyss if you may, why depend on things such as Forex that falsely promise you comfort at the expense of what you truly like? More specifically, why give up your talents just to click a few buttons to make money? If one has a talent for investing in Forex, stock, or even in pursuing a career in finance, that is fine. It is a problem, though, when one blindly throws one’s talents away to chase money.

Anyone approaching Forex for trading must learn the rules, risks, and procedures properly. He or she should not drop ambitions in pursuing other interests. If that person proceeds according to this plan, he or she will not be as vulnerable to scams and greedy tendencies. Forex could bring fame, riches or power, but a person needs to know what to do with all those things in mind.