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The Federal Reserve’s Foreign Exchange Committee just released a report that shows Forex trading in North America rose to a record $977 billion per day in October.

Worldwide, the Forex market trades about $4 trillion a day – and North America now accounts for almost a quarter of that.

After the committee got through surveying all 25 financial institutions active in the North American foreign exchange market, they found that about 37% of the volume was euro vs. the U.S. dollar, and about 10% was dollar vs. the Japanese yen.

Thant means Americans are still largely caught up in two currency pairs, because those two currency pairs alone are accounting for almost half of the volume.

Personally, I spend most of my time focusing on Forex’s Forgotten 15% – primarily because that’s where the profits are.

But why are more Americans – most of whom are in the U.S. – turning to the Forex market?

Well, for one thing, the U.S. dollar keeps eroding in value. In fact, after a small recovery, the greenback is once again heading south.

That means the purchasing power of those Americans who do not take decisive action will continue to decline.

However, those Americans that short the dollar and buy other foreign currencies against it need not see the dollars in their Forex accounts dwindle. In fact, they can even profit from the Fed’s dollar-diluting schemes.

Let’s take a look at the chart below to see just how much purchasing power is being lost in the U.S. CRB Commodity Index…

Please click here to view larger image

The Most Important Index in the World for “Main Street”.

This index is vitally important to Main Street America. In fact, I consider it to be even more important than the Dow Jones Industrial Average or the S&P 500. Here’s why …

You don’t have to buy stocks – even though many of you own them through 401ks and IRAs, etc – but you do have to eat and buy goods for your everyday needs.

The CRB Commodity Index includes things like butter, cocoa, copper, corn, cotton, hogs, rubber, steel, steers, sugar, tin and wheat. Think you don’t use these things? You’re darn right you do.

So whereas you may or may not buy a stock…you’re going to eat. And you’re going to drive a car and live in a house that makes use of these and other commodities.

So I pay attention when CRB Commodity Index starts rising. It shows me that, unless I counteract it through the forex market, my costs will rise as my dollar’s purchasing power falls.

When you hear people say they don’t care if the dollar goes down and that it only affects them if they travel outside of the country, you can tell them I said that’s nonsense .

Here’s why…

Most commodities are denominated in dollars. So, if the dollar heads down in value, by default these commodities rise in value.

As your dollar falls…the price of your butter, corn, pork, clothing, beef, wheat or whatever becomes more expensive. And that’s exactly what is going to happen very soon.

Very soon, you’ll find that you need more money simply to feed and clothe yourself and your family.

The only way to make the dollar work for you is in the Forex market. That way, you can link the dollars in your account to appreciating foreign currencies, which over time will put more dollars in your account.

Your account balance will increase as if you literally owned a foreign currency and not the ailing buck.

Forex is the Best Tool to Defend Your Wealth

The thing I love about the Forex market is that it’s the best tool, in my opinion, to combat both the fall of the dollar and the rise of inflation.

Simply by owning foreign currencies – particularly the “commodity currencies” that rise right along with inflation like the Australian dollar, New Zealand dollar and Canadian dollar – you’re arming yourself against the ravages of the declining greenback.

This is what my Currency Cross Trader subscribers are doing. All of the trades we’ve made so far in 2012 have been plays on the falling dollar and on the rise of inflation.

We’ve profited from 100% of these trades so far simply by following this “dollar down/inflation up” theme that began again in January.

So it’s no wonder the volume of Forex trading is growing in North America.

If you’re not already doing so, it’s time join the Forex party.

Have a nice day!

Sean Hyman

P.S. Don’t miss The Sovereign Society’s ONLY offshore event of 2012. This is your big chance to attend the 11th Annual Total Wealth Symposium and join us in beautiful Los Cabos, Mexico. To make sure you don’t miss the opportunity to attend this action-packed, wealth-boosting event, contact us immediately to make your reservation. Spots are filling up fast. For full details, click here.

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