A large number of issues drive the Forex market. Forex strategy and Forex trading is usually focused on the here and now. Forex trading software is geared to take advantage of technical shifts in global currency patterns. However, every so often there is a monster issue in a major country which has the potential to drive value of the nation’s currency up down significantly. Forex and health care in the USA may be one of these. An adequate health insurance system will be very costly and will have the potential to drive to dollar to new lows.
The problem with providing health care payment to everyone is the immense cost. Eighty percent of health care cost occurs in the last year of life and half occurs in the last month. These are United States figures and have to so with the availability of extraordinary means of prolonging and saving lives. Unlike the public health care system in England where someone over sixty with a heart attack is treated at home the USA puts everyone in a cardiac unit at substantially higher cost.
Forex trading will not be immediately affected if the USA passes a heath care bill out of both houses of congress but one’s long term Forex strategy should take such a monster money sink into consideration. Certainly, when money is paid to US doctors and hospitals it does not leave the country. However, up to 40 percent of health care cost is insurance company overhead and paperwork done by providers. This money goes out of the health care system and can easily leave the country in the form of dividends for foreign shareholders of United Health Care, for example.
Forex and health care are therefore related in the USA. Forex trading will be affected and one’s Forex strategy will need to take this huge cost into account.
The flip side is that US industry could end up being more competitive if the burden of paying health insurance for their employees is lifted. It was said that GM had to add $1,700 to the cost of each car to cover health care and retirement expenses. If US industry can save money because its employees are covered by a government insurance plan then the US could become more competitive across the board. Then Forex trading of the major currency pairs would reflect this in an increased value of the dollar.
A successful Forex strategy for this situation would affect day by day Forex trading in that announcements of the Federal Reserve and changes in monetary policy happen and affect Forex trading immediately. Thus a slide or ascent of the dollar will never be gradual. Forex trading will always see a discontinuous, saw tooth graph, set of changes and that is were Forex trading finds it profits.
It could well be that the mix of expense of a national health care system and a revitalized US industry could make Forex trading very interesting and, for those with a smart Forex strategy, very profitable. Keep in touch with health care and Forex in the USA.