The Next Disaster: Currencies
Saturday, November 15, 2008
Check out the fine print on the website of the CNBC Million-Dollar Portfolio Challenge: a "Fantasy Stock Trading Game", or something like that. It's hard to tell what the Challenge is because the website's so awfully vague. But I noticed this.
Free $25 Currency Trading Account
As a participant in the CNBC Million Dollar Challenge, you are eligible to receive a free $25 FXCM Micro trading account.
You will be able to trade currency with REAL money without depositing any additional funds. A $25 account will enable you to trade up to $9,000 of currencies.
Disclaimer: Without proper risk management, a high degree of leverage can lead to large losses as well as gains.
Click Here To Apply
Read that again. A $25 account will let you lever up to 9,000 dollars, but remember! high leverage is risky.
This is more insane than any of the leverage schemes of 1929. (1929 was all about leverage, and arbitage - both of which the U.S. government is practicing openly and profligately today).
CNBC emphasizes that people will be playing with REAL money.
No, no - this is fake money. This is where the fictional economy begins. This is the catastrophe.
POST-SCRIPT:
CNBC is a "service" of Dow Jones and NBC (and "parent company" General Electric). In a few months, that station is off the air.