A Potted History of Forex

Author: Steven J. Stephens
Forex is the name given to the special marketplace that facilitates the buying and selling of paired foreign currencies. The name itself is an abbreviation of 2 words, the first word being "foreign", and the second word being "exchange".
Before the dawn of the civilized era, long before monetary systems were ever thought of, and long before even bartering came into being, things did not have a value assigned to them other than a degree of ownership desirability. If you wanted something you merely took it, brute force and inconsideration being the rules of the day.
Buying and selling began through the system of barter. With its obvious disadvantage due to its lack of specific monetary units, bartering was soon to be replaced with the earliest monetary systems. The first appeared in 2500 BC, although some sources state it may have been 5000 BC. Suffice it to say that it was a very long time ago
Of course as each country developed in isolation, they each developed their own monetary systems, and it wasn't until 1875, when the "Gold Standard Monetary System" came into being, that a viable system for foreign exchange was born. It was based on the amount of their local currency that any one country assigned to one ounce of gold. This created the opportunity for the price of gold to fluctuate from country to country, in effect creating the first currency exchange system.
The Gold Standard Monetary System stayed in place until the advent of the Second World War, the chaos of which ended the system and instead brought the Bretton Woods system into being, a system which established the US dollar as being the world's reserve currency. This in itself lasted until 1971, when the Forex system, which is still in use today, was launched.
Initially the Forex system was used by countries and companies that specialized in conducting foreign business. But with the explosion of the World Wide Web, by the mid-1990s Forex came to be used by thousands of private individuals who wanted to play the money market.
There are now many specialized Forex brokers (such as Trade Empowered - http://tradeempowered.com) that service the industry, providing the facilities through their specialized software programs to buy and sell paired foreign currencies.
Today's Forex market is worth trillions of dollars. There are 3 sessions throughout a 24 hour day; the Asian session, the European session, and the US session. The market is in effect open to all comers 24 hours per day, and 5 days per week.
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