Foreign exchange student

It’s all part of something known as Forex, which is short for foreign exchange, the $5 trillion global market through which national currencies are bought and sold. Unlike going to a bank and exchanging the dollars in your pocket for, say, Mexican pesos, Forex traders never actually own the currencies they deal with. Instead, they leverage capital in their trading account to rent large amounts of currency known as lots. Depending on the size of one’s account, you might buy or sell a full lot of currency (equal to 100,000 units), a mini lot (10,000 units), a micro lot (1,000 units), or some multiple of those amounts. Money is made (or lost) whenever the price of a currency pair moves, which is known as a pip.

Currencies are traded as pairs, so when you buy one you are selling the other. If you are trading EUR/USD, then you are buying euros and selling dollars, or vice versa. If you buy one lot of EUR/USD, each pip is worth $1. If the price of the pair goes up 10 pips, then you have made $10. If you use 10:1 leverage, that same trade would be worth $100. Seems easy enough, right? In theory, it is. But the financial markets don’t operate on theory alone. Which is why it is prudent to practice and learn from one’s mistakes. And there are many, many ways to make mistakes.

Newcomers to Forex trading are strongly encouraged to hone their skills using a demo account. Like many things nowadays, there’s an app for that. Glenn downloaded a program in early December called MetaTrader 5 and has spent the last eight weeks all but glued to his cell phone screen, watching the undulations of the currency markets, cheering his frequent victories and cursing his occasional crushing defeats. (It is worth noting that all defeats, regardless of their magnitude, feel crushing at the time.) MT5 by default lets one open a $100,000 demo account, and while there is something empowering about making a winning trade that nets $1,000 or more in a few minutes, the prospect of opening a live account with that much trading capital is both unlikely and a recipe for disaster. So Glenn has been practicing with much more modest sums, currently working with a demo account of just $3,000. The highs and lows experienced during the trading cycle are no less extreme. The profits are more modest, but then so too are the losses.

Becoming consistently profitable is the goal. For example, say each trade you enter could cause you to lose $10, but you have the chance to make $30. That would be a risk-to-reward ratio of 1:3. If every three trades you won just once, that would be a loss of $20 for a gain of $30, or a net profit of $10. Scale that by hundreds or thousands and you can do well as a Forex trader. Getting to that point takes time, skill and patience. It also takes knowing when and how to lose, which is the part of the equation Glenn hasn’t mastered yet and the reason why it will likely be months before he attempts to go live. Despite himself, he managed to grow his $3,000 demo account by nearly 125 percent in its first week. That was before one bad trade erased a quarter of the profit. Yes, there are days like that.

But the biggest obstacle to a would-be Forex trader in the United States would appear to be obtaining a broker. Unlike stocks and bonds, which can be purchased from hundreds of reputable sources, there are less than a half-dozen licensed Forex brokers in this country. Even if you do locate one, their spreads (read fees) and commissions per trade make it far more difficult to become profitable. For that we can thank the economic collapse of 2008 and the Dodd-Frank Act that reformed the financial services industry. Forex brokers have since become more heavily regulated by the CFTC — arguably a good thing for their customers — which has led to many of the shadier ones closing up shop in the states. Those that remain find it hard to turn the profit they need to survive, so they either pass those costs along to clients or stop dealing in Forex.

U.S. Forex traders are at a distinct disadvantage compared to those in other parts of the world. Some countries allow account leverage up to 500:1 (which is insane) while the U.S. allows just 50:1. U.S. traders are not allowed to “hedge” their accounts, which is the act of having multiple buy or sell positions open on the same currency pair. In order to open a new position, any previous position must first be closed. That limits a popular trading strategy others are allowed to use. There are other rules, but those are the key differences.

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W

HETHER GLENN ULTIMATELY swaps his news editor’s eye for one focused instead on ticker charts, Fibonacci retracement levels and international economic reports remains to be determined, but for now his fascination with the world of Forex and his initial success in his demo account has him preoccupied. Much to Roni’s chagrin. She hasn’t yet screamed at the mere mention of his trades, but she’s got her mind on her own work, which is keeping her busy as winter grinds along and she looks ahead to spring projects at the sanitary district.

This month, Roni’s hard work paid off as she and the district cleaned up at the annual California Water Environment Association regional awards dinner that took place Jan. 26 in Concord. The district entered nine categories, winning five of them including Plant of the Year for the second year running, and Roni personally was recognized as the Outreach Person of the Year. That is a high honor here in the Bay Area, and it puts her in the running for statewide honors this spring. We’ll be keeping our fingers crossed. One category the district entered again this year was for outstanding newsletter, an award it won at the local level in 2017 and finished second statewide. We have produced that newsletter for the past 16 years as part of Roni’s business. For whatever reason, no award was made in 2018 despite there being several entrants, so we are left to wonder what happened. Glenn joked that maybe they needed some former journalists to help judge the category. He wasn’t volunteering, however.

Roni also has been thinking a lot about some home improvement projects she wants us to tackle, including replacing the kitchen floor. Actually she would like to replace the entire kitchen, but seeing as that is out of our budget for now, she’d be happy with something other than the 30-year-old linoleum that has seen its day. We did some tentative shopping at the home improvement stores and picked up some samples of flooring products that looked promising, including something called LifeProof Luxury Vinyl Planks. They are about a quarter-inch thick and resemble the look and feel of real wood products, and they snap together in tongue-and-groove fashion. They look nice, but best of all is that they are waterproof and recommended for kitchens and bathrooms.

We had installed Pergo planks years ago in our hallway with mixed results. Before we committed the entire kitchen floor to these LVP planks, we wanted to make sure they looked good and wear well. So we decided to try them out in the second bathroom at the end of the hall. That bathroom has been in need of an overhaul anyhow, so we figured we’d do the floor along with some fresh paint, a smaller vanity and a new toilet. We’d really love to do the tub and shower too, but it’s a bigger project than our budget and energy levels will permit right now. We bought most of the supplies we’ll need over the past week and have already begun painting and preparing for the demolition work. Probably by next month we’ll have a finished project to show you.

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J

ANUARY ALWAYS SEEMS to be the time for new things, perhaps because we’ve cleared out the house of holiday season clutter and there are endless post-Christmas sales to tempt us. It’s a particularly good time for finding new furniture and appliances. We’ve been in the market for a new recliner for the living room, or rather Roni has been in search of one for more than a year. The two we got as part of our current living room set a decade ago are nearing the end of their useful life, and given that they have been Roni’s favorite seat in the house where she watches TV, surfs the web and reads her books, she doesn’t want to be without them when they finally go.

We always suffer sticker shock when we go to “real” furniture stores. We budgeted about $500 for a new recliner, but just about everything we saw in that price range was either uncomfortable or looked like it might not last more than a couple of years. It doesn’t help that we have expensive taste, being drawn to models that have power leg and head rests, which run upwards of $1,500. We could probably buy a whole living room set for that if we were willing to settle on quality — and we almost did, when we saw a sofa, recliner and ottoman combo at Costco for $900. It was quite a nice-looking set, and the chair was exactly what Roni wanted. There was just one catch: we’d have to find a way to get it home. Costco doesn’t deliver, which left us the option of renting a truck or hiring an independent delivery company to do the job. With that, tax and disposal of the old furniture, we were looking at nearly $1,200 for a set that included a sofa we don’t really need.

So it was back to the idea of just buying the chair. And unless we were willing to buy sight unseen from someplace like Wayfair, our options locally for furniture stores are very limited. There are maybe three bonafide dealers of quality furniture in our area of East Contra Costa County. It’s not like the old days when you could go to Sears, Macy’s or JCPenney and outfit your entire home. Nowadays the department stores sell beds and bedding and pretty much nothing else. Even if you can find one that still sells tables and chairs, they are usually located in larger markets. Apparently larger than Concord or Walnut Creek, which is where we eventually wound up looking fruitlessly for affordable department store recliners.

We’ve been all over the map just trying to find an affordable, comfortable chair, and still we don’t have one. Never did we imagine that looking for new furniture could be as tough as shopping for a new car or house. We’ll have to update you on our progress next month.

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A

FTER DAYS OF frustration, the migration to the new computer is complete. We acquired Glenn’s new 27-inch iMac during a Cyber Monday sale back in November, but it wasn’t until the start of the new year that he actually got around to unboxing it and setting it up, largely out of concern that he didn’t want to make the transition from old to new amid other projects that he needed to complete. It turns out that was not an unreasonable concern.

To prepare for the upgrade, Glenn backed up all the files from his old computer to a 5-terabyte external hard drive, deciding he would later choose what needed to be on the new machine and what could easily be left archived on the removable drive. There was just one problem with that: the external drive FAILED just as he was in the process of restoring files to the new machine. That might have been just a minor nuisance, as those files were still intact on the old computer, but the backup disk also contained years’ worth of digital photos we had no other copies of.

As luck would have it, Glenn had partitioned the external drive into five sections when it was new, and the two partitions containing our precious photos remained unscathed. For now. But it has been our experience that once a partitioned drive begins to fail, it is just a matter of time before all the partitions go and become unrecoverable, so we had to act quickly. Using all the available space on the new computer’s 1-terabyte drive, Glenn spent hours copying over photo files from the ailing external drive as a temporary place to house them until a more permanent solution could be found.

The emergency rescue project ran late into the night. Just as it was nearing completion, Glenn went to log in to the new computer and it wouldn’t accept his password. He hadn’t mistyped it; somehow the system profile had been corrupted and no longer recognized any of the computer’s registered users. Despite looking for a solution in Apple’s help forums and trying various suggestions on the internet, the only fix was to reinstall the system software. The problem was that there was no longer enough space to do so on the startup drive because it now contained hundreds of gigabytes of recovered photo files. So first Glenn had to install the system software on another partition just to be able to boot up the new computer and move the photos to another place. Then he had to erase the startup drive and reinstall OS High Sierra. It was another day wasted and a lot of programs that had to be reinstalled along with their preferences, but at least Glenn was finally able to log in to his own computer.

Now, back to the rescued photos… Given this was the third external drive we had lost in a couple of years and had come within a hair’s breadth of losing all our photos once before, we decided the prudent move would be to make a backup copy of our backup copy. So it was off to Costco we went to purchase a pair of Seagate 4-terabyte portable drives, the idea being that they would both contain identical files and one would be stored away in a drawer in the probable event that its twin failed one day. We just weren’t prepared for how soon “one day” would come.

The evening we got home from Costco, Glenn took out the first of the two new drives to format and partition it using the new computer. Within seconds he received a message saying that the operation had failed and that the disk could not be mounted. The recommendation was to back up all the data on the drive as soon as possible. Well, better to find out we had a lemon now rather than after all our photos had been stored there. Glenn spent the next day trying in vain to erase and reformat the drive, but in the end we decided it was beyond hope and returned it to Costco for an exchange. This did not give us a lot of confidence in its twin or the replacement. Less so, given that all the drives we had lost previously were Seagate brand. Undaunted, we forged ahead with our backup plan and breathed a sigh of relief when all the photos were (safely?) copied to both drives. We just hope two backups are enough to save us the next time around.

Because the backed-up computer files had all been lost in the original drive failure, instead of quickly transferring them from the removable drive to the new iMac we were forced to drag them over from the old machine to the new machine individually via wifi — a process that literally added hours if not days to the project. Because the previous computer was purchased in 2011 and hadn’t been upgraded much since then, most of the software was horribly out of date anyway, so Glenn decided to start with a clean install of Mac OS High Sierra and then add back recent versions of the programs he needed. It is amazing how much abandoned software just sits around on your computer, taking up valuable space on your hard drive. Once you clean house there is all sorts of room you never knew you had.

Because we were upgrading to a computer that was six years newer than the older model, we harbored the false notion that it would be much faster. Not only was it no faster, it also was no less of a memory hog when it came to running iTunes, Firefox or Photoshop. Glenn knew the stock 8GB of RAM wouldn’t be enough to handle it all, so a memory upgrade became the next thing we invested in after the backup hard drives. We ordered 16GB of memory from B&H Photo that arrived and was installed about a week later. It helped the computer’s sluggish performance, but we were nonetheless surprised that most of the expanded memory was quickly consumed just doing standard things such as listening to music and web browsing. We don’t edit high quality video or audio, so we assumed we would be fine with having 24GB of RAM. Now we are regretting not upgrading further to 40GB.

So far the jury is still out on what we think of the new machine. Glenn hates the new High Sierra operating system, the new iTunes 12.7 and the gigantic memory suck. He doesn’t think the tiny lithium-ion bluetooth keyboard is adequate, nor is the new Magic Mouse 2 as comfortable to use and its predecessor. He dislikes that there is no DVD drive and that the photo card reader is located inconveniently on the back of the computer instead of on the side where it used to be. He is disappointed that it has a slimmer profile that no longer allows him to put his nicknacks on top of the monitor. All that said, at least the graphics card works properly and the machine isn’t freezing up once or twice a day, as the old one was doing.

The old 2011 iMac hasn’t been completely mothballed yet. We moved it to the Writing Sanctuary, where it is currently functioning as a Cloud-connected word processor. For as long as the video card lasts.

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W

ITH CHRISTMAS BEHIND us and the decorations safely put away, we decided to “release the beasts” from their nighttime cage in the living room. Phoenix and Phyre have proven themselves to be a couple of little terrorists at night, so it was in the interest of preserving the house that we kept them confined at bed time. But they have outgrown that space and frankly we knew we couldn’t keep them penned in forever. Starting Jan. 1, we threw caution to the wind and let them roam free in the wee hours.

It has been an up-and-down month for those two with their newfound freedom. They oscillate between sleeping on our bed — usually on top of us — and tearing through the house in the dark, leaping over us as they rumble and tumble in their usual brotherly tug-of-wars. Katy isn’t at all happy that our bedroom is no longer her nighttime sanctuary. The kittens seem to have an endless capacity for getting into trouble, and can still be found late at night parked on the kitchen counters or worse, up on the ledge that separates our kitchen and living room. We hope they will soon adjust to the new night routine and settle down.

Cats aren’t known to get sick often, but this month both Phyre and Katy came down with something that resembled a cold. They were both sneezing frequently and had runny eyes. Katy got the worst of it, although she never lost her appetite or her spunk, thank goodness, because we didn’t want to have to take her to the vet. They both appear to be mostly recovered from their ailments now.

Ben did some remodeling of his own this month when he bought a new desk through Amazon to replace the rickety wood tables that had lined one wall of his bedroom. With the new drawing tablet he got for Christmas he needed more desktop space to use it comfortably. The new corner desk provides that beautifully, although he somehow managed to lose the drawing pen that came with the tablet during the desk installation. Fortunately replacements are cheap. The old tables he removed have come in handy as workbenches while we paint the baseboards and wainscoting for the bathroom.

Ben also continues to practice his driving, although weather and conflicting schedules have prevented us from getting out on the street much. He and Glenn did spend one rainy afternoon testing out the freeway. Glenn’s old car has been a trooper, but we did have to replace its battery this month using the one we had bought for the other Corolla that will eventually be Ben’s. Swapping parts seems to be a way of life in our driveway.

Speaking of driveways, our new neighbors are in the process of widening theirs just a month after buying the house. The real estate flippers they bought it from spent most of September installing a beautiful front lawn that has now been stripped out to make way for a concrete slab that will consume the entire front yard. Ugly but functional. Apparently they aren’t aware that the city requires at least a portion of the front yard to be plants. Or maybe they don’t care.

That’s going to wrap it up for this month. Now we have to try to figure out how to get this online using the new computer and reconfigured software.

 

Glenn, Roni and Ben