Hello! First post here so hopefully it's worth of a reply:
I'm new to trading, just working my way though Guppies Trend Trading and have been reading forums, websites, paper trading and generally learning about the whole sphere (from options to Forex, though to creative use of leverage)
My first question is:
From what I understand, at any one point the world has a static X trillion dollars. When announcements are made that 5 trillion has been lost from the markets due to recent volatility,be it subprime, China's correction etc where has the money actually gone?
Is the static X trillion view even correct or is the 'value' of the market really just an agreement of interest between all the players. What I'm trying to say is, the financial market just the same as say a auction of art.
I'm not exactly looking for a 'tree falling in the forest' kind of answer as from what I understand the people who are cashing out of the market actually have real money they are putting -somewhere-, though the only places I could think of would be Bonds, forex, commodities, etc and I would expect you would just see a bulge there as the trillions moved across.
Where does all the money go?