I'm no xpurt at math but I think you'll find non margin is around 20:1. I would love it to be more choppy as that affords more opportunity for profit but I don't think that will be a side effect. I expect there will be a global move into large trading blocs like the Euro but that will take some time to agree and then a one world currency. Things could speed up if the US$ is devalued and I'm trying to find out if the rumor mill (Bob Chapman) is correct about a forced bank "holiday" coming up, possibly in Sept. Supposedly US Embassy's have been instructed to load up in non US currency so I am tapping a friend for confirmation. If anyone has consular friends it would be worth confirming. That would not be one to get caught up in as stops would be useless.
1.5:1 would significantly hurt retail FX. Let's hope that never becomes a reality. However, lowering to around 25:1 won't destroy the game. It will probably take away a little bit of the dead money though.
fx trading is not as popular in the US as it is in Japan or Europe thus they will most likely reduce it to the 1.5:1 leverage they could not do such a thing in Japan since everyone knows that 95% of household wives are daytraders since they get nothing for leaving their money in the banks
I think every central bank around the world complains about disorderly markets caused by speculators, Trichet's always banging on about it, so did Greenspan, decreasing available leverage will probably make intervention easier (or cheaper) for them. I don't know if, or by how much, Soros leveraged when he screwed the BoE but what happened is a classic example of how speculators wield enough power to screw economies up. They're planning on restricting commodities speculators, why not go for currency speculators as well, hell why not just go all the way and ban capitalism altogether!
Oddly enough, I'm for a certain amount of regulation on speculation. If for no other reason than speculators take things way to the extreme just to do it. they ignore fundamentals in many cases and just try to smash price in one direction or another and it's disruptive to the common man (like in the case of energy). The plus side is that it provides liquidity. I get that. But when everyone jumps on the bandwagon, things just get out of hand. So I guess you can say I'm against extreme speculation.
I agree with you, price often doesn't reflect fundamentals but take oil for example. If you were making money from speculating in oil (and a lot of people made a lot of money) would you be against extreme speculation so much? No, you'd probably be hoping to see oil at $200! Sure it's probably not morally acceptable to gain at other's expense but since when did traders have any morals when it comes to trading, generally they'll buy and sell anything if there's a buck in it. When I evetually quit trading I'll probably be complaining just like every other average joe consumer, until then I'll just appreciate the volatility and try to take advantage of it