I have a question and would appreciate feedback. Not trading-related, but about how capital flows between currencies should/would affect assets denominated in those currencies. Stricly defiined, forex / currencies is not a market to "invest" into. It's a "trading" market. i.e. once I convert my Euros into USD (or vice versa), I have to "put" them somewhere: e.g. in Tbills, in bonds, in stocks, in real estate, in cash under mattress. So, I would assume that the price of assets denominated in the currency, which is experiencing net capital OUTFLOWS, would FALL. Using similar logic, the price of assets in currency experiencing net capital INFLOWS would RISE. Considering the -12% of EUR/USD YTD, suggesting big outflows out of EuroZone, isn't it a bit odd that both EuroZone bonds and stocks (and other assets) were rising during the same time (first 6 months of 2005)? I wonder how much of the volume in the forex market is done in OTC derivatives. Thanks in advance for feedback.