What's to stop somebody from doing this....

[CLEP101]

The thought just occurred to me the other day, I'm confident there is mechanism built in to make this impossible; however, I cannot figure out what it could possibly be unless my whole understanding of the system is wrong. I've never traveled and simply have no idea.

Say there is an exchange rate for money X vs the dollar of 2 vs 1. Say that money X can be converted to money Y at an even exchange rate of 1 vs. 1. Finally say money Y converts at 1.5 vs 1 to the American dollar. In my hypothetical scenario one could convert dollars to X and then X to Y and then back to dollars at a profit. Why doesn't this work?

I'm sorry, it's just bothering me. I, a silly, uneducated, untraveled 21 year old wants to know. I can't figure out how to ask google this question, it's a poor explanation in this context, let alone the rigid confines of a search engine.

I did that all the time in Korea with the Korean Won. It was an average of 1050 Won vs. 1 USD. When ever the WON went up to 1300, I would buy it and save it until it would go back down closer to 1000, then I would sell it back. But in order to make a good profit I would have to spend at least 2K or 3K grand USD. the most I would usually buy at a time was $1,500 USD X 1290 WON = 1,935,000 WON. When I would sell that back at 1050 i would make around $1840 USD or $340 USD profit. :coolgleam: