I am yet to understand what the "trust" do.
CAn someone explain please?
"Trusting" an entity in Ripple is saying that you treat their word as a substitute for money. If you want to send me $1000 USD, Ripple has no way to do that, because Ripple cannot handle actual dollars, it can only handle promises (and XRP). But if I have a Bitstamp account, a promise from Bitstamp to pay me $1000 USD on demand is worth about $1000. If you send me $1000 of Bitstamp USD IOU's, I'll happily take them as payment, because I can convert them into cash without too much trouble. I can also hold onto them and send them to somebody else who wants them as payment. However, if you tried to pay me with pirateat40 USD IOU's, I wouldn't be interested in them, and wouldn't accept them as payment, because I don't think I can ever turn them into real money.
Trust is the way Ripple distinguishes between those. Ripple will only ever give you IOU's from entities you extend trust to. In practice, you should probably limit your trust either to amounts you wouldn't mind seeing disappear or to established businesses with a proven record for handling money. With a healthy Ripple network, you should only need to extend trust to one major gateway you have an account with. You'll still be able to send payments through Ripple to users of any other major gateway.
One thing to be careful with in using trust on Ripple. If you trust IOU's from two accounts in the same currency, Ripple may use your account to exchange IOU's. If you treat both of them as worth their face value, you shouldn't mind – it'll exchange one IOU for an equally good one. Perhaps you trust your friend Amy for 5 BTC and have a balance of 100 BTC with Bitstamp. Amy can pay anybody who accepts Bitstamp BTC by rippling through you, and it will replace 5 of your Bitstamp IOU's with Amy IOU's, which you probably can't pay anybody but Amy with. You're opening a line of credit to Amy, and Ripple lets Amy use this credit directly by spending your money. This could be inconvenient if it isn't what you're expecting, so be very careful about who you trust, particularly when trusting multiple people with the same currency.