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March 01 - 14, 2008

 

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Note: The intention of inclusion of charts in FAQ is to illustrate trading principles - The appearance of a chart does not imply any kind of indication or recommendation to buy, sell, hold or stay out of any positions.

 

 

Questions

(Quotes from Ed in Red)

Answers

Fri, 14 Mar 2008

 

Risk Management in Spanish


Hi Ed,

How is it going?

Please find attached a link to the Spanish translation of Risk Management:


 

http://www.eljugo.es/glosario/

gestion-del-riesgo-seykota.htm



Let me know if you think I should carry out any changes before releasing it.

Sincerely,

Parece bonito bueno a mí.

Fri, 14 Mar 2008


Thank You


Dear Mr. Seykota,

I am glad to see that emotions are still trending in the now. Thank you for the constant commitment to the global Trading Tribe.

Thank you for the encouragement.

Fri, 14 Mar 2008

 

Professional Stock Picking


Hi Ed,

You may find this interesting.

Davita (DVA) wins an MBA stock pitching competition and is considered a strong buy - based on funnymentals - as judged by professional investors at a prominent business school.

 

Holcim (HOLN) wins the October 2007 competition.

 

Funnily enough the market does not agree with the funnymentals as per the charts.

Thank you for teaching the wonders of simplicity and common sense.

Thank you for noticing how the "real world" of professional investing works.

 

And here are the "winners."

 

 

 

HOLN

 

 

 

DVA

 

Fri, 14 Mar 2008

 

Whipsaw Song

 

Ed,

 

This is ask you how you are coming along with realizing your snapshot - about making a video of the Whipsaw Song.

Thank you for asking.

 

We are currently editing the footage.

 

 

 

Rick, Jim, Ed, Ed and Don

 

Thu, 13 Mar 2008

 

Taking Confusion Elsewhere
 

Ed,


Ed Says: You might consider taking your feelings of <confusion and wanting others to rescue you> to Tribe.

Ed, I have moved my questions to another forum.

OK.

Thu, 13 Mar 2008

 

MIT Prof Walter Lewin

 

Ed,


Thought you'd like this about MIT & Physics.

Video: http://potw.news.yahoo.com/s/potw/

63302/high-wire-act

Thank you for the URL.

 

I'm favor of more Lewins and less Ritalins in the schools.

Thu, 13 Mar 2008

 

To the Point


Hail Ed!

I have read and contemplated Trading Tribe twice. Thank you for the insights. I have contacted all the tribes in 3 neighboring states but none have pursued the process or replied. I am open to any suggestions how I might proceed to realize the experience.

Some background on myself:

I am a philosopher in the true sense of the word (lover of wisdom).
 

I am a student of metaphysics/consciousness/spirituality.
 

I have spent 20+ years in the speculative homebuilding business.
 

I am fairly well read on trend following methods and psychology.

Perhaps a short phone conversation with you or one of your students could point me in the right direction, if you would be so kind.

Wishing you continued joy, prosperity and evolution.

For private consulting, see Ground Rules, above.

Wed, 12 Mar 2008

 

High Frequency Trading and Commission Costs


Hi Ed,

Hope all is well with you. I'm curious on the issue of higher frequency trading. When individuals have brought up the idea of shorter term trading your response usually involves the fact that commission costs remain constant while profit potential per trade is reduced.

My limited research has shown that although your profit potential per trade is less than a long term trend following strategy, the upside is that you are able to compound your gains (albeit smaller per trade) on a more frequent basis. In addition, the commission costs are typically $0.005 per share or $0.5 - $1 per contract for options/futures last I checked with the more competitive brokerage firms. With all this said have you re-evaluated a short term trading strategy factoring in these relatively cheap commission rates? Your feedback is as always much appreciated.

Transaction costs for high-frequency trading include more than commissions.  You also have to deal with the bid-ask spread, reaction-time cost and fatigue.

 

If you have a computer back-test that matches your actual trades for a high-frequency trading system, please send it to me.

 

You might consider taking your feelings about <patience> to Tribe.

 

 

 

To Test Your Reaction Time

 

Have a friend

suspend a dollar bill

by pinching it loosely at the top

between two fingers.

 

Place your own thumb

1/4 inch in front of George's face

and your forefinger behind the bill

so you can catch the bill

when your friend releases it.

 

Have your friend release the bill

without telling you when.

 

You are likely to discover

you cannot react quickly enough

to catch the bill.

 

You are also likely to discover

that high frequency trading

that requires quick responses

is another exercise

in watching George

slip past your fingers.

 

Clip: http://lifessmalltreasures.blogspot.com/

2007/10/facts-of-us-dollar-bill.html

Wed, 12 Mar 2008

 

Workshops


Dear Ed,

Do you happen to have another workshop scheduled for this year? If not are there plans to hold another?

Regards

I do not have a Workshop on the schedule at this moment.

 

I am noticing some gathering interest in another Workshop.

Tue, 11 Mar 2008

 

Systematic Self-Destruction

see previous



Dear Ed,

 

I quote from my previous post: (Systematic Mon, 3 Mar)

All I ask is that you keep up your website and I’ll keep to my system.

I didn’t keep to my commitment and blew my account up. I believe everyone get’s what they want and I am angry and upset but not looking for sympathy, I must have wanted it? I can’t figure out why though yet.

I am sorry for breaking my commitment as it seems with the fast posting of FAQs now you are keeping up what I asked of you. I wonder what my problem with commitment is, I seem to keep promises in other areas of my life and am generally considered "reliable" in that sense, a tag I cherish really so I don’t understand why I keep breaking my own rules.

I guess I am going through the process that leads many eventual Tribe members to the TT process.

I am taking your book home from the office tonight and hope it sinks in this time.

I have been in touch with [Name] who informs me the "leader" of the [City] Tribe and the Location have changed. I thought you might want to amend your listing if this is the case.

Many thanks, I hope to be in touch in a few months with better news.

Regards

Thank you for sharing your process.

 

Sometimes people engage some or another form of intense drama in order generate strong feelings to medicate deeper issues.

 

You might consider examining your feelings about <right livelihood, primary relationships and health> to see if you find any such deep issues to address.

 

 

 

This Cheerleader

 

sets it up

to get run over

by the football team.

 

see video

 

 

Clip: http://montrealradioguy.wordpress.com

/2007/11/01/cheerleading-can-be-dangerous/

 

Video: http://www.break.com/index/

cheerleader-gets-run-over-by-football-team.html

11 Mar 2008

 

Curiosity

 

Salutations Ed,

Glad your back and doing well. Congrats on the weight loss also. I find it humorous how much advertising there is on weight loss pills and shortcuts.

 

It's a far cry from the good old fashioned eat less and exercise method; one of the many other things that are an easy concept to understand but hard to put in action.

I have a few questions Ed if you don't mind (mostly based on curiosity):

1. What was / is the longest market trend you ever rode?


2. If portfolio heat is psychological, can we say that betting 2% of capital per trade on a portfolio of 20 stocks is the same as betting 4% of capital per trade on a portfolio of 10 stocks?


3. Will you share with us one of your monumental AHA experiences?

Thank you for your support on my health project.

 

I don't as a rule, reveal personal information. See Ground Rules.

 

Although you can say it, 20 @ 2%  !=  10 @ 4%. 

 

You might consider taking your feelings of <curiosity / using "I" instead of "we"> to Tribe.

 

 

 

Curiosity

 

does not necessarily

carry an entitlement to explore.

 

 

Clip: http://www.ebaumsworld.com/pictures/

view/20557/page=5

11 Mar 2008

 

$200 Billion

 

Ed,

 

These are excerpts of the recent report by
Brian S. Wesbury, Chief Economist, about the $200 Billion Fed Loan.


Below are comments on today’s Fed Announcement of its new lending facility. In addition, we are re-releasing our 2/11/08 Research Piece titled“Fed Hesitation Hurting Economy”.

"The Fed calls this new arrangement the Term Securities Lending Facility and the funds will be made available to the twenty primary dealers that already trade Treasury securities on a regular basis with the Federal Reserve Bank of New York ...

We believe the Fed has already provided the economy with more than enough liquidity to grow at a robust rate later this year ... as long as consumers and businesses foresee much lower rates ahead, they have an incentive to postpone activity.

 

By narrowly targeting the problems in the credit markets rather than broadly influencing the economy through additional steep rate cuts, the Fed has greatly improved its approach.

 

The troubled financial markets are like an athlete with the wind knocked out of him.

 

Today’s targeted Fed approach is like giving him smelling salts to get him back up, rather than the unnecessarily long-lasting effects of shooting him up with adrenaline.

Thank you for the article.

 

According to the article, The Fed is acting to provide medicinal responses to the feelings of the transitions we are experiencing.  This may prevent the economy from developing and implementing pro-active responses.

 

 

 

Smelling Salts

 

 

Adrenaline (epinephrine)

 

 

Doctors sometimes apply smelling salts and "epi" to "help" an athlete with a "temporary" condition. 

 

In some cases, this may interfere with the athlete coming to terms with his underlying health issues.

 

Administration of drugs medicinally (to target feelings) rather than pro-actively (to target the underlying situation) may lead to addictive dependence on the drug.

 

The Fed's actions do not target the underlying situation (culture of entitlement, regulation and dependence on central government) and deal instead with the feelings (fear of loss).

 

Note: Very few "fundamental" econometric models include these factors as they are somewhat outside the current definition of politically correct.

 

Clips:

http://www.antiquebottles.co.za/Pages/

Categories/Odds&Sods.htm

 

http://www.worldofmolecules.com/

emotions/epinephrine.htm

 

Tue, 11 Mar 2008

 

Thank You

Hi Ed,

Glad to see that your weight program and personal growth trend are back on track now ... / and you are back online, sharing openly your comprehensive insights with others again.

The system which you motivated me to finish developing during my visit to Incline Village a few years ago, plus the confidence instilled in me then to stick with it, have given me tremendous benefits both personally and monetarily ever since. I will never forget this AHA ...

The recent supper runs in PA, SB, JY, BO and GC, have reminded me not to neglect sending a Big Thank You to Easy Ed, for all the past help - You are really what made it all happen for me !!

I hope to see you again soon, and do take good care dear friend.

Best regards,

Thank you for sharing your progress. Thank you for the encouragement.

Tue, 11 Mar 2008

 

Empty FAQ Page


Hi Ed,

A blank page appears for the year-old January 1-8, 2007 FAQ page.

Thank you for the catch.

Mon, 10 Mar 2008

 

Client #10

see previous


Ed Says: Barbie Turns to Carbs to medicate her feelings when she discovers Ken is Client #10.

Ed you come up with some really good zingers every now and now lol. Its funny how the people that try to control the moral actions of others cannot seem to play by their own rules.

PS. Ed, I am happy to report progress regarding the email I sent you a while back on Mon, 19 Nov 2007 titled, "Right Livelihood and Cutting Losses". I reduce the price of my store ever so slightly every month or so and now receive 2 offers for my Italian Gelato Store. I accept one of them which closes on March 28. I look forward to progressing full steam ahead with my market research and equities trading system which is coming along nicely. Take care.
PPS. Great work with sticking with your new "eat less, exercise more system!"

Thank you for sharing your progress.

Mon, 10 Mar 2008

 

Risk Article in Spanish



Hi Ed,


I am sending to you a permanent link to the Spanish summary translation of Trends:

http://www.eljugo.es/glosario/

tendencias-seykota.htm

Sincerely,

Thank you for the URL - and for the translation.

Mon, 10 Mar 2008

 

Greek Culinaria

see previous


Hi Ed,


Ed says: Late in December, 2007, in response to various questions about breaking addictive patterns, I commit to mastering my own relationships with food and exercise before continuing to offer suggestions to others. I am now about 20 pounds lighter and healthier in other ways as well.


I am happy to read that. Congratulations - I know how great it feels to lose weight. I have struggled with my weight as a teenager and most part of my life. I have shed the pounds through healthy diet and consistently following a nutritional and exercise system! I guess following a diet is analogous to following a trading system in some respect.

Its great to have FAQ back. Thanks for all you do Ed. All the best with your endeavors for a fitter and healthier lifestyle.

Regards,

Thank you for your support and for the book on Mediterranean-style cooking.

 

It seems to me that carbohydrate addiction may have quite a lot to do with its medicinal effect in quieting feelings about deeper issues.

 

The feeling of "hunger" that comes up may actually be some other feeling such as loneliness or frustration.  Carbohydrates, through their soporific properties, are effective in masking the feeling, whatever it is.

 

Your Tribe can help you sort out your feeling of "hunger" and help you and find pro-active strategies to address the underlying situation. Examples: For lonely, go to see a friend; for frustration, find an easier way.

 

When the underlying situation improves, the "hunger" may abate.

 

 

 

Diets Don't Work

 

when you rely on over-eating

to medicate your feelings

 

 

 

Barbie Turns to Carbs

 

to medicate her feelings

when she discovers Ken

is Client #10.

 

 

Clips:

http://sci-toys.com/attention/2006/

04/gut-feeling-about-mortality.html

 

http://3quarksdaily.blogs.com/3quarksdaily/

2007/07/perceptions-200.html - Andras Kallai - Fat Barbie. 2006 - Terracotta, plastic.

Sun, 9 Mar 2008

 

Looking for Trends

Hi Ed,

I have ran thousands of tests on uncomplicated trend following systems. I have observed that they have admirable equity curves, until the latest five or so years, then the curves flatten out and the largest drawdowns for the systems occur. Have you noted any changes in the "trendiness" of the markets in more recent history?

You might consider taking your feelings about <following trends> to Tribe.

 

You might also consider examining the recent charts of commodity futures for evidence of trends.

Mon, 10 Mar 2008

 

Wants Local Contact

My beliefs about the market and trading philosophies, for the first time, are encompassed by The Trading Tribe and Trend Trading principles. I am looking for someone to help me learn more about trend trading and getting started. Please give me any information and local contacts that you can.

Thank you for your time,

For the best local contact, look in the mirror.

Sun, 9 Mar 2008


Buying the Blow-Off


(FAQ Pyramiding and Anxiety, 12/13/2007) Ed says, "One problem with buying dips is that you might wind up selling the collapse; one problem with selling rallies is that you might wind up buying the
blow-off."

Do you mean you might the counter-trend traders wind up buying the collapse, or selling the blow-off? If so, I think that's a very interesting slip. Thx.

See Wheat Problem for an example of selling rallies and buying the blow-off.

Sun, 9 Mar 2008

 

Wants to Control


Hi Ed,

What do you think about AQ (Adversity Quotient)?

Currently I'm reading Adverse Quotient by Paul Stoltz. The way he distinguishes the responses from Quitters (low AQ) and Climbers (high AQ) seems to correspond to those carrying medicinal rock and resource rock, respectively.

One common characteristic I get among Climbers (high AQ people) seems to be that regardless of the situation, they perceive themselves having control. Therefore, they actively seek alternatives to get around the obstacles. Whereas Quitters (low AQ people) are mostly inclined towards learned helplessness, believing they are victims andhave no control, so they simply give up.

Having said that, I seem to recall many times in the FAQ you mention that those who seeks control of the market tends to get themselves in trouble. (e.g. FAQ 3/28/04, "You might run into financial troubles if you try to control the market")

So is the positive intention of feeling in control to get ourselves to action, but actually trying to control others (or a situation) gets us into trouble? I don't quite seem to fully comprehend and appreciate your insights. Thanks.

You might consider taking your feelings of <wanting control / wanting to understand> to Tribe.

Sun, 09 Mar 2008

 

Wants to Know About Books

Chief Ed,

Reading FAQ and trading leads me to works from Wilfred Bion, Kurt Lewin, and other related authors. Reading FAQ also leads me to an examination of shamanism and witchcraft. TTP Rocks, for example, seem to fit certain commonly agreed-upon definitions for 'talisman'.

For examples, see:
http://www.google.com/search?hl=en&q=define%3A+talisman&btnG=Google+Search

...I see in the most recent FAQ posting that a certain reader receives specific book recommendations, yet FAQ itself does not recommend specific books beyond Dictionary, Encyclopedia, some trading classics, and a few other contemporary titles.

I believe it is very probable you have experience attending at least one Group Relations conference in your lifetime, and have closely examined the works of Wilfred Bion, Kurt Lewin etc.

Have you attended a Group Relations conference in the Tavistock tradition?

I wonder how these authors (Bion, Lewin and others you might study as you develop TTP) are not cited in the FAQ Books list. These authors write titles that probably inform TTP. Lewin for example is known for his Field Theory. Bion is known for his study of the emotional life of groups. Certainly Chief Ed reads widely over his lifetime.

Might you please provide a list of the specific authors and their titles that have most influenced your thinking on and development of TTP theory and practice to date?

It is nice to see the most recent FAQ posts from the Chief. I am telling you now that I now trade effectively as a habit, now, largely from reading and ruminating on Chief Ed's FAQ.

Thank you sincerely,

Astute readers can glean the names of many books by reading the left hand column.

 

Per the use of witchcraft, I suppose it all depends upon which craft you mean.

 

 

 

Detail from "Der Liebeszauber"

Lower Rhenish School

 

 

Clip: http://users.bigpond.net.au/

greywing/witches.html

Sat, 8 Mar 2008

 

Entitlement


Ed Says: "I wonder what you do find "enticing." Perhaps entitlement to making a lot of money without doing any work might appeal to you."

Hahaha ... Yes. Fast and easy. Trend following is intrinsically a long term enterprise, with many ups and downs along the way. Best regards.

OK.

Fri, 7 Mar 2008

 

Pausch at Carnegie Mellon

Ed,

I think you may enjoy these videos of Dr. Randy
Pausch, a Carnegie Mellon professor that found out
that he has cancer with 3 months to live.

He is giving his last lecture:

See the full length video of the real lecture that he gave at Carnegie Mellon University:


http://www.youtube.com/watch?v=ji5_MqicxSo&feature=related

Thank you for the URL.

Fri, 7 Mar 2008

 

Lifeguard

 

Ed,

 

See this ==> LifeGuardinthePool.wmv

It only seems to make a difference when urine the pool.

Fri, 7 Mar 2008


Recent Hot Seat Experience


Hi Ed,

I want to describe my recent hot seat experience as a note for myself and others.

I take the hot seat with an antsy feeling.

The feeling manifests in action as my feet slide back and forth while staying flat on the floor.

The tribe encourages me to really get into it and I do.

I repeat over and over that “I have to do it” and “I have to get something done”

The tribe leader asks how that feels and I notice painful pulling on my left shoulder.

I move up and into the pulling shoulder, all the while sliding my feet and saying I need to get things done.

After a few minutes, the pain in my shoulder subsides.

My feet keep doing their antsy dance while my upper body is still.

I throw my arms down in a caricature of relaxation and roll my eyes, shake my head, and mumble that I just want to veg.

I distinctly notice these two very different and opposing feelings:

Antsy to get something done in my lower body

Lazy vegging in my upper body

It doesn’t feel good but it feels familiar and I realize that this is how I often act in my life with laziness interfering with my progress and ambition / anxiety interfering with my relaxation.

I heed the encouragement from the tribe to really get into all of it!!

After awhile, my arms fall into a rhythm with my legs which feels better, like a relief.

I realize tightness had been in my chest while I was doing the relaxation movements and now with more vigorous movements it is gone.

I like this feeling and try to keep it up but tire after a few minutes

I rest and repeat, rest and repeat

Eventually, I feel no more need to move my feet

I am exhausted

I feel really relaxed now at the zero point.

Best regards,

Thank you for sharing your process.

 

Getting to the Zero Point - and noticing your own patterns - are valuable exercises.

 

You might consider taking it up a level by employing the Rocks Process or other method to fortify your medicinal response patterns with pro-active ones.

 

Absent the implementation of new pro-active resources, you might fall into a pattern of using the Zero Point process medicinally, to make feelings go away.

 

 

 

Some People Pop Pills

to make feelings go away.

 

Some people use

process.

 

 

 

Clip: http://www.achancetochange.org/Identifying_

Dependency/identifying_dependency.html

Fri, 7 Mar 2008

Wants to Visit Incline Village Tribe

see previous

Ed,

I was born 35 years ago today, to a loving family with modest means. I always had a gift for science & math. In high school, I took some honors math classes (Calculus & Trigonometry), and through some successes with junior achievement, was offered a job trading mortgage backed securities. I ended up scoring 740 on my math SAT, and was also offered a full academic scholarship to a local college. Well, dazed and confused as most teenagers are, I turned both the job & the scholarship down, and followed my bliss at the time, designing & installing high-end, car audio systems. I went to popular stereo shop & offered to work for half the regular rate. Within a short time, I found a few successful people to model, and my skill grew rapidly. Soon, I entered into knowledge contest put on by Kenwood Corporation where I competed against other installers, technicians, and sound engineers from all over the world. We were tested on many facets of (sound) wave propagation. I ended up winning first prize (brand new show car, 20K in stereo equipment, & cash to cover taxes).


Over the next several years I began to speculate in real estate and did some small trading in equity options. I interned at a couple of local stock/bond brokerages (Firm). The brokers that I worked with knew little more than how to churn accounts, leaving me a little disenchanted. I decided to continue with the real estate investing, and employed a trend following method; I would buy when the prices were rising, and sell when they stalled. Using some money saved from my stereo work, I bootstrapped a business buying, fixing, & selling small distressed homes in the South Florida area. At the peak of the real estate bubble in 2005, I was turning over 60-70 properties a year. As you know the real estate bubble deflated, freeing me to return to the financial markets which I have always been passionate about. I began reading voraciously, and like many others, was first introduced to your name in Schwager's work.

I know very little about the Tribe's work, but I keep finding myself drawn to your website, and with my trip to Tahoe in few days, finally decided to write. I have a basic understanding of NLP language patterns, modeling and anchoring. I have read works from Bandler, La Valle, and attended numerous Tony Robbins events.

As far as my use of the word "desperate," I posses an insatiable desire to become my full potential in all endeavors to which I commit. Therefore, I am willing to put in the effort, time, and passion to learn and grow.

For what it's worth, I always had my own idea of how Bernoulli worked. I picture the way a toilet flushes. Once a critical amount of water rolls over the trap, the water at the leading edge "pulls" the trailing water with it, emptying the bowl. I assume that once the water at the leading edge starts its movement, the space it once occupied must be filled, and the path of least resistance is to fill that space with the trailing water. In the same way, when air passed through a spool expands out, the air behind the leading edge is sucked along with it, as is the card.

Thank you for your note.

Per Bernoulli: I wonder how you envision the mechanism by which the leading molecules "suck" the trailing molecules along.

Per NLP: I wonder what you feel motivates Zen Monks to maintain an impeccable sand garden.

Per Math: I wonder if you can solve this: 2^X = X^2 .

Per Meeting: I wonder what you intend to accomplish by meeting.

Thu, 6 Mar 2008

 

Rejection

see previous


Hi, Ed

RE: FAQ Fri, 25 Jan 2008, "Scold," and Sat, 26 Jan 2008, "Jazzed Banjo--A Video."

Your response to these emails feels like a rebuff of my attempt to support you in your process and reminds me of similar responses I read in FAQ over the years.

Tonight, at the IV Tribe meeting, we discuss the possibility that you hold people at arm's length to avoid intimacy and any pain that comes from intimacy lost.

I state that I feel held at arm's length in my attempt to show support, and you ask that I direct you to the emails that generate my feelings of rejection.

Ask and it is given.

Your choice of language,

 

I promise to severely scold anyone who tries to punish you ...

 

indicates you may have an issue with scolding.

 

You might consider taking your feelings about <rejection, scolding and applying force to change feelings> to Tribe. 

 

 

Thu, 6 Mar 2008

 

Wants Input

 

Ed,



After coming across The Trading Tribe, I was compelled to send you an email to see if I could get your input.

Recently, I have put together a Forex trading course which includes both my theory and technical approach to trading, to help teach people how to trade the Forex market successfully. As someone whose opinion I respect, I would greatly appreciate any feedback that you could give me concerning
the course.

I don’t want to seem presumptive and just send you a copy of the product. However, if you’d like to review it and would be willing to give your honest feedback, then I’ll send you a link to the digital version of the course. When the printers are finished I’ll send you out a copy of the physical version.

The course was designed for those that want to trade using our indicators in a systematic: setup, entry, stop loss, and exit kind of way. I feel that there are too many products in the Forex market that are too vague or discretionary as to when a trade should be entered and exited.

Sincerely,


P.S. Whether or not you have the time to review my course and give feedback, thank you for the contribution that you are making to our industry.

Thank you for your email and for your support.

You may send me your materials if you like.

I cannot, prior to seeing the materials, agree to study them to any particular depth or to furnish you with a review or endorsement.

Thu, 06 Mar 2008

 

Hot Seat Report
 

Ed,


To begin my hot seat, I lean forward and start slapping the heels of my hands together. I continue for several minutes, turning up the rhythm and the speed. My hands become red, warm, and tingly.

The sensation in my hands reminds me of an elementary school boys' game called "burnout," in which two players took turns slapping each others' hands until one boy cried uncle. Riding the school bus in second or third grade, one of the boys who cajoled me into playing burnout was [Name].

 

At that time, I disliked him (and in hindsight as I write this, envied him) for being extroverted, assertive, and leading. Yet somehow, during fourth grade, he and I became friends.

"I wish I remember how I made him my friend," I think, "that would be a useful skill to have."

"You do remember," I tell myself, "just not consciously. Your subconscious remembers and can help you the next time you want to turn a rival into a friend."

I stop slapping my hands and smile.

Thank you for sharing your process.

 

 

 

 

National High Five Day

 

The Third Thursday in April

 

 

 

A "Handy" Image

 

to use to practice up

for April 17.

 

 

Clips:

 

http://blog.thesyn.com.s17153.

gridserver.com/category/holiday/

 

http://www.joinpants.com/wp-content/

uploads/2007/09/virtual-high-five.GIF

March 05, 2008

 

Night Shift in Iraq

Ed,

 

Turn on your speakers

You'll have to watch this... this is unreal, 2.5 miles away, at night and it looks like they are right there. Heck of a weapon too ...

The pictures were taken from an AC130 Specter gunship two and a half miles away.

 

The guys in the picture are setting up a roadside bomb and planning to ambush an American convoy which followed a while after the pictures were taken. They were setting up for the ambush and were pacing off the distance from the bomb to where the convoy was to pass by.

Turn your sound up. The level of effort these crews put forth to control the enemy's antics is commendable, and their marksmanship with those electronically controlled 40mm cannons is astounding.

 

Note: This clip contains extreme violence: clip

Thank you for the clip.

 

You might consider taking your feelings about <violence> to Tribe.

 

Please send me the source of this clip so I may post credit.

Wed, 05 Mar 2008

 

Spanish Translation


Dear Ed,


Thanks for your kindness in allowing me to translate your work into Spanish.

Let me know if you think I should carry out any changes. You may post it to your site.

I am about to start translating the whole risk management document. I tell you when it is finished.


Sincerely,

 

-----

 

Tendencias (Trends)

Extracto de la versión original en inglés, copyright © Ed Seykota, disponible en la página oficial del autor: www.tradingtribe.com


La tendencia es tu amiga excepto al final cuando se inclina.

Una tendencia es una disposición o directriz general en un conjunto de datos. Toda medida de la tendencia supone tomar una lectura actual y otra histórica para su comparación. Si la lectura actual es superior a la histórica, tenemos una tendencia alcista. Si es menor, una tendencia bajista. En el improbable caso de que coincidan, una tendencia lateral.

La dirección de la tendencia depende del método que empleamos para realizar la comparación. Los activos fluctúan minuto a minuto, día a día y año a año. Tenemos, por tanto una oferta enorme de puntos históricos para determinar la tendencia. Así, podemos establecer tantos casos de tendencia como queramos, en la dirección que queramos.

No existe tal cosa como la tendencia; Existe un sin fin de tendencias, en función del sistema que empleemos para determinarlas. La gente normalmente escoge un método para establecer la tendencia que cuadra con sus posiciones actuales y su visión del mercado.

Todos los métodos de definición de tendencias comparan varias combinaciones de precios históricos. Toda tendencia es histórica, ninguna existe en el presente.

No existe tal cosa como la tendencia actual. Cuando hablamos de tendencias estamos necesariamente proyectando nuestras propias definiciones.

Gracias.

Wed, 5 Mar 2008

 

Stress in the Office



Ed,

I think these people need some TTP!

Kindest regards,


Clip1  Clip2  Clip3
 

Thank you for the clips.

 

Please send me the source of these items so I may post credit.

Tue, 4 Mar 2008

 

The Feeling we Remember vs

the Actual Feeling we Experienced

Hi Ed,

In his book "Stumbling on happiness", psychologist Daniel Gilbert of Harvard University suggests that when we were asked about how we felt in a certain event, we tend to answer "how we think we'd feel" rather than "what we actually felt." This seems to make intuitive sense since we can only feel feelings in the now, so (for example) if asked abouthow he felt when his parents divorced, the person likely "makes up"  the feeling that he THINKS he felt, which is not necessarily how he actually felt.

In your experience, has this been an issue with the Rock Process? When hot seat goes over feeling about a situation, those are all what we THINK we felt rather than what we actually felt. Sure, I guess role-play is a way to get the hot seat to get into the ACTUAL feeling, but it seems that there is an inherent limit of how "real" the feeling can be.

 

Someone who is fearful of water because he has been drowned as a child, may not be able to recreate that extreme panic fear unless heis really thrown into the water again. In the end, he can only resort to is how fearful he think he felt.

Thinking about feelings is not the same as experiencing them.

Tue, 4 Mar 2008

 

Rock Process Experience

Hi Ed,

I have several questions regarding the FAQ on 6/18/07 (Rock Process Experience from Incline Village):

(Contributor) I thank you for stressing on the word " VISION" during the snapshot process...
 

1. Can you please share with us again the role of VISION in the context of the snapshot process?

(Ed) We Assimilate Medicinal Rocks during terrifying events... 2. Is it the only way we assimilate Medicinal Rocks?


3. Is it a necessary condition that "someone" passes the Medicinal Rocks to us? Is it possible that we somehow instinctively pick up a Medicinal Rock?

 

(e.g. Caesarian kids tend to relying on help from others) If so, how do we role-play it in the Rock Process? (In the Rock Process we always have some provokers/donors during role-play)

Thanks.

We learn some things best by practicing them: riding a bicycle, sex, the Rocks Process, etc.

 

Relying upon reading about such things may lead to confusion and sub-optimal results.

 

 

 

 

We Learn To Do Many Things

 

by doing them.

 

Clip: http://mikesbikes.com/page.cfm?pageid=22&tipid=23

Tue, 4 Mar 2008

 

Lucky Call


Hi Ed,

Regarding the FAQ (7/19/07, Pairs Trading / Statistical arbitrage - Snake Oil?), I find it quite amazing the timing of this FAQ, which is about two weeks prior to one of the toughest periods among stat-arb funds.

When I'm right, please be sure to credit me - when I'm wrong, please kindly forget my opinion.

Tue, 4 Mar 2008

 

Austrian Economists


Hi,

On Friday 11 April 2003, Ed says: Different schools justify different political structures. The Austrian School tends to justify Capitalism. None of these schools predict prices very well.

Austrians ... do not try to forecast the future as other schools of thought keep on doing deliberately.

Best Regards,

The Austrian School of Economics is a world view embracing laissez faire.  Various Austrians subscribe to various schools of thought.

Mon, 3 Mar 2008

 

Soros on the Economy

 

Ed,

 

Here's an interesting take by Soros. I find it pretty sobering.
 

------

The Worst Market Crisis in 60 Years
By George Soros

The Financial Times Limited 2008
January 23 2008

The current financial crisis was precipitated by a bubble in the US housing market. In some ways it resembles other crises that have occurred since the end of the second world war at intervals ranging from four to 10 years ... The current crisis is the culmination of a super-boom that has lasted for more than 60 years ...  the financial authorities ... created a ... moral hazard, which encouraged ever greater credit expansion ...  the US started to run a current account deficit ... suck up the savings of the rest of the world and consume more than it produced ...  started with subprime mortgages ... the final blow came when interbank lending, which is at the heart of the financial system, was disrupted because banks had to husband their resources and could not trust their counterparties.

 

The central banks had to inject an unprecedented amount of money and extend credit on an unprecedented range of securities to a broader range of institutions than ever before. That made the crisis more severe than any since the second world war.

Credit expansion must now be followed by a period of contraction ... constrained by the unwillingness of the rest of the world to accumulate additional dollar reserves ... and long-term bonds would actually go up in yield ... the ability of the Fed to stimulate the economy comes to an end.

The danger is that the resulting political tensions, including US protectionism, may disrupt the global economy and plunge the world into recession or worse.


source: http://www.ft.com/cms/s/0/1a7af090-c956-11dc-9807-000077b07658.html?nclick_check=1

Trend followers are generally on the winning side of secular trends, without having to figure it all out or risk figuring it out incorrectly.

Mon, 3 Mar 2008

 

Still Operating

Hi,


Saw this link on Trading Tribe and wanted to see if group is still operating.

Thanks for update.

Thank you for your support.

Mon, 3 Mar 2008

Systematic

 
Dear Ed,

I feel joy and reassurance when I see FAQs updated for Jan, I find reading FAQ keeps me on the path toward my goal of Right Livelihood.

For the first time I sit and write a trading plan that I read and re read when I need to stay on the straight and narrow, it outlines my plan and goals and includes a checklist to tick of before entry and a page for recording my feelings during the day.
 

So far using this plan is working and as I see it working I change from fighting the rules to wanting even more rules! The more rules I define the less stressful I find trading.

My exit from a trade at a profit or loss is now managed by my system and a bit of software that amends my orders to fit in with my system. When I get in I know the circumstances that will result in my getting out. This is a relief for me and logging my feelings as the trade is on helps me stick to the system.

The size is fixed at 1 contract for now with a review when equity as doubled. The market is fixed for now at the FTSE Future and the timescale is fixed at exit by the end of each day. The entry direction is long only as I see the trend for an index that culls the losers each ¼ as upwards over the long term.

The only decision left now is entry which is becoming more systematic and rule driven each day, my endeavor is to get some hard and fast rules so simple even a computer could carry them out for me.

It is not a trading revelation to anyone but me but to me it is truly nothing less than that.

All I ask is that you keep up your website and I’ll keep to my system. Do not underestimate the benefit it gives to many people world wide.


Regards,

Thank you for sharing your process and for your support of this site.

Sun, 2 Mar 2008

 

Cooperation in Marriage

 

Ed,

 

Here is an amazing Video.


It is said it took this couple, husband and wife, eight
years to create and perfect their breathtaking routine
Be sure your sound is on. The introduction is in French.

 

It gives me goose bumps.

http://www.youtube.com/watch?v=N5lN96dgt_Y

Thank you for the URL.

Sun, 2 Mar 2008

 

Four-Fold Way of Success


Ed,

I am very interested in your mentoring services. I'd first like to explain to you my situation in hopes that you might be able to tell me how to best utilize your services and get the most out of them.

I am 24 years old and I am a novice to trading. I have owned a couple of relatively successful businesses since I was 18. The last two years I have been a commercial real estate broker for a large brokerage firm. Through constant reading and soul searching I have been trying to find a career that is fulfilling. I finally believe that trading is truly the right profession for me given my personality, lifestyle, and nature. After realizing this I packed up everything I own into my car and drove to Chicago in order to get closer to the heart of the industry. I am currently interviewing at a variety of firms. I want nothing more than to receive personal training from you and I want to know if you recommend that I immerse myself in the industry before receiving this kind of mentoring from you.

I have read around ten books on commodities trading and I am very confused about which styles to adopt for my own trading system. Besides book knowledge I have absolutely zero trading experience and I would really appreciate any advice you have me. Again, my goal is to get personal consulting from you and I wanted to know how you would respond given my situation. Thank you very much for your time.

You can get very brief consulting for free by submitting questions to this site.  For more intense private consulting see the link to Ground Rules at the top of this page.

Sun, 2 Mar 2008

 

Rocks Process -

Implementing New Resources for Marriage

Dear Ed,

I trust all is well and things are going your way.
Attached is write up of the rocks process I did.

I thank you for everything and God bless.

-----


Feb 10, 2008


I get another opportunity to attend a tribe meeting in [City] conducted by you. I have an issue with my spouse making sure I can get simple things done to the tee and you employ the rocks process to figure out the problem and give me a resource rock to better cope with such situations.

My spouse leaves the house to go to the airport to take an overseas flight to visit her family. At the last minute, she leaves some towels in the washer and requests me to dry them when I get home later that night. I dry the towels.

 

The first time she calls from overseas she inquires if I dried the towels. I reply in the affirmative and then she wants to know if the towels are completely dry. I get upset with this line of questioning as it makes me feel that I cannot dry towels and get angry. I tell my spouse that I run a successful business and support the entire family and she makes me feel nervous and incompetent when probing deeper into whether I fully dried the towels.

 

You say, “Let's look at the question.” and further go on to say “Let's find it’s positive intention … perhaps your spouse has a case of mildew phobia. If towels are not completely dry then they will smell the next day and have to be washed again”. I am totally stunned to notice that you do not agree with the way I feel.

One tribe member is assigned to play the role of my spouse. The telephone conversation with my spouse regarding dried towels is enacted. It is apparent that I get angry when asked if I completely dried the towels. You encourage me to go into my past and remember a few situations where I get upset when somebody questions my decision on anything that I have done.

 

I recall buying a Gillette state of the art razor when I am 22 years old. My father finds out about it and is not a happy camper. He thinks it is not necessary to buy an imported razor because it is too expensive. I tell him that the razor gives a smooth shave without any cuts. He disagrees and since in our culture we bow down to the parent’s decision, I have to give in. I quietly complain to my mother and she calms me down by saying my Dad always thinks the best for us.

 

I also remember another situation when I want to transfer to a different college mid-way into the year because the current one is too far from home. Since under our college system the transfer cannot take place until the “new” school year starts, I am willing to lose a year and don’t care if the family’s image or my reputation of being a good student is tarnished.

Two additional tribe members are assigned to play the role of my parents. The entire Gillette razor episode is enacted as it happened more than three decades ago. During the process my mother gives me the medicinal rock to medicate the frustration of giving in to elder’s decisions.

I get a new resource rock with several new resources to replace anger and frustration as listed below:
 

1. Ask more about the issue at hand.
2. Ask the other person how he/she feels about the issue.
3. Tell the other person how I feel about the issue.
4. Use humor to diffuse the tension.
5. Accept the status quo as it seems to be the best solution under the circumstances.


The towel drying issue is re-enacted. I ask my spouse if she can explain why towels should be completely dry. She tells me that towels not dried completely smell the next day and have to be rewashed. I thank her for the information.

The razor issue is re-enacted. I ask my father why I should not buy the Gillette razor. He explains that there are razors out in the market that are as good as Gillette and cheaper. I tell him I will consider buying one of them and save some money.

In the transfer of college situation I end up telling my mother I am better off by staying in the present college until year end and then initiate a transfer.

While re-enacting each issue employing the new resource rock, I tend to go back to my old ways of responding to spouse, father and mother. You warn me not to use old ways of dealing with these situations.

 

Initially I find it difficult to stay the course and at one point you get pretty upset at me for not using the new resource rock and ask me if I was trying to waste your valuable time by not following your advice.

 

Angrily you tell me to quit TTP completely as it is not my cup of tea. Now I love to be a part of the TTP and the fear of being thrown out of my local tribe sets fear in my mind. I feel this urgency to get back on track and follow your recommendations on how to respond in these situations using the new resource rock. I use this scolding as a wake up call to get with the program and finish the process with flying colors.

In the next few weeks I talk to my spouse for over 500 minutes on the phone without any arguments. I carry the resource rock with me all the time and press it when confronted with difficult situations and handle then correctly. My spouse came back ten days ago and we had a few disagreements but nothing serious.

 

I believe what I learnt from the rocks process is helping me tremendously to improve my relationship with my family and friends.

Thank you Ed for your valuable time and all the things you do to improve our lives.

Yours truly,

Thank you for sharing your process.

 

 

Sometimes Even a Towel

 

can seem enormously

important.

 

 

Clip: http://www.geekologie.com/2007/03/

axe_towel_is_deceptive.php

 

Sat, 1 Mar 2008


Likes the Circus


Ed,


You haven't posted in a while, for a moment, I thought you folded up your circus tent 


I wonder if you really think you help traders become better traders.


I think you've tried to quantify the success with a host of projects, but all the projects I see on the site have either failed or are incomplete.


Like trading the chart says it all.

You might take your feelings of <bitterness> to your Tribe to find out what is troubling you.

 

 

 

Bitterness

 

indicates the potential

to discover a charge.

 

Clip: http://hilaroad.com/camp/projects/

lemon/lemon_battery.html

Date: Sat, 1 Mar 2008

 

Wants to Translate

 

Hi Ed,

This morning I read your new posts. I am glad you are alive.

I know the ground rules about using the materials relating to www.tradingtribe.com

I do not see anything regarding translations.

I really like to translate at least your Trends definition and comments:

(From “A trend is a general drift…” to “projecting our own definitions” at

 

http://www.seykota.com/tribe/TSP/

Trends/index.htm

If you agree, I give you credit by clearly indicating your authorship and displaying a link to your site.

You may use it if it is for a non-commercial site and if you credit me and this site as the source.  Send me the URL so I may link to it.

Sat, 1 Mar 2008

 

Election Results Leak


Ed,



Form the Onion, a cynical view.

Perhaps the truth emerges at last.


http://www.theonion.com/content/video/diebold_

accidentally_leaksutm_source=embedded_video

Thank you for the URL.

 

If enough people were to express their feelings about politics as usual, something unusual might happen.

Sat, 1 Mar 2008

 

Religious Economics

 

Thank you for your incredibly helpful and compassionate website.

Thought you might find this interesting. Found it at the bottom of a New York Times story entitled: Stocks Dive on Signs of New Economic Chill

http://the-end.com/2008GodsFinalWitness/?gclid=CLvyk8PO7JECFQcKGgodWFE4xA

The link to this page was listed as:

'08 Stock Market Crash is only the beginning of troubles for America, leading to its demise.

Thank you for the URL.

 

The news tends to get pretty gloomy around major bottoms.

Sat, 1 Mar 2008

 

Jet Vaporizes


Ed,


Interesting video.

http://worldnetdaily.com/index.php?fa=PAGE.view&pageId=57680

Thank you for the link.

 

I wonder what the production cost is for the video.

Sat, 1 Mar 2008

 
Wants to Visit


Ed, 
 
I am an aspiring trader.  I am going to be in the Tahoe area from 3/14 to 3/18, and I wanted to see if there were any Tribe Meetings scheduled during my visit.  I am in desperate search of guidance for my trading, and would love the opportunity to glean from the best.  I look forward to meeting or hearing from you.

Please tell me something about yourself, your experience with Tribe work and your meaning for "desperate."