December 15-31, 2007
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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 |
Mon, 31 Dec
2007
Happy New Year!
Dear Mr. Seykota:
As of Now it is still 07 but I wanted to send this to you now. I thank
you for your contribution and your work. I feel fortunate and grateful
to be introduced to TTP. Thank you for sharing.
Best wishes for you and your family. |
Thank you for the encouragement. |
Mon, 31 Dec
2007
Thank You for TSP
I may be two years late to the game, but thanks for posting the
exponential lag system with full logs to tie out. I was able to
recreate the entire system in excel (without macros!) and tie out down
to the penny for both the 150/15 and 325/85 results that you posted.
Always nice to be able to tie out with other people vs. working on an
island. I'm happy to share the workbook if you want one to post. |
Thank you for sharing your process.
Yes, I would like to post a tutorial
workbook that shows a step-by-step process for reproducing the results. |
Sun, 30 Dec
2007
Snapshot
Commitment
Dear Ed,
I support your feeling of "producing compromised work."
I am feeling you create value for many people with your video and book.
I also feel hopeful for this value to come soon. |
Thank you for your encouragement.
See
Perfectionist, below |
Sat, 29 Dec
2007
Cause, Effect or
What ?
Hi Ed !

Clip:
http://2photo.ru/uploads/posts/4268/
20071120/joe_baran/20_11_2007_
0044537001195507712_joe_baran.jpg
H A P P Y N E W Y E A R ! |
When you are ready to receive it,
illumination seems to shine from many places. |
Sat, 29 Dec
2007
Disjointed thinking (or I can't see the joints)
Dear Ed
It is the first time in some time I get excel out and try to see what
patterns emerge in a set of data, I am far from an expert excel operator
or statistician.
The system is a long-only system which places orders to buy index
futures when at 10 day highs with a trailing stop that is set initially
at the 10 day low and moves upwards to the 10 day low when a new 10 day
high is reached.
The system exits on stops only. I appreciate that this
system is simplistic and not attractive to trade (It returns about the
same ICAGR as cash with a 25% maxpdd) but the system is only what has
lead me to some thoughts, I am not asking for systems help.
I noticed that when I changed the % of the account I risked per trade
from 1 to 2, 5, 10, 20 and 50% the ending equity moved higher as expected
and so did the MAXPDD, however during this period the bliss remained
pretty constant at 0.002 when rounded to three decimal places.
I begin to think how the emotional journey of turning £10,000 into
£801,312 with a maxpdd of 77.7% would be very different to the feelings
that would emerge when turning the same amount in to £136,000 with only
a 52% maxpdd.
It seems to me that maximizing bliss might be a pure math way to decide
what is ‘best’ for a system. I wonder what decides what is ‘best’ for a
trader. I think it is not always maximum bliss.
Perhaps if you are only trading a small fraction of your net worth with
a high risk per trade it might prove less stressful and easier to follow
even through large draw-downs than trading a lot of your net worth with
a lower risk strategy. You might end up with the same absolute cash
return with less emotion on the lows.
Another rather strange idea that I’ve been coming back to lately is: Is
discretionary trading medicinal if you derive no emotional satisfaction
or dissatisfaction from it?
Perhaps some of the very successful
discretional traders avoid drama because there trading has little effect
on their self esteem? Maybe they’d be as happy if they traded badly and
found another job?
This idea leads me to think that rebuilding my self esteem will be the
only way to reduce trading drama whilst trading at my discretion
or following a system to the letter.
Another unrelated thought that you might enjoy is a conversation I have
with a friend of mine who has just been given joint management of a
small fund (He currently works as an analyst allocating a large banks
funds to other managers). To paraphrase it goes something like this.
Me: What is it you are looking to get in to in the New Year?
Friend: Coal and Gold, what about you?
Me: Well I’m going to spend time when family is at work mulling over a
few trading system ideas I’ve had this year, seeing if there is an edge
somewhere.
Friend: I keep telling you in my office only a tiny fraction of funds we
give money to our quant funds, they are so hard to get right. You would
do well to stop looking for a holy grail.
Me: So how do the quant funds you have invested into done?
Friend: Well actually they are the best performers at present.
So there you have it, the quant funds are hard to get right, but when
you do they seem to perform the best.
Happy New Year, I look forward to another year of personal growth. |
Thank you for sharing your process.
You might consider running further
tests that vary the length of your trend definition parameter from 10
days to say, 20, 50, 100 and 200 days and other points as well.
|
Fri, 28 Dec
2007
Choppy
Markets
Dear Mr. Seykota,
I hope you are doing well. I frequently look over FAQ and enjoy reading
your responses, which can be humorous, insightful, and
thought-provoking.
On to my immediate concern: I want to develop a trend-following system
but am discouraged by a remark made on [website]. The
website states:
We attribute
our good long-term performance to superior research methods. Over
the years the markets have become choppier, and many traders'
returns have suffered. We have a technique that helps to identify
these choppy markets and keep the system out during these periods.
I have noticed that yearly returns for trend followers have decreased since the early 1990's. I suspect
that this partially can be attributed to the use of less leverage, but
can it also be attributed to markets that do not trend as often? And if
this is the case, why do you think this phenomenon is occurring?
Thank you very much for your time. I very much appreciate your responses
and wish you the best! |
The "no more trends" theory shows up
every so often. Its sponsors seem to include people who have some issues
with being able to stick with a Trend Following system.
See
Counter-Trend,
below.
|
Fri, 28 Dec
2007
People Vote With Our Feet
Ed,
This is from the Wall Street Journal.
Yesterday’s Wall Street Journal published the results of the Census
Bureau’s new 2007 population estimates, and highlighted an interesting
relationship. The reporter found that the new data show states such as
Nevada, Florida, and Arizona, which are experiencing extensive
housing problems, had a slowdown in population growth. Michigan,
another state with big housing problems, was one of two that saw
population fall.
When we compare the population growth data with the
state tax burdens we see that high taxes chase people away,
while lower taxes associate with faster population growth. |
The growth in government, as it
shows up in taxation and regulation, seems to be a low-priority issue in
this election cycle.
Voting on this issue may register,
as you suggest, as migration.

The Ultimate Voting Machines
Clip:
http://hazel8500.files.wordpress.com/
2007/07/feet-761353.jpg |
Fri, 28 Dec
2007
New Tribe
Member
Ed,
Just wanted to share with you all that my wife and I just brought home
our newest tribe member on 25 December. Our daughter was born on the 24th
at 1249 am. My wife and daughter both did an awesome job.
Thanks for all the help this year. Add to my snapshots: I receive my
wife and children unconditionally. |
Thank you for sharing your process. |
Thu, 27 Dec 2007
Pool
Ed,
This is slightly above our skill level.
Billiards and Dominoes |
Thank you for the clip. Please
send the source so I can include an attribution. |
Thu, 27 Dec
2007
Cross Winds
Hi Ed,
This is why pilots make the big bucks. It's also why the wind is just
another reason why the landings separate the men from boys. It's like
getting out out of a position. Any body can take off (ie. put on a
position) but its tough to land (ie. get out of a winning / losing
position).
Cross Wind Flying |
Thank you for the clip. Please
send the source so I can include an attribution. |
Tue, 25 Dec
2007
Christmas
Ed,
I wish you a Merry Christmas.
|
Thank you, and many others, for the
wishes. |
Mon, 24 Dec 2007
World Clock
Ed,
This was sent to me this morning, I have not seen it before, talk about
interesting!
World Clock
|
Thank you for the link.
|
Mon, 24 Dec
2007
Season's Greetings
Ed,
I wish a Merry Christmas to you, your family and all FAQ readers.
Happy Holidays everyone! |
OK. |
Mon, 24 Dec
2007
Back-testing a Life System
Hi Ed,
Merry Christmas!!!
It's actually 6:38 AM right now but something crosses my mind that I
can't help but to jump out of bed to get on the computer to write to
you before I lose the train of thoughts.
It starts with a trend-trading system. More and more I feel that a
system's purpose is to ensure that we do not miss a trend when a real trend comes, because missing a really strong trend is lethal - so lethal that we are willing to pay the price of many small losses, just
in case the real one emerges. Each entry doesn't guarantee a profit,
in fact, each entry likely becomes losses. However, the odds is that
if you follow it consistently, in the long run, you come out ahead.
I always see a lot of parallels between trading and living. It seems
we may be able to apply the successful traits of one to the other. For
example, more and more I see many life decisions is actually about
balancing risk and reward - the "best" choice may depend on my risk
tolerance. More and more I see that a key to successful trading is to
be non-judgmental to "what-is" instead of what we think "it should."
Meanwhile, a key to successful relationships, for example, is to be
non-judgmental to who others are, instead of what we think "they
should." If market is always right in trading, than reality is always
right in life.
The thought of a "life" system has been dangling for a while, with
rules like being truthful, accepting others as they are, and etc.
Being deceitful (or to lie to cover up something) is the opposite of
being truthful. It is like a martingale system. Each time you "lose,"
you cover up by doubling down. You may get by it for some time, but
one failed cover up and you will blow up, losing EVERYTHING. Lethal.
As such, following a life system with rules like being truthful is
like an anti-martingale system that ensures we won't get ourselves in
that situation. If we are honest, if we tell the truth EVERY time, it
ensures that we won't get caught lying and the put ourselves in a
position for an irrevocable crippling losses.
Moreover, we are not concerned about the outcome of each trade. Or in
a life system, we are not concerned about the outcome of every time we
tell the truth. Telling the truth may lead to something we generally
consider "good" (e.g. drawing the other party closer to us), or
something we generally consider "bad" (e.g. the other party gets
really upset at us). All we know is, in the long run, if we stay
truthful, we net out being a winner.
Following a system's rules, by itself, may not be profitable. If one
follows a martingale system's rules, which is to double down after
every loss, even if he has the discipline to follow it, or especially
because he has the discipline to follow it, he likely ends up blowing
up at some point. One beyond normal losing streak can wipe him out.
Here, back-testing plays an important role. Say we start from scratch
as we don't know whether a martingale system or an anti-martingale
system works better in the long run. So we backtest it, and when we
see that martingale systems inevitably blow up when a strong trend
emerges, while an anti-martingale system that goes with the trend gets
back all the previous losses plus more when a trend comes (and they do
inevitably come every now and then), that's when we know which system
to choose to follow.
In a way, this seems like what the Rock Process is - back-testing our
"rules." After we have our Resource Rock, we "back-test" it and see how
it works. And this is what I like about the Rock Process, to actually
test it and see for yourself. We don't follow a trading system just
because Ed Seykota says so, just like we don't follow a life system
because some "God" says so. We follow a system because we have done the research and testing on it that we feel that this set of rules gives
us the best chance to attain long-term profitability.
To me, we don't need to "follow" a system if we can actually "see."
When we actually see for ourselves CLEARLY, we naturally "follow" the
rules in the sense that we become it. We live it. It isn't like Jesus
consciously pondering if he is following all the "rules" - He just
lives it.
Now, two questions pop up about the Rock-Process kind of back-testing:
1. Can it be back-tested? That is, can we take some rules and
back-test it by taking us back to a past event and see how it will
perform? In trading, we perform these kinds of backtest by taking our rules and apply it on some set of historical data, and we can see the
results. However, a key assumption here is that our action will not
significantly impact the market, or if it may have an impact, we can add some skid to estimate what the real results will look like.
But here's the thing: in real life, we can hardly estimate how the
other party will react. We had a set of rules from our Medicinal Rock
that we held, and they didn't give us a satisfactory result. That's a
fact. We then take it to the Rock Process, get a new set of rules from
our Resource Rock, and supposedly we know they are useful because we
can backtest it and see how it works. But if we change the way we act,
others have to change as well, and we really can't predict how they
are going to change and whether the new rock will bring a satisfactory
result, can we?
This is similar to, if you are just one of very many
in the market, you can possibly get a good estimate on what the fill
and the ensuring result from following the system is. But if the
market consists of only you and your drama co-dependent, then it is
almost impossible to backtest to see how your new set of rules will
give. Do you agree?
2. As we apply the Resource Rock into the various situation in our
life, invariably it seems that we are looking for a "good" or "better"
result. We expect them to "work", or at least give us a better result
than what we had with the Medicinal Rock.
But then isn't it the same
as applying some trading rule to back-testing and expect it to be
profitable every single time? It's like trying to have some magic
indicator that can call tops and bottoms that works almost every time!
The Rock Process is very awesome as it is a revolutionary idea to me
if we can backtest our "life rules" and optimize them. I wonder if it
is possible to have a back-testing system that is more holistic, that
looks at the overall result (similar to your Bliss function concept)
instead of seeing how it works on each individual trade (event)? What
do you think?
Many thanks!! I feel very excited. Once again, Merry Christmas! |
Thank you for sharing your process.
1. In the Rocks Process we
"back-test" the new Pro-Active Rock by simulations with others in role
playing exercises.
In this way we get a sense of the
behavioral modes we are likely to experience with our new relationship
management resources. This is similar to back-testing your
emotional relationship with your system.
The analog to mathematical
back-testing of a system is the dating process, in which you try out and
compare variations on a theme so as to assist you in selecting one that
fits your personality.
2. The Rocks Process does not
guarantee to produce a stream of outcomes, such that every one conforms
to your notion of "good or better."
With any system, sometimes you win
and sometimes you lose. If you stick with a sound system, you are
likely to emerge as a net winner after a series of many trials.

A System
generates a distribution of outcomes.
Clip:
http://articles.mql4.com/471
|
Mon, 24 Dec
2007
Merry
Christmas
Hey Ed!
I wish you and your family the very best for a happy Christmas and
ongoing success in the new year.
Hope that all is fine with you and your family and you enjoy winter.
Thanks for your inspirations and for providing us with FAQ. |
Thank you for your encouragement. |
Sat, 22 Dec
2007
Cancer-Free
& Clear Thinking
Hi Ed,
I just want you to know that I wish you a really wonderful Christmas and
peace and happiness in the new year. I am cancer-free now and intend to
stay that way, will return to work on January 13 on a part time basis
for a while, and just look forward to feeling better! It has really been
an interesting ride, to say the least.
I enjoy reading the trading website and wish I
were a savvy money person, but it has seemed not to be my best skill.
Perhaps now that I am well the whole thing will make more sense. What I
missed most while ill was my ability to think clearly ! |
Thank you for sharing your process.
Congratulations on your remission. I am accumulating evidence of a
correlation between clear thinking and remission of disease. |
Fri, 21 Dec
2007
Perfectionist
Hi Ed,
Ed Says:
"The book is currently in its fourth draft. The video is currently in
its second version.
I wonder if you have an issue with perfectionism.
Perhaps I am also seeing my own reflection.
Kindest regards and Happy Holidays to you and your family. |
The book and video both deal with
sticking to the system - and experiencing feelings rather than
medicating them with drama and with substances, including food.
I am currently engaging a system to
get my body into a healthy weight zone.
When I demonstrate some mastery of
my own process in this area I may feel more competent to advise others.

Body Mass Index chart
Clip:
http://en.wikipedia.org/wiki/Body_mass_index |
Thu, 20 Dec
2007
Personal
Growth Organization
Ed,
If you and the 'Trading Tribe' are interested in
personal growth and development, I suggest you check out [website]. I'm a former CBOE trader and I've been involved
with this organization for the past 9 years. I think you'll find it very
worthwhile. Thanks for your time and consideration. |
FAQ
does not endorse people or commercial products. See ground rules. I am
happy to publish an account of your own process.
|
Thu, 20 Dec
2007
Tribe in
Fifth Year
Hi Ed,
Our Tribe is now in its fifth year.
In this time, I have provided and received a vast amount of support from
a diverse group of fascinating people from around the world. I have
learned so much, yet I know so little. I find the work as a leader to be
deeply gratifying as I witness people realizing their trading goals or
truly realizing that trading is not for them. More importantly I get to
feel a part of their success as parents, spouses and friends.
The work that we do is not magic and it is not without risk. However,
there is no doubt in my mind that a functional Tribe can move anyone
further than they could possibly manage themselves.
Thanks and Merry Christmas Ed. |
Congratulations on your sticking
with the system and with trading support for growth with others.
|
Thu, 20 Dec
2007
Santa Sings
White Christmas
Ed,
I couldn't resist forwarding this - Merry Christmas and Enjoy!!
http://www.thecompassgroup.biz/merryxmas.swf |
Thank you for the link. |
Thu, 20 Dec 2007 18:09:50 -0800 (PST)
Counter Trend
Strategies: A Chance to be Right
Ed,
Ed Says:
Thank you for sharing your process.
You might consider if you are getting what you want, namely: a chance to
be right, at any cost.
Yes! You're right. That's part of the game: having a chance to and
thrilling to be right for calling and / or profiting out of a move. That's
the fun of discretionary trading.
There is something intuitive and
artistic about it such as observing the ebb and flow of market waves and
trying to take a ride sometimes. Nowadays, though, I am much more
technical in my approach. I calculate the risks involved. I look to
trade probabilities. I look for the meaningful move. I know there is
nothing to predict.
In a sense, I realize that in order to be profitable in the long run I
have to be a lot more systematic and "trend following" even when trading
discretionarily. In many aspects, I realize it was unwise to take this
last trade with the willingness to lose it all if I am proved to be
wrong.
With regard to this trade I took there is one more alluring feature that
enticed me to take it: the options were quite cheap when compared to the
American counterparts as there is a market maker launching the options
and guaranteeing the liquidity (they will buy them back at current market
value).
Whatever, I also find it rather intriguing how sometimes in the midst of
dramas like this I am able to experience some feelings which are not
related to trading specifically.
Yesterday I emoted a lot about some
relationships issues and I am feeling a lot better now. So I understand
that the tendency of "going against the trend" and "going against my
feelings" can be one and the same thing. |
Thank you for sharing your process.

February 2008 Gold Futures
Major Up-Trends
give heroic top-pickers
many opportunities
to try to be right.
|
Thu, 20 Dec
2007
Into the
Weeds
Hi Ed,
Happy Holidays my dear friend.
I'm flying this week checking out a new hire on the 737. What a chore
it is training a new hire on the line. Sometimes I feel like I'm
solo.Talk about high risk with limited reward, not a good place to
be.
At Critical Mach, there is NO stability on the
wing. Curvature on the top of the wing MUST exist to provide a fluid and
stable airflow on top of the wing to counter the lift forces being
generated from below the wing. In order for a plane to fly, the airflow
over the top and bottom of the wing has to be a fluid undisturbed
process. When Critical Mach (the speed of the air traveling over the
top of the wing and NOT the aircraft speed) is reached, all the air over
the wing becomes disrupted and at that point the plane begins to shutter
and the wing begins to lose aerodynamic structure.
I disagree with the contributor who flies the F-16. Contrary to Denny, I still believe and agree with your theory that angle
of attack is what causes planes to fly. Ask him the next time he flies
at takeoff to accelerate as fast as he can and at rotation speed DO NOT
pull back on the stick (which lowers the leading edge of the elevator
thus lifting the nose of the aircraft up) and see what happens.
I will
tell you what will happen, he and his plane will drive straight ahead
right off the end of the runway into the weeds. |
OK.

View From F-16 Cockpit

View from F-16 Cockpit
after attempting takeoff
without pulling back
on the stick.
Clips:
http://www.militaryfactory.com/
cockpits/f-16_cockpit.asp
http://www.organicgardening.com/
images/ogb_weeds.jpg |
Thu, 20 Dec
2007
Spins and Stalls
Mr. Seykota,
I liked the post about spins and stalls, as well as the analogy to
trading.
I used to tell my students it's easy to Monday Morning Quarterback a
pilot
who crashed his airplane by stalling close to the ground.
In reality it
would be very difficult to relax back pressure (sacrifice altitude for
airspeed) and let the plane fly out of the stall, if you were close to
the
ground. Hopefully through experience you avoid getting into situations
which force you to use your counter-intuitive training.
I like the picture of the Tornado. In 3rd generation fighters it is
difficult to get into accelerated stalls. The flight control system is
designed to avoid stalls. If you pull straight back on the stick the FLCS
will limit stab deflection to prevent Over-G, etc. In aircraft with auto
throttles, the A/T system will kick in to prevent low speed stalls.
Per your post, I disagree. Greater speed with constant density does produce
lower
pressure.
Hope this is a contribution and not a distraction. I still find this
stuff
very interesting. |
Greater speed with constant density
does not necessarily produce lower pressure.
Get a large jar and seal the lid,
with plenty of air inside. You might also include a pressure gauge. Take
it on a ride with you in a 3-rd generation fighter. Let me
know if you observe any change in pressure in the jar as you "speed up"
it's velocity. Since the volume and mass are constant, density
stays constant as well.

Simple Devices
can demonstrate
fundamental principles.
Clip:
http://www.sha.org/bottle/Typing/food/
modernolivejar.jpg |
Wed, 19 Dec
2007
Santa Claus is Coming to Town
Hello Ed,
I hear this lyric and think that its no wonder so many have trouble
crying or otherwise expressing sadness, myself included.
You better
watch out.
You better not cry.
You better not pout.
I'm telling you why.
Santa Claus is coming to town.
Lucky for me,
I cry on the hot seat (a first for me) at our Tribe's most recent
meeting. No thanks to Santa Claus, but many thanks to you, Ed!
Thanks as always for all of your work.
Happy Holidays! |
Thank you for sharing your process
and for your insight about the "better not show your feelings" song.

Santa's Gonna Find Out
who's naughty and nice
Clip:
http://www.manbottle.com/
picture_library/santa_s_little_helpers
|
Wed, 19 Dec
2007
Economist Cover from Nov 29th, 2007
see
previous
Ed,
Short term Bottom?

|
I notice the Dollar Index is a couple cents
higher since the appearance of that graphic.

March Dollar Index Futures
The red circle
indicates the appearance
of the Economist graphic. |
Wed, 19 Dec
2007
Visit to Incline Village Tribe
Examining Discretionary Trading
Dear Ed:
I trust all is well. I thank you for allowing me to
attend the IVTT meeting. It is an incredible
experience. I see a slightly different way the meeting
is conducted. I like it and will discuss this format
with my local tribe members.
I take the hot seat and my issue is taking
discretionary trades and not following my system.
You
do not see any problem because I have two systems and
I am following both. I feel that the discretionary
system is my mind's creation that I do not want to
own it. It is a detriment to my right livelihood as it
takes away profits from the mechanical trading system.
You turn the meeting over to another process manager to give him some
more experience while you oversee and coach the entire process.
He asks me how it feels when I
take discretionary trades and to feel those feeling in
the now.
I feel nervous all over my body. I start to
rub my legs and get relentless validation from the
receivers to do more of that.
I tighten my fists,
close my eyes. You play the drum and other members
join in the drum beating. As the drum beating
intensifies, the process manager encourages me to
tighten my fists and squint my eyes to the maximum and
enjoy the feeling.
At the release point the drums stop
beating and I find myself enjoying the feeling that
comes with discretionary trading.
I smile a lot along
the way and the receivers encourage me to keep smiling
and feel joyous. At some point the process manager
asks if I am ready for a checkout. I respond
negatively to that and am adamant to find the cause of
this discretionary trading pattern.
You explain to me
that I am trying to invoke the causal model and TTP is
more about experiencing feelings, enjoying them and
finding their positive intentions.
I agree to trade only my mechanical system and give up
discretionary trading altogether. I intend to
accomplish this by designating a few traders who I
will call when the feeling to take discretionary
trades arises and they can talk me out of this
temporary feeling. One person who follows the same
system as I do has already volunteered to help.
I thank all present at the meeting for supporting me.
A special thanks to the process manager for
doing such an excellent job managing my hot seat.
Ed the icing on the cake that evening are the hugs I get
from you and the other Tribe members before I leave. I feel really wanted at the
meeting. |
Thank you for sharing your process.

Anxiety
Feelings (such as anxiety) in k-nots
tend to entrain drama (such as nervous trading)
to justify experiencing the feelings.
Clip: http://www.mixhealth.com/
|
Tue, 18 Dec
2007
Typo
Dear Chief Ed,
Telling you about this typo is the least I can do to help in maintaining the
integrity of your site.
It is my firm conviction that this resource is the finest available for
traders and others, and it must survive all of us. To that extent I feel
a strong sense of kinship and in a humble and anonymous way, a part of
evolving history.
Isn't that the way it was intended ?
Thank you for inviting us along in this most fascinating journey - into
ourselves, and for making all the difference to our lives.
Sincerely, |
Thank you for the catch. |
Tue, 18 Dec
2007
Magnetism, Electricity, and Cold Copper Rings
Ed,
Here is a cool site.
http://web.mit.edu/jbelcher/www/anim.html#Faraday |
Thank you for the URL. |
Tue, 18 Dec
2007
Lucky Guesses and Missing FAQ's
see:
Dec 16, 2007
Ed says, "You might consider taking your feelings about <finding
reasons in the past> to Tribe.
True, I might be finding reasons in the past NOW.
In a way, when we get AHA's / Flashbacks on the hot seat, or going back to
a childhood experience to experience the old rock and then replacing
with a new rock, they all involve going back to the past somehow NOW? |
In Tribe, we keep the sender in the
now while he experiences feelings and gains insights.
Your wish, to find a historical
article, is likely not part of a Tribe process. |
Tue, 18
Dec 2007
Wing
Curvature
Hi Ed,
I agree with your Radial momentum theory because without angle of
attack, the wing would never lift, regardless of curvature.
However, the curvature on top the wing must exist because if it was not
there the airflow over the wing would exceed critical mach and the
stability would be lost.
Drive 80 MPH and put your hand out the window
and rotate the the trailing edge up and down. At some point your hand
flies out of control.
Vector analysis and F=ma can explain airplane lift theory better than
Bernoulli.
However greater speed with constant density does produce
lower pressure. |
Angle of attack explains your hand
flying up.
I do not follow your "critical mach"
theory or your "greater speed" theory.
For example, if you blow up a
balloon and put it in the back seat of your car and drive really fast,
the balloon, contrary to your claim, does not contract.

The Faster Mr. Balloon Dog Runs
the smaller he gets.
Clip:
http://artmarketinsider.com/page/2/ |
Date: Tue, 18
Dec 2007
Mon, 17 Dec
2007
Flying and Turning
Hi Ed,
When I fly a Jet Fighter,
Fred takes over after awhile, just like with bicycles and bubblegum, and
automates much of the process, but there are some maneuvers that are
counter intuitive, and it takes a little self-talk to help Fred do what
doesn't come naturally.
I speak of stalls and spins specifically, which
require me to let the nose of the airplane point even more steeply to
the ground than it already is in a stall or spin state, but every fiber
in my being tells me to pull the nose back to level.
I DO pull the nose
back to level once the stall / spin is broken, but only after doing the
counter intuitive move. It's like finding the "uncle" point in a TTP
process, then pushing further into the feeling in order to emerge on the
other side at the zero point: uncomfortable at the time, but necessary
for a successful mission. |
Thank you for sharing your process.
I wonder if you see a similarity
between making it through a stall or a spin and making it through a
stock reaction or a drawdown.

A Tornado Fighter Bomber
pulls up, while moving at high
speed,
and enters a
transient high-speed stall.
Radial Momentum results in
a
drop in air pressure,
a drop in air
temperature
and water vapor condensation.
In the case of the Tornado,
the
swing wings automatically move
to adjust for the stall.
Clip:
http://www.highgallery.com/UniquePhotos/
UniqueAircraftPhotos/unique-TornadoStall.jpg |
Tue, 18 Dec
2007
Little Glass
Shack
Ed,
You might enjoy
this.

This is a public toilet in Houston
Now that you've seen the outside,
take a look at the inside view ...

It's made entirely of one-way glass!
No one can see you from the
outside,
but when you are inside
it's like sitting in a clear glass box.
Now would you use it?
|
I doubt this device exists - except
as a joke.
"One way" glass enables the person
in the darker area to view the one in the brighter area.
At night, with a light on in the
shack, the passers by can see the inhabitant. |
Tue, 18 Dec
2007
Wants Money Management
Ed,
My direct question would be, would you manage what little
money I have left to risk?
But I doubt you would even respond to that.
I thought I was a trader, or at least could become a good part time
trader by working hard. I worked long hours in a job that I hated and
believed that it was the source of my frustration.
It took me many years to make a career change to a great
new job that affords me a lot more free time to pursue the things that I
enjoy. It has improved my life in all aspects with the exception of
managing money.
I have come to the conclusion that I don’t even know what
I don’t know, any amount of time spent training myself to trade results
in my same self-sabotage and in the end, I know you would say that I am
getting what I want out of the markets.
I have attempted to get closer to the true root source
of my anguish and believe that there is some type of guilt that keeps me
from reaching a higher capacity but I am either too frightened,
embarrassed or proud to dig deeper and on the surface I feel that I am
truly a normal person. This does not help me to understand myself.
I am fortunate that I have built the rest of my life on a solid
foundation, I have an incredible family and we live in a vastly
rewarding rural mountain town. My wife has been more than understanding
and even though I wasted years of our lives being a complete Jackass,
coming home grumpy and tired from my crappy job, she accepts & loves me
and she even stood by me while I lost all of our money chasing my
dreams.
To stop trading makes me feel like I am quitter – but either way it is
killing me. I want to start over but I don’t know how to begin. |
Thank you for sharing your process.
You might consider taking your
feelings about <doubt, anguish, guilt, fear and embarrassment> to Tribe.
Whether you trade for yourself or
through a broker, advisor or manager, you may wind up entraining drama
in your trading account. |
Tue, 18 Dec
2007
Cute Ad
Ed,
You might like this ad.
http://www.ffk-wilkinson.com:80/ |
The ad suggests winning the battle
with kids.
In TTP we suggest parents and
children support each other so everyone advances. |
Tue, 18 Dec
2007
Meditation
Ed,
You might like this instruction on meditation:
http://youtube.com/watch?v=mZP0Hhcov8c&mode=related&search= |
The video advocates quieting the
body and mind and joining the breath.
In TTP we advocate encouraging the
mind and body to do whatever they wish to do, including becoming quite
active. |
Date: Tue, 18
Dec 2007
Links
Hi, Ed
I don’t really have an issue with your website, but I notice a number of
links displayed in the Navigation Area.
Over the past year I have made the discovery that there
seem to be a total of 14 links, and I have just now clicked all of them,
and they work fine, but I wondered at first if there was a master site
map that I had missed, or if some pages did not contain all the links
just because that’s the way things came together during the assembly
process.
Curiously, none of the pages has a link back to the Home
Page. I’m okay with this - it’s just an observation.
|
Thank you for the feedback.
I use MS FrontPage.
When I save / publish a page, it
saves the current version of the header information in the area at the
top of the page.
Some early pages show early versions
of the header.
I can update the header by editing
and re-saving pages.
Let me know if you wish to have the
latest header on any specific pages. |
Tue, 18 Dec
2007
Goes Against the Trend
See previous: Great
Mistake
Ed Says:
You might consider taking your feelings about <going against the trend>
to Tribe.
Whereas such principle is clear to me with regard to
mechanical / computerized trading, I have been trying to incorporate it
also to a discretionary approach.
My local market has a lot of restrictions to speculation (hence the
relative lack of liquidity) and I am allowed to trade only on the short
side, as if hedging by buying options (puts).
In such a case, i.e.,
trading discretionarily, I am inclined to track price objectives and
momentum in longer time frames and then wait for a trend signal, such as
a reversal, in the shorter time frame.
In the setup I was following I
was not patient enough to wait either for the long term objective being
attained or for a clear trend reversal signal in the short term. |
Thank you for sharing your process.
You might consider if you are
getting what you want, namely: a chance to be right, at any cost. |
Date: Mon, 17
Dec 2007
Program Efficiency
see Market Efficiency,
below
Is the new Language INtegrated Query feature found in C#3.5 important to
traders using this language? If so, why so and if not, why not? |
Importance depends on your notion of
what you think the program "should" do. |
Mon, 17 Dec
2007
Market Efficiency
Chief Ed,
Are equity markets like the NYSE and NASDAQ efficient in terms of
pricing individual issues?
Are markets efficient in the "short run" (90 days) , the
medium term (say, 24 months), the long run (36 or more months) ?
If markets are efficient at pricing, what role do traders play in the
process? |
Efficiency depends on your notion of
what you think the markets "should" do.
You might consider taking your
feelings about <being in control / letting your feelings out> to Tribe.

Gasoline-Efficient Car
Clip:
http://www.freakingnews.com/
News-in-Pictures-May-8-May-14-Pictures---1020.asp |
Mon, 17 Dec
2007
Belief Systems
Dear Ed:
Happy Holidays, and thank you again for your work.
Intentions = Results
Could it be that Intentions are created by our belief system? That our
belief system creates a "blueprint" that we follow without knowing? This
idea is [consistent with] my experience.
Although I earn significant amounts of money on Wall Street I am not
good at holding on to money.
My savings are invested in Money Markets
instruments, I give money away and as I earn more money I increase my
spending to a new level. The end result is that I still work to pay the
bills.
I have several non-supportive beliefs:
1) I think children of rich families get spoiled.
2) I think that money will come and go. (This was my experience growing
up)
3) I'm a good giver but not a good receiver, etc
Now I change my beliefs and I retain more money. The issue disappears.
A friend has a similar experience. He makes significant amount working
with investments. He and his wife save a lot. He makes one investment
that wipes out most of his savings. BIG AHA, we review his belief system
about money and realize that he has many beliefs that are unsupportive
about money.
It seems that he creates a situation that fits his belief system.
What do you think? |
Belief systems that appear as
logical mental constructs rarely account for drama.
Changing your "thinking" may not
change your gut reactions.
K-nots that appear as body feelings
judging other feelings - and Rocks that contain automatic responses to
emotions can and do account for drama.
In Tribe, we open up some of the
body locations where we store our gut responses and we supplement
medicinal responses with pro-active ones right into the same locations.
You might consider taking your
feelings about <losing control and getting into your feelings> to Tribe.

Smokers
spend a lot of time
thinking about quitting.
The same goes for alcoholics
and day-traders.
Clip:
http://www.uoguelph.ca/research/news/
articles/2006/November/smoking.shtml |
Sun, 16 Dec
2007
A Great
Mistake, Again
Ed,
Just
recently I have made another great trading mistake. I had been watching
the soybeans market when I noticed that there was a bearish divergence
between prices and the MACD in the daily chart.
I had also noticed on
the monthly chart that November was unable to close above the key 1100
level (1988 high). Then on December the 3rd I bought some put options
for the May contract in the local market.
I spent about USD 3500 to buy
the options. I was aware that the market could instead rally on a
runaway move to test the 73's all time high of 1290. I was also aware
that the local market where I bought the options is characterized by low
liquidity.
So I was willing to risk the trade until the options get
expired on March 14. Well, so far the divergence proved to be a failed
signal and the market seems to be on a runaway move, some calling and I
myself afraid that the ceiling is around 1400.
Even though the risk was rather "calculated", every tick the market
moves up I am reminded of my own fallibility and I have to deal with
some feelings which from time to time take away my inner peace as I try
to experience the positive intention of throwing away in the waste
basket 3500 bucks.
I bet 1/3 of my savings. Next time I feel compelled
to trade I think I should bet less, say, only 10%. Always learning -
the hard way. |
Thank you for sharing your process.
You might consider taking your
feelings about <going against the trend> to Tribe. |
Sun, 16 Dec
2007
Lucky
Guesses
and Missing FAQ
from Dec 1, 2007
Hi Ed,
Thanks for the reply. The thing is, the question is precisely what I do
not have.
Here's the whole story: I sent you a question back in June 10, 2004, and
for whatever reason, you notice something and suggest to me if I might
check with my family about my own childbirth. You make a "lucky guess"
(as you call it) that there may be some complications at birth. And yes,
I am Cesarean born and I have a tendency of not able to stick to things.
So as I am investigating my own childbirth now, I'd like to gather as
much info as I can, including what the question was that gives you the
hint to make the "lucky guess."
Unfortunately although not necessarily surprising, you make another
"lucky guess" (Sept 16 / 17, Financial Freedom). I just lost a large chunk
of my savings through an investment manager friend, a person whom I look
up to and trust to have the skills and the kind of emotional support to
handle my money.
I understand the volatility but was hoping to invest
with him for the long haul, hopefully decades, and I was shocked to know
that he just blew up. I don't blame him. After all, it is me who chose
to invest with him, and I need to take responsibility and consequence of
my action. On the contrary, I want to support him as much as I can to go
through this tough period.
But I can't help but wonder, maybe as your
"lucky guess", I just need to have this kind of drama to justify my deep
desire to be "financially free." I went through several hot seats to
take me through all the immense sad / frustrating / guilt feeling. Now I am
curious and want to learn more. It seems that you can see me better and
more clearer than I can see myself.
I try to dig up all my notes on FAQ. Throughout these years I have been
taking careful notes on the FAQ. I feel I learn a lot and I have a great
sense of gratitude.
I've learned about trends, about trading, about
service to others, about government, about feelings, about nature, about
supporting others from you.
However, I also notice quite a number of FAQs have disappeared. I know it because I can see from my notes but I
can no longer find the entry on the website.
The childbirth entry (June
10th) is one, and you also once replied to me (around that same time,
via FAQ) that "You might have some feelings about wanting to know who
people really are - perhaps even yourself."
Again, I can no longer find
the entry on the website, and not knowing what is in my question that
leads you to that "lucky guess" (seems to be right on target again). I
never ask you to revise or delete my submission, so I am surprised and
disappointed that it is no longer on the website.
Ed, that's why I am asking, if you still have those previous entries
available from me (from mid June, 2004, and the childbirth one is
6/10/04), I'd greatly appreciate if you can please repost them. As I
say, you seem to be able to see through me clearly, and I wonder if you
can please tell me further of what you see. Many, many, many, many
thanks!! |
You might consider taking your
feelings about <finding reasons in the past> to Tribe.

Yep, It's Still Now
Clip:
http://blog.longnow.org/2007/07/ |
Sun, 16 Dec
2007
Reincarnation
see
previous
Hi Ed,
FAQ, May 14, 2007, Communicating with the Dead, Ed says,
"A drop of
water falls into a shallow elliptical pool at one of the foci. The other
focus "reincarnates" a similar drop."
This is quite intriguing and I am curious if you can expand more.
Do you
mean that when someone thinks of something, through some under-Fred
network, someone elsewhere also comes to that conclusion - such as the
discovery of calculus by Newton and Leibniz ? |
You might consider taking your
feelings about <magic> to Tribe.

Reintarnation
is the practice
by which bluegrass tunes
suddenly appear all over the place
after many years of dormancy.
Clip:
http://www.virb.com/groups/08114786 |
Sun, 16 Dec
2007
Anger
Management
Hi Ed!
My anger seems to get to me when my child is stubborn. I feel like
wanting to hit things, luckily not him. I feel the rage hitting me in
half a second and I'm not ready to avoid letting it get to me. I clench
my teeth, tighten my arm and hand, feel a real tense in my stomach and
feels like struck by lightning in my head.
I have spoken about this in
the tribe one month ago and it calmed down. Now it's back on again. I
tell my little boy of 1.5 years how
upset I get and that I'm sorry for it.
He doesn't understand the words
but definitely my forms. It feels better. A couple of days ago I put on
Linking Park on full volume and felt like a teenager, hiding to stop the
pain (medicinal rock).
I spoke to a father of four grown up children (they seems to be happy
about their childhood). He said that you have to show your child both
love and anger. Life is tough and it won't do them any good to be raised
without knowing what is right and wrong. I agree but it doesn't feel
good when my reactions seems a little uncontrollable.
You have earlier
mentioned that I should take my need to be in control to my tribe. I
have actually forgotten that. Maybe that will give me any insight.
A long time ago I remember that you mentioned to a parent (as I remember
it) that he should question why he put up an expensive vase when his
children were playing near it.
Was it to have a reason to be angry when
/ if they broke it. I have thought about that regarding giving dinner
to my baby boy when he is out of mood.
He just throws everything on
the floor in a split second. Sometimes I just pick the things up and
accept that he's not hungry. Other times I might put the plate back up
and tell him to not put the food on the floor. Of course it just repeats
and I get irritated.
I get what I want but I
don't know I want it. I
think my intention is that he needs to eat more so I got to give him
another chance, but to be honest I know that it wont matter what I put
in front of him. It will end up on the floor anyway. My view is that if
he throws the food on the floor he gets no more, but I'm not consistent
of applying that.
What do I want to say? I want to say that it feels bad to get
dis-proportionally angry at my own child for stupid reasons. I want to be
able to steer myself in every moment, but sometimes I'm imploding.
I
send an image of a very controlled and most of the part is. I'm not
surprised that people sometimes do awful stuff (like picking up a gun
and shooting people) because sometimes I get so angry on small stuff
even though I have reached so many of the things I think I want. I mean
- I'm not desperate.
I have a limit so nothing awful like that will
happen but there are times when I really wish someone would try to rob
me or hit me. Then I can put all my rage on that person.
It's strange
that I think so because that is not good "life management" - analogy to
money management. I would never bet everything on one trade, but still
sometimes it seems I'm willing to bet my whole life on one incident.
Well, feelings are not the same as acts.
I hope I get some peace from these unwanted feelings by accepting them,
writing about them and bringing them up in the tribe.
Thanks for listening. |
Thank you for sharing your process -
and for your willingness to address a core issue that directly involves
the well-being of your child.
Anger typically arises in response
to a threat to self preservation and /or a perception to injustice.
Many philosophies consider anger to
be undesirable or even sinful. Your use of the phrase
"unwanted feelings" is consistent with such views.
In TTP we hold all emotions have a
positive intention.
Your use of the word, "should," and
the phrase "out of mood" are consistent with a world view of controlling
others.
Your wish to receive unjust
treatment so you can experience anger is consistent with the theory of
Fred setting up drama for you so you can experience feelings in k-nots.
You may be running this racket with
your son via the food-on-the-floor game.
You might consider taking your
feelings about <anger and controlling others> to Tribe.

The Anger of Achilles
by Giovanni Battista Tiepolo
In this scene from Homer's Iliad,
the angry Achilles is about to draw his sword
to attack Agamemnon.
The goddess Athena suddenly appears
to stop Achilles by gripping him by the hair
and telling him to restrain his anger.
Clip and Information:
http://en.wikipedia.org/wiki/Anger |
|