Government-Real Truth
Archives of “February 2019” month
rssFocus On Obstacles
Often we’re discouraged because of some tough challenge or obstacle in our way. But a shift in mindset from a Zen proverb can change everything: “The obstacle is the path.”
The obstacle isn’t something standing in our way. It’s the way itself.
That might seem strange, so let’s look at a few examples:
- You are struggling with writing, and procrastinate. Procrastination is the symptom, but it also illuminates the path you should take: you are dreading something about the writing, you are shying away from discomfort, you are afraid of the writing or what will happen when you publish the writing. So work with that dread, the discomfort, and the fear. You’ll be stronger for having done that.
- You are shy and can’t meet people. This can be seen as an obstacle to social happiness, or as a path for something to work with. Many people will avoid this obstacle of shyness, and instead stay home and not socialize. Instead, go towards this shyness, explore it, find out what you’re afraid of, work with that fear. You’ll get better at handling the fear, even let go of it, and it will no longer stand in your way.
- You are stressed out and overwhelmed at work. You can complain about this problem (and it will then continue for the rest of your life), or you can immerse yourself in it, let it lead you to self-exploration, and deal with the source of that stress and overwhelm. You’ll learn that you have unrealistic expectations and ideals, learn to let go of them, and the stress will go away. You’ll now have a tool for dealing with stress for the rest of your life. (more…)
Kettle From Draupadi Era
Best courtroom exchange ever?
Emotional
The amateur trader trades without knowing why, how, or when. She jumps into the market because it looks like it ought to got up, or sells because the market looks like it ought to go down. There is no plan, no set of rules, no understanding of stock market basics; just an emotionally driven response to price action. And the emotionally controlled professionals? They are standing with arms wide open and a smile from ear to ear ready to welcome the amateur into a place of grand opportunities only to be introduced to the slaughterhouse rules. Want to guess who the sheep is?
Lessons From Warren Buffett’s 2014 Letter to Shareholders
The education of any business person is incomplete if it doesn’t include a thorough reading of Warren Buffett’s annual letters to shareholders. I often say that I have learned more from reading his annual letters than I have reading anything else. And I spend much of my days reading! That said, this year’s letter was no different than usual. In fact, it was even more jam packed than normal because Buffett spends more and more time these days focusing on Berkshire AFTER Buffett. So his life lessons are more widely discussed than ever.You should go read the letter yourself, but in case you don’t have the time I’ve jotted down some of the key takeaways:
Macro Matters. As much as Buffett focuses on the micro (specific companies) he’s always mindful of the macro. And he certainly understands that his success couldn’t have happened without riding the biggest macro wave of the last 100 years – the amazing growth of the US economy:
“Who has ever benefited during the past 238 years by betting against America? If you compare our country’s present condition to that existing in 1776, you have to rub your eyes in wonder. In my lifetime alone, real per-capita US output has sextupled. My parents could not have dreamed in 1930 of the world their son would see.”
As I always say, it’s easy to look like a great swimmer if you can figure out the direction of the current. Figure out the macro and the micro more easily falls in place.
Accounting, accounting, accounting. If you read a Buffett letter you’ll notice that it’s filled with accounting tables. I’ve stated in the past that the language of economics is accounting. It is the way we communicate the health of our economy, our institutions and our people. Buffett knows this. Buffett’s a masterful businessman because he understands the language of economics. If you’re not well versed in accounting do yourself a favor and spend more time learning the language of economics – accounting. (more…)
The difference between PR, advertising, marketing and branding
A Question You Need to Ask
Taking a pre-defined loss is part of the business. Exiting a winning trade and watching it continue to work without you is part of the business. Missing an opportunity is part of the business. Many traders cannot accept these realities of the trading business because they have a need for perfection and a need to be right.
Consider the following: You aren’t sure if you should scale your last unit at your target because you notice that momentum has increased and it looks like it could keep going beyond your target – do you hold it? Flatten at your target?
To know what to do, you need to answer the following questions for yourself. First, which is more painful to you…..exiting at your target and watching it run further? Or not exiting at your target and watching it come back in? You also need to know what your default action is when you experience different types of discomfort. Is that typical response of yours adaptive or is it emotionally reactive? Only you know the answer to this question; and it behooves you to know.
What Market Wizard Ed Seykota has been up to lately:
Those familiar with Ed’s Whipsaw trading song will not be surprised to find him back playing music a few months ago. Here is the legendary trader Ed Seykota playing music recently with his son. If you are not familiar with this Market Wizard check him out here: Wikipedia.
How do *your* coping efforts work for you?
How about after you have a few winning trades, days, or weeks in a row? Do you trade better or worse? Breaking down your performance as a function of recent performance will tell you a great deal about how effective you are in coping with risk and reward.
The other excellent indicator of whether your coping is working for you is your emotional experience during trading. If you find that anxiety, overconfidence, frustration, and stress are pushing you into poor decisions, you know that you’re not coping well with the uncertainties of markets.
Finally, it is helpful to identify the sequences of coping behaviors that you utilize when you’re making good decisions and the sequences when you’re trading poorly. Knowing how your individual coping responses come together to form coping strategies can help you cultivate your coping strengths.
Tracking how you deal with challenges when you are at your most effective enables you to create a mental model of that coping that you can call upon during periods of high stress. We cannot avoid the stresses of trading, but those do not have to generate distress and biased decisions.Take a look at how well you trade after a position has gone against you. Do you trade better after a drawdown or worse?