Daily Speculations

The Web Site of Victor Niederhoffer & Laurel Kenner

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8/24/04:
Roles and Ruses, by James Lackey

"Letters from a Self-Made Merchant to his Son" had a very positive influence on my life and trading, many meals for a lifetime. Anything your father or grandfather did not teach you, this book will be a substitute.

I longed for a relationship with my grandfather, who passed at the age I needed him most. I was 14 and he was barely 64. My father was a boilermaker by trade. My father always kept impeccable time, something I strive for on the drums and the markets.

Many of the questions, queries and frustrations of the market over the past many weeks, time is and always be a crucial factor in speculating. The joke is I was right, just early. Ironic was my wife's powerful warnings of hubris to me after the Spec Party. She was concerned that I may think I know what I am doing in the markets. Too many people said I was doing good and a fine guy. She knows that ultimately ends in tremendous losses, of focus and bank balances.

For the first time since I started back to the futures, I took it easy at the end of a period we call months. Traders always seem to do more conservative when up or more aggressive when down, of course that is anecdotal and not tested. What is certain,  I am just as aggressive at the beginning middle and end of a race. I learned from racing especially motocross if you ride at 90% throttle your timing is off, you miss a jump and crash with a big lead. It is always better to rest after the races, never, ever, ever rest while in or on the field. Although it has always cost me plenty, in the markets and in life to always be 100% throttle or OFF. It goes with fallacy of most vividness. Lack that was a bad crash you had; how could you miss that huge up day in the markets?

What I try to never rebel against is my system and my rules. There are times to be more flexible. However, to seek revenge, to get back what we lost, even opportunity cost, must be ruinous over time. What does the markets have to do about me? What price I bought or sold has no predictability. Get over it, like a high school crush on a girl, at that time in your life, it seems so powerful and painful to you, especially after a loss. Until that 20-year reunion comes along and Father Time has tipped the scales, literally.

From a simple soldier, all the talk of discipline in trading is insanity. Insanity is doing the same things over and over and expecting different results.  The markets keep time and like a jazz musician's solo. You know where you are at, "yet not quite sure where it will resolve." Sometimes when it does you are caught, and must get back.  Yet when it all comes together and the big band cranks it up after a solo, we realize how wonderful and magnificent was the soloist journey.

Each market panic is like a jazz solo. (part in quotes from perhaps Chicago jazz spec Haag) if not I apologize, as I know I was plagerizing a bit and always know when I do. That keeps me humble in markets as well. Another meal for a lifetime came from Vic. Pick a sport, practice every day and compete -- this has helped me manage the stresses of trading and family life.  I never really cared why the market or a stock did this or that. By the time the 'why' comes, the move is over.

My wife thinks it was hilarious when she asked me how I lost so much at the beginning of this month, after being so careful at the end of the last inning. She said, "Figures, but how exactly did it happen?" I said well basically, last month the pitcher came out and threw right at our heads and got thrown out of the game. They brought in a new pitcher for August and he did the exact same thing. He threw right at my head a 99mph fast ball.  That could have killed me. Wife asked so what you do? I hung in tight and attempted to swing away as usual. Then another strange thing happened, Yes of course, but the most beautiful sliders I have ever seen, one two three strikes I was out, all last week. Those pitches were so beautiful. I started to walk away before the ump said strike three. I got caught looking; I knew I was out. I Didn't throw my helmet or bat. Even in my head, my dad is watching and for certain my son is watching me play. That "#@$!" mistress will never get me that way again. However, she still has a 99mph fastball. I hope they think I can't hit high heat.

Yes, the joke is hope. This reminds me of Randy Johnson the pitcher for the AZ a few years ago when he was unhittable. Left handers didn't even want in the line up because they all knew he was unhittable to left handed batters. Yet all this summer all the talk of his trade status. Meanwhile, he was getting pounded and his ERA up to the trade deadline. I wonder how long Randy was hittable years ago, meaning didn't pitch perfect, until the batters got it out of their heads he was un-hittable and swung defensively for easy fly outs?

Are you frustrated trading this year? I hear many are, it is all over the Web. That is the mistress's job. Watch the kids baseball movie, "Sand Lot." "You think too much Smalls, I bet you get grades and stuff huh?". Tom Ryan's favorite quote to me. "Lack you can't run the mill with the water under the bridge" Which is the meal of this post.

Surfer Sogi stated the industrialists had the greatest impact on life in the 19th century. There is much optimism in the world today. We see it and are always bullish, especially on our personal futures and yes the stock markets. Yet more drugs (cocaine) is consumed by this country than any other in the world.. So it is always best to remember the book "How to Lie With Statistics." Which I noticed FEMA and what I mistook as capitalism at work in Hurricane Punta Gorda was actually a government handout machine. Bush brothers will destroy anyone on any vote in these parts. The point is we have so much 'time' on our hands to worry. We have time to read the wrong reports, news and books or sniff glue. That is why I spent this am working on this post.

That 100-year-old book was so good I bought a perfect copy from 1903 signed as an X-mas present for a colonel for fiftyyyy bucks. Other meals are the other posts and quotes mentioned here on this spec list. So many meals for a lifetime here. Yet all were far too concerned with crop reports, 1104 and the end of Vic's predictions on his site.  Back to time, the poor and short-term planning for life, in the ghettos of the trading pit, meals for a day VS. meals for a lifetime. My proper role, focused short term day trader, attempts to grasp at all these straws, by the bootstraps for self-improvement. I thank you for all the great posts. LACK