Posts By Vikram

Hindu Temple of Greater Chicago Hosts Maharudra Yagna: 3-Day Prayer for Peace


[originally appeared in The Chicago Tribune]

Last weekend, the Hindu Temple of Greater Chicago hosted a historic and massive three-day convocation to pray for world peace. Thousands from the Chicago area and around the world gathered for ancient Vedic ceremonies that transcended boundaries of religion, nationality, or gender and allowed devotees a rare and transcendental experience.

Thousands of devotees and hundreds of priests and scholars participated in the mass chanting of ancient prayers, culminating in Saturday’s Maharudram Yagna, a fire sacrifice whose history dates back 5000 years, but whose relevance to modern challenges and contemporary life could not be more profound.

Rudra, a deity first described in the Rig Veda, the world’s oldest scripture, appears on the surface as a storm god. But Rudra emerges in the scriptures as an embodiment of universal truth. He represents both the storms of life and our power to weather those storms and turn them into blessings.

The prayer addressed to him transforms into a deep meditation on the fundamentals of a conscious and compassionate life. Leading the chanting was a rare assemblage of 121 Ritwiks, scholars who have devoted themselves since childhood to the study of ancient Sanskrit scriptures and the performance of the elaborate rituals associated with them. These include the great yagnas, which involve offering oblations of clarified butter, symbolic foods, cloth, and therapeutic herbs into a sacred fire in precise unison with the chanting of Sanskrit verses.

The Maharudram event drew attendance and support from a vast array of local, national, and international spiritual, political, and community leaders, including Satguru Bodhinatha Veylanswami, the US-born spiritual head of Himalayan Academy, Hawaii; Swami Ishatmananda of the Vivekananda Vedanta Society, Chicago; Swami Ramanaswaroopananda of Atma Vidya Mandir, Tiruvannamalai; Sri Samaveda Shanmuka Sarma, Hyderabad; Swami Sharanananda, Chinmaya Mission, Chicago; and Sri Swami Adhyatmanandaji Maharaj, Sivananda Ashram, Ahmedabad.  Hindu Temple of Greater Chicago President Bhima Reddy and Committee Chair Lakshman Agadi led the large congregation in honoring the visitors from India, Hawaii, and all over North America with fresh flower garlands and gifts, paying respect to their various religious orders.

Maharudram committee co-chairs Dr. Vijaya Sarma, Subrahmanian Sundaram, and Gopalakrishnan Kary, with the support of chair Lakshman Agadi, led dozens of volunteers and planned with the help of religious scholars for over a year to ensure that the ritual, the prayer, and the geometry of the sacred space itself remain virtually unchanged from yagnas performed millennia ago in ancient India. Dr. Sangita Rangala emceed, explaining the symbolism and significance and maintaining a positive and prayerful mood for the large gathering. Over a hundred children knotted traditional flower garlands and brought them in a procession to offer to the deity. The priests received them and used them to decorate the pyramid of 108 kalasams, silver pots decorated with coconuts, flowers, vermilion and sandalwood powder and symbolizing the cosmological elements of matter and energy out of which the universe manifests itself.

The Maharudra Yagna encompasses psychology, metaphysics, cosmology, and moral teachings. The event was a rare opportunity for children and families to witness heritage and history come to life.

However, this Maharudram Yagna, performed on a hillside in Lemont, Illinois, was not a recreation of a bygone era in a far-off land, but a living part of American Hindu spiritual life, as relevant and meaningful in 2015 as in the time of the ancient epics, Mahabharata and Ramayana. At the start of the day's ceremony, the priests led the assembled 2000-plus in Sanskrit prayers which listed the names of sacred places the congregation calls home. Along with the names of places in India and rivers like the Ganga, the priests chanted the names of the Missouri and Mississippi rivers, Michigan and Alabama.

Friday’s events celebrated the power of women and girls, central to Hindu and Vedic philosophy. Nearly 1300 women and girls chanted in unison the Lalita Sahasranama, a poem listing the 1008 names of the Supreme Goddess, who embodies the essential power and love of the universe.

Seated row upon row in a sea of colorful silk and gold saris, the women and girls sat in front of small, individual statues of the Goddess and prayed and meditated as one. Men and boys volunteered with logistics or sat at the periphery joining in the prayers. At the front and projected on large screens, priests from Chicagoland and around the world led the recitation of the 1008 names, offering flowers and fruit to the statue of the Goddess, a symbolic representation of the divine feminine power, or Shakti.

A literary and spiritual masterpiece composed with perfect meter and no repetition, the Lalita Sahasranama uses the 1008 names to describe 1008 universal or divine qualities which are manifested in the world and in the individual. The vibrations of the chanting and its spiritual counterpart are said to have healing and liberating power for those who chant and listen.

The Lalita Sahasranama pooja, or offering of prayer, was preceded by a Gomata pooja, or worship of a cow and calf, which symbolize the loving and all-nurturing nature of the universe. Through symbol and ritual, devotees show gratitude to the universe which gives us everything we need to sustain our material and spiritual selves, just as a cow provides both the milk and the protection and love needed by her calf. Just as the calf grows to become a cow herself, we also seek to grow in our capacity to love and care for others.

In keeping with tradition, dozens of volunteers prepared thousands of fresh meals in the temple's kitchen, and the organizers donated to a local food pantry to feed thousands more. And in a sign that the event was truly a 21st century version of a 5000-year-old tradition, a quadricopter drone took aerial live streaming video and children got a 3D virtual walk through famous temples in India.

Sunday culminated with the Nava Chandi Homam, 14 simultaneous fire sacrifices with offerings of ghee, clarified butter, flowers, fruit, and special preparations of therapeutic herbs, seeds, and aromatic wood. Devotees chanted verses praising the feminine aspect of divinity, embodied as the Goddess. Seated in front of the priests' large fire pit in squares of 16 people around 13 smaller copper fire pits designed according to geometry prescribed in the Atharva Veda, worshippers praised the goddess's various qualities: she is omnipotent and terrible to those who would do harm, tender and all-protective to those who have faith and seek peace within and without.

Despite severe thunderstorms and flash floods, volunteers laid tarp and made emergency provisions so devotees could sit comfortably through the three-hour ceremony and focus their meditation on the 700 verses of the Devi Mahatmyam, one of the most treasured scriptures in praise of the Goddess.

The goddess in her multiple incarnations represents universal forces of power and compassion. When the forces of greed, exploitation, oppression, and patriarchy grow too great, the goddess manifests herself to destroy evil and restore harmony. Both a source of comfort and courage, the goddess also reflects our own power to overcome our weak tendencies and cultivate the inner power that lies beyond earthly fears and ambitions.

In Indian philosophy, the concept of God is of a truth that lies beyond gender, form, ethnicity, time, and space. Rather, this Ultimate Truth manifests itself as all these things. By realizing the oneness of all, we cultivate true happiness, the goal of all religions. The final pooja offering celebrated this union of Shiva and Shakti, Rudra and Devi, individual soul and universal consciousness. Whether it was the sweet fragrance of the smoke, the soothing sounds of the Sanskrit verses, or the way the sky cleared halfway through, the smiles and tears and rapt attention of the participants showed that the mood Sunday morning had turned to pure joy and togetherness.

Organizers had expressed their hope to the volunteers that those in attendance would not just be moved, but transformed. The original intent of the Maharudra Yagna is to transform the worshipper, to help him or her transcend fear and doubt, and it remains the same 5,000 years later: to help us discover the divinity within ourselves and each other, to empower us to face the storms of life with courage and faith, and to be peacemakers in our lives, in our communities, and on behalf of the whole world.


Are you the hero of your story?

A keynote I gave to the Golden Key National Honor Society UF Chapter in 2007.

I was asked here this evening to offer some advice about success. The thing of it is, planning for the success itself is easy. It’s pleasant to look forward to prosperity, respect, advancement. What’s hard is accepting, and even planning for, the setbacks and failures that are inevitably part of any well-lived life. If success is the opposite of failure, then is the key to success avoiding failure? How do you avoid failure? The answer: set very low expectations for yourself. Then you’ll find it easy to succeed and never fail. For example, I’ve set myself the goal of going home this evening and watching a rerun of The Simpsons. But, you may well point out, the Simpsons is on at 7:30 and this banquet may not end in time. But my friends, I TIVO’ed it. I’m going to watch it. Then I’m going to check it off my to-do list and sleep the sleep of the easily satisfied.

If I fill my weekly schedule with similar items, by Friday I’ll have checked off a long list of mundane and pointless tasks and feel ever-so accomplished and successful. I might similarly design a whole life in which my ladder to success is more of a gentle slope dotted with modest, easily reached milestones: have job most of the time, live in enclosed structure with indoor plumbing, enjoy relationship with not entirely repulsive significant other who is firmly resigned to the fact that I’m the best she can get.

Not the stuff of great novels, but entirely within my grasp. Not so bad, could certainly be worse. If this vision of a modest, easily-achieved, not entirely objectionable life doesn’t fire your imagination, ask yourself why. Why do we seek a life of challenge? Why flirt with risk? Why do we get inspired by quotes like the one from Helen Keller, who said, “Life is either a daring adventure or nothing.”? Is it ego? Do we all have an inner Napoleon or perhaps an inner Madonna who craves conquest and fame? Or is it something we needn’t judge so harshly? Is our ambition to succeed something that is good, not only for ourselves but for the world?

I think of the stories we tell ourselves and each other for inspiration. Rarely are they stories of prudence, modesty, and settling for what is practical. The great stories are always of heroes daring the impossible, or possibly impossible, enduring hardship and humiliation, growing and adapting with creativity and humor, but never, never giving up. Those are the stories we cherish. My friends, each of us is living a story, and I urge you to think about what sort of story you are living. Above all, ask yourself, am I the hero of my own life story?

I believe we all have a right to see ourselves as the heroes of our own life stories. Not the victim of circumstance, not a comic side character, not a villain waiting to be exposed, but the hero. When you think that way, you can remember that in every hero story, there are parts where the hero struggles: Cinderella sitting among the ashes, humiliated, alone, her true worth unrecognized. And you need that part of the story to be there. If the story went: Cinderella was popular, rich, and never had any problems, and then she met a prince and lived happily ever after—well, nobody wants to watch that movie! You might want to live it. But then again, deep down, no you wouldn’t. It’s the struggle that makes the success mean something. It’s the essential part of the story.

When a friend of mine was going through a severe illness, I shared this idea with her, and asked her to write the story of her life, but with her as the hero, not the victim. I wanted her to see that if you only look at the chapter in which the awful stuff is happening, you might see it as just an ugly, sad story of a victim suffering. She was living that chapter then, and you can imagine she felt like a victim. She felt like a failure. She asked “Why me?” as anyone would. But writing is wonderful therapy, and this time she rewrote her story, so that the horrible chapter she was going through—her body failing her, her husband leaving her, etc.—was part of a larger whole—a story of which she was the hero and, indeed, the author, or perhaps co-author.

I knew something interesting was happening when she asked if she could make the story an allegory, like a fable. I said sure. Then she said, and I quote, “Can I be a fairy princess?” Now, this is a high-powered executive, who lives in suits and leads a large organization. I knew something interesting was happening. When I read her story, it was funny and touching, but nearly half of it was very detailed descriptions of what she, as a fairy princess, would be wearing. I said, “This is mostly costume changes! What about the important stuff?”

To which she replied, “What I’m wearing is the important stuff!”

But there was also a plot, and though the events were the same, it had gone from the story of a victim suffering, to that of a hero struggling. That is the key difference. As I said, every great story has setbacks, heartaches, periods of great suffering. We put up with them because we know that at the end of the tale, those dark chapters lead to the eventual successes and without them, the hero’s successes wouldn’t mean anything.

When you are facing one of the dark chapters of your own life–and unless you set consistently low expectations for yourself, you will have dark chapters–remember that you have the choice, to see that episode as one of a victim suffering meaninglessly, or a hero struggling meaningfully and creatively in the midst of a noble quest. Have the courage to look at your so-called failures and setbacks and decide for yourself what they mean in the context of the larger story, a story of which you are the hero and the co-author. Then you can deal with those dark chapters in a way that respects your deepest values and your inner nobility.

I realize that what I’ve given you is advice on how to look at failure, when I was asked here to give you advice on success. So let me conclude with some advice on how to handle success, which I learned from my friend who said, “What I’m wearing is the important stuff.” My advice to you is, when success comes, as it will for all of you, people will want to take your picture, so make sure you look good. Iron your clothes, get your hair done, maybe get some of those tooth-whitening strips. Because people will look at the person in that picture, and they’ll think about your story, and then they’ll think about their own stories. Your story can inspire others to make their own stories great, even people you never meet. So that’s my advice on success: don’t just achieve it; achieve it with style. The hero of your story deserves nothing less.

A Quick Guide to Becoming a Better and Happier Writer

29 April 2005, Rue LeCourbe, Paris

[Advice to students in my study abroad course in Paris.]

As I write this, I am sitting in the Café LeCourbe, at my favorite table by the window. One block west on the Rue LeCourbe is a Monoprix store that once was the apartment of a leader of the French Resistance. Nazi troops came past this window to capture him. When she got word, his fiancée Hélène got on her bicycle and rode 200 miles, somehow caught up with the train carrying him to a prison camp and managed, during a transfer stop, to hold hands and walk with him one last time before the SS guard pulled them apart. I mention this because it reminds me that if you’re ever struggling to write, a great story may be just a few steps away.

It is 1915h and I’m having une bierre pression, a draft called Stella Artois. A little girl came in with her father and shouted to the back, “Maman, voila une bouquet!” and ran with a red rose in her hand to the back end of the bar, where her mother sat with two friends. Now the little girl, in a pink dress with a red heart on the front and matching pink sneakers—she’s even a redhead, honest—is going around offering men at the bar “un peu du chocolat?” She then holds out her lollipop to them and when they say non, merci, tucks it back in her mouth, the stick held in one corner like a cigarette, and smiles. The first person I’ve seen in almost two days wearing a beret just walked by. A black beret, a blonde in a black coat; she looks nothing like Monica Lewinsky. They all seem friends: when they leave, they kiss four times, twice on each cheek.

First things first

1. Definite, specific, concrete language is the essential element of good writing.

Nothing is more important. Replace the general, vague, abstract, or clichéd terms you may use at first drafting with more specific language. And cultivate the habit of dropping to deeper and deeper levels of specificity as you note the details. When you write that you saw a car, next to “car” write “silver, two-seater Smart car, as long as most cars are wide,” then note any other details worth noting. A poodle sticking its head out the right-side window, maybe. And you have just come from London so for a second you thought the poodle was driving.
Let me give you a reverse-engineered example. Imagine (try your best) that you are a writer in Paris writing in a café when you see an attractive person come in. You are prone to nostalgia, to self-doubt, to depression, and both these feelings and your suppression of them come to the surface when you write and in what you write. You might, if you were a talented student in a college writing course, make this first draft:

I was writing a story where the characters were drinking, and this inspired me to order a drink, which warmed me up and made me feel relaxed. A girl came in the café and sat down. She was very pretty and I got distracted looking closely at her face and hair. I felt a jumble of emotions as I looked at her, but it was easy to tell that she was waiting for somebody, so I went on writing. I really got into it, and I ordered another drink, but I still looked at her from time to time. Somehow the writing and the girl and being in Paris all blended together and made a strong impression on me. I’ll never forget it. Then I went back to writing and I got so involved in it that I forgot everything else in the room and didn’t even order another drink. When I finally looked up, the girl wasn’t there and I felt sad. I put away my notebook and gave the waiter my order. After writing a story I always had mixed emotions, but I felt pretty confident about this one. Eating dinner certainly improved my mood.

Notice that you get some idea of what’s going on, but the story is still not unique. Lots of people could have written it. Look now at the original and see how the writer replaces general words like “characters, drink, dinner,” and even “emotions” and “pretty” with specific words from a specific life. Well, with “pretty,” he leads us deliberately through an awkward cliché: new coins are round and shiny—hardly a complimentary way to describe a girl’s face—only to give us a memorable image and phrase, “rain-freshened skin,” and a hairstyle you can see. Yes, he breaks the rule by using “happy” and “sad,” but he knows what he’s doing. Rules are made to be practiced, mastered, and then masterfully broken.

Here’s the original, from A Moveable Feast:

It was a pleasant café, warm and clean and friendly, and I hung up my old waterproof on the coat rack to dry and put my worn and weathered felt hat on the rack above the bench and ordered a café au lait. The waiter brought it and I took out a notebook from the pocket of the coat and a pencil and started to write. I was writing about up in Michigan and since it was a wild, cold, blowing day it was that sort of day in the story. I had already seen the end of fall come through boyhood, youth and young manhood, and in one place you could write about it better than in another. That was called transplanting yourself, I thought, and it could be as necessary with people as with other sorts of growing things. But in the story the boys were drinking and this made me thirsty and I ordered a rum St. James. This tasted wonderful on the cold day. I kept on writing, feeling very well and feeling the good Martinique rum warm me all through my body and my spirit.

A girl came in the café and sat by herself at a table near the window. She was very pretty with a face fresh as a newly minted coin if they minted coins in smooth flesh with rain-freshened skin, and her hair was black as a crow’s wing and cut sharply and diagonally across her cheek.

I looked at her and she disturbed me and made me very excited. I wished I could put her in the story, or anywhere, but she had placed herself so she could watch the street and the entry and I knew she was waiting for someone. So I went on writing.

The story was writing itself and I was having a hard time keeping up with it. I ordered another rum St. James and I watched the girl whenever I looked up, or when I sharpened the pencil with a pencil sharpener with the shavings curling into the saucer under my drink.

I’ve seen you, beauty, and you belong to me now, whoever you are waiting for and if I never see you again, I thought. You belong to me and all Paris belongs to me and I belong to this notebook and this pencil.

Then I went back to writing and I entered far into the story and was lost in it. I was writing it now and it was not writing itself and I did not look up nor know anything about the time nor think where I was nor order any more rum St. James. I was tired of rum St. James without thinking about it. Then the story was finished and I was very tired. I read the last paragraph and then I looked up and looked for the girl and she had gone. I hope she’s gone with a good man, I thought. But I felt sad.

I closed up the story in the notebook and put it in my inside pocket and I asked the waiter for a dozen portugaises and a half-carafe of the dry white wine they had there. After writing a story I was always empty and both sad and happy, as though I had made love, and I was sure this was a very good story although I would not know truly how good until I read it over the next day.

As I ate the oysters with their strong taste of the sea and their faint metallic taste that the cold white wine washed away, leaving only the sea taste and the succulent texture, and as I drank their cold liquid from each shell and washed it down with the crisp taste of the wine, I lost the empty feeling and began to be happy and to make plans.

2. Cultivate awakeness to what your senses bring to you, without judging.

I realize “cultivate awakeness” is pretty un-specific; practicing rule #1 will help you cultivate it. An eye for colors, shapes, juxtapositions—writers become more sensitive to these things, as well as to the sounds their words make. Good writers will have a preference between the word “began” and the word “started.” They are not interchangeable.
To see one circle and relate it to another circle requires first that you see the circles. An improv comic picks up a dinner plate and it’s a steering wheel. He drives too fast, crashes, dies. His partner picks up the plate; it is the halo of St. Peter, deciding whether the dead man gets into heaven.
A first step in writing is simply to begin—as Adam did—to name the things in your world with their unique names. Turn that purple flower into a wisteria, the French girl who will give me a coupe de cheveux tomorrow into Natalie, that “Oriental-sounding instrument” you heard in the metro station into a shakuhachi, that nice-smelling shampoo into cucumber-melon. When this becomes a priority for you and a habit, you begin to inhabit a world more rich and alive than what most people live in.
If tomorrow Natalie shampoos me with cucumber-melon shampooing before my haircut with shakuhachi music in the background, and if her perfume smells of wisteria, I’ll be really freaked out.
You’ll find that you never master this skill, but rather keep finding new ways to improve. Choosing and expressing the significant details may be the biggest writing challenge, bigger than the word-play. For a start, practice relaxing, giving up the need to control things, and staying with the discipline of just making lines of words and letting things be as they are.
I swear that the Beatles’ “Let It Be” started playing just after I wrote that last bit.

Look again

The next two rules apply after the first draft is written, during revision. The word “re-vise” means to look at something again. So you have to first bring it into being before you can revise it.

3. Abhor the cliché.

Learn to spot and change or cut as many instances as you can of clichéd ideas, expressions, and words. Expressions are easiest to spot, and there are websites and books that collect all those well-worn, tried-and-true chestnuts. Words sometimes get so overused and misused, like “individual” for “person” or even “individuals” for “people,” that we forget they’re wrong.
Clichéd ideas are the most insidious, because they imply that we have already figured out what to think about a given situation. We like to think we know the truth, even when it’s not true. Incoming freshmen tell me they’re not “math and science people” as though it’s genetic. Once when an engineering major told me he “wasn’t an English person,” I told him I could tell from his accent. He just looked at me blankly.
Students begin essays with “I was a typical freshman with the typical experiences when one day I met…” and already they’ve lost me. I understand the impulse, but you can never be original this way. When someone tells me her mother’s “rags-to-riches story,” I ask her to tell me her mother’s story, not prove how her mother’s story fits a certain type.
I think we do it because we have a need to belong. We want to know what type or crowd we fit in with. We want identity and uniqueness and yet we don’t want to be alone.
Assume nothing. Let familiar things fascinate you again as they did when you were one and spent hours putting things in your mouth and taking them back out, feeling their corners and tastes without yet knowing the labels people put on them.
Take in mouthfuls of Paris the same way. The fact that you’re here means you’re already past the Fox News clichés of “cheese-eating surrender monkeys” or lazy, socialist sex-maniacs, that you don’t expect a land of greasy-haired accordion players kissing their fingertips and saying, “Formidable!” at the drop of a hat, or beret. There’s an art to being both completely at home and completely in wonderment at the same time.
So what do we cliché-abhorrers have left to write if, as Mr. Shakespeare wrote, “There is nothing new under the sun”? (He wrote a lot of clichés, Mr. Shakespeare did.) Arrive at those old truths by your own path. While it’s good to learn from and even imitate other people, let that imitation lead you to the place where you can add your unique view. Be humble enough to realize that you are unique and that God, being infinitely creative, makes no backup copies. If I’m sure of anything it’s that the Good Lord abhors the cliché.

4. And finally, omit needless words.

This advice from William Strunk, the original author of the classic Elements of Style, is about more than changing “due to the fact that” to “because,” though that’s a good start.
The rule also means that sometimes you will clear away a lot of vague clutter and make room for specific, concrete details. This can result in something like this:

“We proceeded along Rue LeCourbe, the street from which we had started out from the hotel, until we reached the metro station, Sevres-LeCourbe, after crossing the Rue Garibaldi. Then we entered the metro station, paying our 1,40 € and proceeded to the platform. Our professor, Vikram, began lecturing us on writing but it was difficult to concentrate on his commentary due to the plethora of Parisian sights, sounds, and smells with which our sense were being tantalized. I only remember a few fragments of his discourse,”

turning into something like this:

“Out the hotel, up its namesake the Rue LeCourbe, wait for the light, cross Garibaldi and after a short detour to see the top of the Eiffel Tower behind a building, descend into the metro station and pay 1, 40 euros to a man who is the spitting image of Victor Hugo. Vikram lectures all the while—you recognize the drone—but there is a bucherie with bright red meats you’ve never seen before, a charcuterie with terrines of salmon and little quiches and rows of cheeses wrapped in ham, and a salon called ModsHair with a large mirror outside, at which you all stopped.  The French girls all have scarves and you start mentally scarf shopping. You remember nothing of Vikram’s lecture but “Behold the Eiffel Tower. It is Gallic, phallic, and metallic.” You all groaned at once and wondered how much of that there would be all week.”

Yes, I know the latter is not actually shorter. But it does more per inch. If I kept just the parts that do what the first passage does, it would be half the length. But omitting needless words suddenly shows me how empty the original really was. It just seemed full because of all the words in it. The latter says more, implies more, and shows more of the writer’s personality.

But that advice is for later, as I said. The writing process is like pottery. First, you dig the clay. Master potters for millennia were known for their gift of looking at a hillside and knowing where the good clay was within, just as physicians traditionally were not just healers but farmers and botanists. The artist loves his materials and processes. Most great musicians love to play scales. In The Writing Life, Annie Dillard writes of a painter who chose his job because, “I loved the smell of the paint.” So make this your practice while we are in Paris:

  1. Keep your hand moving. Don’t stop to think or judge or wonder what to say next. Thinking is of little use to writers. Let the writing come out of your hands, even if it means writing the same sentence a few times or writing “I don’t know what to write next.”
  2. Do not hurry. In fact, treat it at times like penmanship practice. You are not trying to write anything great. You are just putting pen to paper, making nice, pretty letters, and whatever words and sentences happen to come out, come out. You needn’t go too slowly, but when you find yourself racing to catch up to your mind, accept that you cannot, slow down, and go back to just writing nice, pretty letters.* Your hand will be too slow to write all the thoughts you can speak or think. This provides an elegant and natural filter once you’ve learned to use it.
    This way, even if I give you a difficult topic or writing task, or a difficult subject comes up as you’re writing, you have a strong, basic center to anchor you and give you control. If I ask you, for example, to write sentences beginning “I remember…” and painful memories come up and you want to cry…cry. Don’t stop writing. Someone will hand you a tissue. Try not to let the tears smear the ink. You’ll want to re-read it…it was probably worth writing.

Oh, and rule #3: remember to breathe. You’d be surprised how often you hold your breath. Once you get flowing, you’ll enter a relaxed, meditative state that is pleasurable and creative.

* Thank you to my teacher, Joyce Carol Oates, for the nice, pretty letters practice. She’s written over 80 books, all in longhand on yellow legal pads, all in nice, pretty letters.

The 4 things all good teachers do

One of my teaching mentors, Dr. Dennis Huston of Rice, taught me Shakespeare and encouraged me to become an actor. Above all, he inspired me to want to teach and to enjoy it as much as he did. He was named Professor of the Year by the Carnegie Foundation, but more than his excellence, it was his enthusiasm I admired. He described the classroom as a “magical space,” where people could better understand each other and themselves and gain insights which you cannot gain elsewhere. After 17 years of teaching, I have learned how right he was.

Dr. Huston once mentioned, casually, that there were “only four things a teacher really needs to do” and the rest came from practice and experience. I asked him to teach me the four things. It took an hour, after dinner on a Tuesday, and a few of my friends joined us.

The four things:

  1. Have a working knowledge of your subject. Not necessarily world-ranking expertise, just enough to be useful. It makes me think of the Japanese word for teacher, sensei, which just means “one who came before.” You just need to be a few steps ahead on the path, calling out directions over your shoulder as you and your students move forward.
  2. Show that you care about your subject. It’s not enough to show that you know the stuff. You have to inspire passion. You get to inspire passion. It’s a duty and privilege.
    If, as Einstein said, example is not just the best means of teaching, but the only means, then teachers have to set an example of how to have fun. I’ve had dozens of students tell me they weren’t interested in writing at the start of the semester, but when they saw how enthusiastic I was about it, they became curious.
  3. Show that you care whether the students learn the subject or not. I may be an idealist, but I think it’s a missed opportunity when you teach only to the best students and mentally resign the rest to Cs or below. Sadly, our system encourages and even requires creating artificial divides, from Kindergarten through grad school. I believe my job is to get every student doing A work, or at least try my best to do so. (As you can guess, all those As led to rumors I was an easy grader. I’m not.)
    As for professors who say, “I’m a teacher, not an entertainer,” I sympathize but disagree. People learn best when it’s fun. And when you can make it funny, it shows mastery of the subject and the learning process. Humor is just the truth sneaking up on you.I’ve always believed that a classroom that isn’t laughing (and crying and rapt in silence) isn’t learning. My best teachers taught me this by example and I’ve done my best to pass the lesson on.
  4. Care about the students themselves as people. It’s not easy being a student, especially now when many are targets of predatory lending. Some of their challenges are even worse. An estimated 1 in 5 college women will face a sexual assault before graduation. Some will not be believed; some will be talked out of filing charges. I know this because several wrote about it in my classes.
    Your students may suffer from depression, addiction, eating disorders, and the post-traumatic stress of a difficult childhood. They may have stalkers. Even if you can’t help, at least understand why some are asleep or distracted or late. I walked a couple dozen students to the University of Florida counseling center and referred hundreds. I still have the number memorized (352-392-1521).

The trust they place in you often translates into dedication to your class. I had several—too many—students say their only reason for not trying suicide on a Tuesday was because they had my class on Wednesday. And they knew I would miss them. No training can prepare you to be the only reason a student gets out of bed all semester. You just thank God and keep teaching.

Dr. Huston was right about the rest being practice and experience. You find beauty in the basics which you didn’t see at the start of your career.

80% of my writing classes is still rules 16 and 17 of Strunk & White’s The Elements of Style: “Use definite, specific, concrete language” and “Omit needless words.” Not only do these basic truths of good writing cultivate and strengthen style, they reflect larger truths of character.

To be specific is to give, as Marge Piercy puts it in “The Art of Blessing the Day”:

attention to each little and big blossom of the tree
of life, to let the tongue sing each fruit,
its savor, its aroma and its use.

How lovely a way to treat the world! Adam’s first job, after all, was to give names to each creation in the Garden.

To omit needless words we must make hard and clear decisions about what words we need. I called my first and best-loved course “Writing & Love” because, I said in the description, “Writing and loving are similar disciplines requiring similar decisions.”

To decide what needs to be said can only be done through compassion. To see each other well, to decide what is important to notice and what just gets in the way, requires a sure and well-guided eye and hand.

In the end, good writing is a promise to tell the truth as well as you can and with compassion, and the keeping of that promise. The promise leads to the beauty and power inherent in the language, which only attention can reveal.

Good English prose consists of sentences of varying length, with pleasing rhythm and melody, using short words drawn mostly from the Anglo-Saxon, with Latinate and French words for seasoning. The Gettysburg Address is a model, beautiful and powerful. It shows Lincoln’s compassion for his people, and love for the act of writing to them. It shows his attention to detail in choosing those 272 words and omitting any others.

Other subjects have their power and beauty. Chemistry is a dance between positive and negative charges. Even the language of chemistry is love poetry. Molecules are water-loving (hydrophilic) or water-avoiding (hydrophobic). A galvanic cell is a tale of unrequited love. (Really, it is.)

Architects don’t design structures, they design spaces of potential, waiting to be filled with life. So do all teachers who believe in Dr. Huston’s “magical space” of the classroom.

In all of these is the magic of attention, from the French attendre, to wait. To wait for something is an act of faith: you believe something is going to come. What that is depends on what you ask for. Bad teachers, teachers who have given up, expect only disappointment and drudgery. And so they find it.

A good teacher expects, even demands, something else. She attends, waiting for the burnt-out and unconfident student to show the merest kindling of genius. She feeds that ember into flame enough to shed light. She holds it up before the student’s glowing, half-believing eyes and says, “See? That’s you.” As Marge Piercy wrote and my mentors taught me, “Attention is love.”

US business: young, entrepreneurial, equal opportunity? No.

Despite all the talk of Lean Startups, millionaire app developers, and Shark Tank, we are less of an entrepreneurship economy than we were in the 70s. So says a new Brookings study(PDF).

Really? Before we had the iPhone, the Prius, Google, and Justin Bieber? Before MTV, Atkins, Pokemon, and Clear Pepsi?

When there were half as many obese adults and twice as many Germanies? That was our entrepreneurial heyday?

Apparently so. We talk about startups as job creators. But we don’t give them priority. Our question is, why?

The evidence, co-author Ian Hathaway says, “is pretty overwhelming.” Big, old firms are driving job creation and economic activity. Young firms like Twitter (though they may get the headlines) are employing less than a quarter of us.

By our estimate, about three-quarters of private-sector employees and nearly 80 percent of total employees (private + public) work for organizations born prior to 1995. This is especially remarkable considering the volume of product innovations and household-name businesses that have emerged in the last two decades.

How is it that so few jobs are coming from new businesses?

One reason is familiar to anyone who has held onto a job they hate just to keep the health insurance. Fear of going bankrupt because of an injury or illness isn’t good for risk-taking.

Now that even Republicans are saying, “keep your government hands off our Obamacare,” maybe the House GOP will decide that 50 tries to repeal it are enough.

But let’s not get distracted arguing about so-called “entitlements”; they aren’t the big problem. It’s our whole attitude toward risk-takers.

We pay lip service, but we don’t work to find the best risk-takers, extend them low-interest, long-term credit, and then share their risk and minimize it. We cling to myths about who is credit-worthy. Hint: the next Steve Jobs won’t look like Steve Jobs.

We also have a failed vision of how to take on risk. Young, new firms based on new ideas are more likely to fail, more likely to need long incubation time, and less likely to quickly become profitable.

The rate of new firm formation has fallen by half during the last three decades, and has contributed to the decline of American “business dynamism…”

In short, fewer firms are being born, and those that are born are increasingly likely to fail very early on, as are firms that survive into young- and medium-aged years. Those that are old, on the other hand, tend to persist, allowing them to constitute a larger share of economic activity in the United States over time.

The American Dream lives in the idea that you can start with nothing and create something that makes the world a better place and maybe makes you rich as well.

We talk about it, but we don’t put our money where our national mouth is. We don’t take on the reasonable and necessary risk of investing in the boldest and brightest among us. Here are some of the reasons:

The short-term, “build a company and sell it” focus of many entrepreneurs.

Few entrepreneurs are trying to build something that will grow and last. Look at a Google search for “build company to sell”: not one top 10 result talks about it being a bad thing.

In short, not many companies are trying to be the next Facebook. They’re trying to get bought by Facebook, the way Instagram and Whatsapp did.

Serial entrepreneurship is fine. But you can’t build an economy on disposable companies.

The refusal of banks to lend generously to small firms and startups.

Instead, big banks are taking the 2 trillion-plus the Fed has paid them and putting much of it into reserves. Quantitative easing was based in part on the hopeless notion that massive amounts of free cash, no conditions attached, always brings out the best in people.

Instead, banks have disproportionately used it to benefit themselves, investing in large-cap stocks and big funds, not lending to the new small-caps the economy needs.

A friend of mine, former editor of a leading financial site, told me the investor buzz lately is about emerging market small-caps. The American Dream is alive, it seems, and getting funded in Bangalore and Buenos Aires.

The education debt weighing down many of the same young graduates who typically start businesses.

It’s hard to get a business loan when you already have 30 or 40K in student loans to pay off. Some just give up when the banks say no, without realizing they’re more likely to get startup funding from family and friends than a bank or angel investor. Such investments are a challenge for all but the richest families.

So why not help parents who co-sign loans for their children starting small businesses? A tax credit or insurance against loss would allow parents to invest in their children’s talent and ambition without risking their retirement savings.

Surely if we can let banks use taxpayer welfare to pay tens of millions to CEOs who caused the financial crisis, we can help parents invest in their kids.

The new Obama model, where repayments are a low, fixed percentage of monthly income, is like that of the most successful lender in the world, microcredit pioneer Grameen Bank, which has a 97% repayment rate.

It works so well that Grameen stopped accepting donations in 1995. They are one of the most consistently profitable banks in the world. Another big reason for their success? They lend mainly to women.

The biggest reason for the world’s (and America’s) economic difficulties is our failure to invest in women.

We underestimate the value of women as an economic power in ways that, well, hardly qualify us to lecture others. Few of those big, older firms employing 75% of us are run by women.

Marissa Mayer, CEO of Yahoo (L) and Sheryl Sandberg, COO of Facebook

Discrimination is particularly awful in the tech sector of all places. Tech firms run by women “show significantly better returns,” yet they get less funding.

You’d expect all those bearded hipsters and the moneyed old guys who want to hang with them to find such blatant sexism as outdated and noxious as Clear Pepsi.

But Issie Lapowsky of Wired found one “angel investor” saying “I don’t like the way women think,” and another proclaiming he doesn’t invest in women he doesn’t find attractive.

The solutions are obvious.

As I revised the above I had to ask myself, is this what I’m accusing us of: being short-sighted, greedy for quick and easy profits, more eager to make a quick buck off our students and graduates than invest in them, and unfair to women who want to create new jobs, new products, new services, and new ways of doing business?

Yes, but saying it will just make some people defensive, so let me ask it this way: is there any good reason not to do the following and do as much of it as possible?

  1. Invest for long-term, sustainable growth and stop looking at quarterly returns like they mean anything. (They don’t.)
  2. Use taxpayer funds to promote lending to entrepreneurs (who are also taxpayers) who want to create opportunities for themselves and others. Taxpayers need not fund the stock market speculation of big banks or subsidize an ever-smaller group of corporations, some with earnings larger than the GDP of most countries. Most of them don’t even pay their fair share of US tax. (Legal does not equal fair.)
  3. Invest in our students so their most productive, risk-taking years are not clouded by massive debt.
  4. Unleash the full power of half our citizens and immigrants.

I haven’t discussed the value of raising the minimum wage. To those OldCaps who insist that it kills jobs, the New Capitalist reply (which is also Reality’s reply) is simply: you’re wrong.

1400 different studies show no effect on employment. Every time Congress has raised the national minimum wage, two things have happened: Republicans screamed and unemployment stayed the same.

Plus, consumer spending usually rose, since poor people spend more of their income. What’s more, most small business owners favor an increase in the minimum wage.

This issue boils down to a question about democracy in a capitalist society. Do America and the world continue to move to a system where a few giant entities create most of the jobs and products and set most of the rules? That’s China.

Or will the land of opportunity set an example of doing what is both right and profitable? Our failure to invest in women is the clearest sign of our failure to treasure the best of ourselves.

It’s great that women are speaking up and “leaning in” and all. (Facebook and its COO are model New Capitalists.) But in a larger sense, women shouldn’t have to lean in, should they?

How much better than a man do you have to be before male investors consider you good enough?


How to profit & still lose

ES 03-14 (5 Min)  2_13_2014 - VikramThis is the story of how I made $1762.50 yesterday in a demo trade in the E-mini S&P [CME:ESH14], while failing as a trend-follower and a trader. If I, or you, look just at the final profit, we’ll be missing the story.

The markets do allow you to recover from stupid mistakes sometimes. That doesn’t mean I should turn it into a habit or a “system.”

Note: This example comes from the demo account NinjaTrader kindly provides me to test trading ideas and keep an eye on how our calls perform. The usual disclaimer applies (see the footer of the page). In a demo, you don’t feel the same pain as with real money. Then again, I’ve had losing trades where after a while, I became numb to the numbers.

It’s your mind’s way of protecting you from the pain, and it was part of the story yesterday. Again, please don’t see this as an example of how to recover from a mistake profitably, even if a lot of trading gurus would sell it to you as exactly that. It’s an example of ego and stupidity and needless suffering. You don’t want to trade like this.

Since most of the key steps to the $1762.50 are on the chart, I’ll just highlight a few points. The morning started nicely with a couple of quick one- and two-tick scalps, which added up to $62.50 in profit, before commissions and fees. My goal was to show that you could do quite well taking a lot of small profits, if you were not yet confident enough to do a big swing trade.

I like pitchforks almost as much as this guy

And yes, that is how my charts look. The lines are prices that have been significant in the past and which the market is likely to remember. Look how beautifully the market hugged the middle tine of that large red pitchfork! And respected 1817, 1814.50, and 1811 as support and resistance. [SNP:^GSPC] Those levels acted as magnets, as they did last month.

At the beginning of the big rally, before the 8:30 AM CT open, I “sold the rally” a couple of times for small profits totaling $62.50. It was quick and easy and so I imposed my idea on the market that the market would and should go down. First big mistake: telling the market what to do.

Then, I ignored the uptrend, ignored my own super-secret proprietary indicators, and stayed short as the market took back most of my $62.50. I could have gotten out and kept half of it, but I didn’t. Being right was more important to me than keeping whatever money I could from leaving my account.

I used what is called “dollar-cost averaging” to increase the price from which I was effectively short. For example, if I get short from 10 and the market goes against me up past 20, I could sell a second contract at 20 and thus be short 2 contracts at 15. Sounds smart, right?

No. It was my way of fooling myself that I was being clever. But the simple question is this: the market was in a clear uptrend. Deciding to be long and profit from that trend was so easy “even a caveman could do it.” And here I was, trying to push back the tide. Why?

That the market did eventually turn my way and yield a profit is beside the point. I left more money on the table than I put in my account, all because I fought the trend instead of following it.

Look at the missed opportunities. $1000 on the first up rally, another several hundred back down, then the perfect Fibonacci correction. And my MACD and moving averages were showing them as well. (Oops, I just revealed my secret formula…) I ignored it all.

Instead of blending with what the market was doing, I was dancing to a different tune and the two did not harmonize.

I failed to do the thing I know works: listen to the market, shut up, don’t question it, and just follow the trend. As Jack Broz, who will be back next week, told me, “If you have a method you trust, then just trust it.” Reminds me of one of my favorite Springsteen lyrics: “God have mercy on the man who doubts what he’s sure of.”

We buy and sell the stories we tell

The recent Super Bowl ads were an example of companies selling a story about themselves. Coca-Cola, for example, is selling the word “happiness.”

It’s a great word to wrap your brand around. My own website, The New, has the tagline, “Happiness is profit.” Coke even has a website on how to be happy (hint: it involves a beverage).

Never mind the depletion of groundwater and freshwater aquifers in places like High Springs, Florida, and Mehdiganj, India.  Never mind the obesity epidemic and the effects of high-fructose corn syrup on children.

Stories can tell you what to ignore as well as what to focus on. And sometimes those stories are complex. Coca-Cola also is using its power to help women start small businesses around the world. The happiness they want us to focus on is real, too.


Traders and investors turn stories into profit and loss

As traders and investors, it’s important not to get caught up in the story of how a particular trade is going to make you money. You start to focus on any evidence, any price tick, any change in your favorite indicator, that seems to support your bullish or bearish position.

You ignore evidence to the contrary. “It’s just a little drawdown! It’ll come back, it’ll come back!”

Thanks, Mr. President!

Thanks, Mr. President!

On any jobs Friday, you’ll hear some pretty wild stories getting tossed around and often tossed right onto the trading floor. This week there’s a boneheaded article in Forbes claiming that the CBO says Obamacare will cause job losses. It doesn’t

But to read Scott Gottlieb’s article (which, in combination with his great hair and teeth, should get him on Fox News), millions of us are going to be so healthy from Obamacare we’re going to quit our jobs to take up extreme sports full time.

The financial crisis? The unpleasant incident? The end of the world as we know it?

One of the big stories of our time, of course, is the financial crisis. It’s actually many stories, depending on your role in it.

Right down to what you call it. The credit crisis, the financial meltdown, all that fuss in 2009?

How about the Second Great Depression? After all, if we’d responded to it the way we did in the 1930s, it could have been worse this time. We faced a bigger, emptier bubble and greater inequality than in the 1920s.

The story we tell determines the decisions we make about a situation. It even determines how much courage we can summon.

After the crisis, many people chose not to put their money in the markets at all. A friend of mine just told me yesterday he keeps his in a bank account and “under the mattress.” So do a lot of people.

It’s hard to argue against his fear. If you’re not well-informed, i.e., you haven’t gotten an empowering story to guide you, you’re in trouble from the moment you open a brokerage account.

You are the hero of your story, not the market

One of the most important story changes anyone can make, in any area of life, is to go from seeing yourself as a victim suffering to knowing that you are a hero struggling.

Victims give up, they get used and abused further by forces larger than they are; they are not in control.

Heroes, no matter how dire the circumstances, are in control of their own minds and never give up. They don’t take any $&?*! from anyone, or any market.

So the first step is to understand a situation clearly by telling yourself the truth about it, even if the truth doesn’t make you feel good at that moment. And especially if the truth seems complex and boring to get through.

Remember, liars rely on your willingness to lose focus, get bored, and just hand over control to them. My broker, Paul Brittain, is one of my best teachers; so is MrTopStep’s CEO, Danny Riley, and our little group of honest and profitable traders. Most people aren’t so lucky.

So in the interest of a little Friday truth-telling, here’s one of the best explanations of the credit crisis around. It takes 11 minutes. If you want a great movie about what really happened, check out the Oscar-winning Inside Job.

Happy Friday, and keep an eye on the stories people tell you (and try to sell you) and the ones you tell yourself, especially the ones that have become habit (I have trouble with my weight, I’m not good at math, I’m shy, etc.).

Don’t let them control you and whatever you do, don’t let someone sell you bubbly high-fructose corn syrup and tell you it’s a bottle of happiness.

Guard your empowering stories like they’re money. Because one day soon, they will be.

Fair Value, the great overlooked market force. (Also, robots)

In this morning’s “Our View,” CEO Danny Riley mentions “something so basic that most traders don’t even look at it: premium levels, fair value (FV) and volume.” For months, I’d heard Danny mention buy and sell programs and premium. I put the fair value into our daily report and looked back at premium and price history. And as often happens, I was also thinking about robots.

Fair value premium is the major driver of price action

If you watch CNBC with the volume up, you’ve heard them say “fair value” every morning, when they quote the pre-open S&P 500 futures [^GSPC:SNP].

If you’re like me, you probably thought “fair value” was something like the blue book price for a used car. And you might have thought about whether stocks and index futures were overpriced or a bargain.

Little did I know fair value premium is the major driver of price action in index futures. China’s PMI, the Fed, housing prices, unemployment—they may affect investors’ feelings about where the long-term value is.

But it’s the premium between fair value and futures that moves the price up and down the ladder, tick by tick. Why? Robots, of course. (More on that below.)

And since funds and banks use futures to hedge their portfolios, as in the recent rotation into tech stocks, fair value plays a big role in the stock market as well.

Premium and index arbitrage

To put it simply, a difference between the current futures price and fair value constitutes a premium. If futures is above fair value, then you sell the futures and buy the cash S&P. If futures is below fair value, then it’s a bargain; sell the cash and buy the futures. Then you liquidate the spread and keep the difference as profit.

You’re probably saying, I’ve never done that kind of trade. You probably haven’t. You may also be saying, sometimes that premium is just a few points or ticks. You’d have to be really fast to profit. Yes, you would. Maybe faster than humans can be.

Learning from the robots

60% to 75% of trades are done by index arbitrage buy and sell programs, algorithms that trade the difference between the actual current price and the future price, selling the higher one and buying the lower. To do this, they (and other algos) lay down buy and sell stops–often months in advance–and then run them when the time comes. This is how a small move turns into a run, as it did Friday.

So what can mere humans do against the droid army? Keep being human, but learn one thing from the bots. They do what they plan to do.


When their stop is hit, they exit. When the market meets their entry conditions, they pull the trigger without hesitation. They don’t fantasize about big winners or let a loss make them go back and analyze their childhoods.

They trade like, well, machines, knowing that losing is part of succeeding and being just as willing to take losses as profits, as long as their edge gives them profit that exceeds the loss. Otherwise, unlike humans, they stop trading.

I’ll say it again: there is no holy grail of investing or trading. You are the holy grail.

Finally, the money part

Fair Value

Last Friday morning, futures were 10 full points below fair value before the open. And had been negative 10 of 15 days this year. That was enough to tell you how the day was likely to go. Wasn’t it?

One more thing: remember that robots, even more than humans, remember price levels of significance, where there was a lot of volume and a lot of time spent.

Those levels act as magnets on humans and perhaps even more on algorithms programmed to mirror human desire.

So is it any wonder the drop stopped on the red trendline? And will you be surprised when it drops to 1750 or 1715?

Let’s put some things together. The Friday-Monday rule says that Monday will continue Friday’s momentum.

And the Asian markets traded sharply lower. (My Asia Sunday Rule says that Asia will start a trend and then hand it off to the US to continue or will start and finish a move and let the US digest it.)

And the S&P futures has been below or at fair value most of the night but are now 5.46 points above as of 7 AM CT. Do these things suggest how today will probably go? A bounce and then continuation of the downtrend seems likely.

The next level down is in the low 1760s. I hesitate to write that because some of you will just short from Random Point A to Random Point B, lose money, and be sad. I hope you won’t do that. But then again, everybody gets what they want from the market.

Should investors and traders care about economics?

Mark_TwainI was talking this week to one of Chicagoland’s leading custom home builders about the changes in his company’s business model since the credit crisis. That crisis had wiped out many competitors, who were mainly investors, sort of like house flippers (remember that?).

When they folded, they left their craftsmen out of work. Lakewest kept and expanded its workforce, who are, as you might imagine, skilled, motivated, and loyal. In short, his business model centers around keeping his workers doing work at the peak of their ability.

What the stock market or even interest rates do barely touches his business. Anything short of another crash means little to him. His economics are the demand for homes in Naperville and the well-being of his employees and family.

It got me thinking about one of my big questions: What is an economy for? As I’ve pointed out before, Milton Friedman never claimed that the economy’s purpose is to enrich corporate shareholders.

The New Capitalist view is that the purpose of an economy is to help people create opportunities for dignified, meaningful work and through that work, a chance to pursue happiness.

But the nearly 160% rise in the stock market since March 2009 has enriched shareholders. A $10,000 investment in the SPDR S&P 500 Index ETF [SPY:NYSE] in January 2009 is now worth $20,400.

The problem is, the effect of that hasn’t trickled down to the rest of the economy, which is doing better by many measurements, but not fully recovered from the self-inflicted wound we call the Great Recession.

To borrow from President Reagan’s famous question, “Are you 104% better off today than you were in 2009?” Some of you, yes. Most of you, no, at least not in money terms.

As this viral video makes clear, we simply don’t realize how unequal we are. Studies show 92% of Americans agree that wealth is too concentrated in the hands of the wealthy. But even those people don’t realize how bad it is. It is 1929 bad. It is almost “Let them eat cake” bad.

Those 104-plus-percent gains that we talk about? 95% of that money went to the 1%. Most of it went to a fraction of that 1% that you could fit on a cruise ship.

Sure, they invested the most so they should get the most. No one argues that. But should that be the main way we measure how well we are doing? Is that what we built this machine called an economy to do?

After all, retail investors, the so-called Mom and Pop with their E-trade accounts, haven’t returned to the U.S. equity market in a big way and those who are investing are preferring small-caps and international stocks much more than they used to. So are the mutual funds that cater to retail.

In other words, the stock market is really two markets, one for big institutions and a different one, with different priorities, for retail.

OK, enough economics, already. Talk about the money!

Trading is best done amorally. There are limits, but when Warren Buffett does a major buy in Exxon-Mobil, he isn’t donating to the Destroy our Oceans and Suppress Middle East Democracy Fund. He’s just saying, as long as we’re still running on dinosaur remains, might as well take some of those profits and move it to better hands.

In the same way, my trading corn doesn’t mean I love Monsanto and GMO monoculture infestations. My trading cocoa doesn’t mean I support child labor. If I boycotted every product that had cruelty in its supply chain, I’d be naked, hungry, and homeless.

My trading can’t directly change macroeconomic reality, so why should I look to the news to tell me how to trade?

Take yesterday’s drop in the stock market. Was it caused by a collective New Year’s hangover? Was it because of the Fed? Or in spite of the Fed?

We all know the reason: Miley Cyrus. OK, I can’t back that up. But it’s about as good a “reason” as any other you’ll see on TV. The market dropped because it dropped. That’s all we know for sure that actually is so.

What we can do is identify the trend for a given time frame and follow it while maintaining contol over the only thing we can control: our thoughts.

And a trader’s thought should be this. If the markets are divorced from the reality we live in—and they are—then let’s accept it. Successful traders don’t worry or much care what the Fed does or doesn’t do or what the overall sentiment or buzz says. Many of them don’t even prefer one economic theory.

They follow price. They use logic on the field, compassion off the field, and humor always.

We don’t need to know a lot of the things we think we need to know. Because we often find out, after knowing them for sure for years, that they just ain’t so.

How to turn resolutions into habits

Women-on-Treadmills-Credit-iStockphoto-124584919-630x420It’s great to know you can count on yourself to do what you say you’ll do. Drive to the parking lot of any gym or fitness center the next few days and you’ll see a lot of hopeful people parked. Most of them, sadly, will let themselves down by February, when the habit of not exercising comes back from winter vacation.

So how do you make a new habit out of a goal or a wish or a hope? There isn’t one answer, but the process does have some common features.

There is power in repetition

But you don’t have to physically repeat the act for it to work. A study using college basketball players showed the power of visualization .

They were divided into three groups. One group practiced free throws as usual. The second got to skip that portion of practice. The third group was asked to suit up, sit on the bench, and visualize themselves shooting free throws. After a few weeks, the group that didn’t practice had gotten worse. But the visualization group scored 97% as well as those who practiced.

So even when you aren’t actively doing your new resolution, visualize yourself doing it successfully. Your brain doesn’t know the difference.

feet walkingVisualize it down to the last detail. Picking out your workout clothes, your socks, which aren’t still in the washer but are waiting for you, fresh and dry. Pulling out your membership card, which is in your wallet because it’s always in your wallet. And so on. Don’t just have a general plan. Plan every little step and walk through those steps again and again.

My friend Chapman Ducote is a top LeMans race car driver. The night before a race, he walks every foot of every mile of the course, visualizing the race. The next day, he knows the route intimately.

That’s how well you should know your plan, whether it’s how you’ll get out at your stop loss or profit target, or how you’ll pull the trigger and enter a trade.

Talk in the present tense

We often say things like, “I’m trying to work out Monday, Wednesday, and Fridays before work,” or “This year I’m going to” or “My goal/resolution is to.” To make it worse, we might even add a shrug or eye-roll or a “We’ll see how it goes.” Wrong!
You don’t say “I’m trying to brush my teeth every day” or “My goal is to shower every day.” Those are habits. You talk about them as habits, in the present tense: “I brush my teeth daily,” and “I shower every day.”

Talk about the new resolution the same way. “I eat vegetables and fruits with every meal,” “I work out Monday, Wednesday, and Friday before work.”

Sure, someone will ask how long you’ve been doing it or point out that it’s January 1st. Ignore him. Change the subject. Pretend you didn’t hear. Go to the restroom.

Your subconscious mind doesn’t ask such questions. It simply accepts what it hears over and over. If it hears, “I’m a professional trader who always uses stops,” it won’t pull out last week’s trading record and cross-examine you. Ignore the part of your mind that does that. You’re not in court. You’re creating a reality in your mind.

Fake it till you make it.

Find and use a trigger

APTOPIX South Korea Athletics WorldsAlmost everything we do automatically has a cue, a trigger. You see the Starbucks on your route home and you immediately change lanes. You hear a certain voice and you immediately tense up or get excited.

You hear “Have a Coke and a–” and you think “smile” even though that ad ended decades ago.

A recent study of patients recovering from surgery showed the power of triggers. I learned about it in a recent email from Chip and Dan Heath, the authors of Made to Stick and Switch:

Action triggers like these can be surprisingly effective in motivating action. The psychologists Sheina Orbell and Paschal Sheeran studied a group of patients in England with an average age of 68, who were recovering from hip or knee replacement surgery. Some of them were asked to set action triggers for their recovery exercises—something like, “I’ll do my range-of-motion extensions every morning after I finish my first cup of coffee.” The other group did not receive any coaching on action triggers. The results were dramatic: Those patients who used action triggers recovered more than twice as fast, standing up on their own in 3.5 weeks, versus 7.7 weeks for the others.

Find a simple trigger–something that is already part of your routine, and attach the new habit to the old one. The trigger can even be silly. A little phrase you say out loud in a funny voice. A little song you sing.

I sing a line from a song by Mr. Rogers to remind me to use stop-losses: “I can stop when I want to/stop when I wish/can stop, stop, stop any time/And what a good feeling/to feel like this/and know that the feeling/is really mine.” Shut up. It works.

The reward

Sure the stick works faster than the carrot sometimes, but in the long run, our most powerful motivation is love, not fear. Successful people motivate themselves by focusing on what they want to be, not what they want to avoid.

Don’t think of a purple elephant.

What did you just think of? Of course. It’s because your brain only hears the interesting, new part of the sentence, “purple elephant,” and not the “don’t.”

This is why telling children not to do something doesn’t work. Tell them what they can do instead and make them feel happy about doing the alternative.

The resolution-keeping, habit-making part of us is like al child. Sure, we might fancy it up with psychology and big words, but in the end it still comes down to: See cookie; think “Cookie!”; Eat cookie.

And then of course, blame parents for wrecking self-esteem and the media for promoting unhealthy body images. But still, cookie.

You’re thinking about cookies right now, aren’t you?

Eating a cookie has its rewards. They are immediate and familiar. Eating healthy vegetables will only become habit if you feel the reward of it, if it makes you happy, not just weeks later, but as you’re eating them.

That’s why it’s important to make the habit its own reward. If your diet (horrible word, never use it) involves you thinking, “If I eat all my salad, then I can have pie for dessert. 100 grams of pie.” That is just sad.

Seriously, you want to spoil the eating of pie by introducing math? And Americans don’t like the metric system to begin with. No wonder we’re so fat.

What if instead, you celebrated every bite of a delicious salad, then had a tasty balance of protein, monounsaturated fat, and finally, something sweet that you took time to savor instead of scarfing it down while driving? What if you enjoyed feeling like one of those people, the healthy ones who aren’t hungry all the time?

The technical term for an activity that is its own reward is teleological intrinsic finality. It means that you don’t do something for a later, separate outcome or reward. You do it because it is inherently worth doing.

Think of billionaires who keep working. If more people had jobs they would do for free because they enjoy them so much, the economy would boom.

The simplest way to make your new resolution teleologically intrinsic is to do what Chip and Dan call “looking for the bright spots.” Find one little part of it that you enjoy and make sure that part always happens. You may not like everything about your workout, but you like the always-happy aerobics teacher, so you go. You like doing curls in front of the mirror. You like lacing your shoes and listening to the theme from Rocky (or “Firework” by Katy Perry, we’re not judging).

It doesn’t matter what the bright spot is, just find it and make sure it’s always in there.

Pick ONE habit and start small

Your brain can only handle so much change at once. So even though you might have a whole list of self-improvement goals, don’t try to do them all on January 2nd. That’s a sure way to make yourself sad by January 10th.

lola bites carrot bPick one, an easy one. And make starting to do it as ridiculously easy as possible. Take small bites.

The flow experience is what makes any activity self-rewarding. It’s that feeling you get during a great conversation or doing something with total absorption. You lose track of time, there’s a perfect balance between the level of challenge and your ability. I’m sure you’ve felt it.

The key is to make the start as easy and frictionless as possible. My resolution (and I’m only focusing on one for January) is to wake up at 4 am, get out of bed, and do a Surya Namaskara, the sun salute exercise that every yoga student learns. It’s a simple act of waking up, getting into my body and mind. Most importantly, it’s an act of doing what I promised myself I would do.

This morning it is well below freezing outside in Chicago and I went to sleep a little after midnight. But I wanted to make myself trust myself.

Simple as that. I wanted to know I could trust myself at least in this small thing. I got up, stretched and moved, and got back under the warm covers.

Funny thing, though. Instead of going back to sleep, I started doing other parts of my morning routine. I proofread Kathy Garber’s excellent technical analysis of the S&P’s direction as we go into 2014; it didn’t need much editing, so I just ended up admiring it. You should read it.

It’s about how she (like all good traders) doesn’t make predictions, but offers If-Then statements. If price holds below level X, then we’ll see more downside, and so on.

In the same way, can I predict at 5:45 AM how my day will go? No. But IF I was able to trust myself to do one small good thing at 4 AM, THEN maybe I can have more confidence in myself to handle the rest of the day well.

Don’t break the chain

dont break the chainYou may have heard of Jerry Seinfeld’s great “Don’t Break The Chain” advice on habit formation. It is now quite famous among coaches. You simply do the new habit, then mark that day on a calendar with a big red X. Next day, same thing.

Soon you have a growing chain of Xs, which you’ll enjoy seeing. Your job is just to not break the chain. Do you see the pattern? Inherently rewarding, easy to start, has a trigger.

Go to for a free, simple app (and Chrome extension) to start and keep your own chains. As I said, start with just one. Keep it small and easy. Like, “put the cap back on the toothpaste” easy. Studies show if you do it for 21 days in a row, it’ll be habit.

Happy New Year, everyone! I hope you have fun. And I hope having fun becomes an unbreakable habit for all of us.