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Trading Traumas and traders

Discussion in 'Shares' started by wdongli, 19th May, 2012.

  1. wdongli

    wdongli Well-Known Member

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    If we, the traders or investors, don't jump into the stock market in the last decade, most of us should have gentle and untroubled lives even we can be upsetting by the trivial nuisances in offices or workshops.

    In the last decade, we have IT bust, GFC, and EC crisis, which have caused a lot of losses. Some losers lost nearly all, which definitely caused damages psychologically not just financially, trauma. If a trader has the trauma he could have some disorders psychologically and change his life negatively.

    Have you heard this word, trauma? Sorry I know you have much better English but it is very critical you know it deeply enough. A lot of traders have chosen to run away with regret. If you don't want to run away you have to change your attitudes to the shocks and traumas. No yes/but!

    ***
    Psychological trauma has often been associated with military deployments. During the First World War the term shell shock was coined because it was assumed that these problems were a result of physical damage to the brain caused by shells exploding on the battlefield.

    Gradually it became clear that these were psychological rather than physical injuries but the disorder in both military and civilian settings remained highly controversial. However these psychological disorder can be caused by shocks or failure in stock market.

    If you have stayed in the stock market as a trader for a decade, and you just have the losing experiences, you need to know you were probably suffering from significant mental health problems such as posttraumatic stress.

    ***
    Fortunately most of traders or investors would choose to leave from stock market after they lose too much for recovery in their home. However if you choose to stay and continue your trading or investing for profit you have to know:

    1. recognition of traumas helps to modify the perception that these problems.
    2. most of traders don't understand or choose to malinger which is an attempt to avoid unpleasant duties.
    3. it is most important to know traumas and the resultant disorders are not those of the person’s inherent weakness, some kind of inadequate personality.
    4. if anyone is exposed to a sufficiently severe stress, anyone could develop these difficulties. So you have to avoid any chance you could be in trauma in the stock market.

    ***
    Why did one of the most great traders in 1900s, Livermore, committed suicide? He was a strong man but the shock before his death was too much and destroyed all of desire to continue and face the future life.

    Don't mistake me. I admire Livermore very much but could we at least lose nothing which would mean no trauma and enjoyment of your efforts in the stock market.

    Of course it is insane for loss-free of all of transaction but it is critical you don't lose unaffordable money and let you lose the hope to live.

    ***
     
  2. wdongli

    wdongli Well-Known Member

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    It is normal for anyone to get traumas in shocks. It is normal for anyone to die in the eye of tsunami. We need to prevent us from the places where we would be shocked and died in the stock market. We could not predict the time of the shocks and tsunami exactly but we could leave enough room to buffer them.

    If and only if you unfortunately are shocked and get the traumas the following things are needed to remember:

    1. human beings are generally very resilient and the majority of people exposed to potentially traumatic events recover well

    2. Depression, alcohol and drug abuse, anxiety and physical health problems could be the aftermath of trauma.

    Not too mad in the stock market nearly 99% of traders choose to run back home, where he can forget the stock market and is recovered. All of things about the traumas are important to the traders who are still in the stock market and will be in the stock.

    ***
    There are three broad groups of symptoms that tend to occur together after traumas.

    1. re-experiencing the trauma, being haunted by the memories of past horror.

    Traders constantly let vivid and painful images jumping into their minds, invading consciousness or terrifying nightmares of going through the event again. These experiences are extremely distressing. In these cases, you have to leave from the stock market and change your focus on relax matters.

    2. trying all to stop these memories coming back.

    The traders may try to avoid any reminders of what happened and refuse to talk or think about it. They may also become emotionally numb and socially isolated, it’s as if the system shuts down in a desperate attempt to block out the pain.

    They are usually those who run back home and decide to stop their practice in the stock market forever.

    3. being constantly tense and jumpy, always on the lookout for signs of danger.

    The traders who just only believe stopping losses, tend to do so. They constantly make losses, sometimes just fail to stop losses, and then some big losses just shock them...

    4. irritability, blaming, cursing, anger, and so on, which are not just caused by traumas, but too many little problems if we could not learn how to ignore them.

    I did feel little bit of irritating after I saw AKK price dropped down to $0.02 but it was one scenario I expected from the impact of Greece and EC.

    ***
    No all of traders are shocked to traumas in IT bust, GFC, and EC crises. The reasons to get the trauma are various. It is a complex combination of what the person was like before the trauma, their experiences at the time and what has happened to them since.

    1. some genetic vulnerability may be involved.

    It seems that our genes may not only influence our reactions to these events but even our likelihood of being exposed to these kinds of events in the first place.

    This presumably operates through some kind of personality traits that promote thrill seeking or poor risk assessment. A history of previous trauma, particularly in childhood, as well as tendencies towards anxiety and depression, make it more likely.

    The traders with the trauma history will develop the trauma if they are confronted with a traumatic experience in the future. In another words, if you just have losing experiences in the stock market, you tend to make failure in future.

    2. Not surprisingly, the more severe the trauma, the more likely the traders will have difficulty recovering from the experience. If a loss is too big it would are more likely to cause problems.

    3. the traders’ reaction at the time is important.

    Traders who respond with extreme fear or, conversely, those who become very detached and on ‘automatic pilot’ seem to be at bigger risk.

    These are normal reactions of course but if they’re extreme they seem to predict later problems. Someone react to my words very extremely and they would have more chances to get the traumas.

    ***
    Prevention is the Holy Grail.

    Can we prevent the development of losses in the stock market and then we can avoid the traumas? Our personality would decide how heavily we will be exposed in the eye of financial tsunamis?

    It seems not all of us will prevent it completely but we can minimise it by good preparation, early recognition and effective management of risks when they arise.

    In a similar vein, we can respond wisely and intelligently in the disasters such as GFC and IT bust as well as the current EC deficit crises.

    ***
    All in all, you need to avoid shocks in some proactive ways, which could be achieve to make your mental system healthy and avoid extreme actions in the stock market.

    We should know

    1. we are fragile in the stock market
    2. we can be wise to be out of the eye of tsunami or come back after the tsunami passes by.
    3. we can have traumas and if a loss is too big we need to be recovered before we act in the stock market again.
    4. we shouldn't be extreme to anything but questions for balanced trading and investment. So that we can have a appropriate disposition and behavior.
    5. we make or lose our own money and we shouldn't blame anyone and anything unless we stop to play in the stock market.

    Good luck and don't kill yourself since you are genius with little self-protection genes! Use all to train yourself for first reacting right, and inverting to be sure you are right in this ever changed stock market.

    If any of my words irritate you, I beg your pardon with sincerely hope you and me can never be in traumas!
     
    Last edited by a moderator: 19th May, 2012
  3. wdongli

    wdongli Well-Known Member

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    Another financial tsunami?

    As a trader or investor, you have to pay less for what you buy than what you get fro what you sell, statistically for long enough time.

    As a responsible bread earner for your family you have to put aside some extra money aside for your kid's education and your retirement, which is a matter good for you and society.

    You could not do too much if you just work in your offices for your employers since you just could control the items around your table or the place you have to do your job.

    ***
    We come to the stock market for most of us since we want to put more control on our own finance. We want to retire with financial independence, if we don't have the gift to hold the huge fortune.

    The problem is most of us who jumped into the stock market become poorer rather than a little bit rich let alone financial independence. A lot of traders feel very disappointed but they fail to act to find the reasons. They are too busy in offices and stock markets.

    Logically you have to stop making losses not stop the losses after you have lost the shirts. How many traders do know the difference? Few. If they know they would not lose the shirts in IT bust, GFC, and EC crises.

    ***
    The crashes like GFC are terrific and very powerful to destroy anything in their eyes when it sweeps around the market. We all know that but few of us can get it abstractly right.

    Abstraction is like modeling in scientific development. The wrong model of the real world results in failure. The abstraction is the model you see the world and market, which will affect your analysis, induction, intelligence, judgment, and decision.

    It is universal phenomenon that when the market is up and up, our heads become more and more hot; when the market starts crashing our heads colder and colder until frozen.

    ***
    We tend to be short sight, which doesn't totally distort the truth and at the very beginning of the crash or boom the anxiety or hope can reflect the reality but few dare to act.

    It is obvious that is why some intelligent and knowledgeable people could get huge profit from some great crash and boom. They run ahead of them with the truth and the over-reacted crowd sentiment.

    Have to say they do a very risky business and any tiny miscalculation could result in debacles. That is why JP Monger could lose $2billions in weeks.

    ***
    Everything has its catches in the stock market. No catches are impossible since it is not human matters to let everyone get huge fortunes. Anything become too much means no value and the price must be down.

    Greece will take another election. It could cause earthquake so that another financial tsunami could be in sight. All of traders and investors see this possibility but few could calculate the probability.

    So you could not question what if the tsunami becomes true or not. It could wipe off all of your money from the table. Have you seen this risk? What if its odds turn to be true? Could you be survival or could you accept the consequences without blames and curses?

    ***
    No scientific model is right at its very beginning. You can do it and Einstein can not do it also!

    I canceled all of my buying orders today. If the tsunami would be in sight, it would crash the stock markets onto its knees for at least 3 months. This tsunami if happens, may be less than the power of GFC but the crowd sentiment could get more damage than GFC. In GFC crash I was still very optimistic but I become fearful after I got the trauma last year. It is a time no hope but depression even the tsunami has not happen.

    What if the tsunami doesn't happen? I have rebalanced my portfolio before this May. It is quite possible the crowd become crazy and another V-Shape recovery would be in sight.

    ***
    I don't believe anyone now has the gut to bet or gamble if he just knows the lines and patterns in days. They are rushing in stampede for exit if they are still in the stock market. When all run away, the forums of stock market becomes ghost town usually.

    Between Nov 2008 - March 2009, I cried in ShareCafe for running under the Sun! I was lucky then since I really didn't put self-protection into my abstraction or model or mental framework. I wan out to the peak of V-shape recovery but it was my luck only.

    I have got a lot of lessons from my mistakes last year. I have realized the truth in the stock market, that is "protection is holy grail." I would try all to let my snowball become bigger in worst case even I accept the possibility it could be smaller.

    ***
    By the way, thanks a lot to ABC on line, which provides a excellent classroom for me to improve my English Listening, the excellent materials to let me pick up the wisdom and logic, which I left in my remote hometown in China, and the choice to update my mental framework while I work for my English Listening.

    Actually ABC news let me know there are too many bad or good things around Australia as anywhere there are people. The beauty is the bad or good get more balanced than a lot of societies around the world. Its philosophic zone is marvelous which talk about something very universal around human being.

    When you want to get something, you need the facilities for your goal and you need the benchmarks to confirm you move forward towards to your goals. ABC is the platform for my mental framework updating and benchmarks.

    ***
    I understand market economies are very bad and it puts the profit at the first place but fortunately we can leave the social equality and common good to the system in Australia.

    I want to make my personal legend and want to get the fortune even I know I may never be qualified. However if I could update my mental framework effectively and get the fortune, I would let more poor children to get their dreams become true.

    A man needs something higher than his own being that is a legend. I have to say all of my writing is to update my mental framework. It is not good for everyone, Please look after your own brain.
     
    Last edited by a moderator: 20th May, 2012
  4. wdongli

    wdongli Well-Known Member

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    Know everything but nothing

    It is the time that everyone seems know everything that happen around the global but sometimes I feel I just know nothing.

    I know there are lot of miners are striking or will strike in Queensland. Employers said Unions have dangerous power to the society and Unions told how little they demands are. The more I know the less I am sure.

    Do remember how I believed IT boom would last forever. It was new and open a new door for human being. Yes it is not wrong but I didn't know IT bust would beat most of traders into the drains.

    While we believe we know everything the consequences could say you are nothing. So it is better you believe something but not bet yourself on. Traders now know that but are frustrated since they could not do what they believe now.

    ***
    The smoking from Greece have been spread over the world for quite long time. Everyone seems know what happen there but no one really know things enough where it will go. All of the stock market are working on their guesswork and everyone hopes their guesswork can be confirmed soon.

    Everyone knows everything in the past; everyone can react differently; so that everyone doesn't know anything for what will happen. Internet makes a world that everyone seems be able to hold the future but few really can set the future course. It is a puzzle worth of billions of dollars where Greece would go.

    Actually few know what they should know in the stock market. Nothing can change it since no one can predict the reaction of the crowd globally. In my remote village far away from my hometown in 70s, everyone could predict what exactly would happen, but the unpredictable but prepared matters have changed my life forever.

    ***
    News said Greeks are running on banks; there are lot of mattresses stuffed with cash; it is predicted borders would be closed; hyperinflation, riots, shortages of food, medicine and oil, would out of Greece even no one know where these things would be just in Greece not in Australia.

    Everyone in his short sight can see the disaster scenarios for Greece if it exits the euro currency and returns to the drachma, but no one know what will be ahead really. It seems worse no one really know how the disasters would happen if it will. Some wise people said about it

    1. Greece voluntarily leaves from EU.
    2. EU ejects Greece since it refuses to take austerity.
    3. Accident through a widespread run on Greek banks triggered the Greece crashes down to knees and EU has to cut it off.

    Greeks are wise since they want to stay in EU but don't want to tighten their budget. Who likes to count every cents for the mouths only? So which option you choose if Greece leaves and be sure you are right? Could we use lines and patterns in price charts for that? It is a silly question, isn't it?

    ***
    In macro economies, its impacts to micro economies, and stock market, nearly all of puzzles are the an elaborate game of chicken.

    Neither Greece nor the rest of Europe wants it to leave the eurozone. However as traders or investors you could not try to figure out the worst case and its probability. The longer political uncertainty continues, and a Greek election is not slated until mid-June, the more likely worst scenario probable: a messy exit of Greece sparked by a massive bank run.

    XAO has sped up its step to the worst price zone. Last weeks it wiped out all of premium built since last running into the imaged GFCII.

    ***
    I still could not see what will be in the future horizon surely. I will do all based on this assertion. Please don't give me the lines and patterns now! I want the truth in future not in the past.

    I will remember that "facts are stubborn things, and whatever may be our wishes, our inclination or the dictates of our passions, they cannot alter the state of the facts." Future facts are elusive and tricky, when we look for the future facts we should not be stubborn than the fact itself. If we do we would hurt our heads and get the traumas. Do you know the implications of the traumas. Be careful.

    I will not waste the impending tsunami and the lessons about the crowd, self-protection, in-time service to the warrior safely and so on.
     
    Last edited by a moderator: 20th May, 2012
  5. wdongli

    wdongli Well-Known Member

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    Just encountered the words from Shakespeare, which let me get some of my thrilling back when I first read some of his works in Chinese 30 years ago. Since then going around the world as a nomadic man in Engineering left a little time for me to read and ponder widely.

    *
    "What a piece of work is a man.
    How noble in reason, how infinite in faculty
    in form and moving how express and admirable.
    In action, how like an angel; in apprehension how like a god.
    The beauty of the world, the paragon of animals;
    yet to me, what is this quintessence of dust?"

    Hamlet, William Shakespeare

    *
    You may wonder how the great words could be linked with the stock market. Don't rush to get your conclusion but think about. In the stock market we need to a reasonable good view of the world and then a trustful mental framework.

    ***
    Could we ask some not so great questions as below?

    1. what a piece of work is a trader or investor?
    2. how could you be noble in reason as a trader or investor?
    3. how infinite in faculty to sense the chances and risk are you?
    4. what do you admire or how do you express your wisdom and intelligence?
    5. could you act as an angel to hand out your service to the warriors without burning yourself down?
    6. you could not act as a god but could you never let anything shoot you into the hell of the stock market?
    7. it is beautiful of the rollers-coasters as a whole but could you be the example of the crowd not struggling for the cakes in the sky?
    7. what is to you after all of your money gone?
    8. could you be a little bit higher than your own being?

    ***
    Can we know what is what at the place and time we want to stay and then we can never regret for what we are? What should be done if we could choose or not?

    It always lets me feel pity if I just know the lines, patterns, and picture shown in YouTube. The life can be very colorful even you still need to get the necessities such as the profit. Are you one of the mammal but you want to interpret your own life?

    I do want to be a little bit higher than the being I am! Could I? Very hard but should I give up especially in the stock market, which only show I fail to do the basic job?

    ***
    There are black swans. What are the black swans? They the matters totally out of everyone's imagination. In the stock market for a decade, I have seen a lot of black swans, which made us cheerful or painful.

    Why do you lose your shirts rather than stop the losses at pennies rather than the shirts? You didn't believe you could lose the shirts and when it happened the damages had been done and then you were trapped there. Why did FMS or PRR shoot up 1000% or more? Most of them believed they were died cats but they were not.

    All of the stock market believe the Greece would drag all of EU and the world into the water if not the hell. All are so obvious but who really could know what if Greece exits out of the EU?

    ***
    I still feel the policy makers would not like to see they also die under the fallen sky or in the hell. Now everyone just see what happened and draw some straight lines from the past into the future. So the world follows the past or some new matters change the course?

    It is understandable all of traders prepare the sky falling down. However I also prepare what if all of the policy makers do all to stall the sky falling down? It is quite possible and also probable. That was why I hold the shares which I feel have fallen down too much.

    Don't forget it is quite probable that there could be a resurgence of the euro if Greece is forced out of EU and that world authorities just flood the international system with huge liquidity to stop the domino effects.

    ***
    It is sure that EU will pull out the stops to keep Greece in the system as they weigh the full dangers of contagion. Should that fail, it triggers a series of dramatic moves to save the sky:

    1. ECB would cut interest rates, launch quantitative easing (QE), and back-stop Spain and Italy with mass bond purchases;

    2. ECB would inject capital into the banks and create a pan-European system of deposit guarantees.

    3. Fed would introduce more QE and China would loose its credits too.

    ***
    How about Greece should it exit out of EU? It would experience of running to the banks... But the stock market would not care about it even it would default its debt and all of its bond buyers would be losers.

    I do feel in the sky is in risk, the policy makers seemingly could work together since anyway you cannot play the game theory in the hell. The policy makers seem not less wise than me and they should act to save the sky.

    17 June is a reckoning or reborn day in my view and it is 100% sure multiple choices. Which choice will be in sight? I still could not be sure and feel the market will need a few months to settle down.

    How about XAO? Forget it and it would follow the world rather lead! It is extremely stupid and if you want to be wise Australian, listen ABC radio which is full of wisdom and truth.
     
    Last edited by a moderator: 21st May, 2012
  6. wdongli

    wdongli Well-Known Member

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    Prisoner's dilemma, common good, and Greece

    Have you heard prisoner's dilemma? Are there the common good in the stock market? Is it probable the policy makers would act together for their common good even Greece chooses or is forced out of the EU? How would China response?

    To set it in context, let's see what is the prisoners' dilemma:

    1. Imagine that two people have been arrested for committing the same crime, and held in separate cells, interrogated separately.
    2. Each of them is offered a deal if he confesses to the crime and his partner doesn’t, then his partner will get all the punishment, and he will be released.
    3. Both of them know each of them will get the same deal.
    4. However they’re both better off if they both stay silent
    5. Question is how can you trust the other guy to stay silent?

    ***
    Rationality says that the best choice in the prisoner’s dilemma is always to rat on your partner, because you can never be sure that she or he won’t rat on you. But the rational choice is not always the best one especially if the dilemmas between both or them are not a one-off deal.

    Greece can be destroyed if EU is safe, which if can be achieved, is better off than EU drags all into the water. Could Greece be saved or not? It depends the carefully evaluation of which could make EU damaged less. The global financial system has integrated the world together. EU in the hell would be the day of the world in the hell. All would work together to stop it.

    So it seems that 16 June should not be the day to end of EU even Greece could be kicked out of the game and put it into self-punishment with its own currency and depression. Rationally Greece could be better off to stay within the EU but emotionally its citizens seem hate the austerity much more than depression.

    ***
    Of course, Greece has drawn all of the eyes around this world for quite long time. XAO should set its price much depressed than its value nor long term average so far. Today XAO struggled to move up but flatted out, which means some bargaining hunters are moving in.

    However it is important to know you are not the criminals to make Greece in brink. So you need to see the scenarios based on your own position and environment. Damages have been done to the criminals(Greece or EC or US or China even they are definitely are not the criminals), and are there more damages during the criminals work together for the silence.

    Just encounter the words: "Let me get right to the point. I’m smarter than you, and I’m going to find out what I want to know, and I’m going to get it from you whether you like it or not. I’m not a rat." If you want to join the game in the stock market, you have to read these words again and again.

    ***
    I am not smarter than you but I can be patiently enough to provide the services to the warriors if 16 June would cause the warriors more even EU could be saved by the collective efforts of the policy makers.

    1. If the sky is there it is common good to me.
    2. Even the sky is there, before the risks play out its parts I could not safely provide my services to the warriors.
    3. I have not lost all of my hopes so I have got and will get some positions so that if warriors have beaten themselves enough before 16 June.

    I prefer the way I can win out for my services. The world or the stock market can run any direction after 16 June. I will buy if you sell at the price even in worst case I still could get enough margin of safety. I do feel there are more shocks coming before July! I am very patient for my fishes.

    ***
    In the stock market, the possible near future can drive the crowd crazy. An intelligent trader or investor should be never act as the same as the crowd. They just want to fight for what they want but most of them definitely could not get what they want in the valley of the death.

    Now most of traders or investors have been beaten down so that most of the crowd would choose run into the exit. In this time the most risk matter is you are crashed into pieces by the crowd. The best way is to prepare to run after the died warriors have died and just few cried in the ruins. Do remember you just could save these few only!

    Once you move yourself into the war zone safely as saviors or representatives of the warrior service businesses, you have to try to climb up to some tops to get the whole views. If Sun is trying to jump up into the horizon, you need to fine tune yourself to run under the rising Sun.

    ***
    Don't forget if you do anything in the stock market, you need good logistics and supplies for your necessities. You have to get enough cash to be alive for what you want to do for long enough time. I tended to run in one direction with all of things I could use. It is very effective if I am right but it is really risk to get everything failed.

    In this sense you need vision, strategy and plan, organization, process function, and direct gold driving without losing the sight of indirect goal. Some of my best friends just could not agree my efforts on English listening. It could not give me any direct benefit.

    However I do believe it is the base for what I want in the future 20, 30, or 40 years. If I could not get my English Listening good enough, I could not say bye bye to my premature life in the stock market.

    ***
    Yeah, it could not get better prospective in my Engineering expertise, which I may still need to compensate the needs which I could not be sure I could get. However you have to take some risks if you are at a turning point of your life.

    Actually if necessary I can do anything for survival or make my small ball as it is in the tough time in the next one or two years. Human could not live if he goes too far from his environment allowed. You could not be the US president if you were born and then live in China or Greece. However you can do much better than what you would do effortlessly in your environment.

    A very serious question is have you done something enough to get your turn as your being allowed. No mouth needs be worried now; No heel you should try all to get into; You just need to get your mental framework works in the stock market without craziness for the cakes in the sky.

    ***
    Just try to aspire myself: who knows who just want to pay me for my writing for their own profit.

    Yes, before that I should break down most of barriers in my mental framework and write meaningful words in a elegant English. I am not sure seriously and is joking but it is sure that I have to do my job. If you are qualified enough you would be chosen by lucks or people. Who knows?

    Aussie traders as a whole just know copying and pasting or run desperately to the imaged GFCII. I don't know what part of the disposition of them as a whole enforced them did so. Are the traders in EU and US do the same? Why just use your gift, English, to destroy yourself?

    With all these exalted powers from internet and complicated modern organization, man still bears in his bodily frame, the indelible stamp of his lowly origin.
     
    Last edited by a moderator: 21st May, 2012
  7. wdongli

    wdongli Well-Known Member

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    Who kill whom?

    It is very bad and really bad. You can feel and smell in the air even you don't read anything about the stock market.

    Traders have been slaughtered in millions if not billions globally and Aussie traders lead the way. You can shoot at me and dislike what I said but it is the fact and we dislike the fact we have lost the war as the first generation of the online trading.

    Nothing can kill the traders but the crash in the eye of tsunami and the stampede to the exit. After you lose everything and if you could not have the resolution to change, you would be wiped out, even you can blame some of whose words kill all.

    We all know it is not true but we get used to find excuses for our incapability, insanity, and depressions. We can lose all but we could not let us look ourselves down, but is it a right self-esteem?

    ***
    The things in the bear market like the GFC, IT bust, and the current one, kills most people financially.

    The longer is it, the more would the traders in the hell. Yep, money is not everything and to some people money is nothing. However to the losers of their shirts the money is everything.

    The toll are huge as GFC, Natural Disasters, Japan Tsunami and Reactor Collapse, Minor Government in Australia, Greece, EU, and China, have been in team to play out in the last few years.

    They just take so long to play out, causing the deflated traders or investors to give up and walk away. Hope-filled rallies are dashed by another gut-wrenching fall.

    ''Just when I thought I was out, they pull me back in!"

    ***
    In the stock market, a wild field, you have to be honest to yourself. Do you have the gut and mental framework to be honest.

    One question is very critical: are you one of the most traders who just could lose their shirts in the crises? Do you have gut to answer it honestly? If you can, could you believe you have not a perfect brains as everyone else? If you are not perfect, do you accept the fact that market never takes captives but wipe them out? So you are not error free and is it right any tiny miscalculation without excellent protection you could be killed?

    I am reading the news in ABC on line and pondering what the possible risks ahead around me and my corner which I believe but may not be safe. I hold the chances I feel in my left hand, hold the risks I could feel in my right hand, work hard to update my mental framework, and try to balance on the tight rope of the life in the stock market.

    I do ask if most of traders like me have gone forever, will I have to follow their steps into the hell?

    ***
    Too many gamblers among the traders and investors. They don't care anything but quick money and easy gratification even the crisis makes crashes one after another.

    What I did and what the most of traders and investors have done, remind me of the man in the old joke, which I encountered in 2004. In this joke a man constantly prays to God to let him win the lottery. After years of this, God, frustrated, finally replies: 'Mate, help me out here. Buy a ticket.'

    How many tickets have the traders and investors bought from the stock market rather than any ticket from God? It was said last week when XAO dropped down about 100 points, billions of dollars evaporated in the air. The pain was huge.

    Could the pain changes them? Today some positive words come out, and then our forum have some words to show they are there. I would not be one of them any more even I would trade for my service business for them.
     
    Last edited by a moderator: 22nd May, 2012
  8. wdongli

    wdongli Well-Known Member

    Joined:
    31st Mar, 2010
    Posts:
    1,292
    Location:
    Perth
    It is a bear time, which no one doubts. It is contrition bear time since the traders have been beaten down several times when they hopefully XAO moved up. The gradual gains notched up for months just evaporated in a matter of weeks.

    When XAO has shed more than 40% than its high before GFC, it is not a nice but true reality that all of traders and investors are in the water. In the green days, all of losers or lookers tend to get the time for their breath. Some would like to take long term views and some like short one.

    Investors tend to ignore the chances they could be hit by a tsunami in months. Traders tend to brace the past in their future days. So once the tsunami came in surprisingly and has being whipping this world financially, all of investors and traders are losers.

    1. Investor in RIO at $65 buying price are the losers
    2. Traders failed to stop the shirts losing are the losers.

    George Soros is a trader but he never loses the whole picture. Warren Buffett is a investor but he never bought red hot qualities. We like to be traders or investors since we want to win out but most of traders and investors hit each other with their biases.

    ***
    Business needs model. Driver needs the road map. Trader need punt with some calculation for probability and risk management. Investors need to throw their money on the qualities when the qualities are dealt with as the rubbish.

    Of course, you want to win out, you need know what is what for what you want to do. Who closes the door of their business? Model? Not necessary. Who crash in the free way? No map for where you go? No necessary. Probability to traders. Not necessary too. You just need one time wrong in 360 days of one year. Quality to investors? You would fail just because you paid $65 for RIO.

    You could not ignore the value, the basic, and so on.

    So you need ask a critical question: that is where is the market? Why stick to some words but never put them into the context and conditions?

    ***
    All know we could not predict the future but you could not say you don't need to pay attention on the place you would put your toes on. Predictions are fraught with danger because they are invariably wrong, but worth a shot regardless.

    It is my belief that we are entering the final stages of the secular bear market which started from GFC. It has been there for 4 years. It has driven nearly all of traders out of the game. It has cut the investors in pieces. It has hit the dream to retire into pieces if anyone put their hope into the super as an ordinary salary earner.

    Aussie traders or investors or the whole population are very cautious. It is good for the whole nation but not necessary good to the investors and traders. XAO got the money from them in sunny days but refuse to walk as steady as Aussie economies.

    XAO lost more than any renown stock markets globally in last 5 years. In XAO if you want not lost too much it was very difficult.

    Some would curse me I kill the people but is it my fault?
     
    Last edited by a moderator: 23rd May, 2012
  9. wdongli

    wdongli Well-Known Member

    Joined:
    31st Mar, 2010
    Posts:
    1,292
    Location:
    Perth
    You must be tough...

    Yesterday, a lot of traders and investors were caught up by the desperately needed rising up globally, which included even EU, the hostage of Greece.

    In a valuable sunny day it is understandable and should be all of people who feel breathless in their corners or valleys of death globally. So our forums of traders and investors became alive. That was really let me happy.

    However lingering under the sun with too much clouds need some cautions and protection in case the tsunami would come back without notice. It is not a complicated issue but simple logic, which we tend to forget.

    ***
    Without our own belief about the global and Aussie economies, we have to be tough, and extremely tough to our hopes, guesses, and expectations.

    The stock market can follow our hopes to go forward for some times in normal and peaceful time, but it never follow the sanity and consciousness in the extreme times. In the extreme time, you have to be tough and better to let your thought or mind to see the worst case or best case.

    People tend to say the thing can be worse and much worse or better and much better. Few people really know when and where this logic would play its parts. So that we know more, experience more, we put us in the more risk situations, and then all of bad consequences become normal.

    ***
    A lot of people believe Warren Buffett have won out since he just follows some simple rules of value investment, which is not wrong but few understand how he zoom in and out, for the truth.

    There are plenty of value and qualities but they destroy or kill the people around the world too. How many people have been killed by BHP or RIO financially? Value and quality are not the items who grow in our imagination but the real world, the stock market.

    We tend to lose our focus and few really know they are gamblers when they gamble. We tend to use our beliefs to convince others' beliefs are wrong. The reality is you are right this time and I am right next time.

    ***
    The problem is the stock market just reward the right action and doesn't care about your beliefs. So too many people holding their lovely beliefs go nowhere but the hell financially.

    We need the beliefs, we need to check our beliefs matched with the reality, we need to change our beliefs not in days but at least months. What do I believe now? I believe 16 June is a very important day, which could make things much worse or better than anyone's expectation.

    In the tsunami, logically we need to get ready for the worst case with a room to get out of the mess. I am tough and will be tough this time. I am ready for the worst and best results.

    ***
    I was alerted by the mood shown yesterday. Hopes are destroyed very quickly when the bad lucks hit us. Hopelessness get its course then. Little hopes appear but disappear too easily.

    Do you question the Sun? Do all of the people in the ruins question the Sun? Do you see the cracks on the dam? Do you know when the new season will start? Do you know even in the spring you could get cold?

    Do you know all you do are reasonable to individual human being but it could be insane to Mr. Market. I just feel Mr Market is very elusive when he is in extremes. He can change in days if not second.

    ***
    The challenge when too many in the ruins get some hopes, is you have to know something and some days are very important, only after that the hopes can grow up into optimism.

    Greece exits from EU definitely would cause keen-jerk reaction. The tax deduction definitely would work with the knee-jerk to crash more traders into the hell. Why XAO led the world into the GFCII? You could not say fundamental Aussie economies are worst but Aussie traders just want to use or be used in the smoke from remote EU fire.

    You can not win out when the crowd is crazy and powerful. You must wait for the time when the crowd has no any energy to crash itself into the hell. You have to send your service squad bit by bit since you can be wrong.

    ***
    Time average is beauty if you can average around the worst points. Time average is cruel if you get wrong about the worst points. How to reduce the probability that you are wrong about the worst points?

    Fully agree EU crises have done its parts very effectively and efficiently. If they can be so effective and efficient to stir the fire, you can not safely say the crowd would do nothing if Greece exit out of EU. You can be hurt even no domino effects.

    The crowd just needs the exit of Greece to run into the hell for days if not months.

    ***
    Don't worry you can miss a train. It is the time more trains crash when they rush out by feeling. If you have the capital in hands, you can get the ticket for trains anytime. Just be sure you don't put all of your capital into one train.

    After Greece votes the new government, it and EU would cause more headaches to XAO. You have plenty room to pick the best buys from the nearly died warriors in the valley of death. What's the patience is virtue? See what will happen before the July and if you have some gifts you can figure it out by yourselves.

    Did you notice that fewer people have the mood to give their own or coped words in stock market? They need the sun. No sun no words and no thought. They waste the winter to get their mind ready.
     
    Last edited by a moderator: 24th May, 2012