Sport and the Markets
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The Perfect Landing, from Patrick Flanders
A friend asked me how Dirk Nowitzki can be such an effective shooter (um, the last two games notwithstanding) when he always seems to be fading, or moving, in his shot. It's true that he moves while he's shooting. It looks awkward, but he's actually pretty textbook - he sets the ball in his dominant hand right about eye-level, then while generating power from his quads/ankles/feet, he extends the ball straight up into the air, and at the apex of his shot, he releases the ball in a motion that resembles a kid who is reaching up to retrieve a cookie from a cookie jar, it's really just one right angle - from the wrist on down, he's straight, but at the wrist, he extends it 90 degrees. When done correctly (Jordan, Bird, Gervin, Havlicek) it's a beautiful and quiet motion. And coaches will tell you not to move when you shoot - however, that's not entirely a problem, and that's because even if you move or have your feet cockeyed when you begin your shot, the important thing is "where your feet are when you land." You should land fairly squarely - feet separated about the same distance apart as your shoulders (a bit wider), and the foot that correlates to your dominate hand should be about four inches ahead of the less-dominant one. Watch dirk - when he lands, he doesn't stumble or fall backwards and it's because he's managed to keep his weight distributed evenly and his feet are moving in air to provide a soft and secure landing. I think there's a parable here, and I'll most likely create one to explain the concepts of shooting, steadfastness and competitive edge to my three boys. For now, they just like hearing more about the cookie jar.
It's "Goaaalll" Time!, from Bilal Raja
For those of us outside the USA, every four years we fall into a football induced dream. What new joys will this year's tournament bring? Which underdog will defy the odds, giant-killing along the way? Which new player will spark our enthusiasm and love for the game (again?). Which team will have us dreaming and fantasizing? Who will score the best goal ?
My first world cup memory is of the 1986 finals in Mexico. I remember sneaking away from my 6th grade exam study material, and parking myself in front of the tv for the England - Argentina quarter final. This was the first time I saw Maradona and my love for true footballing genius was born. The day was memorable because it etched two very different images of Maradona on the footballing world's collective memory. The first was the infamous "Hand of God" goal, when Maradona scored with his hand over the English goalkeeper, Peter Shilton (who was probably a foot taller than the diminutive Argentinean). Maradona later had the cheek to say he had not cheated, but that the goal was a little bit hand of Maradona, a little bit hand of God. Minutes later, Maradona scores what is definitively one of the best goals scored in world cup history. He slalomed past about four or five defenders (a couple of them twice), and then slotted the ball home when it looked like he was about to lose his balance as he got tackled from behind. Each tournament since then, I've always looked forward to seeing goals that are beyond the imagination and are pure instinct, pure genius.
My other favorite is from 1998 and was scored by another number 10, Dennis Bergkamp of Holland. (FYI other no 10s to have graced the global game: Pele being the most famous and Maradona, Bergkamp, Ronaldinho, Baggio of recent vintage). Bergkamp received the ball from over his left shoulder in the last few minutes from the de Boer, controlling it dead with his instep whilst in midair, flicking it to the left of the defender and then final flick over the keeper into the corner. This is what football was meant to be.
This year's tournament has already brought a few great goals despite the fact that we're still in the first round. However, the goal that already sticks in the memory already is the Cambiasso goal (Argentina's second in a 6-0 win over Serbia & Montenegro). This was a goal I tried to find repeatedly in sporting highlights on Friday because of the beauty of the move that actually led to the goal itself. And here in lies the dilemma. Is a great goal that which is instinctive and representative of the individual genius or can a goal be as brilliant if the result of a series of moves? ( The difference for me is moot. One is an immediate feeling of elation and adrenaline rush. The other is more similar to a crescendo. Why try to differentiate between the two? )
The Argentinean build up play started from their own half, involved no less than 24 passes and was constantly probing the Serbian team to try and find its weak point. Back and forth the Argentineans played the ball, until they sensed where the opening was. Right in the middle. So the pace of the passing increased, and the ball quickly found its way to Crespo, who calmly backheeled the ball whilst running away from the goal (the equivalent of a no look pass) into the path of the oncoming Cambiasso who scored with a cracking volley. WOW. What a move! No individual flourish (apart from the great back heel) but the team combined to score one of the goals of this tournament and set themselves up as the favorites.
When I saw the goal repeatedly on Friday, it occurred to me (maybe because of triple witching in the US & Europe) how that goal was actually very similar to market activity in the way there was constant probing to try to find where the weak player was. Once they figured it out, the ball was quickly moved there and ruthlessly dispatched to goal. There was the element of the con (the backheel), the element of moving back and forth, before the final surge forward. There was the sudden switch from left to right to set the goal up (similar to how when the market is focused on one thing, it's often something unexpected that bites you in the keister).
But most of all it reminded me why I still love this game. Because occasionally, when you least expect it, you see an act of such beauty that you memorize it so you can describe it to your friends who didn't see it, or to tell your son when he's old enough to start to care about sporting beauty, and finally, so you can be involved (however vicariously) in its creation and fulfillment.
Comeback of Martina Hingis, Paolo Pezzutti
Yesterday, Martina Hingis won the WTA Rome final. Her first title in four years, a 6-2 7-5 defeat of Dinara Safina. Her Russian opponent made too many mistakes as the Swiss #2 cruised to her first title since the Pan Pacific Open in Tokyo in 2002, and first since returning to the tour.
It is great to see a champion back. I was there today, at Foro Italico. I was impressed by the way she moved around the court and managed to keep her opponent far behind the court, constantly off balance. The geometry of her tennis simply was too difficult for the powerful Russian player.
A comeback must not be easy. Especially after three years, that's a long time in tennis. And a long time for a 25 years old player. Even for a champion like her. It would be interesting to know why she's making a comeback. Many thoughts must have been in her mind. The possibility of failure? Does a champion fear failure? Or are they just too determined, and sure about their capabilities? However, when she gave an interview at the end of the game, her voice was filled with emotion, just like a little girl, smiling, she thanked her mom for being there with her. I was not expecting that. You are always brought to believe these champions are machines, robots programmed to win. Well, at least she is not. And may be she was also scared to death of losing that game. Must have been hard, the preparation, all the matches. But she won. And, today, she is great.
Federer on Clay: How Does He Get an Edge? by Alfonso Sammassimo
Adapting against an opponent often requires us to play shots we are not as comfortable with in an attempt to exploit their weaknesses, and sometimes it simply means playing to our strengths as often as possible.
Federer has a positive expectation at the net, even on clay. That positive expectation won't last long if he attacks the net every point - selective approaches matter as much as his ability to execute the volley. But increasing the opportunity is so important when there is an edge - so how good does the approach set-up need to be to attack? Increasing opportunity may incorporate more risk - there is always a delicate balance. But where is the risk higher? In making more approach shots which may end up in the player getting passed? Or being too careful and end up being slowly eaten by a monster (sorry Rafael) who dines from the baseline? We decide on how big an edge we require when we trade - demanding too much of an edge may lead to many missed opportunities. The size of the edge required may vary depending on the court we're on.
It is easy for any player to lose track of where the positive expectation is during a match. Getting passed three or four times in a row will often convince an attacking player to stick to the baseline - which may be just the place where he is more likely to lose most of the points. Experience helps a player distinguish between a short term swing against him and an end to the success of the strategy. The better he knows his opponent, the easier this distinction becomes (until his opponent comes up with something new!).
A little nugget from John McEnroe in Tournament Tough, by Carlos Goffi:
The key to beating a player on his favorite surface, or on one which suits his natural game better than yours, is to get him out of his preferred game, make him do things he doesn't like to do.
Applies to almost endeavor you can think of.
A Basketball Thought, from Rodger Bastien
As I follow the misfortunes of my favorite basketball team, the Detroit Pistons, I am reminded of the similarities between trading and sports. Oh how much easier it is to be the underdog rather than the favorite! I have on occasion demonstrated the smug over-confidence that a modicum of successful trading generates. The rarified air of invincibility has captured me more than a couple of times as I find myself giving a tick or two to the house at execution or disregarding a stop, so certain that things will eventually go my way. Not so fast. Trouble is, once you allow yourself such luxuries, once brought back to reality it's doubly difficult to catch that wink of the Market Mistress, as if she knows you've taken her for granted. And hell hath no fury like...well you get the picture.
So tonight my Pistons, transformed from the hunted to the hunter, facing elimination in a hostile environment, in a perverse way should have an easier task ahead. That is if they are humble in their work and contrite about their haughty approach to the previous three games. Be it basketball, golf or markets, "never!" let the gods or goddesses hear you say you've mastered their domain, for only then will they allow you to win once in a while.
Book Review of “Match Play and the Spin of the Ball” by Bill Tilden, from Charles Pennington
I discovered Bill Tilden’s 1925 book “Match Play and the Spin of the Ball” while browsing Tennisplayer, which had a nice excerpt from it, with accompanying video footage of Tilden and other legends at play. There are many used copies of it on Amazon, my copy was a 1969 reprint.
Tilden in 1925 was at the top of the tennis world. Wikipedia says that he won the U.S. Championship (precursor of the U.S. Open) in 1920, 1921, 1922, 1923, 1924, 1925, and 1929, and was a finalist in 1918, 1919, and 1927. “During his lifetime.., he was a flamboyant character who was never out of the public eye, acting in both movies and plays as well as playing tennis.” Elsewhere I’ve read that his fame at the time was about equal to that of Babe Ruth.
Tilden’s writing itself is fresh and interesting. There’s a jaunty tone, just a touch pedantic, a little bit Gatsby, a little bit Dale Carnegie, a little bit Phil McDonnell:
Most tennis players look upon that ball as merely something to hit…Let me suggest the ball for a moment as an individual. It is the third party in the match. Will this third party be on your side or against you? It is up to you.
He gives unhedged opinions--
I have heard people with real intelligence, who should have known better, attempt to prove that the best women’s tennis equals the top flight of men’s. Nothing can be more ridiculous.
--and he is on occasion wrong, here on the same topic:
It is my belief, and has been my experience, that the woman does not live who can go the net with success through three sets and stand up under it
Someone should tell Martina Navratilova!
This is a how-to book on how to play better tennis. Tilden's view, from the top of the game, was that tennis in 1925 had been preceded by first an era of mostly defensive baseline play, then an era of more reckless attack, culminating in the synthesis, in 1925, of a game having strong elements of both attack and defense, targeted specifically at the weaknesses of the opponent. This all described his own game, of course:
Let me open this discussion by a sound tennis maxim: ‘Never give your opponent a chance to make a shot he likes.’…I may sound unsporting when I claim that the primary object of tennis is to break up your opponent’s game, but it is my honest belief that no man is defeated until his game is crushed, or at least weakened. Nothing so upsets a man’s mental and physical poise as to be continually led to error.
He presents strategies for playing two stock characters in the tennis world, the pusher, “Old Joe Gettem,” and the slugger, “Pete Swattem”.
..in playing Old Joe you must be patient, steady until an opening comes, and then severe… What is an opening against his defense? Old Joe will give you several…There are the openings of driving Joe way out of the court, to one side, and hitting hard to the other, and the shot which pulls him to the net so you can pass him, for Old Joe Gettem is seldom a good volleyer.
..in playing young Pete you should rely largely on defense, allowing him to pile up the errors off the backstop or in the net…Young Pete Swattem thrives not upon returning the ball. He seems to join Lady Macbethin her famous soliloquy, ‘Out, damned Spot! Out I say!
Tilden laments that there exist good players, neither Old Joe or Young Pete, and there the situation is more difficult. His advice, admittedly difficult to follow, is to hit “sufficiently aggressive to force your opponent into defense, provided first you are certain to put the ball in play”. Tilden emphasizes though that errors, even at the high levels, often determine the match, and he stresses, “Put the ball in play!”.
Not surprisingly, Tilden advocates practice, practice, and more practice. He describes how his continuous work on mastering every shot. He spent a full winter in Providence on an indoor court, trying to develop a strong backhand, and he credits this work for moving him from the top ten to number one.
The book has some very nice illustrations showing the major grips and strokes of the day, and they confirm that “There is nothing new under the sun”. There were players who tried just about everything. There were flat, spin, slice, and American Twist serves, topspin forehand and backhand drives, slices, volleys, overheads. The western grip, which has become the most common over the past decade or two, was in use back in 1925. Tilden himself hit with an eastern grip, but his main rival, “Little Bill” Johnston, hit with the western. Furthermore, Johnston also used the same grip on his backhand--he hit his backhand on the same racquet face as he hit his forehand, without shifting his grip at all. This is exactly what I do, and I thought I was in uncharted territory.
Some probably think Tilden was equal or better to today’s pro’s. I doubt it. Tennisplayer has video footage of Tilden’s strokes, and they’re just not as advanced as today’s. For example, on his backhand drive, his left arm hangs limply by his side. In what other athletic motion would you not move the left arm? Pitchers, skaters, javelin throwers, bowlers…they all use their left arms as counterweights to what’s happening on the right. Furthermore, why should we expect, a priori, that tennis players haven’t improved over the past few generations when we know that athletes in more quantifiable sports, e.g. runners, sprinters, weightlifters, swimmers, etc., have all continually advanced their world records.
Tilden had some well-known fatal flaws that got the best of him, and one reads uneasily the chapter titled “Youth to the Fore” about the upcoming junior stars of the day. Ultimately his is a sad story. Nevertheless this book captures his deep thinking about tennis, written in plain, entertaining prose, when he could and did speak confidently from the top of the game.
The Guys, by Rodger Bastien
For most people I know, four hours is a pretty big slice of time, reserved most days for hot pursuit of the almighty dollar. On most days I am like most people. But on those days when work is done, sunshine peeks through my blinds and a good buddy requests my presence to fill out a foursome, I have less will power than Liz Taylor at the Old Country Buffet.
“If you want an argument, pick a different subject,” the Bald Eagle says, deftly flipping my golf ball back at me with the back of his putter. I should know better than attempt a self effacing “I suck” after yet another missed four footer. Not today, not in this group. The rule of the day is to dish more than you receive or at least dish early and often. Not only had I been badly pre-empted, but this time by my own partner.
“Old Paint, we never have been able to see eye to eye,” I offer, repeating my best but oldest comeback, highlighting both his advancing years but also his google-eyed countenance as a result of the loss of one eye in a childhood accident. I toss the ball back at him, which of course he drops. “ I’ve seen better hands on a clock,” I mutter and walk away, satisfied I had at least drawn even in this exchange.
Bob Rotella, psychologist of a bevy of golf professionals, wrote a book titled Golf is Not a Game of Perfect. Praise the Lord. In my eclectic group of hackers, perfection would not be tolerated, any more than improving your lie or using the proverbial foot wedge. Once we don our spikes and gaudy colored shirts, we are transformed from business owners, doctors, dentists, lawyers and brokers to Archini, Hullpup, John-dog, Rooter, Gray-man, Ben-Jammin‘ and others of that ilk. Nestled in the lack of pretence is the casual warmth of being who you really are for an afternoon on the pristine grounds of your favorite 18 holes. There’s but one rule of decorum and that is that there are no rules. Check your ego at the door lest have it summarily trampled.
“Hey Rooter, are you feeling better,?” asks Arch as he bends over to peg one up. “I heard you had Dunlop’s Disease.”
Cautiously, he takes the bait. “Dunlop’s disease?”
“Yeah, Dunlop’s Disease…,” Arch dead-pans. “You know, where your gut done lops over your belt!”
Across town, my secretary diligently holds my business together. She receives a call from a very important client who insists on speaking to me and inquires as to when I would be returning to the office.
“I don’t think he will be back in today, “ she begins. “He said he had a very important meeting…with the Greens, I believe.”
Misperceptions -- Badminton and Rowing, by Pitt T. Maner III
There is a world of misperception out there. And I am no doubt as guilty (or more so) than others on a variety of issues. But if one checks things out, counts (as this board strongly recommends), gets in the pits, puts one's nose to the grinder, consults with many, does due diligence and employs a hands-on approach, the miasma of misperception tends to recede --and very quickly--particularly in the field of sports.
Oh goodness, they say, badminton is such a child's game and so, so, utterly easy. Having played a bit of badminton in a college gym class I can assure you it is one of the most difficult racquet sports you can imagine.
You can't be serious!! Well, yes I am. A Pakistani expert player once challenged me to win 1 point to his 15 or 20 for a case of Heineken -- fortunately I wisely avoided that losing bet. In the hands of a skilled player a feather shuttlecock can be barely dropped over the net (think "drop shot" in tennis) and then driven deep to the end line, over and over again until the novice player is totally exhausted after one point. It is a game of incredible touch punctuated by tremendous smashes. Yes, there is a similar game played in the backyards across this country--it bears little resemblance to pro badminton.
Several years ago a "personal trainer" was giving a tour to a new member of the gym I belonged to and stopped before the rowing ergs and stated something to the extent that these machines really did not provide much exercise and were amongst the easiest of exercise equipment to use. There is a lot of literature on this subject, but I can tell all from first hand experience that rowing is incredibly demanding and a sure way to test your tolerance for painful lactic acid buildup--and a great way to stay in shape. Yes, you can go easy on your workouts and still get benefits, but the English don't call it a Weapon of mass reduction for nothing.
In my 30s I stupidly bragged to a veteran Navy SEAL while working on the former Roosevelt Roads Naval Air Base in Puerto Rico that I had done 2,000 meters in 7:02 minutes on a rowing erg (during the best shape of my life, age 37), which was a machine the SEALs used for training-- and he seemed impressed. The SEALs to me were and are some of the most impressively conditioned and courageously strong individuals I have ever seen. Watching them run hills all morning for hours with packs on their backs is a sight I will never forget. Incredible mental and physical discipline. Very inspiring to see.
A friend of mine, a former English Jr. Olympic rower who is about 80 pounds lighter, 5-inches shorter, and in his 40s (and just started getting back in "shape" after years of light training) recently mentioned that he is doing a 7:02/2000m now on the rowing erg--no doubt on his way back to 6:40 min--2000 meters times. How bloody irritating!!! Psssssssssssst the air exits the ego balloon.
Morals of the story--the game is played on a far different level amongst pros--say several orders of magnitude better. You may be stronger than average in some areas but the pros are stronger across the board and they are training every day starting at 6 AM. Don't foolishly assume something is easy until you try it. Be very humble, because there are a lot of people out there who are as good or much better than you. If you want to approach a pro level you need to do an awful lot of work and respect those who have done the work to get where they are and try to learn from them.
Another Lesson Learned, by Rodger Bastien
As I toed the imaginary rubber I leaned in to examine the batter, my son. The stern determination on his face belied the gentleness in his 11-year-old soul as before me stood my little boy, tickling the underside of manhood. This was the first batting practice session of the spring but this was a winter where Carter had taken several large leaps through childhood instead of the baby steps I had grown accustomed to. There was something different about him, from the subtle deepening of his voice to the faint hint of swagger as he wiggled his bat toward me, imploring me to throw one down the middle.
I was not too sure about what kind of Dad I would be to my sons. I was almost relieved when my first two offspring were girls, as I feared I would morph into my father -- uncompromising in a quest to relive and fulfill my own unfinished dream. Aren't we the sum of our parental influence, after all? Funny thing, the lessons that prevailed upon me long after my dreams had disappeared were lessons not taught but absorbed through my less than perfect upbringing. These include:
"C'mon old man, throw one down the middle," Carter laughed, further stretching his transitional legs from child to adolescent.
As I wound up, I felt a tug of what to do versus what must be done and I threw the pitch a little harder but no less direct, plunking him lightly in his none too fleshy rib. Immediately, he glared at me with a look of both surprise and indignation. But then, just as quickly, it gave way to his little boy smirk and he stepped back into the box, another lesson learned.
Sports: Robert Locatelli, from Craig Maccagno
Having just come back from a sad journey to the west coast to put a dear friend to rest I arrived home, and looking for a distraction, decided to catch up on the Moto GP at Qatar on the DVR (Moto GP being the one good reason to have the DVR). It began with the 250cc class and was treated to a marvelous comeback that led one to ponder a question all traders should ask themselves.
The 250 race began with Roberto Locatelli on the front row and taking the hole-shot to begin, staying in the top three until the third lap when he took a trip into the gravel, holding onto the bars as the bike slid across the tarmac and into the dirt pulling the rider along. He lets go just before the bike comes to a stop and quickly jumps up to pick up the bike, restart it and get back into the race. This little adventure costs him several seconds and takes him from battling in the top three positions to 21st out of 21 riders. He was unshaken and like a man possessed he begins putting in some tremendous lap times and making his way through the pack. Now mind you this in only a 20 lap race but Qatar is one of the longer tracks on the circuit. Locatelli remains steadfast in his run for the podium and manages to make it back to 4th place behind Hector Barbera with a couple of laps to the finish. Then, in a sensational riding display and with the checkered flag in sight, the Italian nudged Barbera from the rostrum by 34 thousandths of a second. A truly amazing comeback to take the third spot on the podium.
So after that display, the obvious question that comes to this trader's mind: How do you trade when battling from behind or after taking a huge loss?
From this point forward one hopes to trade even a little bit like Locatelli rides in similar circumstances.
Gerry Bertier, from Steve Leslie
Who was Gerry Bertier?
I doubt anyone has ever heard of him. I never had until I watched "Remember the Titans" on TV last evening. . He is one of those marvelous people who without the aid of being memorialized in a movie, I never would have.
The star of the movie was Denzel Washington, but the hero of the movie was Gerry Bertier.
So big deal, who was he? In 1971, he was one of the top 100 high school football players in the country. Highly recruited with offers from many colleges including Notre Dame, his football career ended when he crashed his new Chevrolet Camaro and became paralyzed from the waist down. This was just after his team had won the state high school football championship in Virginia and they were proclaimed one of the top football teams in the country. The cause of the accident was deemed to be a faulty motor mount.
He just happened to be in the wrong place in the wrong car at the wrong time. Gerry did not let this stop him from his greatest dream of participating in the Olympics. Not the Summer Olympics of course, but the wheelchair Olympics. In fact, he won a gold medal in the wheelchair Olympics in the "Shot-put" event.
Gerry spent the remaining years of his life, helping the handicapped obtain easier access in the world. He died in 1981. There is a scholarship in Virginia named after Gerry Bertier and his legacy lives on 35 years after his high school playing days ended.
Other than that I don't know anything else about the young man. I do know this, every day on this planet is a gift, a blessing from God. We all complain about the hardships we may have had to endure until we meet a Gerry Bertier. If not in person, perhaps through a book or a movie. It is at that moment that we need to step back, reflect on our lives and truly give thanks for all the marvelous things that we have received in spite of ourselves.
J.T. Holley on Countin', Sports and Tiger
I shared this with Phil McDonnell and James Lackey the other day in a discussion over whether the edge of distance was what compelled Tiger Woods to be so great. Being an avid golfer I was shocked when I put pen to paper. My figures are very roughed out and definitely could be criticized. I only used the two complete years of '04 and '05 due to constraints from ESPN. I have located on the PGA site other historical data and will add that data later in continued work. Here are my results:
Tiger Woods has a z score of 2.4 in driving distance category. The amazing thing is that he has a -1.54 z score in driving accuracy. This to me leans towards the theory that distance matters as long as you are not hitting it out of bounds and costing yourself strokes. Just pure distance, no matter where it lands in bounds, is an advantage. The other score where Tiger stands out is Putting average, where his z score is 2.25. The amazing thing about this is that the range on the tour from the top to the bottom is extremely tight with it only being .14 in average putts per hole with a .02 deviation. Plain and simple, everyone can putt or they would not be there, and the stats verify that. The other major categories that I looked at where Tiger did not have any statistical edge was Greens in Regulation and Save Percentage. He is on the plus side but has z scores around 1 or just under.
It is amazing how a man can out drive the majority of the Tour but not be able to hit a fairway more than 50% of the time, and not be able to have a high Greens in Regulation score and still dominate with great putting ability. I would want to conclude that he has the "book ends" with great driving and great putting, but after having watched him for the last 6 years regularly on TV I see that the middle game isn't missing. He has something that might possibly go in the "Winning Bad" column. Tiger Woods has more determination and will to win than most human beings that I have witnessed play competitive sports. It seems he only cares about making History, and money is secondary or almost tertiary. On those second shot that are on average 300 yards from the tee box he has the uncanny ability to get himself in a position to birdie the majority of the times. Most of us would be disgruntled or feel challenged to be in the four inch rough, behind a tree, up against a rock, or in between two bushes. He it seems blocks out his last shot, focuses on the current shot and doesn't even think about the shot after better than any human that I can think of.
That ability to focus and determination to not just win but make history is what fills in those z score book ends of driving and putting. Funny how its hard to quantify focus and will to win?
I think I will go hit some balls and practice.
Golf as a Metaphor for Life, by Rodger Bastien
Lately, we have had a lively discussion regarding what is the "best" sport. I would posit that although many games have attributes which endear them to us, the game of golf is a true metaphor for life.
As a former manager who did a lot of hiring, the ultimate interview took place on a golf course. As opposed to viewing a resume or sitting with a candidate for half an hour for an interview, on a golf course all pretense was quickly forgotten and the true character of an individual quickly came to light. I don't know a better place to gauge a person's honesty, courtesy, response to adversity, ability to accept a compliment, tenaciousness, or sportsmanship in a few short hours. What's more, I could get an idea about how this individual would react to victory as well as defeat and whether or not I wanted this person on my "team". How someone handled the wager (were they afraid? Did they want to win at all costs or within the boundaries of fair play? ) gave me a good idea about whether they had the competitive spirit necessary to survive or flourish in the investment business. Though I was fooled several times in the interview process, NEVER did a person's character in business contradict his character on the golf course.
How To Be Ethical AND Profitable or Why Tiger Woods Doesn't Cheat by Mark Goulston (Fast Company, May, 2005)
"First you get on, then you get honest, then you get honors." -- Lew Wasserman
Q: Why doesn't Tiger Woods cheat?
A: He doesn't have to.
Why doesn't Tiger have to cheat? Because he has a huge competitive advantage over every other golfer.
What's a competitive advantage? There are three things going on when you're playing against Tiger (and the same was true of Jack Nicklaus 30 years ago). One, you know Tiger can beat you. Two, Tiger knows he can beat you. And three, Tiger knows that you know he can beat you. That is a competitive advantage.
Competitive advantage or lack thereof is the key to ethical behavior in sports, in business, and in life.
Sometimes it is the perception of one's own competitive advantage rather than the reality of it that is the greatest determinant of that individual's behavior. It is a foregone conclusion that Bill Gates would have been very successful had he been ethical throughout his career. But having not recognized, realized, or in essence perceived his inherent competitive advantage early in his career, Bill Gates, entrepreneur, may have been tempted to stack the deck in his favor to guarantee winning. Now, as the wealthiest man on the planet and with huge successes in the can, respect and esteem from supposedly non-ethically challenged pals like Warren Buffett, respect from his wife, and unadulterated trust from his children Bill Gates appears to (borrow from the movie, "As Good As it Gets) "want to be a better man" -- and is aspiring to become the ethical elder statesman of technology.
Ethical behavior is directly proportionate to competitive advantage. The greater the competitive advantage, the easier it is to be honest. The greater the competitive disadvantage (compounded by unrelenting pressure to meet unrealistic expectations), the greater the temptation to stray or lie. In golf, this translates into taking an ungiven gimme putt, moving your ball to a better lie in the woods, or just writing down a different score than what you actually played.
In fact, the way people play golf -- honestly or not -- tells you a great deal about their character (and, I would add, ethics) according to the late Mark McCormack, founder and chairman of IMG, an international management organization that handles the commercial affairs for sports figures and celebrities.
In business, "taking a preferred lie" without asking becomes manipulating numbers to meet earnings projections, expensing personal expenses, and misleading customers, shareholders, or employees.
The temptation to cheat can be very seductive whether it is triggered by greed among the "haves," who feel that more is not enough; jealousy among the "have nots," who moan that success is not happening to them; or desperation among the fearful, who are just trying to survive.
When ethics are breached, public outcry causes a President and Congress to quickly pass a Sarbanes-Oxley Act. It is short sighted to confuse the deterrents by regulatory legislation with definitive solutions to these problems.
Short term though they may be, these deterrents are necessary first reactions to such events. They are an intervention to keep the backlash of outrage from the exploited from spinning out of control and turning into mindless, widespread lynchings. Two wrongs don't make a right.
By themselves, such remedies are doomed to fail. In a competitive environment -- especially one in which the vast majority of people shade the truth or fudge an expense report -- people who do not develop a true competitive advantage through the dedication, hard work, and focused determination of a Tiger Woods or Jack Nicklaus will lie and justify it by saying, "Everyone else does it."
The only way to stop such behavior is for companies to increase their true competitive advantage by consistently increasing the real (vs. manipulated) value of their products and services well beyond their competition and well beyond their customers' and clients' expectations. Companies that can't find ways to get ahead competitively will find ways to cut corners.
You start down a slippery slope when you start to lie to others or yourself. You can't be a little bit pregnant, and you can't be just a little bit of a liar.
Nat Stewart responds:
My initial reaction is that this may be one of the most disgusting conceptions of ethics I have ever read.
Much more important than thinking of life as a zero sum sport where competitive advantage is a prerequisite to honesty is ones character and principles, such as using reason to ones up-most ability, living by productivity, and honesty. Having competitive advantage has little if anything to do with it.
The principle of -comparative advantage- demonstrates that most anyone can "succeed" in life on a competitive basis if one is realistic in self assessment. A semi-retarded person can often work at McDonald's or as a janitor, etc, and earn enough to meet life's needs. If he resorts to unethical behavior because his ability and place in the world do not match his delusions, the issue is not one of competitive advantage but one of honesty.
If one can not find pride in ones own capabilities, but rather prefers to fake competence at a higher level, is the issue truly "lack of competitive advantage" or once again just plain old dishonesty? All but the worlds greatest, which is typically only a temporary stature, could rise to a level where dishonesty is required to compete.
In fact i will take a opposite view. True competitive advantage in anything is unnecessary in life and not possible for all but the few greats blessed with the right genetics and circumstance. Most can have advantage only on a small scale, in a small niche, were they find a line of work they can excel and where they do not have to directly compete with their intellectual or physical betters, but rather benefit from such people through the wonders of mutual gain, invention, and capital accumulation.
As I consider Von Mises's writings on games vs. economics and business and his thoughts on games - game theory in human action, and his "the anti-capitalist mentality". Correlation vs. causation, determinants of ethical activity may be another use.
Mark Goulston says:
Don't you just love people who aren't afraid to voice their opinions? Nothing like a good healthy diatribe to stimulate the palate.
While we are on the topic, the one thing I think is that Tiger Woods is competing against "Par" or the course that he is playing. Golf is an individual game that requires one to focus attention as much as possible to their own game (I'm no Tiger by the way). It is like trading to me in that even though there are a lot of other players (traders), the Mistress is the ultimate competition and my relationship with her is the utmost importance. That being said, you don't cheat yourself or act unethical or you would be taking concentration off your game and placing it on something that is only going to make you play worse. Golf is one of the few sports that makes you almost magically play your weaknesses. Most sports you can be athletic and to a certain degree be competitive, but in golf that's not necessarily the case. Don't think that while guys are pumping iron these days on the PGA that makes it a must do either. Athleticism is only a small part of the game. It's you against "Par" on the golf course, everything else is just a waste of thought and a distraction. Once again, cheating is a natural constraint because you can't fool yourself!
Rodger Bastien comments:
A very interesting topic. On one hand, Dr. Goulston makes some good points, as I certainly agree it's EASIER to be honest if you possess a competitive advantage. I disagree that your honesty is commensurate to your advantage. As an avid golfer I would say that there are the integrity of the game and the respect, almost reverence most golfers have to it's rules is the reason most men in my group don't cheat--to do so would be to reduce the contest to something less than what it is.
J.T.'s argument about playing the course and one's self is a good argument if you are playing in a tournament or competitively in high school or college. But it is also a naive argument. Make no mistake about it -- GOLF MORE THAN ANY GAME THERE IS, IS PLAYED BY SPECULATORS SUCH AS US FOR THE SAKE OF A WAGER. And that means match play, mano-a-mano for quarters, dollars or hundreds of dollars. If queried (because I have done this), virtually any man would prefer on any day to play poorly and win money vs. playing well and losing money. Think back at your early days when racquet or handball matches were made--it's all about the action and I think that some of the more memorable golf "matches" I remember was winning when I didn't have my best stuff and using my other resources to pad my pocket at the end of the day.
James Lackey adds:
These are examples of games where the rules are fixed and agreed upon. In MX or race cars the rules are constantly updated for "safety and new tech" to avoid killing patrons to the races. For every tech leap their is an advantage and a way to "so call 'cheat". In drag racing the NHRA mandated "finish line rev limiters" to slow the cars down under 330MPH Yes that is 330MPH, not a typo. Well if you allow a "electronic-timer on a rev-limiters box you can also call that 'traction control". My personal best was back in the old school days of MX where there was still a 100CC MX class. We took a New YZ 125, sleeved it and had a "legal" 100cc engine, yet I had all the new tech of the new 125CC bike which was HUGE new water cooling , new forks, suspension, 6 speed trans, that was literally such a huge edge it was "cheating".
I posit anything that has advances in technology other members will call foul and cheating. I remember in the late 90's the market makers called day traders "cheaters" or unfair because we had the fastest machines, a rule advantage (due to their own behavior) right or wrong it was an advantage, we took it they called us cheaters and we called them.
Nigel is a good friend and we will use him for an example. Does he believe that card counting at a casino is cheating? Is using a computer to assist in card counting cheating? Is using big blue cheating at chess?
Should we go back to wood-woods for Tiger Woods so called advantage that is all in his head which is total Mumbo as he is a huge edge as a big driver. Does Ben Hogan roll over in his grave with titanium clubs? Why not ban steroids in baseball and allow aluminum bats, fan safety?
The risk of foul balls from an aluminum bat injuring fans is too great. Never mind all records being destroyed. Yet in Golf titanium is legal.
I think about cheating "them" or the market every minute I am awake. That joke is two fold. How much do you think about women? Every minute I am awake, and half of my dreams when I am asleep. Perhaps, the best one-liner ever on spec list was from Craig on the topic of "what the other guy is thinking, "of course the other side of the coin is: "Sometimes you can think yourself right out of a trade" I don't focus on "the market can't be beat" so lets lower fees to our clients. I think lack of profits or at least trying is unethical.
Steve Leslie remarks:
Golf is the only game I know where you are supposed to call a penalty on yourself, in fact, the nature of the game requires it. There is no game on the planet that requires more integrity to play, I have played golf for nearly 40 years and in numerous tournaments and outings as I am sure many others have. And, let me tell you, that every golfer worth his salt knows exactly what his score is after each hole that he played. Trust me he does not have to guess what his score is.
I have seen professional golfers call penalties on themselves when nobody would have questioned it. I have seen them lose tournaments because a ball moved after he addressed it. Some years back, Ian Woosnam had 15 clubs in his bag on the first tee, after he hit his first shot. He was in the top leader board at the time and was forced to take a 2 stroke penalty. Craig Stadler, was assessed a penalty because he kneeled on a towel to hit a ball that was under a tree. There are few things in life that are more reprehensible than cheating on a golf course. There is no reputation that is harder to shake than being labeled a cheater and it is a reputation that will follow you the rest of your life.
Tiger Woods does not cheat nor do the vast majority of golfers because you do not do it. Period. You don't think about it you don't guess or wonder if you will get away with it, you don't do it. You honor the game. Whether you are a scratch golfer or a 18 handicapper, the integrity of the game will never be insulted by you cheating. I know guys who would cheat on their wives, their family and children and cheat in business, but never cheat on the golf course. A very curious view indeed. By the way, Tiger Woods has said numerous times he does not compete against others he competes against himself. I once heard Earl Woods say "the one thing you need to know about Tiger is that he has absolutely no fear of failing." That in my estimation is Tiger's greatest advantage.
Dr Goulston is 100% wrong. Making such simplistic statements are always dangerous. John Rockefeller by far the wealthiest man ever in America, far surpassing Bill Gates, once commanded 8 % of the countries GDP yet he would drive the small business owner out of business with impunity. It was only at the end of his life that he became philanthropic.
Ever notice how these ultra rich people become philanthropic after they have destroyed the lives of thousands of people. Bill Gates has numerous issues on driving competitors out of business. Microsoft is in court every day litigating anti trust issues. Larry Ellison and, yes, there are others are the same. I am sorry Dr. but your argument just does not hold water. I respect it, but it needs a bit of fine tuning.
A Response to The Beauty of Baseball, by Rodger Bastien
Pitchers and catchers have already congregated in Arizona and Florida to begin baseball's annual exercise of hope, promise and renewal. This officially shatters the icy grip winter has on many of us, for some literally and quite figuratively for many others. For those who love and have played the game of baseball, it represents the smell of leather, the crack of the bat or the resonating sound of the ball thwacking a mitt. For the players, it is a time for unfettered dreams--this season has yet to disappoint them, no oh-for-fours, no strike outs with the bases full, no bobbled grounders or gopher balls surrendered. For many fans it is the return of that piece of their soul that is mostly conspicuous only by its absence, and upon its return ,comfortable as their favorite pair of jeans. I don't think baseball is an acquired taste. Never has a son or daughter been smitten by the game when forced to endure it through obligatory participation in little league or as an ancillary appendage to a visit to a local ballpark. Instead, for many of us it became one of the first places we met our parents or loved ones on common ground , where we could share our allegiances, debate our differences and identify with whatever part of the game struck our fancy. Whether it was the hot dogs after the third inning, the majestic arc of a home run disappearing over the fence, the ballet of a well executed double play, the languor of the seventh inning stretch or skipping school to attend opening day, we shared the experience We appreciated its availability, the relentless nature of a 162 game schedule, but that constant we could share every day of the summer, every year of our lives. It became our refuge, the retreat from the daily grind, the port in the proverbial storm. Everyone I know who loves baseball has shared it with someone they love or have loved ,the game transcending the white lines between which it's played.
So, what does all of this have to do with speculating? The obvious parallels; batting/stock averages, leading off to gain an edge on the bases, reading signals, taking chances, going for the big inning, protecting a lead -- the list is endless. But today, I'm embracing an imperfect friend who's knocking on my door and telling me it's time to play again. I think I'll grab my boys and go outside and play a little catch.
The Beauty of Baseball, by Steve Leslie
I believe in my heart of hearts that baseball is the greatest of sports, the purest of games. It is beautiful in its complexity and magnificent in its timeless glory. Its geometric design is flawless. 90 feet from home to first, from first to second, from second to third and from third to home. 60'6" from the pitchers mound to home plate. Those dimensions have never changed.
The field of play is different and unique in every venue that it is played on. Yankee Stadium has a short right field fence. The Old Houston Astrodome was as big as the Grand Canyon. The Vine covered brick wall in Wrigley Field. The Green Monster in Fenway Park. The huge outfield in the Polo Grounds.
What greater place could a father take his son or daughter to, buy them a hot dog and a coke and the child will remember it for the rest of their lives.
Talk about one last hope. The home team always gets one last chance. There is no time limit. The clock can never run out on your team. A game can last an hour and a half or 6 hours.
Where else on the face of this earth does anyone reference a person who lived 100 years ago and compare his physical exploits and accomplishments to modern day players. They actually created a word to describe him. Ruthian!!!!!! What number did he wear.
Unquestionably the greatest athletes in the world played baseball. For decades it was the only sport that an athlete could make a living doing. They were truly larger than life. They walked on water. Baseball players have always stood the test of time. Some people can't even say a name without a touch of reverence in their voice or a tear in their eye. You could say only one name and a fan, and it didn't even have to be a student of the game, knew immediately who you were talking. about. Go ahead try it, The Babe, Stan the Man, The Yankee Clipper, The Iron Horse, The Splendid Splinter, The Big Train, Bullet Bob, The Duke, Lefty, The Ryan Express. The Georgia Peach, Mickey, Yogi, Mr. October, The Say Hey Kid. And every fan had a favorite ballplayer.
Look at the terms that were created: The perfect game, the cycle, the heater, uncle charley, The shot heard round the world, The Triple Crown, The Double Header, The Sandlot.
The greatest actors of all time played in movies about baseball. Gary Cooper, De Niro, William Bendix, James Earl Jones, Matthau, Costner, Tommie Lee Jones, Paul Winfield, Karl Malden, Redford, Close.
This is the game that I wish to remember. The one that has been around for nearly 200 years. The one that has withstood the test of time. The one that has survived one scandal after another. The game that made it through two world wars, the black sox , the cold war, and steroids. And I bet this is the one that you want to remember also.
John Philpott retorts:
With all due respect to Mr Leslie and his US centric sports history, baseball has nothing compared to football (soccer for US folks). From ask.com, some history about the sport I quote:
"There is documentary evidence that a a game or skill building exercise, involving kicking a ball into a small net, was used by the Chinese military during the Han Dynasty - around the 2nd and 3rd centuries BC. Earlier evidence - of a field marked out to play a ball-kicking game has been found at Kyoto, in Japan. Both the Greeks and ancient Romans played a soccer-type game which resembled modern soccer - although in this early version, teams could consist of up to 27 players! It is impossible to say accurately where and when soccer started - but it is reasonable to assume that some type of ball game - from which the organised sport we know today developed - has been played somewhere on the planet for over 3000 years. Britain is the undisputed birthplace of modern soccer/association football. Scotland and England being co-founders of the organised game. Football - as soccer is called in Britain - was a popular sport of the masses from the 8th century onwards."
I would say football has stood the test of time, interestingly football/soccer has been played in the USA since as far back as 1609, other factoids: FIFA (The Federation of World Football) has 204 member nations and last but not least football/soccer is bigger than baseball, basketball and american football combined.
As to great names oh boy ... Gabriel Batistuta (Argentina),Zbigniew Boniek (Poland),Zico (Brasil),Roberto Baggio ( Italy),Peter Schmeichel (Denmark), Ruud Gullit(Holland), Lothar Matthaus ( Germany), Marco Van Basten (Holland), Michel Platini (France), Ronaldo (Brasil), Alfredo Di Stefano (Argentina), Ferenc Puskas (Hungary),Stanely Matthews (England), Bobby Charlton (England), Eusebio (Portugal), Johan Cruyff (Holland), Lev Yashin (Russia), Franz Beckenbauer (Germany), Diego Maradona (Argentina) and Pele (Brasil).
Since others have described the game more eloquently, I quote from The Beautiful Game, by A Fowles:
"If football at its best is classic Duke Ellington - sublime soloists soaring aloft from the ground base of the tightest pre-arrangement soccer is be-bop. Charlie Parker and Bud Powell on a day when they were talking to each other. A brilliant soloist ghosting past defenders may scintillate all day; a duo, a trio, a quartet may repeatedly wiseacre the ball the length and breadth of the field; ten outfielders may overlappingly give and go until they seem like twenty. Hidden under the fluid interchanges all teams play to the basic shape, the overall game plan in their heads. But the result will probably hang on the exploitation of an utterly unplanned split-second moment. Soccer is existentialism with muscles."
Just a slightly different view on why baseball though interesting lacks the universal appeal of Football.
Steve Leslie answers:
Normally I would not reply to another's comment about my posting, respecting their right to voice their opinion in an open forum no matter how ill informed and delusional they are. That is an inherent right in our country and plainly stated in the first amendment. Should Mr. Philpott choose to expose his naivete and thus fall on his own petard that is his choice. However, when someone blatantly makes a statement and follows it with such a weak and egregiously poorly constructed argument I must defend my position.
How can you say baseball has NOTHING over soccer/football. By stating something in absolute terms and displaying such hubris you must realize that you open yourself to attack.
I choose to start here:
"Just a slightly different view on why baseball though interesting lacks the universal appeal of Football."
That Sir is now and has always been the American Way.
God Bless America land that I love.
Stefan Jovanovich argues:
Steve Leslie and Roger Bastien have the better part of the argument - for a very simple reason. Baseball is the fairer of the two games. In his list of great soccer players, John Philpott should have added an asterisk to Diego Maradona's name reading something like - "won the World Cup for his country by cheating". Those hundreds of millions who saw Maradona's fist-assisted header were reminded once again of football's greatest weakness: victory in the championship game can be literally be stolen. As those of us now watching the European Champion's Cup well know, "home field" advantage is so important in soccer that matches between teams have to be based on the cumulative scores from home and away games combined. In baseball, on the other hand, home field advantage is negligible (only 2% better than chance), and the only successful cheating in its championships came when Arnold Rothstein rented the 8 best players on the Chicago White Sox.
Roger Bastien comments:
I don't see an argument. My way of thinking is that it's interesting to yankees like us to see how people in other parts of the world have their emotions stirred over soccer (football) much the same as many of us do about baseball. I don't think it's a matter of which is the better sport at all but rather the fact that these games somehow spark us. Diversity makes the world go round.
Footwork, by James Sogi
Footwork is critical to effective fighting and sparring and many other sports. One important aspect of footwork is going backwards. There are numerous techniques, shuffle back (right and left) cross step back, and back step. It takes practice and uses different muscles to avoid falling on your butt. The back step is used to gain space, change timing, rhythm, distance and defense. The specific technique to focus on tonight is hitting while back stepping.
Probably the best example is the Ali vs. Frazier fight, the "Thrilla' in Manilla" where Smokin' Joe keeps charging in, head down, swinging. Ali is back stepping around the ring, leading Frazier, and as Ali back steps, he shoots off punches that catch Frazier coming in. When Ali can sense Frazier is stung, he reverses forward and flurries with a combination. Ali is always just a step away. Our coach always told us to change up the rhythm. Don't step, punch step, punch mechanically, like Frazier. Soon the charging bear gets exhausted, and the back stepper can move in for the knockout, and has scored points all during the defensive phase. This type of tactic can work when entering a position and when you don't quite get the bottom tick like some traders I know.
Patrick Wegner adds:
Having been taught by a lot of good coaches over the years, there has not been a single one that has not said that footwork is more important than anything else. Lay the foundation and the basket will make its self. It is impossible to shoot, if you are off balance and balance is gained by correct footwork. How can MJ or Dirk Nowitzki make those fall away jump shots? Mostly because they are balanced when they take off. Obviously the footwork will come with practice, to create muscles memory it takes 17,000 repetitions on average. Now, have a guess what Dirks personal coach had him do over and over again; without even shooting, just jumping in to the position. Lay the foundation and the success will come, it might be tedious but ultimately worth it. I cannot think of any sport or any part of life that that doesn't apply to.
Few combinations of Head Coach/QB have been as successful as the Bill Walsh/Joe Montana (hate to admit it as a die hard Raiders fan). "Bill Walsh rarely spoke of Joe Montana's arm; it was Montana's footwork he loved, footwork that made his arm so accurate." Seth Wickersham, ESPN
Barry Gitarts mentions:
I used to take lessons from a martial arts expert who created his own style. He often said the problem with most point fighters is they move back and forth in a linear fashion and that one could have an edge by moving in a circle around the opponent.
A Baseball Tale from Rodger Bastien
The following tongue in cheek comparison is by Rodger A Bastien, a former All American Baseball college player who replaces the dearly lamented Larry Ritter as our official baseball goto man.
I am sure Ms. Doherty must also be a baseball fan and is cognizant of the sad story of Vladimir Guerrero, the superstar right fielder of the Los Angeles Angels. Despite having career statistics through age 29 second to none, comparable only to the greats such as Willie Mays and Joe Dimaggio, his undisciplined approach to hitting seems to be be finally catching up with him. Mr. Guerrero, who habitually swings at the first pitch (Ted Williams is turning in his container!) and has been known to even slap a base hit by hitting a pitched ball on one bounce, saw his batting statistics slump substantially in 2005 versus his MVP season of 2004. As examples, his batting average declined by 6%, his RBI total was down by 14% and his total bases declined by a whopping 19%. It appears as though his steadfast refusal to employ the use of batting gloves has finally done him in as he missed 21 games last year due to injury, undoubtedly as a result of the wear and tear done to his hands. Supporters insist that his decreased numbers last season were still good enough to place him among the league leaders, but it is obvious that this once bright star is approaching a flame-out. Should his statistics continue to decline at this rate and his obstinacy and lack of discipline persist, he will be fighting to remain above the Mendoza line before too long, it is assured. No modern day hitter has been able to continue to sustain hitting statistics of this sort. A preponderance of night games, specialized relief pitching and the emergence of the split fingered fastball are all facts of life in today's baseball which make it impossible to continue hitting at the same level as the all time greats....
The Perfect Game, by J. P. Highland
While being in Houston, TX (a few years ago) for a short business trip, I used my free time to visit the former Enron Field to see Randy Johnson, pitch for the Snakes against the Astros. I had been lucky to see many of the finest pitchers of our time like Roger Clemens, Pedro Martinez or Curt Schilling but Johnson was missing.
Johnson was impressive, delivering effortless strikeouts and harmless ground balls and some occasional fly-outs. It seemed that everything was going his way. But Johnson didn't look happy, he was constantly grumbling and yelling to himself and to his catcher. Despite that his performance was not perfect since the second inning, he kept looking for perfection in every pitch.
I still remember his numbers, 8 innings pitched, 10 strikeouts, 3 hits, and 2 walks: not bad. It wasn't until May 18, 2004 when he achieved the Perfect Game, pitching for the Diamondbacks against the Braves. At the age of 40, he became the oldest pitcher to achieve perfection.
After I trade I'm never happy, If I lose money I'm angry because I hate to lose money, if I make money I'm not happy because after reviewing my trades I realize that I could had made much more. I can't recall a single day which inspired me to sing Lou Reed's "Perfect Day".
Pitchers have a benchmark to measure perfection, but which is the trader's benchmark? I would hate to learn the Soros' killing in the BP is the benchmark, thus there is no hope for small fish like me to accomplish a Perfect Game.
A Statistician Goes Surfing, by James Sogi
Today the big surf came up. One thing we always watch out for in rising surf is stacking sets. That is a phenomenon when you go out and the waves are a nice 5 or 6 feet, but then every wave becomes bigger and bigger and bigger, and you just start paddling for the horizon for your life to avoid being crushed by ever growing waves, and can't get back in. Its very dangerous. It's like those days that start with a small drop, then the drop starts to build up speed, breaks down, and then, it really freefalls in the afternoon.
A statistician would describe big waves to have a higher standard deviation as well as the greater amplitude of the waves. At least once during the day, a wave triple the size of the rest of the waves that day will roll through and clean everyone out of the line up, and roll them around in white water. So on a big wave day, you can never sit inside, that is closer to the shore, and catch the nice looking inside waves because if you do, you will get smashed by a giant outside wave that comes with regularity during the big wave day and get "caught inside". Its like entering a trade too soon, before the drop stops and get fooled by the little intraday moves. For long periods, say 30 minutes or more, during a big wave episode there will be dead calm. This is dangerous for tourists who come to watch the waves. It gets calm, they think, " Oh it's calm now. I'll go walk along the water." Then a 30 foot wave comes and washes the hapless tourist out to sea never to be seen again. Very sad.
Waves cluster. They come in sets of between 2 to 20 or more, then there is a lull between sets. The wind that blows across the water builds the waves up and the faster ones out run the slower ones, and then some join together creating sets of waves of different sizes. In the open ocean this causes the rogue wave effect of both the giant "freak" peaks, (they are not really freaks, but a regular thing), and also the "holes", where the bottoms drops out of a waves, the boat falls down into the hole, is damaged, or the following wave fills in and crushes and floods the vessel.
Dept. of Sports and Games: Sudoku, suggested by Dr. Janice Dorn
Read about Sudoku the latest puzzle craze that's overtaking jumbles and crosswords.
A Question for Victor on Inner Tennis and Trading, from Jeff Beckwith
With the spring frostbiting season not far away and my New Years resolution that I would seek to shape my well rounded physique into something more competitive, I picked up a copy of the book Sail Fitter by Dr. Michael Blackburn, BApSc (Hons), PhD. Dr. Blackburn is a Sports Science PhD and a top level international sailor who won a bronze medal in the Laser Class at the 2000 Olympics. The book is very good reference manual for any dinghy sailor looking to bring his fitness level up a few notches. The one item that really struck me in the bibliography, where amongst all the sailing titles appeared:
Gallwey, W.T. (1976). Inner Tennis: Playing the Game. Random House, New York.
A tennis player first confronts the Inner Game when he discovers that there is an opponent inside his own head more formidable than the one across the net. He then realizes that the greatest difficulty in returning a deep backhand lies not in the speed and placement of the ball itself, but in his mind's reaction to that ball: his own thinking makes the shot more difficult than it really is. Further, he becomes aware that these same mental obstacles which keep him from playing his best tennis also prevent him from living his best life.
Dr. Blackburn states that despite its focus on tennis, it is a great book that can help you improve your feel for and mental approach to sailing. Based on the quote from the book I imagine that may help improve the mental approach to trading too! Are any of the racquet aficionados familiar with this book?
The tennis aficionados are indeed familiar with Gallwey's book , especially since he was a year or two ahead of me at school, and Hobo wrote the Inner Guide to Raquetball, an augmentation of Gallwey's book, and Dr. Brett is always trying to write about the inner game of day trading.
Regrettably, there is nothing to the idea that the inner game is important. You need good strokes in tennis to be good, and good athletic ability. Then you need good coaching so that you can fit your strokes and abilities to the game, and proper discipline to apply the previous two factors. Nothing else matters, although someone like Martina Hingis is a natural in knowing where to hit the ball, and someone with a bad temper, and bad character can detract from her abilities and training at the margin. Let's say that ability, strokes and training account for 99%, and your temperament accounts for 1%, that 1% being that you could destroy yourself with cowardice et al.
The same applies to trading. If you have the right niche, if you ask the right questions, if you apply the proper balance regarding the mix of qualitative and quantitative, if you choose a proper reward and risk structure relative to your goals and ruin point, if you choose your spots, if you vary your positions and markets based on the above, if you realize the cycles are always changing, if you take account of the interrelations of markets, if you understand your place in the market eco-structure, if you have your costs to an absolute minimum, if you have no fixed rules that are easy picking for the flexible, if you choose to trade against the ephemerals and not against the true experts like the dealers and the market makers, if you have the wind at your back by always believing Lorie and Fisher, and and Dimson, and if you have the right trainer, then you've achieved 99% of what you can accomplish.
All the inner secrets, all the proper training, all the EEGs, all the good character can't augment the preceding by more than 1%, although like the tennis player that blows up, if you're particularly egregious of character, if you drink or gamble too much, if you spend your time trying to impress the beautiful babes, if you're desirous of financial suicide, then you can override even the best of the 99%..
Now that I've listed the factors necessary for success for the spec investor, I see that it's much harder, and much more varied than for the racket player who if he's fast and strong and agile, and has good strokes, the world is his oyster, whereas comparable attributes for the spec investor, i.e. intelligence, capital, knowledge, study, are just a beginning.
Bo Keely adds:
I hope to clear some readers minds in four paragraphs. I opened Tim Gallwey's "Inner Game of Tennis" right after it was published in 1972 when I was the national paddleball champ and runner-up in racquetball. The contention that the tennis player first confronts the Inner Game when he discovers there is an opponent inside his own head more formidable than the one across the net struck me as bizarre. I still remember putting the paperback aside and meditating a full minute with the closure that the author's implication of an inner game hence an inside player was something I hadn't found on my own and didn't want to.
Fast forward a year to an evening in the mid-70 s when the phone rings. I was living in an unheated garage on a remote lake in Michigan with a Doberman, and we were surprised to hear a fast-talker on the other end remark, "This is Tim Gallwey's agent and he would like you to co-author a book on The Inner Game of Racquetball with him". We verbally sealed the deal in five minutes, and I hung up elated. Immediately I pulled a thick file of racquet sports psychology clippings and wrote an introduction and table of contents. A day later, the agent rang and I proudly told him what I d done. To my astonishment he scoffed that it was impossible to empty the head with a file of clippings, and if I'd closely read the Inner Game I'd understand Zen athletics. Maybe he heard the Doberman mindlessly fetching in the garage, but in any case the book was stillborn along with my chance at Zen sports stardom.
Incidentally, I read Gallwey's original text from cover to cover to be stunned not by the main precept but by another sports proffer that has had wide implication throughout my life. The author suggests that if you are frightened by any prospect, anything at all in life, then cure it instantly by mental rehearsal of the worst scenario outcome. For example, I am going to lose this match. That's pretty awful, but the worst scenario might be more like I am going to lose the match by an unforced error in front of my parents and fans, my wife will divorce me to run off with the opponent and take the dog that fetches my practice balls. That vision overshadows simple loss.
Buy Inner Game of Tennis but ask yourself before cracking it, if you already have an entity in your head. If not, begin and stay on your toes.
Dr. Brett Steenbarger responds:
The book I'm currently writing reviews all research on human performance, including athletics, chess, performing arts, etc. Hundreds of studies and books are available on these topics, but--oddly--no one has assembled all the data. The bottom line is that psychological fortitude and confidence comes from structured practice/rehearsal, in which performance expectations are progressively raised and frequent, accurate feedback allows for correction of errors and eventual mastery. If the goal is the development of expertise, the pursuit of "positive attitudes", "self esteem", etc. apart from effortful mastery of a performance domain is a waste of time. Psychological difficulties can impede the enactment of skills and the expression of talents, but psychological interventions cannot substitute for those.
J. T. Holley remarks:
Reading Brett's undertaking made me think of Sam Snead's famous quote "practice puts brains into my muscles". This is from a man who could stand in a doorway and kick the top part of the frame in his younger days. The other is ole' Harvey Penick who shunned any use of negativism in his teaching of his pupils e.g. "I am never going to tell you not to swing hard, I'm going to tell you to swing slow". My wife tells me that I make people sick on the stomach I'm so optimistic and positive thinking.
Dean Tidwell adds:
Contemplate yourself in the condition you want to produce.
8 time world champion calf-roper Dean Oliver is a living legend in work ethic. Repetition to the point that nobody could/would do what he did. My father still has the old projector film showing his hours and hours of repetition.
Wasn't it Vic's Ed. Of Spec. that told the story of Rene Lacoste's serving of a ball while the crowd was bowing to the Queen. Of all the world's greatest, at their respective field) I have never studied anyone who created the "Condition" without 1) unbelievable work ethic and 2) Powerful "re-creation" ability.
True Story... In high school, I was a baseball, basketball, and any ball "star." Bolletieri tennis academy helped me to a Singles District Championship and a Regional Semifinalist in tennis as a sophomore. I quit forever after the final loss that year as a new passion in golf was found. After struggling to an 80+ every tournament (my senior year), my father had me read Psycho-Cybernetics. I spent over 3 hours visualizing the entire day. The surroundings, each swing, everything. The next day resulted in a 74, winning my 1st High School Tournament. This was 6 shots better than any round I had played to that point. Was it NAIVETY in an easily manipulated teen that might believe anything if the right person told him so? Or was it psychological fortitude?
Inside Outside: More on Pitching Strategy from Dr. Phil McDonnell
A baseball batter is taught to "turn" on an inside pitch. This means that he will move his hands in front of the body and throw the fat head of the bat out in front and possibly step toward his power field (left field for a right handed batter). The combined effect of turning on the balls of the feet, turning on the hips and swinging the bat all the way through provides the maximum amount of bat speed and power. The result of meeting the ball in front causes the bat to be at an angle and normally sends the ball to left field for a right handed batter. Another expression for this style of hitting is "pulling" the ball.
Generally speaking batters are coached to try to pull the ball when they have an inside pitch. The inside pitch allows them to see the ball well. It also the best pitch to hit with the bat head out in front. There are two disadvantages to pulling the ball. The first is that you have to move the bat the greatest distance meaning you have to be quick with the bat and quick to decide. The other is the increased risk of a foul ball if you turn too far. It is quite common to see a long foul ball near the foul pole at home run distance. Invariably it was an inside pitch which the batter pulled too far.
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Defending Against Attacks and Trading, by Tom Ryan
With respect to Kobe Bryant's 81 point scoring effort Sunday, my daughter's soccer team has the same problem as the Lakers, as they have one dominant offensive player who tends to score 1- 2 goals each game in the first half. However, in the second half the opposing team adjusts so she has a much harder time scoring although some of the other girls get more opportunity to score.
I didn't see the game with Kobe Bryant although I once saw Jordan score in the 60s. In that game the opposing team could not seem to stop Jordan from scoring, even when they adjusted and double teamed him.
It's an idea applicable to trading, the time required to sense a pattern of attack and make an adjustment in your defense. For example, last year we had several long runs where stocks were down open-close day after day, to the point where we were all shaking our heads and throwing pencils across the trading room. At what point do traders adjust to a repeated pattern of attack?
Several years ago I saw a paper on team defense where there was a study of lacrosse, soccer and water polo that showed defenses collectively began to adjust after 6- 7 continuous attacks by the same players in the same portion of the field. How they counted was questionable and unclear, but the magic number seemed to be about seven. I find that noteworthy that we see very few runs in the market on the smaller time scales (intraday, day to day) that go much beyond seven in a row.
James Sogi comments:
This discussion about continuous attacks, runs of 7 or more, and 3 pointers in basketball reminds me of record sessions in three-line break charts. Steve Nison describes this in Beyond Candlesticks, chapter 6. Being a Missourian in spirit, and following Chair's admonition, I like to test everything now, and with all due humility, even the stuff Chair criticizes as pure mumbo, like candlesticks--see Practical Speculation Ch. 3, pg 85. The old time Japanese rice traders probably painted their charts with a calligraphy brush as they traded their rice warehouse receipts for future delivery. They called 8-10 record sessions "the bones of Sakata's body". Nison claims 8-10 record sessions up is bearish. Testing same reveals some merit to 8 record sessions up being 'overbought'. Scientifically speaking, I hypothesize that it is not pure mumbo. 8 new highs in the market, as in basketball, is an amazing event and might be considered as oishi bento for the current cycle as it was for the last 100 occurrences. Oishi mean tastes good.
GM Nigel Davies adds:
I would have thought that adjustments would start to be made as soon as a pattern is observed. But perhaps a 'critical mass' of observers is required for the pattern to start to disintegrate. Perhaps the adjustment to 'known' patterns is much quicker than those that are obscure. It will be interesting, for example, to see what happens around February 1st after the last two firsts.
Scott Brooks says:
I believe this simply goes beyond pattern recognition and adjusting to it. Skill and ability can and will overcome adjustments made by lesser opponents.
When I was in grade school I got into playing chess. A kid named Mark was the president of the chess club and reigning champ. I beat him and thought I was hot stuff. Soon there after another kid (nicknamed Elmo) came to play. Elmo was a smart kid but smoked to much dope, got suspended for fighting a lot and when he was in school, got bad grades. He played chess one day because we had chess club in the detention room (where Elmo spent a lot of time). Elmo, who had never played before, caught on very quickly and went on the beat everyone. He beat everyone at every school he played against.
I could adjust my play to Elmo all day long. It didn't matter. He was simply better than me. If I played Nigel, the same thing would happen. How could I hope to adjust to Nigel? How could the NHL adjust to Gretzky?
A great player is simply one who sees things that others do not. Like Gretzky said, "I don't skate to where the puck is, I skate to where it's going to be" (or something like that).
Same thing is true when I played poker my Junior and Senior year of college. I made a lot of money (I estimate I made $35k - $45k my senior year). I discovered that I could really play poker well. I played against some very good players who knew how to adjust. They couldn't beat me (I'll have to do a post sometime on some of my poker story's). When I played poker, I went into a zone.
These analogies apply to trading:
Victor Niederhoffer adds:
One could not help but think of the irony of some pseudo academics like the Tversky twins studying basketball scores and concluding that the hot hand does not exist and that Kobe Bryant's 81 points was completely consistent with randomness. In similar fashion, Cootner and Fama and others of the 1960's concluded that markets were completely efficient until the opportunity to profit from anomalies they found that in actuality due to their faulty abilities were truly random retrospectively as well as of course prospectively thru the Bacon effect.
Power Skating, by Steve Ellison
One way to store potential energy is in a coiled spring. I was coaching my son at hockey practice last week on how to skate more powerfully, and he said I sounded like a physics teacher. To skate for speed, the technique is to use the legs like coiled springs. With the knees deeply bent, 90 degrees or more, one angles a blade edge into the ice and forcefully pushes the leg to full extension while gliding on the other skate. The gliding leg remains bent because, as soon as the skater retracts the extended leg, he will switch legs and push off hard with the other skate. If one skates with the legs bent only slightly, he cannot go nearly as fast.
An interesting corollary is that, because the force of the leg extension curves the gliding blade slightly outward, the fastest path between two points on a hockey rink is not quite a straight line; it's a bit of an S curve.
Sprinters similarly compress their bodies against the starting blocks to get a fast start. There must be many applications in which one can store potential energy by movement in one direction to increase force in the opposite direction.
Pitching Strategy, by Phil McDonnell
The days of Little League coaching are gone but the memories linger. Early in the season we would discuss all of the different types of pitches - fastballs, curves, knuckleballs, change-ups, split-finger fastballs, sliders, screwballs and all the rest. The question I always posed to the team was which is the easiest pitch to hit? There is one clear answer to this question. The correct answer is a "strike".
Obviously the emphasis is on judgment and knowledge of the strike zone. The point for a batter is that he doesn't have to chase a bad pitch. He can wait for his pitch. The lesson for a trader is clear. Wait for your trade. There is no need to chase bad trades.
As a player I was a pitcher. There is quite a bit of strategy to pitching, and consequently just as much to batting. The pitcher and batter are continually trying to outthink each other. Most pitchers have mastery of about three pitches. Almost every pitcher considers his fastball to be his bread and butter pitch and the pitch which he can control the best. When he needs a strike or needs an accurate location pitch he will probably go to the fastball.
The curve is the most difficult to hit. A major league curve ball can curve at least 17 inches. That is the width of home plate. The ball can literally appear to be headed inside to a batter and wind up outside the strike zone. What most people don't realize is that the curve ball accelerates in its curvature. The spin on the ball induces an acceleration which causes the ball to move at ever increasing velocity in the direction of the curvature. The movement the batter saw in the last hundredth of a second will only increase in the next interval. The usual linear extrapolation of the human brain simply does not work with the curve ball. Thus it is deservedly the most difficult pitch to hit.
From the pitcher's standpoint the curve is also the most difficult to control. To deliver my curve into the LOWER strike zone I had to aim for just behind the batter's ear. To be a good pitcher one must overcome any silly squeamishness about hitting the opponents with 90 mile an hour lethal projectiles.
The change-up is usually relatively easy to control and usually thrown right down the middle of the strike zone. It relies on its slow speed and deceptiveness for its effect. Most batters time the fast ball and key their swing off that. The key to a good change is to throw it just like a fastball but with a grip which reduces its velocity. Like so many things in the market it relies on deception for its efficacy. Otherwise a change-up is just like a slow fastball. It is no better than a batting practice meatball.
Pitch selection depends on the count and the situation. One of the simplest strategies is for the pitcher to start the batter off with fastballs thrown for strikes. The batter has not timed the fast ball yet so the pitcher has the advantage. The goal of the pitcher is to get to two strikes before getting to three balls. At two strikes the pitcher can use his curve ball if he has less than 3 balls. If the pitcher reaches three balls the curve ball is very risky because it is a difficult pitch to control.
Batters know this. In fact good batting coaches will teach that hitters counts are: 1-0, 2-0, 3-0, 2-1, 3-1. In each case the pitcher is behind in the count and will undoubtedly rely on his fastball for control. When a pitcher gets to three balls he will probably tend to go to his fastball to get the control and not walk the batter. Good hitters will anticipate the fastball and wait for a pitch in the middle of the strike zone as long as they don't have two strikes. The saying is that the strike zone shrinks on the hitters counts.
Conversely the strike zone expands with two strikes. The batter must now "guard the plate" and not let the pitcher sneak a corner strike by him. There is no longer any opportunity to wait for the juicy pitch right down the middle. Now the batter's goal is simply to make contact, put the ball in play and see what happens. Given the expanded strike zone this is the optimal time for the pitcher to pull out the curve ball. The batter is most likely to chase a pitch which looks like it might be a strike and later winds up outside of the zone.
The batter's position is analogous to the trader who is full extended and is beginning to suffer losses. He enters a stop loss orders to limit his losses. The market is fully aware of this and gratuitously responds with an excursion through his stop and back again. The market has thrown the hapless trader a curve and he is forced to protect his capital "zone" and strikes out.
Stefan Jovanovich adds
After he retired from baseball, Hank Greenberg explained how he had been able to hit Bob Feller. Rule 1 was 'Never Swing At His Fastball' and rule 2 was 'Wait until Feller has two strikes on you, then stand flatfooted and hit the curve to right field'.
When the reporters asked him what he did when Feller threw a 3rd fastball for a strike, Greenberg said he put his bat back in the rack and prayed that next time he would throw a curve.
When someone asked him why Feller ever threw anything but fastballs, Greenberg replied, "He probably gets bored".
The Wallpaper Ball, by Bo Keely
A significant event in the rise of my left-hand in paddleball took place deep in the Connecticut woods. I spent the summer of 1995 with Vic Niederhoffer, perhaps the best all-around racquet player of the last century. The key to his racquetball, squash, tennis and paddleball games was the wallpaper ball on both the forehand and backhand sides. This shot is a plaster-clinging pass, kill or lob that courses from paddle to front wall and reflects sliding along the side wall. It chews up more opponents' paddles than any other. I knew at Niederhoffer's court if I could nail this shot I would phoenix my paddles career.
Vic's compound had an outdoor 4-wall court with a glass back wall, night lights and no ceiling. I studied his down-line shots for weeks. There was little else to do there except play court sports, and my paddleball practice sessions often extended into the wee hours. Once I practiced the wallpaper ball alone from before sunset till after sunrise. Another time I drilled barefoot so long on the concrete court floor that I didn't notice that the calluses wore off my feet until they leaked blood from the court to the house door.
Night practice sessions were an entomologist's delight as the bright court lights attracted thousands of moths of dozens of species from the dark woods. They fluttered and darted and hundreds settled on the floor and walls. Hence I also practiced footwork around them and accuracy to keep from hitting them. I practiced closed-mouthed to keep from choking.
The wallpaper shot finally became mine. The ball spin, shape, center of gravity and rubber stretch synergized to propel a straight down-line forehand or backhand, staying in its lane and kissing the side to back wall. The shot looks like a moving nose along a clown flat face. It also makes an effective serve.
The secret to the wallpaper shot is a blood trade secret. However, knowing that the shot can be hit is half the battle to owning it. Analysis of the combinations of ball spin, shape, center of gravity and rubber distribution is another 25% of the secret, and practice is the final 25%.
To add to this Department please email us at Specs@Mantrade.com