Many subjects of interest seem to intrigue Phantom on trading but seldom is there time in a persons
life or career when the time to smile and have nothing but fun exists. As a child we all experienced
the great fun of a Sunday afternoon filled with surprises and anticipation of newly found fun things.
As an adult we often miss the point of a balanced life in most respects and none more than to take
the time to be happy regardless of the current situation.
It seems fitting that Sunday could be one of those days for traders. With electronic trading now and
world markets, it is more difficult to have the old days of limited hours of trading through the week
and have weekends free. Still Phantom wanted to give a smile upon the serious adventures of
Today we start with a blank sheet of paper on the so-called cheat sheet in order to convey the
thoughts of fun in trading as well as respect the seriousness of the business required. We never
know the road and the turn this project is taking until we come upon it. Fitting since this is written
as Phantom’s view as a trader’s insight into reality of trading. Nothing more than his presentation
into your thoughts in order to generate your own ideas as to what the possibilities are.
Sometimes a question of how to approach any situation can usually be reduced to a series of
qualifications of one of two states before going into the next priority of thought. Phantom indicated
that as we grow older it seems to be natural to oppose change of any kind. Since change is the one
thing we can count on we must learn to use it to our favor even more so as we grow older or we fail
to grow at all. This is true in trading and is usually magnified as change takes place.
Phantom’s explanation of how the opposition to change is directed was explained as a percentage of
the whole. He indicated that as a child of maybe 6 or 7, we would judge change based on our new
adventures of discovery. Over the next year as a child we would grow much more than the
additional year of 12.5% from age of 7 to age of 8. Mainly that in that additional year of growth as a
child, we would find change an adventure of new found knowledge and not put restrictions on
As we grow older say from 49 to 50 we have increased our new found life knowledge by a smaller
percentage of say less than 2%. Our new knowledge is now not new frontiers of adventure but more
of an uncomfortable reality of unfamiliar situations. Since 98% of our known knowledge is more
comfortable than the 2% of new knowledge we tend to oppose any change created by the new
knowledge for we strive for the simple comfortable life, as we grow older. We tend to feel that our
effectiveness of making changes ourselves is reduced, as we grow older because the percentage of
the whole of new knowledge is smaller and smaller each year.
Phantom feels when we reach the point of not caring about change anymore, we have severely
defeated our most powerful thought process of creativity. Creativity can enhance our ability to
accomplish great things and make great trades.
One point Phantom felt about the question of change was that it is important to expand the
creativity process best by doing the fun or new thing, which gives us a sense of adventure in our
lives. To be young again is not a lost thought if we could decide to be young today in our thoughts
and our motivation toward being creative again. But how do we proceed with our creativeness to
overcome opposition to change? Phantom is no expert on such a subject and so he feels as long as
we could put a fun smile on the readers face, that it would serve to put on notice anyone who failed
to come up with their own excellent ideas or their own answer.
ALS – Phantom, I know that “A wink is as good as a nod to a blind horse” is one of your favorite
sayings. Why is that so great a statement to you?
Phantom of the Pits – My Grandpa was one of the last people to have horses for working the fields
that I knew. It really wasn’t that long ago but to younger people it seems like long ago. When I was
a small child my Grandpa would take his workhorses to the field to plow the fields. I would get to
sit on the big workhorses, as they were very gentle. Being gentle horses had drawbacks, as they
were at times also very stubborn. When Grandpa couldn’t get them to do what was required, he
would say, “A wink is as good as a nod to a blind horse.” Well that stuck with me whenever I knew
I was correct on something and couldn’t convince anyone of it.
Trading is full of situations where that phrase is fitting. There are traders who are as stubborn as the
horses my Grandpa had for working his fields. Still we loved those horses until they died. We never
gave up on them and they proved to be great memories of wonderful efforts of a great team of my
Grandpa and the horses.
Today if I take interest in any particular trader’s view and I see that view as very narrow or perhaps
close to an opinion set in cement, I will use the phrase. It is meant only to provoke thought as to all
possibilities rather than leaving a narrow and fixed opinion. There are often times, which it is
obvious to me that the particular trader is wrong in their fixed and narrow view. I am not making
judgement that the view is wrong but that it is too narrowly based or insufficiently thought out. I
will use that phrase to provoke the important re-thinking process in order to search out new
ALS – You must be careful with the statement because there are traders who will immediately think
they are wrong and go the other way.
POP – Yes, that is mistake newer traders will make. The broker will in order to verify an order will
say “are you sure you want to place this stop?” The trader will doubt his plan at that point and say
“no, let’s hold off on that.”
I don’t mean to be responsible for changing a trader’s mind but only to change their horizon of
knowledge and thoughts. I especially will see it an important statement when a dramatic change is
starting to flag our indicators. A common thinking is what if I miss the move? So what? Is there no
Ok you put the position on anyway and you are wrong! So what? You expect to be wrong if you are
thinking and trading correctly. It is a big problem only if you don’t properly protect your trade as
required. My statement is to prepare a trader for looking and being prepared to act on any
possibility rather than being convinced beyond doubt.
ALS – You said we would talk and explore fun things, which provoke creativity. Let’s just start with
being a child again and playing games on Sunday.
POP – Ok you have given me good thoughts when you said to start being a child again. I can
remember when just our family on Sunday would play a game called “PITS.” I don’t think many
folks knew of it that many years ago but I just recently saw a deck published in the 20’s recently and
that brought back memories of a game which has been around for a long time. It was a game based
on trading. Now that I think of it, I can take my introduction to trading back even further.
It isn’t my intention to sell the game but I know there will be a run on it now. Perhaps we should
talk “Futures” into licensing their own version for marketing as a courtesy to their readers. The
game was an exciting game and still is today. We would get as many as four decks together and
have 32 people at a time yelling and screaming. What fun that was to everyone from six-year-olds
to eighty-year-olds. By expanding the players to four decks, we were being creative. To be creative,
it is easy to improve upon anything, which inspires your interest. That is what we all need to do in
order to grow, as we grow older.
ALS – Why was the game so much fun?
POP – The game was rather simple and though not well publicized became an adventure of newly
found fun for anyone who discovered the game. It was a deck of cards with different commodities
on the face of the cards. I remember that there were commodities such as hay, rye, wheat, corn,
barley, oats, and I believe two others. I will leave the two others out in order to let the readers fill in
the blanks as we get them to being a child again.
Each commodity had I believe eight cards. There was a bell like the one you would see on the
counters at motels, which you could ring by hitting the top of the bell.
The idea was to deal eight cards to each player and the one player who had all eight of the same
commodity would ring the bell and say they had won. At that point the game was over. Each player
who had never played the game before would be shy and say this seems a bit far-fetched. As the
game progressed by the rules the shy player would start screaming the loudest. Each player could
exchange any number of their cards with any other player up to three at a time.
If you had five wheat cards and were trying for all eight wheat cards, you could get rid of what the
other cards were in the numbers of which you had the other commodity cards. For example if you
had two corn cards, you would yell two. Anyone who had two to trade would trade with you. You
wanted to trade all of your cards away except the ones you were trying to get eight of the same kind.
You wouldn’t think much of this game without seeing the action it created. All the players would
start screaming at once as they got into the game. I remember we had a visitor come by one day we
were playing and they thought there could be a war going on when we were playing. “PITS” is the
closest game to true trading emotion and adventure to this day. I haven’t played it for decades but
still remember the fun it gave us all.
If I were a magazine or broker, I would put my advertisement on the cards and give that game to all
of their clients at a discounted price. It’s a fun game anyone can play within minutes of hearing the
rules and it takes less than fifteen minutes for each game. We found that it was the best way to bring
strangers into a conversation at a new meeting or reunion.
ALS – You’re going to start a run here! I am sure there are lots of people who remember the game
and would like to get a game or two.
POP – Ok I know that we have the readers thinking and being creative now. They can improve the
game and the cards, as an example of showing them the nature of how being creative will overcome
opposition to change.
ALS – Why don’t you put your picture on the cards and call them the Phantom of the Pits game?
POP – Why didn’t I think of that? You see you are very creative too! Sure we could do that and give
the game to each person who bought a book. In fact I know you have two artists working on the
I realize we are getting a little away from what the traders want to read. Do you think they will
forgive us and understand the importance of the Sunday fun point we are trying to make?
ALS – To use your phrase “So what?” I know that you are going to cover it all eventually and
interactively with the traders. How can we deny you the smile on your face as you think back as a
child would and enjoy the pleasures of being creative. I know the readers and traders whom you
have so much faith in are enjoying this as much as you.
POP – Yes, it is important to me. There are few things in a child’s life, which allow a child to play as
an adult while allowing an adult to play as a child. I don’t regret bringing up the game I remember
best as a child. “PITS” is a game, which will sharpen your awareness of your surroundings and
interaction with other people without requiring much of a task on your part. Do you remember the
ALS – Yes, and a few others too more recently. I remember playing drop the clothespin in the milk
bottle with a 101-year-old lady. Now how much younger thinking can you get. If a 101-year-old can
go back and enjoy the childhood memories than why wouldn’t a trader be able to understand this
Phantom, it looks like you’re on a roll here. I remember a well-known writer saying that he felt that
the books with less in them were sometimes better books. We certainly are giving less in this part
POP – I know whom you are talking about. I don’t know whether he would want credit for that
statement or not. I think I know what his point was. It was to express that it was important not to
overwhelm readers with too much data, which could do more harm than good.
ALS – I think so too. Could that be the true Phantom of the Pits who said that?
POP – You’re not going to get me to admit or narrow the field but why don’t you ask yourself that
question. I guess we can narrow the field can’t we? That is pretty clever on your part. By knowing
who POP isn’t I guess you do narrow the field some. But why is it important anyway?
ALS – Ok I’ll drop it. I was just trying to think from the reader’s point of view in asking. I am just
being creative. Can you be more creative in front of a warm open fire on a cool fall day or cold
POP – Relaxed maybe but I think serenity sets in with comfort. That too is important in a traders
balanced life. I really see trading as driving a car around the Indy 500 track at 200+ and having to
always be alert at every turn. That is why it is so important to wink at a blind horse sometimes. You
don’t need to operate at 100+ percent all the time for you lose some sharpness that way. Come down
and go a different direction on thoughts. We are kind of doing that now.
One of the ways a trader can be creative is to just pick up the newspaper on a Sunday and ask about
a story they read as to how it could be expanded for more information. I like to do this, as very few
times we happen to see the follow up story of something which, is a question we want the ending
It is easier to research further today with the news updates on the Internet news posts. Often times
we read news on different trading stories and we must keep in mind that the view is not ours but the
I don’t want our discussion to be taken as my views but my effort to provoke trader’s views and
ALS – Yeah, and I know your draft chapters are just a beginning in getting feedback to complete the
process of interactive feedback in order to continue and complete each chapter. You have presented
ideas, which have generated ideas, and questions of which you want to respond for the benefit of
POP – It’s part of the reason I wanted a light part in our discussion here before we get into trying to
narrow down the needed answers to questions, which will, and those that have been presented. We
have many subjects yet to draft before we turn the car around.
ALS – I remember reading an article about motivational speakers recently. Do you see your insights
as doing that?
POP – Not at all! Who would want to replace their own intuition of what they see as success with
someone else’s? It is important to have your own thoughts and ideas. You can’t be someone else so
why would you want to be totally guided by someone else’s idea on what is best for you?
Motivation speakers have a place and it is important to be motivated but most that follow forget one
of the most important truths. You are the one who motivates yourself. It must be you. As in trading,
it is you who must make the trades not someone telling you make a trade.
I see my insights as a guide to knowledge which, the trader may not have had otherwise. This
always leaves open the interpretation of their own ideas and thoughts. In fact that is what makes
markets. In trading we make assumptions based on known knowledge and we use theory to prove or
disprove our expectations being correct. I am trying to take away the feeling that a trader usually
has the advantage when they do not. I am trying to take away the feeling that there is no way to
succeed in an unfavorable game.
My insights are not anyone’s ideas but experience in my trading career. When I was in Junior High
School I along with the class was asked to select one of two stories to write. The first one was
“Clothes don’t make the man” and the second one was “Clothes makes the man.” I chose Clothes
makes the man. It was the worst grade I ever got.
The teacher was biased toward clothes don’t make the man. Well I chose the one I felt would be the
hardest to prove with theory and assumption. I had good arguments and I think to this day that I did
the best piece of writing in that class. The teacher had her mind made up as to anyone who chose
what I chose would be wrong. “A wink is as good as a nod to a blind horse” was what I thought of
the teacher’s grade.
I have proven that I was right in my lifetime and I think that story is part of my success. You see a
person must believe something and then proceed to either prove or disprove their theory. My theory
proved out over the years. My theory of clothes makes the man built my character and my
determination that I would someday be able to prove in fact that it was beyond theory and
assumptions true in my case. Now that does not mean it would be true in all of the class mates cases.
This is what the teacher missed.
ALS – How did you prove you were right by fact?
POP – My assumption was that how a person feels affects their actions and reactions to situations in
their lives. My main point was that someone who had good clothes and was dressed well would
have a different feeling about themselves than someone who would be wearing lets say just shorts
in important situations. The key was important situations. Can you imagine being at a funeral in just
shorts? How would you feel? Wouldn’t your actions and reactions be more agreeable with your
feelings if you were dressed in good clothes? Of course you would.
My fact proof came as a parallel to that article. I considered the well-dressed person and the well
knowledgeable trader as a parallel in points of feelings. In the pits trading with good knowledge
(well dressed) I felt more confident in trading. When well dressed in correct situations such as
meetings and important events, I felt better confidence and my effectiveness was much higher. True
I am the same man regardless of how I am dressed but I am not the same person if I have not
prepared my knowledge before I trade.
For the traders, I want to impress in their minds the same parallel. If you trade with lack of proper
knowledge and behavior modification in situations, which the market will present you with, you are
only wearing shorts at a funeral. How does that make you feel? It certainly won’t say to you, clothes
don’t make the man! It will strike you to know that being prepared properly is the same as having
the proper clothes for any situation.
ALS – Ok, did you ever want to get back at that teacher?
POP – I don’t think I was smart enough to know what getting back at someone even meant as a child.
I had lots of stars in my eyes. I still do for that matter. It is a waste and non-productive of time to
have anger or greed or regret or fear.
ALS – How about hope?
POP – Hope and love have a place in my life. Hope must be tied to action and plans. Love is my
reflection of what I have given or am willing to give.
” There are few things in a child’s life, which allow a child to play as an adult while allowing an
adult to play as a child. “—POP