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I’ve said before that The Market can be the greatest sensei you’ll meet in your lifetime, if you’re open to learning about yourself. Most of the time, most of us aren’t. We’re too busy trying to force our will onto the Universe, wondering why it doesn’t act the way it should, and resolving therefore that we must “force it harder.”

In a post last year, I suggested that you explore the reasons which underlie your passion for trading… the deep reasons- not just “I want to make money,” but “Why do I want to make money?” and “What situation will that money get me out of?” and, in moments of total personal honesty, “What choices did I make which resulted in my being in this situation which I wish to be out of?”

Continuing that thread of questioning can lead us to some very uncomfortable places, because we often discover that our trading passion is more of a trading desperation, that we are unhappy with our current position and our place, and that we mostly trade from the dream of money that will ostensibly get us out of that place.

This realization is one of the greatest opportunities in life, because if we’re ready to admit it, our current position and place are largely constructed of the consequences of our own earlier decisions, and not of the unfortunate circumstances which we curse as having been thrown upon us randomly by Fate. And it is in realizing that our own decisions are the source of our current situation (consequences) that we begin to gain the power to choose different consequences for our future, rather than continuing to powerlessly live and re-live the same drama, only changing perhaps the actors or settings as we go.

This is not to say that at some earlier point we consciously sabotaged our own future. In fact, we don’t consciously do much at all. Remember driving to work last Monday? Me either. What was for supper that day? Me either. Do you remember what it was about that phone conversation or online forum or Personal Pity Party that was so important it caused you to ignore your kids for hours as they vegged in front of the Boob Tube or text-messaged their thumbs off or chatted with a new stranger on MySpace? Are those the values you would consciously choose for your children, or for yourself?

The Ego: Pay No Attention to the Man Behind the Curtain

The decisions we (routinely, unconsciously) make as adults are controlled for the most part by our Ego, and I hate to use that word because of its negative connotation in current popular culture. The Ego I’m talking about is the core set of complexes and defense mechanisms set up in childhood, in what feels to the child as being necessary to survival, and sometimes actually is. For instance, one of the defense mechanisms my sister and I learned as children was the ability to become invisible, to not call attention to ourselves. It spared us many beatings, though many times we still couldn’t be “invisible” enough. And we didn’t have the option of leaving the situation. We were limited to the choices of 1) Kill What Threatens You or 2) Become Invisible, and Hope It Passes Over. And in the event it didn’t pass over, we learned to automatically switch into the trance of Don’t Show the Pain Or It Gets Worse.

Now, as an adult past the midpoint of my life, my inner, emotional response to any situation which feels the least bit threatening is still the urge to either Attack and Destroy or to Withdraw, with very little space in between. They are both survival mechanisms, and both are severely misplaced when what feels threatening is usually someone else doing or saying something out of their Own Personal Oblivion, with no intention to directly threaten me (and besides, I’m a big ‘ole boy now).

This Ego, which was constructed during childhood in order to protect the child, continues to stand behind the curtain through adulthood, pulling the levers of our decision-making, usually without our knowledge, and with a very unfortunate result: in seeking to protect the child from a threat which doesn’t actually exist, the Ego causes us to re-live the trauma of that child over and over as adults, isolating us and severely limiting the options which should be legitimately open to us. We end up in dead-end jobs, dead-end marriages, abusive relationships, financial chaos and various addictions, seemingly ever abused or neglected by the World the same way we were abused or neglected by our parents. The tragedy is that one can live an entire lifetime without realizing the role we play as adults in calling all of this unto ourselves.

The protective Ego is not bad, is not evil. It is The Guardian taking charge and making the best decisions it can, given the information at hand and considering the fact that it always sees you as being in peril, and that the primary task is one of survival. It’s no wonder, then, that we go through life making what later turn out to be absurd, impulsive and often self-defeating choices… choices which limit our ability to find the happiness we claim to be seeking.

With the benefit of hindsight, we’re able to look back and see many of the poor decisions we’ve made in the past. However, that hindsight never seems powerful enough to change our reaction the next time we face a decision. Hearing ourselves say things akin to “I’ve learned my lesson” or “things are different now” is usually the surest sign that we have not learned anything, as the Ego’s best trick of all is the trick of self-deception.

That last failed trade taught us. That last bad relationship taught us. That last time we fell off the wagon taught us. No they didn’t! It is only in recognizing our pattern of poor choices and delusion, and our powerlessness to consciously make oursleves different, that the opportunity for true change begins. And no one is more proficient at revealing to us our ability to continue making those poor decisions over and over and OVER than our good friends Mr. Dow and Mr. Jones.

The Market: Gentle Guide, Merciless Disciplinarian

Another statement I’ve made in the past is that the market is always there, waiting patiently to reflect our own weaknesses back to us with stark honesty, and often in our own blood. The terrible thing, and the wonderful thing, about the market is that it is completely dispassionate. If you’re impulsive, the market destroys you with your own impulsiveness. If you’re timid, the market continually reflects to you the cost of your hesitance in the form of endless missed opportunities.

How many people got big heads and declared themselves to be Brilliant Investors in the 1990s? In its own way, and in its own time, the market separated the truly brilliant ones (maybe one in a hundred) from all the ones who were simply spectators on a ship being borne by the rising tide of irrational exuberance, and it separated them using their own weaknesses.

How many people lost it all in ‘29 or ‘87 or ‘01 and gave up, retreating into the protection and familiarity of simply sitting in the corner and sniping at “the lucky ones”? How many resolved that what worked before must work again, and they just need to do the same thing, but “do it harder”? How many of them (us) are deluding themselves, and simply repeating previous patterns in more creatively-disguised (from consciousness) ways, and doomed to the same eventual outcome?

What if instead we began to observe our own patterns as the market reflects them back to us, covered in our own sweat and tears? What if we asked, “What is is it about me that allows or causes me to continue to make the same mistakes, even though each time I’m convinced I’ve learned better?”

Precisely because of its objectiveness and dispassion, The Market makes this type of introspection easier than almost any other facet of our lives. The glaring opposite would be the example of interpersonal relationships, where (afterwards) we can always recite what was wrong with “the other” and how it was all their fault. We seem to be able to do this without hearing the echo of our own voice praising them earlier, or defending them to friends who weren’t lost in the fog of romance as we were. We must insist that “they changed”, as otherwise we’d have to consider the possibility that it may say something about us. And after all, we have all those magazines and TV shows and pop songs to reinforce our Ego’s position.

The Market leaves us no one else to blame. Sure, we all complain about the “Big Guys” and the Market Makers skinning us up one side and down the other with their bid/ask manipulations, but we really know where the buck stops. We know its our own poor decision-making and self-discipline that drains our accounts. And with nowhere else to turn, that’s a terrible blow to the Ego, which is to say, a true opportunity for personal growth.

The Market as Guru?

Not really. More like The Market as a very clear mirror. It’s no secret, but so terribly hard to accept, that the Guru who knows us best is on the inside, sometimes locked in a sensory-deprivation chamber “for his own good” by Big Brother Ego.

Perhaps we can venture out a little, take a little power back from that well-intentioned but fatally-flawed Man Behind the Curtain. For me, for example, there lies a great gulf of possibilities between “Attack and Destroy” and “Withdraw” when it comes to unfamiliar, scary or even threatening situations… possibilites of true engagement and interaction which I never knew existed before The Man was suddenly and unceremoniously exposed after my divorce in 2000, and possibilities which have been responsible for much of the (blessed) joy and the (blessed) suffering I’ve experienced since. I stand to gain so much from exploring those possibilities, and the infinite number of others I was unable to see because admitting that I play a role in creating my problems feels like the Reaper is standing at the foot of the bed, and summons my own Guardian to jump in and start making the (flawed) survival-based decisions it always has.

So trade for the action. Trade to get rich. Trade because you’re addicted to adrenaline. Trade because you’re determined to file bankruptcy faster than the other guys. Trade for whatever reason you choose. But if, at some point, you feel the ground move beneath you and hear the sounds of your carefully-built facade beginning to crumble, take the opportunity to look back over your trading journals, your rules, your notes… and see what they really tell you about yourself.

Cheers, and best of luck. I’ll end with a wonderful quote I read just last night:

We see patterns unfold in the course of our lives, patterns which reflect individual history. As long as we remain unconscious of these inner sources, we project them onto the outer world. We may blame our parents, or the game stacked against us. In time, we begin to recognize that the enemy, so to speak, and therefore the deliverer as well, is within. We recognize that the energies we have projected onto the world derive from the inner scenarios, that we are the makers of our world… This means that what is wrong in my life is in me; what is repetitively wounding is in me; what is healing in my life is in me. As obvious as this may sound, in daily life such a recognition is as profound as it is difficult to achieve.

The clues are everywhere. Under our feet. In our relationship patterns. In the perceptions of those who know us best. Everywhere, and we do not see them until we are forced to. Think of Oedipus as the prototype. The omens announced, the prophecies declared, and he walks right into each blind alley. Then, blinded by all he has seen, he is humbled and comes at last to know himself fully. Though in exile and ruin, the gods bless him for this humble homecoming.

The world in which we live is filled with ubiquitous messages. Can we begin to read that world truly? Can we bear the blessing of the gods which comes from being responsible for our lives, the humbling which occurs in our seeing ourselves in the mirror, the liberating insights which bind us to ever deeper acknowledgements of accountability?

John Hollis- “Creating a Life”