Sunday, May 16, 2010

All good things must come to an end ... or perhaps a new beginning.




Fractal-based theories of market behavior explain discontinuous movements such as the May Trix Flash Crash.

As opposed to supposing that the bubbles in your portfolio are as random as the bubbles in your soda pop, a fractal approach concedes that bubbles are a certainty.

'Fundamentals' most certainly do matter although the use of the term is not what the conventional wisdom perceives.

Even a cursory examination of modern financial history would seem to consign the squawk of randomwalk to the febrile dustbin of history and yet the arrogance of unlimited self-determinism and the mastery of man above all motivates adherence to the ex-theory.

Like lemmings herded to discontinuous chasm after chasm, markets move in memoriam much to the prevailing wisdom's opprobrium.

For your humble blogger Mandelbrot was an eye-opener, but John Needham was the closer.

Over the last week I have automated a spreadsheet based on a 'fractal' theory where upon entering high, low, open, and close as well as ONE other indicator (proprietary from Needham), buy and sell orders can be triggered in ALL liquid markets, and quite successfully I might add.

Applying what Mr. Needham has taught in 'face-to-face' sessions and postulating as to what he will unveil in his foreshadowed 'next stages', have on this fella's spreadsheet clearly, and empirically, separated the winners from the 'sinners'.

Stunning, brilliant, simple, elegant, and in direct opposition to most every financial model known to man.

Now, gentle reader, you might ask why not publicise it Mr. Money, become rich and famous, dye your eyebrows and hair black, and become a billionaire, or at least write a book?

Well, the humble reply is as follows: 1) the entries in this blog do publicize it and have directed folks to Mr. Needham's website thedanielcode.com, however to truly appreciate his teachings one must attend a tutorial and he is coming to the States this summer ; 2) fame is way, way, overrated and I've already made enough coin for both myself and my children to be comfortable; 3) I've earned my grey hair thank you very much; 4) money is the root of all evil and should be treated with respect much like a weapon and a drug, it is so very hard to make abundance in in this world and not at the end of the day be a complete a&$%ole and 5) all I care about is feeding the kids, and from time to time the extended family, feeding a book would be torture.

And yet this is damn entertaining, and sharing, albeit anonymously, is caring.

The purpose of this blog was in part to figure it 'out', believing' it' to be 'it', with the understanding that it was much easier to make 'it' than to invest 'it'.

Now that I'm firmly ensconced into a future where I'm in 'it' to mint 'it' , the purpose of this blog is called into question.

So...will ponder that. Thoughts for now are that future entries may be limited, if any, and that the future focus will, predominantly, be on the premise that according to fractal theory 'self-similarity occurs on all scales' as well as an exploration of the more subtle concept of self-affinity which refers to a fractal whose pieces are scaled by different amounts in the x- and y-directions.

All good things must come to an end ...or perhaps a new beginning.

There is a difference between knowing the path and walking the path.

To be mindful is a discontinuous process, our senses allow us a glimpse at the perfect form (truth) but that view can often be distorted by the flickering fire of perception that illuminates the shapes we perceive to believe.

Peace.

15 comments:

joe said...

anon M,

Good bye, and good luck. Thanks for your advice. Your method and Steve Keen's cash until stocks are dirt cheap sound the most reasonable to me.

Jed said...

Well this was one of the few blogs I enjoyed reading.

Good luck & God bless

I-Man said...

Speaking of fractals... throw up a 1min SPX chart of May 6th overlayed on a SPX weekly chart going back to Sept 2007...

Waterfall...

Channeling Hendrix, May This Be Love...

I-Man said...

And brother, stay in touch.

You know where to find I and I.

Even if you're gone for good, or just fasting, I-Man will forever bookmark your works.

One Love,
I-Man

I-Man said...

How does one find the courage to actually walk the path?

What is fear?

I-Man said...

AM,

Got a prop for you, breddah...

I-Man is interested in your new spreadsheet, and although I dont want it, I would be interested in seeing how I-nalysis matches up with it.

If interested- send me a ticker, I'll do some charts on it, and I'll give you in return the pivots and timelines that appear to me.

I bet you they corellate pretty nicely.

Its the same symmetry, just you're getting it with numbers, and I'm getting it from the visual... I suspect.

Anyway, fascinated by Needham's work, but just not at the point where I'm ready to really attack it, from a learning standpoint of course.

Thus, this would be a fun exercise for me.

Someday, I'll let you know how spooky your last paragraph is insofar as how it relates to where I am right now in my own path.

Your words, helped me realize, that I need to just take a step.

Hit me up at dreadcapitalATgmail if you're interested about the prop.

If not, all good, no sweat, and see you in another life, breddah.

Mark McHugh said...

Um...yeah.

Far be it from me to spoil your "Yoda" moment, but I thought you might get a kick out of this graphic. I made it with you in mind.

http://acrossthestreetnet.files.wordpress.com/2010/05/i-cant-believe-its-not-capitalism.png

William said...

Hi AM,
Hope your new endeavors are going well. Looking forward to hearing from you if you decide to continue posting, or if you decide mentoring is for you!

Cheers,
MP

I-Man said...

Miss the AM...

Anonymous said...

I just found your blog and you are a person of wisdom...I'll continue reading if you will continue. Pass on your good thoughts...and more will come. Thank you for sharing what you have learned...and in so doing...you do care. Thank you.

Anonymous said...

AM,

After re-reading several of your posts, the light bulb came on (dimly). Been doing some reading and thinking. While I agree that knowledge needs to be earned, I looking for a blaze along the trail. Am I on the right path with this?

http://people.physics.anu.edu.au/~tdm110/Articoli_web/My%20articles/2007/QuantitativeFinance.pdf

In the case that 1) you still check this blog, 2) you feel like responding and 3) you don't wish to respond publicly, I can be reached at orlando_lassus@comcast.net

Response or not, just want to say that I miss your posts. You were one of the more interesting observers out there. Best of luck to you.

David

Dave Narby said...

Hey AM...

Where you been?

Update us on your thoughts, we miss you!

Dave Narby said...

AM, come back... Come baaaaaack...! ; D

I-Man said...

Something nice and comforting about that "0" for the comments... hope it stays there.

http://www.tradingfives.com/store/so9book.html

I-Man getting closer my brother.

Hope you are well, and miss your prose.

1Love,
I-Man

I-Man said...

Sepharial...

is interesting...