AP trying to do the math

The AP assigns 11 staff writers to immediately fact check Palin’s book.

They apparently haven’t yet read Obama’s book, which precludes them from asking him why he won’t admit that it was written by Bill Ayers

Ask a Pakistani why Afghanistan matters

If you want to know, ask somebody: (ht: smallwarsjournal)

Afghanistan: Seven Fundamental Questions by Major Mehar Omar Khan

I know we live in a world that is real and is moved by minds – thinking, manipulating, conniving, conspiring, calculating and masquerading minds. Our world therefore seldom has a place for ‘sentiments’ – pure, sincere, honest and spontaneous as sentiments are. But when it comes to war in Afghanistan, I am not deterred by the tyranny of the trend. I like, in fact I am forced, to think through my heart. What else can you do when you see images of your countrymen; innocent and unsuspecting men, women and children; ripped apart by other human beings exploding in their midst almost on a daily basis? How can I not worry about my daughter when I see a pale and empty face of a mother in Kabul or Peshawar, bent like a broken branch of an old, dried up tree; over the dead body of her child? How can I not cry when the soul of my nation is hit and hurt by violence that is so inextricably linked with bloodshed beyond the snaky Khyber Pass? For us in Pakistan, the ongoing struggle in Afghanistan and astride Durand Line is the most seminal endeavor of our history. If this war is won, the entire world stands to benefit. But if it is lost, one country that will be hurt the most is Pakistan – my daughter’s home and her future. War astride the Durand Line is therefore so personal to so many of us.

This war is also extremely personal for thousands of American mothers who await and pray for the safe return of their sons and daughters: bright young men and women who deserve to live and who must never be wasted just because someone considers it politically expedient to continue to muddle along and because setting the course right needs some statesmanship and may also involve some political cost.

Major Mehar Omar Khan, Pakistan Army, is currently a student at the US Army Command and General Staff College at Ft. Leavenworth, Kansas. He has served as a peacekeeper in Sierra Leone, a Brigade GSO-III, an instructor at the Pakistan Military Academy in Kakul, and as Chief of Staff (Brigade Major) of an infantry brigade. He has also completed the Command and Staff Course at Pakistan’s Command and Staff College in Quetta.

A reflection on action research “storytelling”

What follows is a 1st person, stream of consciousness  reflection written to my mentor & committee chair.  

I describe  what it was like to record a 10 min video “telling the story” of  some preliminary findings emerging from my action research cycles into curriculum and adult learning. 

The video is hosted  at YouTube.

It will be shown at an international conference in Athens, as part of the Collaborative Action Research Network (CARN) annual conference, as part of a bundle of reports from the Future(s) of Education project, an international  participatory action research network.  

Dr Alana:  

i am just glad to get it out of my head  

i had a real out of body experience recording that one;  

i  am a very effective briefer in person, because i can read the audience pretty well.  

i have recorded hundreds of mini lectures etc for my business and for use here at the college on various topics.

i have never, ever needed more than a single take to record, decent and sometimes even inspired voice-overs  until  last night and that briefing.  

I literally needed about 30 takes to get thru it; most i stopped when less than a minute into it because the tone just didn’t feel right

 i think it has to do with being a fish out of water, and the difficulty i felt in trying to tune my story for an audience i couldn’t see, but more importantly didn’t have empathy for

because the audience characteristics still feel fuzzy to me, i couldn’t call up the right tone, voice, persona to apply  

 this caused me to have almost a split personality in the moment, when i am ordinarily dialed in

 i had a “talking part” and a “look ahead part” that is concerned with shaping the transition to the next point/slide  

but now i had a disconcerting 3rd part that was trying to anticipate the possible reactions of an unfamiliar, and hard to imagine audience  

this is what made me feel so out of sorts

 until i “wore out” the last, 3d part and was able to trust in just telling the story, and accepting the vulnerability of knowing that i couldn’t know the audience, i found i just couldn’t get thru it.  

this is the same phenomenon I spoke with Prof Mike Wesch, the digital anthropologist at Kansas State University, and world thought leader on social dynamics in social media: the camera eye represents the unlimited, unfathomable infinite future of all possible audiences across time and space who can be looking in on the “telling moment”.  

in a sense, its like coming face to face with the unblinking eye of God and wondering what she is thinking  

 it is trust that lets us get thru that moment, the accepting of vulnerability, that creates the empathy that hopefully fills the story, as told, with hope.  

that’s a clumsy way of trying to express my meaning of the risk and vulnerability to “telling” and why it can be such a powerful learning moment, and why we need to model it, embrace it, encourage it, and support it. 

Your “producer’s draft” was exactly what i needed to be able to get out of my own comfortable fishbowl; 

you gave me a bridge to the audience that i could not create on my own.  

this has become an interesting reflection to me already  

please put the video on the website, and any or all of this reflection as you deem suitable  

have a great time at the conference!

Management games for deep insight

Peter Checkland’s Soft Systems Methodology (SSM) describes the use of models to help us frame questions to ask of the world, and which help us become explicit about our world views, assumptions, frames of reference, theories of cause and effect, values, and desired outcomes.

Checkland, P. (2006) Learning for action: A short definitive account of soft systems methodology and its use for practitioners, teachers and students.  Chichester, England, Oxford Press

 We’ve developed a deceptively simple Force Mgt practical exercise in the form of a card game. The complete rule set is simple; takes 5 min to scan and understand. 

Rapid rule summary:

1. Students buy forces (5 cards) from a production table (a limited deck) and in each of 5 rounds,  deploy them into 5 regions to compete for Victory Points

2. Win:  first one to 51 victory points OR most points after 5 rounds

3. Game: lasts up to 5 rounds

4. Each round has 5 hands , each hand is worth Victory Points (VP)

5. Hand 1 is worth 6 VP, hand 2 is worth 5 VP etc…

6. Player 1 buys from the red deck, player 2 from the blue deck)

7. After you buy your 5 cards, you place 1 card face down in each region (hand)

8. Once all cards are placed,  cards are flipped over and you determine results

9. If your card wins the hand you get the victory points and keep you card; if you lose the hand, you get no victory points and lose your card. If it’s a tie, you keep your card and no one gets points.

10. Each player has an identical deck to buy from.

 It turns out that the development of strategy and then fielding an appropriate force really matters, AND there are distinct choices that are meaningful, available and feasible.

If you are interested, we’d like you to review the rules, and :

• 1. Buy your first round of forces
• 2. Deploy them into the 5 regions for turn 1.
• 3. Send your “Round 1” move to long-kenneth@conus.army.mil, along with a short description of your strategy

 We are interested in examining the variety of forces and the strategy employed in round 1.  Do you, for example:

1. Buy 4 ea 10s and a Joker to kill any enemy aces and retain max budget  flexibility to see what he has remaining?

2. Buy aces early to get a lead on victory points and then protect them?

3. Buy Jacks to kill 10s while still preserving SOME budgetary flexibility?

4. How do you balance economy of force with winning victory points? (efficiency vs effectiveness)

5. Variations?

 And then tactically employing forces, do you:

1. Put aces against 6 and 5 victory point regions?

2. Put 10s against 6 and 5s to hunt aces?

3. Aim for maximum victory points each round?

4. Aim to capture 11 of the 20 available points each round? (ie bluff on 6 and 3, but try to win 5,4,2?)

 In the actual play of the game we’ll look for adaptability and learning, and how strategies change after teams have played each other a couple times etc. 

We’ve play tested it enough to know there is a rich source of insights available in the game and that it is simple to play. We’ll  play it with decks of cards in the classroom 

We prototyped the game in our Force Management elective and are satisfied that that we generate student interest and insight into broader questions of Army force management in an interesting way.

 Here are some student insights gleaned from our playtesting:

1.  Round 1 results dominate the rest of your strategic choices, so getting Round 1 is crucial.

2.  Round 1 strategies are dominated by uncertainty because you have no information about your opponent’s strategy or adaptive style yet.

3. You have to decide when you want to buy strength: early and aim for quick wins, or later after you have seen pieces of the opponents forces and strategy.

4. Forecasting your opponents moves is problematic and make this more like poker than chess or bridge.

5. Aces are like the FCS: dominating until low-cost alternatives found the weakness. It wasn’t unit Aces were developed that the 10s became meaningful, so be alert to deep flaws in complex technologies.

6. Kings are costly but dominate the field; An opponent with Kings drives you to buy Aces but make you vulnerable to 10s.

6. Jacks (J) are a low cost success strategy against 10s, but can be incrementally be defeated by other mid-weight forces.

8. The costs of transforming cards between rounds is significant but manageable and may lead to strategic advantage. Scenario: You buy Aces on the first round and are successful, opponent buys 10s to kill your aces in the second round, but you trade down to Kings which dominate, and which remain difficult to defeat in subsequent rounds.

9. Deciding where (in what regions) to selectively deploy strength

10. Tactical results can overcome strategic insights and strategic failures. Tacrtics can be game changing.

11. What if the enemy has different victory conditions? Price points? Has different rules?

12. What if new cards are introduced after the first rule set is established?

13. How much would you pay to see the opponents’ hands?

14. What if there are partial wins? Or more than 2 teams playing?

15. Simple games can be powerful learning strategies

 Conclusions: the game serves as a way to dramatize very clearly many of our force management challenges and is a useful way to create rapid, deep awareness of prime issues in this domain.

 Here are some insights from a dedicated gamer and management game modeler:

I suspect that for most people’s first play they are strongly influenced by a form of Confirmation Bias: the As are priced higher, therefore new players conduct their analysis from the assumption that As are more valuable. Depending on the goals of your concrete experience, that may be the best argument for keeping the current price structure. However, an ace of spades loses to seven cards, including four cheap ones, where a KH loses to only four cards that are both expensive and vulnerable — the KH is easily the strongest card in the deck.

I assume trade-ins are secret — in fact that for all practical purposes players are operating behind a screen during their setup phase — because knowing whether your opponent has made any trade-ins is very valuable information. You may want to specify that in the rules.

 Given the prevalence of 10s in everyone’s first turn strategies, it seems like the second-cheapest strategy is far more optimal than the cheapest — that is four tens and a jack of spades. That marginal $15 gives you a pretty good shot at a victory somewhere, and a decent chance of carrying more net capital forward.

 Here are a selection of previously submitted moves for  Round 1: (* = Joker)

Strategy 1
Region	Cards	Strategy:                  Cost:  102   Carry forward: 48
6	10h	I’m trying to kill aces while creating and deploying one, but putting it where it is unlikely to run into an ace-killer unless the other guys is trying an ace-killer strategy like mine.  I’ve got cheap on the ace I bought, which is a risk that may not be worthwhile. I’m expecting to kill an ace in either 6 or 5, win 4 outright, and lose in 3 and 2.  Expected results are thus 9.5 points to me, 10.5 points to the bad guys, I will lose approx $35 worth of cards and kill approx $70 worth.  The enemy is expected to have spent rather more than me, so I will have more cash with which to restructure in light of what I find out. Cost: 102
5	10c
4	As
3	10d
2	10s
Strategy 2
Region	Cards	Strategy:                   Cost:  150   Carry forward: 0
6	10s	10 is the ace killer on 6, then we try to overpower each successive category on the way down.  Assumes aces go to 6, which rapidly becomes a tail-chasing assumption.
5	As
4	Ks
3	Qs
2	Js
Strategy 3
Region	Cards	Strategy:                   Cost:  123   Carry forward: 27
6	Jh	Hunting the ace-killers, retaining some flexibility, winning early points
5	10h
4	Ah
3	Jc
2	*
Strategy  4
Region	Cards	Strategy:                   Cost:  150   Carry forward: 0
6	Ah	Maximum strength in every region
5	Ac
4	Qs
3	*
2	*
Strategy  5
Region	Cards	Strategy:                   Cost:  145   Carry forward: 5
6	Ah	Maximum strength in main regions, try to hunt an ace and kill 10s; accept risk in small region
5	Ac
4	10s
3	Js
2	*
Strategy  6
Region	Cards	Strategy:                   Cost:  149   Carry forward: 1
6	10s	Hunt aces and accept risk in regions 5,6, steal points with aces & J in regions 2,3,4

Profitable ETF Trading Strategies: Color code price zones to improve decision-making

Intraday trading brings together perspectives from any different time frames into a single arena.  Sometimes it is hard to make sense of why buyers and sellers react so strongly at certain price levels and not at others. How can you quickly and easily organize the information from different time frames to shape your trading decisions?

One way to to frame your trading environment is to look at multiple time frames and find patterns and price levels that indicate support and resistance levels in the past. We cannot know with any certainty why a price level became support or resistance. The good news is that we don’t need to know why, only that it DID!.

The reasons why support and resistance occurred fade pretty quickly in time. All that remains, like footsteps in the snow, is the price record maintained on charts for all to see.  The places where price turned and reversed will begin to take on a power in the minds of all chart readers and will begin to influence their decisions to buy and sell, to preserve profits or anticipate  reversals.

This is why congestion areas begin to form around certain price levels.

In the same way that we should not be supposed to see traffic forming around major cities, we should expect choppy price behavior around previous support and resistance levels, and near the 50 day and 200 day moving averages, the two most popular moving averages.

Once you have identified the obvious support and resistance levels, treat prices greater than the congestion area as “Green zones” where you would not be surprised to see price move swiftly up.

Identify the congestion areas as “Yellow zones” where choppy behavior is the norm and where you do not have a particular edge unless you are a master tape reader.

Red zones are open price areas below congestion, where price can be expected to fall quickly once it breaks out of congestion.

In the Red and Green zones, which are really mirror images of each other, you want to be positioned to go with the path of least resistance.  There’s not a lot of time to wonder what to do when price is here.  Don’t chase price, but certainly take advantage of limit orders to pull you into good positions.

In the Yellow zone you should never chase, and always require a visible 2:1 reward to risk ratio inside the yellow zone to justify your entry.  Don’t expect price to break out either, since congestion zones we expect price to be choppy and for breakouts to be false.

Framing your trading decisions in terms of these 3 color codes can definitely help you make proper decisions in the heat of the moment.

Profitable ETF Trading Strategies: appreciating the power of rehearsals

Rehearals are considered to be one of the highest payoff practices in the military planning process. It’s where units develop and reinforce the patterns of action and decision-making that make all the difference in combat.  Rehearsals  will improve your trading practice as well, if you understand how to do them well.

There are 4 main reasons why rehearsals can improve your trading practice:

1. Practice essential tasks.  By identifying the critical tasks in your systems, you can focus on the ones that contribute the most  to success or failure

 2. Identify weaknesses or problems in the plan. You often will not discover  gaps in your logic or problems with the concept until you have “driven the route ” from start to finish from the perspective of the operator. This is especially true if you have built your plan out of component pieces, each which are individually sound, but have not yet been linked together before.

 3. Coordinate subordinate element actions.  When you use a building block approach to trading system development, sometimes  you will discover that the sum of the parts is different than the whole. This means that there are unknown or unintended consequences of piecing things together which are not revealed until you put the plan into operation, or better yet, have a decent rehearsal to test the seams.

 4. Improve understanding of the concept of operations. Once you have driven the entire plan, you will develop a sense of completeness and appreciation for its qualities or problems areas from the top down. You will be able to see the seams, where pieces come together in utual support or in sequence.

By paying close attention to your rehearsals, and making them as realistic as possible, you will be able to dramatically improve your trading practice.

Taken together with effective After Action Reviews, rehersals are an important part of your preparation phase. Time spent here will add directly to your bottom line.

Reflecting on the source of qualitative judgement

Profitable ETF Trading Strategies: understanding Average True Range (ATR)

One of the most powerful measurements in the technical trader’s toolbox is Average True Range, invented by Welles Wilder, and found prominently near the top of every major charting package that can be found on the web.  Its power is what makes it so popular. 

I always recommend to traders that they use ATR for their systems if they need a decent measure of short term volatility that is sensitive enough to detect important changes in near term volatility, smooth enough to prevent whipsaws of opinion and action, and reliable enough to be useful in all types of market conditions. 

The way the indicator is calculated and displayed though makes it very easy to misinterpret by a trader or investor who is not familiar with how it works. In my opinion, the problem is so profound that it should not be displayed in the raw form on your charts because the visual display of the information is so misleading.  Even experienced traders, who look at a lot of indicators, can overlook the problem. In fact the more indicators you use, the easier it is to forget this insight about ATR. 

The problem is simply that ATR is measured in dollars and cents and so when you see the ATR line rising on a chart you are naturally led to believe volatility is increasing.  The problem is that if price is also rising, volatility may be steady or even declining, which you cannot easily tell by inspection. 

For example: an ETF priced at 20 with an ATR of 2 is much more volatile than an ETF priced at 100 with an ATR of 5. If it were the same ETF, and you watched its ATR climbing from 2 to 5 while price went from 20 to 100 you might assume that it was more  volatile as price was climbing. The opposite would be the truth of course, but your eyes could lead you to believe otherwise unless you were constantly alert. 

Here is the refinement that I recommend. Instead of using ATR in its basic form, simply divide ATR by the current price. This will give you a number which I call “ATR%”. This is interpreted to describe the percent fluctuation of the value of the asset that can be considered normal given recent price action. By recent price action I mean the last 14 trading days, in the default construction of the indicator. 

Use of the ATR% will allow you to do the following things very easily, things which cannot be done using straight ATR numbers, which represent a dollar denominated “normal” fluctuation. 

You can use a time series of a single asset to see how its volatility is truly changing over time. 

You can compare the ATR% of an asset against a set of other assets, and rank them into a scheme of relative volatility at that moment. 

You can use statistics to further classify and describe a set of assets into logical, statistical sets 

You can compare sets of volatilities against other time periods to help you with market classification. 

Average True Range is an important tool of technical analysis, but one which has serious  problems in interpretation for novice or very busy traders. Know your tools!

Profitable ETF Trading Strategies: Respect Volatility, use its power for good

At the most fundamental level, volatility is the fluctuation in the price of an asset. The greter the price swings in the shorter periods of time, the greater the volatility. Periods of great volatility are like thunderstorms. They get your attention.

Volatility is an absolute requirement for a trader to make money. Most investors look at volatility with fear and trepidation, and properly so, because wild swings in price are an indication of uncertainty about the fair value of the asset in question. This uncertainty will play havoc with your bottom line as an investor. It is a normal tradeoff consideration for investors to give up the potential of outsize gains in exchange for protection against downside volatility.

 

It is clear from scholarly studies that increases in volatility correlate strongly with declines in equity value. If you look at bear markets you see volatility everywhere, leading to tremendous gains on up days and tremendous losses on down days. This volatility  is what drives longer term investors to the sidelines and creates the window of opportunity for longer term value players to establish excellent entry points for long term holdings in beaten down companies and sectors. This eagerness to buy value at a discount is why we see buying pressure even in the midst of the worst bear markets.

 

Traders who are looking to make their loving off the buying selling of inventory need the volatility of longer term position traders and short term scalpers to move price in swings that last long enough for them to realize their gains while offering the buyers and sellers from other time frames reasons to get in and out of these positions as well.

 

Because swing traders do not need fundamental beliefs in their positions they are able to operate successfully in swing trades during bear markets, and providing that they can manage their risk in the periods of higher volatility, should be eager to trade on the most violent of das in the market.  For a swing trader the greater the intraday volatility, the easier it is to see opportunities and frame favorable trades in terms of reward to risk. 

Like electricity, volatility can be your best friend or your worst nightmare. As a trader you must learn to use the power of volatility responsibly and effectively.  Stay grounded and respect the power for your own good. 

Profitable ETF Trading Strategies: Good traders know and exploit their edge

As an individual trader, you must be absolutely clear about where your edge is in the market place so that you can ensure your trading strategies are designed to put you into positions where your edge can make the difference against the average market return. 

Let’s be clear too: your edge must give you a reliable means of achieving better than average market returns or you are much better off simply buying and holding lowest cost broad market index exchange traded funds. To do otherwise would be a waste of your time and get you a lower than easily achievable returns on your capital. 

When I consider institutional traders, I see their advantages in computing power, depth of fundamental research, administrative trading cost efficiency  and legitimate inside information, I quickly conclude that there is no way I can find an edge by trading in direct competition with these organizations on a fundamental basis. 

This means I am going to steer clear of situations where my edge would consist of having a better understanding of the fundamental business model and market opportunities of individual firms. The fact that so many businesses go out of business due to misjudgments of market conditions when led by  experts who have a made a career out of narrowly focusing on that line of business suggests to me that I can not hope to have an edge in fundamental analysis. 

I also know that I am not capable of scalping better or market making better than brokerage houses who are fighting for fractions of pennies on large volumes in time periods measures in fractions of seconds. So I will stay out of that trading environment as well. 

I know that I need enough opportunities to allow my statistical edge in trading to manifest, and so I cannot afford to have overly long holding periods and wait for the ship to come in. I believe I need to be like Walmart and trade in quality merchandise that everyone wants, take my decent profits quickly and cycle through inventory efficiently. I want to be the swing middle man helping the market achieve orderly distribution. 

This leads me to look for my edges in the swing trade time periods of 1-5 days, and looking to lock in profits and/establish  no-lose positions as early as possible on the entry day, and only hold overnight when I have clear indications that the extra overnight risk is justifiable. 

Know your edge and stay within your area of competitiveness.