Archive for November, 2009



27
Nov

High Frequency Trading

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A world that lives 0.03 seconds ahead of you

A non-descript building

In Jersey City, just across the Hudson River, stands an unmarked building hidden in the urban jungle. Although inconspicuous from the outside, it boosts strong security on the inside with many checkpoints, mantraps and high-tech identity verification.

If you would get past all the security, you could enter the main section of the building: a dark room, full of giant unmarked cages, vigorously buzzing away. Looking down one corridor, it stretches for a hundred yards. The entire complex is the size of 3 football fields. It is cold in here, powerful ventilators are droning away, sucking up all the heat.

server_room

Processing financial data

If you owned one of these cages, you could enter it, and find yourself surrounded by a vast array of computers. Here, you can identify yourself using the biometric hand scanner. You would then be allowed to access the activity of these machines: 10’s of thousands of shares are traded by these machines every second. Sold, bought, and resold. But why? And why here?

Rise of the Machines

The purpose of this immense facility is so that computers can be close to each other, minimizing the distance that information has to travel. As a result, shares can be sold ever faster. (This is called co-location.)

Each computer can process a transaction in a micro-second or less, a millionth of a second. In other words, each computer can process 400,000 transactions per second.

People aren’t needed here.

These computers trade on the stock markets, and it is estimated that 13% of all shares in America are traded here. That makes it the third largest stock market in the world, bigger than the London stock exchange. 21 Billion dollars were traded here last year alone.

And none of this was here 2 years ago.

Electronic spies that beat time and space

03-PS91-6~Manipulation-Posters

Are we being manipulated?

These computers are set up to detect all activity in the market. As soon as a regular share trader tries to make a transaction, the computers detect it, using something that in the jargon of the trade is called a ‘high-frequency algorithm’. Because the computers are so close to the center of trading, they can cut ahead of the sale. They issue and cancel the sale almost simultaneously, bullying slower investors to giving up profits. The computer will do this all day long, in a systematic way, making money out of the original trader’s intention.

“It’s become a technological arms race, and what separates winners and losers is how fast they can move,” said Joseph M. Mecane of NYSE Euronext, which operates the New York Stock Exchange. “Markets need liquidity, and high-frequency traders provide opportunities for other investors to buy and sell.”

Even if they make a modest loss in the process, they still profit. They benefit from the competition between stock exchanges that pay small fees (called liquidity rebates, usually a quarter of a percent of a share) collected by the biggest and most active traders. Spread over millions of trades each day, these small fees amount to huge sums of money.

The problem is that these trades simply happen for the sake of the trade (because of the payout made for the act of the trade). That means that the trader doesn’t take a position, or rather is on either side of the trade, effectively taking opposing positions regardless of market intelligence. As a result, it skews the markets and makes them opaque. The investors argue that they provide liquidity to the market by being on either side, but the controversy is that the way they do this creates murky prices, undermines the fundamental principles of the exchange and under extreme circumstances (which happen often) leads to volatility or at the very least badly informed decisions that destabilize the markets.

In the last 2 years, this type of non-human trading has risen to almost 70% of all share transactions in America.

The billions of dollars these ‘predatory traders’ earn are directly at the expense of such traders as pension fund managers. It spies on what they do, reads their movements on the stock market and instantly runs ahead of their activity, undercutting their selling behavior.

Is knowing information 0.03 milliseconds in advance of everyone else still insider knowledge?

r302555_1315366

Making money, but adding value?

Legally speaking, this is not insider trading. Insider trading is the practice of trading based on non-public information. It has been made illegal, because it gives the trader an ‘unfair advantage’ and the power to ‘disrupt the markets’ and ‘game the system’.

The big firms who run these computer programs claim that they are not engaged in insider trading, that they simply trade faster. In truth, they can read your actions, and cut ahead of you by a millisecond, and make the trade in your place, then sell it back to you at inflated prices.

These companies are making huge sums of money based on innovative technology that costs billions to put in place. But isn’t that the American way?

To understand how this changes society as a whole, it is important to remember how the stock exchange came into being.

Making capital available to trade

Stock exchanges were set up to raise new shareholder capital for growing companies. Regulations were put in place to lower cost and offer a fair and equitable capital system which has the confidence of all participants because everybody has a fair chance of participating in the market. In order to keep this system viable, practices such as insider trading were made illegal, so that investors would remain in the stock exchanges and trade in a transparent ways. As a result, a large number of people poured their money in stock exchanges, investing in the future of business.  Then, in 1998, the Securities and Exchange Commission authorized electronic exchanges to compete with marketplaces like the New York Stock Exchange. Their intention was to open markets to all of us, so that we could participate armed with nothing more but a desktop computer and a new idea. But what happened was very different: 1% of the richest banks started building super computers, and they were perfected in the last few years. They positioned them close to marketplaces like the New York Stock Exchange and actually are aimed at driving prices up for those very people who the new regulations intended to involve.

How We Ate Your Lunch -  A Case Study

On July 15th 2009, Intel had reported high earnings the night before. Investors quickly realized that as a result of Intel’s success, Broadcom, a semiconductor company, would be in a strong position. Traders should be investing in Broadcom shares. But they faced a conundrum: buying large number of shares would alert the markets and drive up prices. So they divided their orders in smaller batches, ducking and diving as they went on their business. The markets opened, and shares started trading at $26.20

The orders were being issued, in small and cloaked forms. This is where the high-frequency sellers kicked in: their computers saw a pattern. They managed to be faster than the traders by 30 milliseconds (0.03 seconds) and executed what is known as flash orders. Their computers started buying Broadcom shares and then resold them to the investors who placed the orders in the first place, but at the higher price of $26.39.

What happened was that the high-frequency computers saw the movement in the market, executed a sale faster than the traders could and then resold these trades to the traders at a higher value. This practice rakes in huge profits every day.

That world is changing

The former executive vice-President of the NASDAQ  is wary of the new system of ‘High-frequency trading’. He warns that it undermines the very purpose of a stock exchange: raising capital for growing companies. Instead, the large profits from High-frequency Trading have led big investment funds to focus on the shares of the biggest companies where shares are plentiful. As a result, the feeding capital for the future of the US, the new growth companies, is cut off. This means less growth, innovation and jobs.

Instead of speculating on future innovation, all money is currently caught up in a gaming system that simply analyzes movements in the shares of the largest companies, and artificially creates value and trade without these companies actually offering equal amounts of innovation or improvement of service to justify this.

The former executive Vice-President of the NASDAQ is warning that this practice is undermining the US economy and undercuts the integrity of the markets.

“You want to encourage innovation, and you want to reward companies that have invested in technology and ideas that make the markets more efficient,” said Andrew M. Brooks, head of United States equity trading at T. Rowe Price, a mutual fund and investment company that often competes with and uses high-frequency techniques. “But we’re moving toward a two-tiered marketplace of the high-frequency arbitrage guys, and everyone else. People want to know they have a legitimate shot at getting a fair deal. Otherwise, the markets lose their integrity.”

Fighting back: Dark Pools

There already has been a growing backlash. Companies now increasingly trade in ‘dark pools’, away from the stock markets and their High-frequency Trading Algorithms. Dark pools are currently estimated at 30% of the trading market.

A dark pool is essence a place where a willing buyer meets a willing seller in a closed room, and makes a non-public deal. This means that the actors are making decisions disconnected from the rest of the market, and that makes it very hard to understand the value of the buy. In effect, without assistance of the market, the buyer and seller are throwing their hat at the actual value of the trade and it could be argued that trades in the dark pools throws this part of the market back hundreds of years and all the instabilities that come with that. Fair enough, the buyer and seller are highly educated, but they are NOT an island.

The greatest innovation in financial systems was to have all actors participating in the price formation process, a price that reflects the business is being done and insures transparency by treating all buyers and sellers equally. Today however, markets are less transparent than 40 years ago.

This has consequences. The more trade happens in dark pools (and it is constantly increasing) the more it undermines the system of pricing in general, because your prices don’t reflect a sufficiently large enough part of the market. Many people are making their decisions on current prices; if these prices don’t actually reflect actual value as well as they can, this can lead to unexpected upheavals, booms and busts and volatile markets.

Can you spare some change?

All of this is now part of a larger debate on how to regulate markets: how do we reduce banks appetite in trading and increase its appetite for traditional banking: taking in deposits, giving out loans, raising share finance for growing businesses. But with such big profits available in what is essentially casino trading and the current system in America of legally buying the votes of Senators through lobbyists, it is unclear this growing profitable instability in the markets can be tamed before a new crash occurs.

And all the while, it is draining liquidity from the markets just as the economy needs it most, lavishly pouring money on the established businesses while cutting off funding from growing industries, and in effect, the future of America.

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21
Nov

Of Kings and Castles

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Kings did not remain in their castles long

Kings did not remain in their castles long

When watching historical movies about medieval courts, one could easily be forgiven for believing that kings lived lavish lives in their castles, only to be taken on the road to fight the mandatory wars. But this proves to be a popular misconception.

Kings traveled around the country from royal estate to royal estate all year long. This wandering existence has nothing to do with the restlessness of kings, but was in fact the way they managed their kingdom. Kings traveled the country to discuss the affairs of each region with their magnates and to ensure law and order.

So where we have a picture of kings living in opulence, true as that may be, they also lived a grueling existence, constantly experiencing an uncomfortable slog, traveling the old Roman roads or prehistoric tracks of their kingdom.

Always on the road

Always on the road

The further back in time we go, the more uncomfortable the journey’s were. For much of history there were no royal carriages, meaning that the journeys would have to be undertaken on the back of small, stocky horses (horses were more akin to ponies centuries ago than they are to our modern horses), or they would travel in wooden carts (without our suspension technology), or even on foot. Kings lived in a world that was permanently packed up or unpacked.

The truth is that coming home from work, putting your feet up, opening a brew and watching some television while enjoying a snack is more opulence than a medieval king was accustomed to. True, we might not have the same power of the king, but most Western people live lives far more comfortable than that of kings. And on top of that, we don’t have to be worry about losing our heads due to popular demand.

We live a pretty sweet live after all…

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15
Nov

How the enemy needs war to stay alive

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When watching GPS with Fareed Zakaria on the Mumbai massacre I was struck by a testimony in his feature.

Taj Mahal during Mumbai attacks

Mumbai attacks

A young terrorist is instructed by his controller in Pakistan to set a room ablaze. The controller understood that if the Taj Mahal was on fire, this would offer a more dramatic visual. The visual of Taj Mahal on fire would garner media attention and strike fear in the heart of the West, witnessing the might of this one terrorist cell.

It struck me that the controller had not ended with corrupting the mind of this young terrorist, brainwashing him to kill dozens of innocent people before deliberately giving his own life to his ‘cause’. He was also intending to stir up feelings of hatred and fear in the hearts of the Indians who watched this on television.

It reminded me of an Al-Qaeda statement posted on the al-Hesbah Web site during the presidential elections. It said if al-Qaeda wants to exhaust the United States militarily and economically, ‘impetuous’ Republican presidential candidate Senator John McCain is the better choice because he is more likely to continue the wars in Iraq and Afghanistan.

‘This requires presence of an impetuous American leader such as McCain, who pledged to continue the war till the last American soldier,’ the message said.

‘Then, al-Qaeda will have to support McCain in the coming elections so that he continues the failing march of his predecessor, Bush.

Source: UK’s Daily Mail.

When a small group chooses to attack a behemoth, nothing much can happen when the behemoth decides to simply ignore the small group and keeps it at arms length. The only hope the smaller group has is that the behemoth starts chasing it, and that the smaller group can stay alive long enough to exhaust the behemoth and then strike it when it is weak.

Al-Qaeda can never win from the US in a conventional way. But it can trick us into wearing down our military personnel, exhausting moral and depleting the coffers as we fight a financially imprudent war.

Perhaps it isn’t just the young peasants who are brainwashed to become jihadists. Perhaps we are all ‘brainwashed’ to enter into a full-blown war against a small number of enemies who have strategically positioned themselves in 7 countries that the US could never truly tame nor occupy without fatal costs to its economy or standing in the world. And perhaps, when we rely on the prudent way to dealing with this ‘small enemy’ by choosing to fight it through intelligence agencies alone, Al-Qaeda will step up its efforts to produce a terrorist attack on American soil again, because it knows it can only win when it can get the behemoth to chase it instead of having the Behemoth keep it at arms length.

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1
Nov

Living the strenuous life

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Theodore Roosevelt

Why do we look up to great men, why do we read the great books? Ultimately, as the Greek Philosopher Epictetus said, we do this to answer the question: ‘how to live our lives’?

How to live our lives?

Rome 65 AD – 4 miles outside of Rome, in an elaborate, lush estate, Lucius Seneca, 69 years old, notes that he is about as old as his hero, Socrates, when he was forced to drink a cup of poison to ‘atone’ for his ideals. And here, today, Seneca also faces the prospects of his own death because he refuses to abandon his ideals.

Lucius Seneca

Seneca is probably the most famous man at this point, after Nero, the Emperor. Seneca has lived a life of power, glory and immense achievement and had worked himself up to become the second most powerful man in the Roman Empire.

Yet today, he waits, stoically, at his home, for his death to arrive in the form of Nero’s soldiers.

A quick history to put things into context

In these days, Rome stretches from the shores of Britain to today’s Iraq, from the North Sea to the Saharan deserts. Rome has brought prosperity and peace across most of the know world, united under one language, one currency and one law.

Seneca was born in 4AD, in Cordoba, Spain, in a wealthy, influential family. Seneca was sent off to study in history and became a student of Stoicism. He was thought in the market places of Greece, by professors who gave their lessons from a porch, as was the habit of the day.

Seneca came back to Rome, and became a famous writer. He wrote a series of tragedies and was part of the revolutionizing of the Roman literary tradition. Tragedies were rewritten and updated for Roman sensibilities. Shakespeare borrowed a lot from their innovations, although he did not know it. You can see the influence of the Roman writers of Seneca’s time in Shakespeare’s melodramatic endings, murders on stage and even the inclusion of ghosts as main characters. Because of his importance to the revitalization of Roman literature, Seneca won great fame.

This at a time when the political landscape of Rome had experienced great changes: Julius Caesar had recreated the Rome as a dictatorship, and his heir to the throne, Augustus Caesar had decided that the only way to insure Rome’s prosperity and strength was to create a dynasty. Augustus saw to it that all his imperial powers were passed to his son, Tiberius.

It pretty soon became clear that once you give power to a dictator, it is hard to lose it again. The Roman people, at least those in power, were smitten with all the rights and power they had gained without having to be responsible for any of them.

However, Tiberius turned out to be a cruel despot, suspicious and greedy. His heirs to the throne, Caligula and Claudius were truly wicked despots.

Claudius ruled Rome as an evil bureaucrat: jealous, suspicious, lending his ear to informants with their own agenda, the Roman people suffered under the emotional up and downs of their emperor.

It was in this court that Seneca became part of public life, at 45 years of age. He found himself quickly outwitted by the intrigues at court and was forced into exile on Corsica.

Seneca was returned to Rome by Agrippina, wife of Claudius and master intrigant. She had been born with a lust for power and tried to gain her power through influence over Claudius. She managed to have Claudius divorce his wife and marry her. They had a son, Nero, which she wanted to be the new emperor, although that place was reserved for Claudius’ first son, Britannicus.

Seneca felt that Britannicus would be a bad emperor for Rome and aligned himself with Agrippina, in an effort to get Nero placed as the next emperor of Rome.

Here a truly downwards slope starts: It was decided that Britannicus was to be poisoned. But Britannicus, aware of the intrigue at the court was a suspicious man (it isn’t paranoia if they are really out to get you) and had all his food tasted by others. Agrippina devised a clever gambit. She brought Britannicus an apple and cut it in half. She proceeded with eating one half, and Britannicus, satisfied, ate the other. He didn’t kno that Agrippina had laced the half of the knife facing Britannicus with poison. Britannicus died, officially of stomach indigestion.

Claudius was also in Agrippina’s sights, and was served poisoned mushrooms. Claudius struggled for his life, but didn’t appear to be dying. Agrippina quickly gathered her wits, dipped a feather in poison and stuck it in his throat, telling bystanders she was trying to open his airways to help Claudius breath better.

Seneca was aware of all these plots. But after a life of intrigue at the court, he had decided that the goal justified the means: one has to accept the lesser evils to achieve the greater good. Why Seneca believed that aligning himself with power-hungry murderers might somehow benefit the Roman Empire is unclear, but we do know that Seneca had a hunger for power himself, having once tasted its glory and then felt the bitterness of losing it in exile.

Still, Seneca told himself that he had aligned himself with the powers of good, and that somehow this intrigue was necessary to put himself and his allies in a position where they could rule Rome and steer it in the right direction.

Nero was young and inexperienced. He lacked statesmanship, and recognizing this, Seneca wrote the speech to be delivered in the Senate that was to confirm him as the next emperor. Today, this seems to us as no big deal, all great leaders have their speeches written for them, but in that day, all emperors wrote their own speeches. And even today, great leaders still direct the spirit and content of their speeches.

All the betrayal at court, all the murders seemed to pay off . Under the rule of Nero, with Agrippina and Seneca tucking at the cords behind the scenes, a golden age settled over Rome: the informers who had lead a series of anonymous accusations were put behind bars, lowering the emotional temperature and division within Roman public life, courts were again held in public, the economy was put in order, a strong foreign policy improved Rome’s standing in the world and an the empire was administered in a more effective, more transparent manner. For 5 years, Rome thrived and all the dirty deeds had somehow whitewashed the political life of Rome.

But young Nero began to rebel more and more against the influence of his mother. Nero had his own ideas, and felt he had a greater destiny than being an emperor, he felt he was also an artist. He felt constrained by the duties of office. He was frustrated by the power sharing with his mother, that went as far as having to share his portrait with that of his mother on the Roman coins. He decided that he had to break free. And the only template for such a move he knew from his youth, and perhaps the only real option left to him, was to kill his mother. Freud would have a field day with this one.

Nero, after another bitter quarrel with his mother, invited her over to a makeup dinner and at the end of it, offered her a yacht as a present. The yacht was especially designed to collapse when it exited the bay. And so it did, but Agrippina managed to swim away, even escaping the murderous attempts of the sailors who tried to beat her on the head before she could escape. Nero, gripped in fear about this turn of events, sent loyal soldiers to her home to finish the job. When the soldiers arrived, Agrippina put her hands on her stomach and said: “Here, strike my womb, for it is my son that is killing me.” The soldiers ‘obliged’.

With his mother out of the way, Seneca was summoned to write a speech for Nero, to explain the death of Agrippina to the Roman people.

And so Seneca was the speech writer, advisor and spin master to the court of Nero. Seneca took on this task with dread. After all, by doing his job, he became more and more a liability to Nero, being the keeper of all Nero’s guilty secrets.

Seneca, at the age of 66, asked for permission to retire and was granted this but asked to always stay near…

What is good, what is evil?

Sometimes we find with men who have achieved great power and fame, that their mind closes off to the alternative lives they could have lead, instead, coming to justify the course they have taken as the righteous one, one of difficult decisions, agonizing trade-offs that somehow created the virtuous world we live in today. That path was more or less closed off to Seneca, who had placed himself in great peril due to the choices he had made in his life.

We also often see that rich, influential people become to question their legacy in the zenith of their lives, and become champions for social change, immersing themselves in moral lecturing, charitable causes and what more. They abandon the naked strive for power and instead start to use their influence to create a ‘better’ world for all, to somehow come at peace with their legacy.

Perhaps these forces drove Seneca on his dangerous path.

Seneca, a disillusioned old man, having achieved wealth, power and fame, became to pounder his life and wrote his thoughts down in a series of dialogues. He invoked the memories of the young man he once was, full of ideals.

Seneca judged his life as an error in believing in situational justice: that the world is only a place of trade-offs and that sometimes wrong deeds should be carried out for the greater good. Instead, Seneca started to believe in ‘absolute justice’. That some things are wrong in all circumstances.

How Seneca developed his philosophy

He started with God. Does God exist, he asks himself? Yes, is his resounding answer, and he offers the world, the immaculate beauty of the order of nature, the consistency of the universe as proof. To Seneca, how else could this vast world follow its orderly existence, if not guided by the invisible hand of God?

His next question was: is God ‘good’. Again, the answer is a resounding yes.  How could he not be, having created all this beauty and wonder?

And if God is good, than why does evil exist in sickness, loss and injustice? Confronted with this age old question, compounded when one believes that the Gods aren’t fickle, but fundamentally good, Seneca expresses his belief that God has created the universe as a test to mankind. Adversity is God’s lessons, to teach us like a good father about right or wrong. We cannot fully be human nor achieve our potential if we aren’t truly tested to the core.

Borrowed from Socrates’ apology

This idea was borrowed from Socrates’ apology. When Socrates spoke to his accusers who demanded his death sentence. he stated in his address that he did not hate his accusers, that he accepted their actions as being part of a universe that puts him to the test, as a necessary stage in his life.

Socrates went on to explain that all he had ever control over was his own mind. Hate would destroy this power. Socrates argued that if he were to make the mistake of trying to invoke ‘a greater truth’ where his accusers were absolutely wrong and he was absolutely right, he would fall in a mental ‘trap’, because it would ultimately divorce himself from the reality of his own being. All he could be was himself, and the only way to stay in touch with himself was not to judge, but to carry on being who he was, in the face of adversity, in the face of his own death. The true test was not about the nature of the world, about seeing right or wrong, but about remaining firmly who he was, even in the face of the absolute price. This was the test of (the) God(s), Seneca argued.

The philosophical implications

Seneca moved to a philosophy where he is ultimately responsible for his thoughts and actions. He does not blame Nero for his situation, because Seneca states that everything he does, everything he is, everything he thinks belongs only to him, and the situation he finds himself in is presented by God. His reactions are not and never could be governed by the actions of another, no matter how wicked, because he is the only master of his soul, the only person that can give it direction. It would be wrong to blame circumstances for how Seneca has lived his life, because nobody can force him what to think.

Seneca believes that as long as he does not return evil with evil, then he will not be conquered.

He also believed that no person truly suffers evil: evil, adversity, is simply a test, to help us become ourselves, our highest ideal. Without it we would be impotent to achieve our potential. The only evil that we can inflict on ourselves is that of abandoning ourselves. All the rest are milestones on our road.

On to the end

Nero, worried about Seneca’s state of mind and the potential consequences of his writings, sent his soldiers to order Seneca’s suicide. It was a rather protracted affair  that I will not describe here, suffice to say that Seneca eventually, after numerous suicide attempts, drank hemlock, and finally died.

La_mort_de_seneque

Seneca's last moments

A life of absolute responsibility

A mantra you hear often today is ‘If I don’t do it, somebody else will’ or ‘I am just doing my job.’ According to Seneca, saying this does not only surrender all control over the little difference you can make in this world, it also means surrendering control and responsibility for your own actions. Seneca would argue that losing your job because you acted according to your own convictions is not hardship: it is simply answering with the potential of your full being to ‘God’s test’ (in the terms of Seneca). Not taking full responsibility of your actions, and instead rationalizing ambiguous actions by arguing that it wouldn’t make a difference, because ‘if I don’t do it, somebody else is sure to do it’ is relinquishing the only control you really have: that over your own actions. This, argues Seneca, is the only evil that can truly befall a man.

Why we surrender responsibility as a society

Of course, we live in more practical, more secular times. Idealism has often been replaced by collective goal setting and metrics within corporations and societies. It is ironic that in a time people believe more than ever in the power and existence of the individual, more individuals believe their own small existence has little capacity for making difference. Our highest value is not to change the world, but to be happy, to take care of the small nucleus that is our family – we have, as individuals, somehow given up control over our societies and the forces that drive it, whether it is corporate, religious, political or any other earthly force. Sure we vote, sure we try to do the best job we can, but somehow we are no longer responsible for the overall result, all those little compromises we made, all the judgments we make without adequately informing ourselves first, all the votes we cast without having educating about the issues, none of these contribute to the overall result. Somehow, individuals today live in a world where they believe they can have their cake and eat it too, somehow aligned with the forces of good while others are mysteriously to blame for the current state of the world.

Of course, I express things rather black and white, but upping the contrast on the issues can sometimes reveal the inconsistencies that somehow slip between the cracks.

The only way to be fully human

But Seneca’s prescription for a good life is simply this: to never absolve ourselves of responsibility. It is not wrong to compromise because compromise is an essential tool in creating consensus and direction. Seneca offers two addendums to compromise: once you compromise, you cannot say the situation made you do so. No, you saw the situation, and made a conscious decision to act or not to act, and you own that decision. And you cannot divorce yourself from the result, even if you are only partially responsible for it or had no power over it at this point. You nevertheless remain in relation with your environment, and always responsible for how it is. He beckons us not to see our limited power as a reason to absolve ourselves of responsibility for the overall result, but to see our limited power as a clear call to action, a call to work harder to make a difference.

And Seneca also offers the ideas that there are some absolute wrongs and absolute rights. That if you conspire with murderers to help them to the throne, can you expect less then murder from the throne? To not tell ourselves fairy tales that if a creature is one day today it might be different tomorrow. Instead we should take the long view, and help the right powers to take hold in society over a longer period of time, instead of going for the quick fix and helping the wrong powers achieve position with the wrong actions – as if somehow, once in position, they would magically change…

Seneca in our own time

Of course, when one centers his debate on the nature of God and why God created the universe the way it is you are bound to get in a sticky argument, exactly because anyone can pretty well make up his answer whether God exists or not and what exactly God’s intentions might have been.

But stripped from the more numinous arguments, Seneca’s observations hold one important truth for our time:

If we don’t take responsibility for the world, we cannot blame the world for what it is today. No matter how small, we are all cogs inside a giant machine, and we perpetuate it, no matter how small, through our own actions. We can play the game, but then we should own the problem. Or we can instead choose to stand up for our ideals, and then we have to work tirelessly to become an answer to the problem. But the idea that we are somehow not connected, somehow have no bearing on the end result, that is simply not a true idea.

Theodore Roosevelt and the practical application of Seneca in our time

Roosevelt on campaign

Roosevelt on campaign

Theo Roosevelt inspired America with a powerful call to action, telling each individual that action, not inaction is what will make America strong. Not to shirk responsibility, but to take more of it, and to lead ‘clean, vigorous, healthy lives’, both spiritually and physically.

In the age of consumerism, we often see our role as simply being a cog in a giant machine, but Roosevelt says we are more than that:

No country can long endure if its foundations are not laid deep in the material prosperity which comes from thrift, from business energy and enterprise, from hard, unsparing effort in the fields of industrial activity; but neither was any nation ever yet truly great if it relied upon material prosperity alone.

[…]

A mere life of ease is not in the end a very satisfactory life, and, above all, it is a life which ultimately unfits those who follow it for serious work in the world. – Theodore Roosevelt

In our next entry we’ll speak about Theodore’s practical solutions for our time, and how he envisioned individuals could take ownership of today’s problems, through living the strenuous life:

I wish to preach, not the doctrine of ignoble ease, but the doctrine of the strenuous life, the life of toil and effort, of labor and strife; to preach that highest form of success which comes, not to the man who desires mere easy peace, but to the man who does not shrink from danger, from hardship, or from bitter toil, and who out of these wins the splendid ultimate triumph. – Theodore Roosevelt

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