Greed In The Markets: The Pythagoras Cup

Welcome.

This is my first article of literature in a series pertaining to market philosophy and psychology. I find the twitter-verse to be a less formal form of market pedagogy, so It is my hope that inside of these articles that the information is enlightening and retaining. I also believe that substandard forms of insight have run rampant due to attrition, so I shall do my best to bring some original and refreshing material to the table. Alas, here is my first piece of work on none other than what I have invariably struggled with; Greed. Enjoy.

Greed. Avaris. Rapacity.

Ring a bell? Or does something less sinister come to mind, such as grabbing the last piece of pizza knowing you are no longer hungry, yet refusing to let anyone else have it. This as we know is called gluttony, another form of Greed. No matter how we may identify and/or define it, I believe it to be safe to assume that all of us have had moments of Greed in our lives.

Is Greed Healthy?

We live in a world where Greed is glorified in our media and entertainment industry. Raking in excess of $700 billion in the United States annually, the U.S media and entertainment (M&E) industry consists of businesses and organizations that produce motion pictures, television programs and music. In short “The bigger the better”. Such is the American Dream.

Speaking of movies, what kind of article about Greed and the markets would this be without referencing the famous line from an all-time classic; “Wall Street” by Oliver Stone released in 1987 where the infamous Gordon Gekko states, “Greed, for lack of a better word, is good”

Enjoyable, isn’t it? Hold that thought, this might interest you.

Fun Fact: The movie “Wall Street” and its well-known character Gordon Gekko was loosely based on and inspired by one ‘Ivan Frederick Boesky’. A former stock trader who made excess of $200 million in the market in the 1980s and was sentenced to three years in prison in 1987 for his role in running an insider trading scandal involving insider information about impending mergers, all the while trading stock in the companies involved. As part of his sentencing he was also ordered to pay a $100 million fine.

How about another classic and one of my personal favorite Wall Street movies of recent past, The Wolf Of Wall Street. The main character (Leonardo Dicaprio) portrays Jordan Belfort on his wild rise and fall detailing an electrifying excess of drugs, women and luxury before ultimately being sentenced in 1999 for stock market manipulation and running a boiler room in connection with a penny stock scam. Belfort was sentenced to 4 years and ordered to pay back $110.4 million in restitution. In Belfort’s own words:

“I got greedy. … Greed is not good. Ambition is good, passion is good. Passion prospers”

Should Greed Be Embraced Or Circumvented?

By definition, Greed is explained as an “Intense and selfish desire for something, especially wealth, power, or food”. Let’s pause there and understand that greed and having aspirations are not synonymous, and by all measures it is paramount to make the distinction. Individuals who possess the ambition and have high aspirations in their lives may be doing so in hopes that their accomplishments or success may positively benefit themselves, or their loved ones – without being at the expense of others. Goal setting and having a systematic approach to achieving these goals helps us in all areas of our lives, not just in one particular goal. But where is the proverbial “line in the sand” drawn? How can we identify the subconscious agenda behind our aspirations? Simple.

Write down a few of your biggest dreams. Things you innately and passionately desire. Key word here is innately, as we are looking to dissect the subconscious mind. What immediately reaches out to you that you desire? Let’s take an objective look at them.

By Achieving These Goals, Who Do I Help?

Many of us have goals of say, buying our mother a new house and car, or setting up a nonprofit organization to bring resources to an impoverished third world country riddled with destitution. In these examples and in doing for others, there is no malevolent intent. Interestingly, the famous roman philosopher Seneca stated: “The highest wealth is the absence of greed”. How’s that for irony? It is at the point in which we can do the most for others that leads us to find highest value within ourselves.

The Pythagoras Cup

During my unending quest for knowledge and my undying love for mathematics, I recently stumbled upon the teachings of an ancient Greek philosopher named Pythagoras of Samos. For those unaware, Pythagoras is considered the first pure mathematician. Well known for his theorem, a²+ b² = c². In other words, stating that when a triangle has a right angle, and squares are present on each of the three sides, that the largest square has the exact same area as the other remaining squares put together. Pretty interesting for 530 BC. His theorem also paved the way to the Pythagorean triples, c² = a² +b². I digress.

Another invention Pythagoras is credited with was his Pythagoras cup, or “Greedy Cup” that fills up with any liquid desired until the point of overflowing, at which time the cup completely empties its contents through the bottom of the cup. Pythagoras engineered a center column inside the cup right over the stem of the glass, and made a hollow chamber with a “U” pattern within. When liquid is poured into the cup above the column, the liquid continues up the small chamber and down through the bottom of the glass, preventing anyone from getting too greedy. I encourage everyone to you-tube the Pythagoras cup in action.

What Does The Pythagoras Cup Symbolize?

It is said that Pythagoras wanted to convey to his students the practice of moderation in their lives. Reach for a little, retain a little. Reach for a little more, retain a little more, continuing this pattern. Reach for too much all at once, risk total collapse. I feel that what the Pythagoras cup represents is a stark reminder of following a sound trading approach, and not using extreme greed to over capitalize on one particular area, leaving one’s self exposed to excessive risk. Although somewhat ominous, I perceive the cup to be gratifying as I know that if said proven methods are followed in my trading, that the risks of my endeavors fall dramatically. The Pythagoras cup is my favorite item on my trading desk.

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I hope you found value and practicality within this article, and I thank you for your time. I will expand this series periodically as time permits, and I look forward to interacting with more of you while I strive to provide useful content to the community.

Micah Yo
@Micahhyo

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