IN THE CONFESSIONAL


I was wakened by another commotion in the street outside my window, but this had more than the usual echo against the walls of the the decrepit buildings.   The din was created by a small number of young women shouting,  "Shuddup,  shuddup,"  and ", Shuddup".  Of course they embellished their commands with locutions that they fancied increased their gravity.  "I just want to have some fun.  Wrong widdat?".  They were trying to quiet each other at the top of their sharp voices, each wanting to get above the din that they were creating enmass, each telling the others to be still so that she could make herself heard.  About four to start, then others started to yell shut up to the girls.  The corner-spitters and trash-talkers, the hangers-out and the hangers-on who stand in front of the building all day were themselves getting tired of the noise apparently, and they're not themselves pikers when it comes to noise-making.  Epithets were heard, more joined in.  More shutups, louder.   Then scuffling, glass, thuds.  Still more people, angry, were getting involved.  Shuddups were general.  "Be quiet", I intoned out the window, but no one paid any mind.  Finally the sirens came.  From all directions.  Our neighborhood is heavily policed, thank you.  The police know that when a call comes from 44 it means come in force.  This is not gentle Atherton, this is not the proud East Side.  This is the Tenderloin.

How did I get here?  I was middle class. or so I thought , but maybe it was just because that's how I grew up..  My parents had twenty acres for their home outside of Chicago.  I was scrubbed and combed until I was shiny.  And I was a happy child, too.  I was a king in my own fantasy world.  But, as in other tragedies I, though noble and good in every way, made a number of wrong decisions at critical moments, and with them came downfall and self-realization. How could I have imagined in that idyll in which I saw my nearest neighbor’s big house as a speck in the mute distance the constant yelling, squabbling, the filthy execrations that occur outside my window all day in this Tenderloin?

But now I just try to keep up appearances:  What you see now is just my impersonation of the man I used to think I was: An honorable and competent man, a man of means.  Civilized.  Means of course, but what are means?  It's all about money, isn't it?  Money makes a man solid and poverty makes him empty.  Maybe a chalk outline on the sidewalk?  No one wants to know an empty, invisible man!  With a slight movement a silly thing like a real estate market, or a stock market can make you vanish.  Of course I know the market crash undid a lot of people, but my undoing came even earlier, long before everyone else, long before the rest of the country.  I got in on the popping of the English real estate bubble in ’06.  This was the killer for me.  Many people don't even know about that one.  It was then that this man vanished.  This is where the labyrinth closed in, and I was lost.

You've probably heard of San Francisco's Tenderloin district, like other tenderloin districts a big skid row.  How did I get here from my penthouse apartment where only a few years ago I’d been safe, or so I thought. yesterday and another era.  In those days I had a quiet view stretching over the rooftops of the Marina, from which I could contemplate lovely Angel Island with its flowing atmospheric displays, lonely Alcatraz,  the lights of Sausalito.  I could see the Golden Gate Bridge with the same perspective as the proudest of San Franciscans.  Then, suddenly--or so it seemed--I found myself looking down from my lovely view at the ground below trying to imagine falling, what the parabola of my fall would be, whether I would hit the ground cleanly or glance off  that planter box that seemed to be in the way?  That would hurt, and I didn’t want to suffer, I don’t like pain.  Would I lose consciousness on the way down?  Even if not, I knew that the decision to jump would be the one decision I had made in my life that I would never regret.  But was that enough?  How did it happen?

It all started with a dcecision I made in all innocence--and I was terribly innocent.  The American way is to work to make oneself more valuable, isn't it?  And I set about doing this in one of the ordinary ways, and that is to make investments.  Mine was an investment in an overseas construction project.  It wasn't buying real estate; it was buying an idea of real estate: a building that was not even built yet.  I guess you'd have to call it "unreal estate."  Not only was this a way to inncrease my net worth, but there was a little romance to the idea, too!  Yes?  I know it seems a little fatuous now, but at the time it had an irrestistable charm.  I had taken a membership in an Internet site called "International Living".  One of the things they did was to help people with money to hide it from the government.  That didn't interest me.  But another feature of the organization that did interest me was their finding places where an investor could put money to work, often buying into real estate projects that were located in areas that were unexploited but which their expert thought showed promise of becoming popular in the near future.  He had had many successes, had organized trips for wealthy folks to go and examine the sites that would probably become the next French Rivera.

The Property Finder had discovered an incredible opportunity in Newcastle-Upon-Tyne in the United Kingdom.  Newcastle was experiencing a boom like they hadn’t seen since the discovery that coal would burn.  A new building was going up, and we investors were being given the chance by the builder to participate in the funding of the project by buying apartments for a very small down-payment which, International Living assured us,  we would be able to sell even before the completion of the project—so heavy would be the desire to live In this wonderful place. 

That did interest me.  It would not only make of me a true "investor", as I was already known to the IRS,  but an investor in a foreign land.  It must have been the same feeling that Englishmen had when they took off for that unknown land they called America.  There was some romance in it!  But not too much romance, It wasn't that I was investing in some area of the world where they didn't speak my language.  I wouldn't have to use my rudimentary grasp of some foreign language to communicate with the locals. The project was in England and the folks spoke my own language as well as I do myself.  I sent in my check.  It wasn't much, five percent of the purchase price which would be less than a hundred thousand pounds, and I would be able to sell the thing for double that!  Here I was, an investor in England!  You might say I was colonizing England!

So, in a manner of speaking I had my little apartment in a future-building in Newcastle-Upon-Tyne.  I got some paperwork from the builders and that was fine.  There were  drawings in the package, one of which depicted the footprint the place would occupy in the section of Newcastle called St. James's Gate. and a map of just where in town it would be.  Very near the river, the Tyne, and it was fine!  It  sounded very classy indeed.  It would be the kind of place that up and coming young people would dream about and pay a lot from those prematurely deep pockets that young people have these days, in a boom town like Newcastle. 

It was about a year before anything happened.  They had a building to build and I wasn't surprised that it would be some time before I heard from them.  All the paperwork was done and I sat comfortably.  Finally I got notification that the structure had been completed and the estate agents were working to put the units on the market.  I assumed that everything was going according to plan even though nothing seemed to be happening at all.  And then I found that I was having difficulty getting in touch with the people in Newcastle.  I discovered that though they spoke the same language as me, they didn’t want to speak it very much.  The agents were "on their mobiles" or out of the office.  I went weeks,  months, without hearing anything from them.  Finally I got another agent--not the one that International Living had contracted with--to show the apartment, figuring that the problem might be in the first agent's office.  As it turned out that was the source of confusion amongst the agents, keys were exchanged or not exchanged when they should have been.  Who had the keys?  No one knew.  My opinion of English business competence took a hit at this point.  It seemed that they didn't know anything about selling real estate.  I probably should have gotten onto an airplane at that point and confronted somebody--I didn't know who, anyway--but it never crossed my mind.  Every time I got someone on the phone it turned out that something had just come up and he would have to call me back.  Oh, yes.

And the other folks, the ones at International Living were also unavailable, not helpful.  The expert was out finding more opportunities, I was sure.

After a year and a half I finally found out what had been happening.  I got an email from someone, a lady with a conscience employed at the estate agents.  She must have been very unpopular among her co-workers!  She had seen records of my account with the estate agent, and saw that, through some confusion no one in the office had been showing the apartment at all.  It had just been sitting since the work had been completed.  She suggested getting in touch with someone in a special law enforcement organization that they have in England.  I took her advice and finally I started to get responses from the estate agent--the first one--who were more willing to deal with me.  But there was just one more thing:

Between the digging of the hole for the foundation and placing the final kitchen tile—the bottom had dropped out of the market due to the fact that there were quite a number of similar projects in the area, all finishing at roughly the same time.  In other words when the building was finished the buyers were not lining up outside the estate agent’s door and the fantasy of selling the units before they were done just on the promise of the wonderful life to be lived in that building revealed its true nature.  There were buildings aplenty, and the well-heeled youngsters had as much choice as they could have hoped.  The selling prices, of course, were sinking faster than the buildings were going up.  An investor would be lucky to get out at break even, and the owners/builders didn't want to be stuck with the losses; they wanted their investors to pay up for their worthless apartments.  They demanded full payment from those of us who had not had the wisdom to back out early. 

Well, the deposit was small but for me—I had only a small fortune—the full price that they wanted came very close to everything I had in the world.  Though there had been mention of loans in the beginning, they didn’t come to pass and I had to liquidate most of what I had in order to pay these nice folks.  Some said I should have made them come after me across the ocean, that they had probably known it was an unwise investment in the first place.  This may have been true, but I couldn't bring myself to do that.

But it was a problem.  I had been trading stocks successfully for some time but now that I had had to give most of my money to the people in England I could no longer trade stocks. Or I should say that "I thought I could no longer trade stocks".  I actually could have but my power of reason had been stunned to the same extent that my bank account.   Equities, I reasoned,  require an amount of capital that I no longer had.  The only answer seemed to be the trading of “futures” which require less capital due to the fact that in the futures market you have a great deal more leverage than you do in the stock market.  To buy a stock you need half the value of the asset but in the futures market you can buy a contract on, say, a bushel of corn for a tiny fraction of the value of that bushel.  Just as much money can be made from trading futures as you can get with stocks but with a much smaller amount of money in your pocket to begin with.  Well, of course leverage works both ways as we all know now from the crisis in the derivatives market, and you can lose high multiples of the money you have in your pocket as well as gain them.  And besides that, the market is much trickier than the stock market.  So I sat down to study the futures markets.

I spent long days, ten hours a day, seven days a week studying the markets, patterns of behavior, my own motivations and fears concerning what I was doing.  For three years I worried over every indicator, every chart pattern. I watched the Moving Averages, the Keltner Channels, the Bollinger Bands, the Stochastics, the RSI's, and the all important MACD's.    I questioned the motives of other traders, and my own. This was nothing like trading stocks!

Still, I was getting better even if slowly.  Could I get good enough before going broke?  That was the question   I realized at the end of 2007 that my situation was becoming critical.  When I talked to my taxman I used the simile of a fighter pilot in a dive after being terribly shot up in a dogfight. I’m going straight down toward the earth with ferocious velocity and I’m pulling with all my might on the joystick. I see the earth coming toward me but gradually, so gradually, the nose is coming up. Yes I think I’m going to make it, I’m leveling off. If I can just clear those trees, I think I see blue through the windshield! Now I hear the tops of the trees hitting the fuselage, I can feel the thumps but I’m not going into them!

And I did become a successful futures trader, except for one thing: My first successful month was the one in which I found that my account balance had gone below the minimum necessary to trade.  It was a pyhrric victory in which I emerged victorious but completely ruined!  I paid everything I had for tuition in this school of finance, and I had nothing left with which to ply my craft.

I felt stunned, paralyzed.   I knew, like the man in quicksand, that any movement would just sink me deeper.  Now I was beginning to realize that I was heading into an impoverished old age.  I had lived independently, blissfully ignorant of what dangers there were in life.  I sympathized with the poor but never thought I would be poor.

Some time ago I had walked down streets in the city and passed people sleeping in doorways, possessions gathered close.  They were haggard and dirty and I used to wonder what I would do in that situation.  Would I really want to continue like that?  Of course, it won't get that bad, I thought.  What is it that keeps a person going, having to live in a place like the "Tenderloin"?   Only the fear of death?  A hopeless, and painful existence lived only because one is afraid of not being any more.  I wondered then, and I wonder now, what those folks had done, what mistakes they had made to get themselves into that situation.  Were they like me?  Did they think that they were immune from disasters like the ones that they had obviously suffered?  Or had they, like me, had presentiments of catastrophe?  and I forgot for a while that I had felt drawn to those folks on the street as though I could be one of them some day.  I dismissed the thought for that moment.

People don’t want to think about these things.  We all know how people jumped out of windows in 1929 when they were ruined.  And why not?  It’s a reasonable response to losing everything you have.  I’d heard of a multi-billionaire who killed himself upon losing just one of his billions!  A couple of years ago when I realized that I was facing ruin I looked down from my lovely view at the ground below I tried to imagine falling, what the parabola of my fall would be, whether I would hit the ground cleanly or glance off of that planter box that seemed to be in the way?  That would hurt, and I didn’t want to suffer, I don’t like pain.  Would I lose consciousness on the way down?  I would hope so.  Even if not, I knew that the decision to jump would be the one decision I had made in my life that I would never regret.

Well I did face ruin.  But I didn't jump off of anything.  I borrowed money, I took charity from the government, I survived as I had to.  But I didn't stop studying--even though I didn't have the wherewithal to trade.  I did it because I found it fascinating, which is really the only reason a person should do anything: for the love of doing it.  While living in the Tenderloin in conditions that Charles Dickens could better describe than I, I studied the markets.  I saved a little money and put it into an options account at a major brokerage that offers a very nice on-line trading platform.  It was just a few hundred dollars and I had to lie to them to get them to allow me to trade.  It wasn't really the options that I was interested in;  it was the futures.  I still love the futures.  In particular it was the index futures, the ones that I knew I could make money with because it was with that product that I had had my first winning month. So I logged into that program every day, though only during the hours that the library is open.  I don't have the income to get my own internet connection.  But at the library I explored the charts of the index futures, namely the e-mini S&P futures.  And after a year or so I actually did find what I had been looking for: a nearly fool-proof way to make money in this market.  It has to be "nearly" because there is no such thing as a perfect system.  My punishment, what I have been experiencing, has taught me...  Well, I'm not sure what it taught me, but I know that a person has to live with the conditions given, and like the Tenderloin, the futures market will kill you if you're not careful, but unlike the Tenderloin the futures can make life better.






The title of this blog refers to an article I wrote for the magazine Technical Analysis of Stocks and Commodities.  It came out in January of 2016 and I would recommend it to anyone wishing me success in my endeavors.  I hope to secure a loan, repayable with a high rate of interest for anyone willing to take a small amount of risk: Not more than $1000 in exchange for at least doubling the $3000 investment.


Anyone interested can get in touch with me by email at phealyhill@gmail.com