- Ed Seykota
mine too
trading
Wednesday 26 June 2013
Sunday 16 June 2013
Wednesday 12 June 2013
"Not dead. Can't quit."
Richard J. Machowicz is a martial arts specialist who achieved certified
instructor rating in the U.S. Navy SEAL hand-to-hand combat program.
Even though he is not a trader, Larry Connors interviewedMachowicz
for TradingMarkets because so many of the insights in his book,
“Unleashing TheWarriorWithin: Using the 7 Principles of Combat to Achieve
Your Goals,” apply to trading. This conversation took place in late 2002.
LARRY CONNORS:Welcome Richard. I have a number of questions for you,
and our main focus in this interview will be on extreme achievement.
Our members tend to be type A individuals, many of whom have been
successful in a previous profession and are now trying to succeed in the
trading industry, which is a very, very difficult game. It is an extremely
mental game which has less to do with having the ability to get in and
out of positions than being able to sustain losses and handle chaos in
those positions. Most people can’t handle it. The failure rate in the industry
is high. And it’s high with people who are incredibly intelligent.
It also has to do with the fact that trading tends to be counterintuitive.
That confuses people because they have previously succeeded by being
intuitive and logical. Trading is just the opposite.Whatwe’re going to try
to do here is focus on achievement—why people achieve great success
— not only in trading, but in all walks of life.
Richard J. MACHOWICZ: Sounds great.
CONNORS: Themain thing that people are interested in is the fact that you
were a successful Navy SEAL. Let’s talk about the extreme training
process that one has to go through to become a SEAL. As I see it, it becomes
a mastery over two things. The first thing is the mastery over the
The Mind 123
SEALs which is one skill set, and the other
thing is the mastery over yourself, which is
harder to do. Do you want to talk about that
and take it from there?
MACHOWICZ: Sure.What it takes to make it as
a SEAL and to achieve extreme success in
anything in life really comes down to one
thing: How bad do you want it? There are
times when you think that the SEAL instructors
are literally trying to kill you. You have
to be able to generate the capacity to keep
moving forward in spite of that fact. Or at
least in spite of that belief. I think that’s the
real challenge, but I also think that it translates to everything you want
to do really badly in life.
It’s not some magic formula that’s going to allow somebody to go after
the thing they want to do. It’s the consistent progress or moving toward
the thing they want to do, regardless of whatever thing comes up—and
I call that thing “quitting.”
That quitting conversation will show up a hundred different ways.
You can say, “This thing is bullshit. This thing is crazy. I can’t believe
I’m doing this.” Or you can create things like, “Well, that person’s just
trying to hold me back,” or “I’m just not good enough.” Whatever. . .
I’m telling you, quitting sounds very reasonable. Literally, it’s a very
simple process of getting on target and moving forward vs. the conversation
that leads to quitting. And those conversations show up
every day for people. And really, that’s the battle. That’s the war. If
124 Chapter 14
“What it takes
to make it as
a SEAL and
to achieve
extreme success
in anything
in life really
comes down to
one thing:
How bad do
you want it?”
there’s a war going on, really the war is within yourself and one you
have to confront day after day.
Themajority of people who get selected to SEAL training will quit, drop
out or simply go away. You’ve got to be able to generate within yourself
themind frame that youmust always be going forward.And you’ve got
to want the thing bad enough to be willing to do anything to get there,
regardless of and in spite of all the obstacles, in spite of all the hurdles,
in spite of all the doubts that get in and the stress and the pain, you’ve
got to keep going forward.
CONNORS: Is it necessary to have the mind frame to reach extreme goals
that you are either going to achieve the goals or die? Because that
seems to be the common characteristic for many people, such as Navy
SEALs, who achieve extreme success. It’s tough for somebody to sustain
that type of mind frame, but is that the type of mind frame it takes
to get there?
MACHOWICZ: Well, it makes it very binary. You’re either going forward
and accomplishing or you’re not. It’s very clear under pressure, under
stress, under doubt, under hesitation, under pain, under intense fear, to
make that clear decision. You’re either going forward toward it, or you’re
not. It gets all the excuses out of there. I’mtelling you: quitting is very reasonable.
I can have amillion reasons to quit. But can you find the one reason
to keep going forward? And literally, by saying, “Well, I’m going to keep
going until I die.”As long as you’re still breathing, as long as you have a single
pulse in your body, you can still go forward. I think it justmakes it very
easy to distinguishwhether you’re going forward or you’re not.
Under stress and pressure, you think about the doubt. . . and it’s just self
doubt. I think everybody has self doubt. Everybody has those things that
The Mind 125
occasionally creep in. I don’t care how strong
you are. You’ve still got to be able to go one
step further. And as long as you can breathe,
you can still go one step further. You’re not
dead. And so I live by the axiom, “Not dead.
Can’t quit.”
“On the back of this picturewas a quote that said, ‘Aman can only be defeated
in two ways. . . if he gives up, or if he dies.’ “
I got a quote that really droveme forwardwhen Iwas trying to get ready
for the SEAL team and getting ready for BUD/S. It’s a six month course
and people get badly injured. We had four broken necks, broken legs,
and broken arms in the class. It’s a severe, intense course.And they have
this thing everybody knows about called HellWeek in which 80% of the
participants fail. . . I think we had a class of about 140 people and eventually
we finished with 23 or 24 people graduating. That’s a significant
drop off, especially considering the screening process you had to go
through just to qualify for the class. I was like 150 lb. soaking wet at 6 ft.
I was desperate to have some kind of advantage. Some kind of thing that
would give me an edge. When it was going bad, I needed something to
keep me going forward.
I was fortunate to have a friend whose brother had made it through
SEAL camp. I didn’t know the guy personally, but what happened was
he sent me a picture. On the picture was just his platoon jumping out of
an airplane. It gave me a visual representation of what I wanted to be
able to accomplish. Butmore importantly,when I turned the picture over,
there was a quote. On the back of this picture was a quote that said, “ A
man can only be defeated in two ways: if he gives up, or if he dies.” That
126 Chapter 14
“And so I live
by the axiom,
‘Not dead.
Can’t quit.’ ”
radically shifted where I was ever going to come from that day to the
day I die. Aman can only be defeated in two ways — he gives up or he
dies. I carried that quote withme until the ink disappeared off that piece
of paper.
CONNORS: Great mind frame.
Your means of execution to achieve your goals is centered around a
phrase you coined: “targets, weapons,movement.” You choose your target,
which is basicallywhat you are trying to accomplish. This targetwill
dictatewhatweapons youwill use to achieve the target.And yourmovementwill
be based upon theweapons youwill be using. I knowthis concept
is new for many people who are reading this for the first time, so
let’s walk through it.
MACHOWICZ: Yeah. I created this thing called the play dynamic for combat.
Basically, it’s: Targets dictate the weapons. Weapons dictate movement.
As long as you are very clear on what your target is, you don’t
even have to think, and weapons will show up. You don’t have to think
and the appropriate movement will show up. That way you see the
things that matter vs. all the things that don’t. That’s what we’re competing
for on a second-by-second basis, especially under stress and pressure.
You’re competing with all the information that doesn’t matter vs.
the specific information that does.And what happens ismost people fixate
on the minutiae that don’t matter vs. the one laser point that will
drive them to the thing they want to accomplish.
CONNORS: The target applies to anything in life. For the Navy SEALs,
you guys went quickly into a foreign country to execute a mission.
That mission became your target. That’s all that mattered. But that
The Mind 127
same focus applies to everything in life. I recently read an article by a professor
from Harvard Business School. His research found that there is no
formula to business greatness. There are, however, themes, and the number
one themewas a clearmission. So essentially, the peoplewho achieved
greatness in their businesses had a clear mission. They had a clear target.
Andwhen it comes down to trading, it is the same thing.Aclear target can
be wanting to earn $1 million a year, or wanting to become the #1 hedge
fundmanager in the world. That becomes a clear target.
MACHOWICZ: Yes, for sure. You just talked about big targets. I also categorize
targets as primary and secondary. . . once you get a target that
big, I call it the mission. Inside of that mission, there have to be incremental
targets. In other words, there is a target before the next target. I
call that target the primary target which will, if you hit it and knock it
down, set up the secondary target.
CONNORS: Give us some examples. Let’s say we know what the ultimate
target is, what the mission is. What are examples of the primary targets
here within this mission?
MACHOWICZ: In a SEAL team context, what is our mission? Let’s say,
we’re supposed to do a kidnap, what they call a body snatch. In other
words, we need to collect the general.We go to grab a specific person because
that person has intelligence, and we need to capture that person
alive. That is the mission. There can then be literally a hundred or two
hundred different targets inside that mission. Now all that matters is accomplishing
themission, but before you can accomplish themission, you
have to do planning. Youmake a target of setting up a good plan. In other
words, creating a time, a very specific time frame where we’ve got to
have a good plan by this time. Period. The end. Now that’s the target.
128 Chapter 14
Now you start to break up little things. Ultimately, inside of a mission
you have insertion — you could be jumping out of an airplane or coming
in by a boat or being inserted via submarine. Then you have infiltration
— the process of getting to the target, the main objective. And then
you have the actions you do, what they call actions on the objective.
What specifically are you going to do on the objective? Then you have to
leave the objective and exfiltrate, in other words get out of that dangerous
territory now that you’ve told everybody in the world that you’re
probably in that town. . .
CONNORS: So are these all targets on the way?
MACHOWICZ: Yes, because if I started focusing on exfiltration before I actually
got the guy, what are the odds of me being able to get the guy, or
to actually infiltrate?
CONNORS: It’s one step at a time.
MACHOWICZ: You’ve got it.
CONNORS: Let’s talk about this in trading terms then. Your first target
would be to identify the setup. Then it would be to properly get into that
setup. Then it’s to properly put in your exit strategy. You’re going one
step at a time. You’re not thinking about losing money or how you’re
going to spend the money or whether or not this is your third win in a
row. You’re not jumping ahead four steps — your total focus is on simply
executing the next step.
MACHOWICZ: Exactly. Which helps you stay focused on the main target.
The Mind 129
CONNORS: And it takes the chaos out of the situation.
MACHOWICZ: Exactly! In other words, thoughts or feelings or things that
don’t belong get thrown by the wayside and only what is essential to accomplishing
your overall mission is kept in the mix.
CONNORS: So targets dictate weapons; weapons dictate movement. We’ve
talked about the targets, let’s talk aboutweapons.Howdoes this allwork?
MACHOWICZ: Really, when we talk about weapons, I use it as a physical
metaphor because usually I try to teach it through a physical metaphor. I
want you to developweapons that easily knock down the targetwithout you
getting hurt.And that’s really important, for example, when you talk about
using stops in your trading.Minimizing losses is one of the steps in helping
you hit your target and one of theweapons you use to do this is to use stops.
What you’re trying to do is use specificweapons tomaximize a profit ormaximize
an incomewithout putting yourself inmajor jeopardy.
CONNORS: Go further. . .
MACHOWICZ: The weapons are. . . let’s call it a skill set. The weapons
could be skills, they could be strategies. They could be actual tools. They
could be the technology you are using. It depends on how you’re looking
at it. What your target is. Again, it really depends on what your target
is. But most likely it’s skills, or equipment, gear. . . whatever it is that
helps you knock down the target. And movement is simply the act of
making the weapon hit the target.
The longer it takes for you to pull the trigger. . . themore that doubt, hesitation,
pain and fear will creep in. . .
130 Chapter 14
CONNORS: I see this a lot where traders will not pull the trigger on a trade
. . . they have a movement problem. They have everything put together,
they knowthey’re supposed to take the trade, they knowwhere the entry
is, and then when it comes time to pull the trigger, they won’t do it.
That’s the movement you’re talking about. They become paralyzed.
MACHOWICZ:Well, that’s what happens. Somewhere in this chain of “targets
dictate weapons, weapons dictate movement,” someplace between
target and weapon, the whole world can fit in there. When I say the
whole world I mean your whole world of doubt, second-guessing, hesitation,
fear, the unknown.And the longer it takes for you to pull the trigger
– like you said – the more that doubt, second-guessing, hesitation,
pain and fear creep in to that mechanism. . .
CONNORS: How do you get them to not creep in?
MACHOWICZ: Go back to the target! Focus only on this one thing. Just ask
yourself, “What is the target?What is the target?” This incredibly reduces
the chaos and brings everything back into focus.
CONNORS: Always focus on the target.
MACHOWICZ: Yes. And the second half of this is having guts.
What I like to do — basically it’s a really simple question. I do this
thing called the “gut check.” I was really trying to find out what it was
going to take for me to be able to just really handle BUD/S and become
a SEAL. What it was going to take for me? Was it going to be
that the kind of shorts I wore would reduce chafing?Would it be some
kind of socks I wore to reduce some of the chafing or maybe try and
keep my feet warm? Was it going to be some kind of supplement that
The Mind 131
was going to help me? It turned out that all that stuff was garbage.
That didn’t matter. The one thing that kept coming back to me when I
would check in, trying to find out what that secret was, was you have
to have guts. You’ve just got to have guts. I got the experience of learning
what guts were by sticking through to the end. I got that visceral
feeling of what “guts” was. So what I wanted to do was develop a very
simple way so that you could get a gut check. If you could answer yes
to these three questions, you have the guts you need to take on anything
in life.
CONNORS: What are those three questions?
MACHOWICZ: The first question is: Are you willing to make a choice?
Now, a lot of people make choices every day. They choose to watch TV,
or to do something else, or they choose to be nice to somebody or they
choose not to be nice to somebody. But rarely do theymake a choice that
would substantially improve the quality of their lives. I’mwilling to give
the benefit of the doubt to the person willing to play the game, and yes,
a lot of people are willing tomake choices. But when we come to the second
question, we start losing people.
We probably lose half the people on the second question: Do you have
the courage to start?
Alot of people talk the talk, but when it comes to walking the walk, they
disappear. Really, that’s it. Are you willing to step up and show up and
get the work done?
CONNORS: Why do you think half the people stop?
132 Chapter 14
MACHOWICZ: I think people are afraid.
CONNORS: Why?
MACHOWICZ:Why? Number one, I think people don't think they're good
enough, for the most part. People think there's something inherently
wrong with themselves.
CONNORS: Self doubt.
MACHOWICZ: Yes, they just don't feel they're worthy. They're afraid to
even try. They're so sure they're going to fail. They're so sure they're
going to get screwed. They're so sure it's going to fall apart that they refuse
to even show up in the first place.
CONNORS: How do you overcome that?
MACHOWICZ: How? Recognize you don't even know what's going to
happen. You do not know from second to second what is going to happen
in your life. You've got an idea. You think you know. But the reality
is what's going to happen ten seconds from now you really don't
know. What's going to happen an hour from now? You really don't
know. A year from now? You really don't know. That's the state, that's
the condition of our lives.
CONNORS: So if you don't try, you do knowthat you're not going to succeed.
MACHOWICZ: But you knowwhat?You didn't even have an opportunity. The
mind doesn'twant to even go there. Itwill just assume that it knows that you
can't succeed, so it validates the fact that, guesswhat? "I knoweverything."
The Mind 133
CONNORS: How do you trip the mind
up to make it believe it will succeed?
MACHOWICZ: I don't think you have to
trip the mind up. I mean you can do
that. You can short-circuit that
process. You can.
CONNORS: And the third question is...
MACHOWICZ: Do you have the guts to
finish? Do you have the guts to succeed
at the mission you set out to
achieve? Do you know what the only
common characteristic there is
amongst the thousands of people
who haven't made it through Hell
Week?
CONNORS: What’s that?
MACHOWICZ: They quit.
CONNORS: The things that you're teaching here are not just appropriate for
Navy SEALs, they are appropriate for any walk of life, no matter what
you're doing.
MACHOWICZ: That's absolutely correct.
134 Chapter 14
“When I look
at the guys I’ve
worked with
that have been
successful,
the one thing
I see consistently
is the commitment
to finish. Yes, they
were willing to
make a choice,
they had the courage
to start, but the
thing that made
the difference,
was the commitment
to finish no
matter what.”
CONNORS: You've obviously been around extremely successful achievement-
oriented peoplewho have achieved extreme levels of success in their
field, including your teammates in the SEALs. I've read that fromapplication
time to the finish of BUD/Sonly one in 6000 get through the process. So
these are peoplewho are executing at a level in life beyondwhatmost people
can comprehend.You alsowork directlywith individualswho are professional
athletes, top names in the entertainment industry and some
very successful businessmen. If you could state a single characteristic, a
common theme, what would it be for their success?
MACHOWICZ: Avery clear target and perseverance.
When I look at the guys I've worked with that have been successful, the
one thing I see consistently is the commitment to finish. Yes, they were
willing tomake a choice, they had the courage to start, but the thing that
made the difference,was the commitment to finish nomatterwhat. Even
if they were going to finish dead last, they were going to finish. I think
that's the big thing. People do not finish what they start. A lot of people
will start things but never see it through to the end.
CONNORS: These guys pick a target and are always moving forward to
that target. Is that correct?
MACHOWICZ: Absolutely. If you're at least going forward to the target,
you're always moving forward in your world. And that's the most important
thing. You have one life. You've got to play it full out. If you play
it half-assed, if you play it partially, I'm telling you, on your deathbed,
you'll be wondering why you ever were born.
The Mind 135
CONNORS: Going back to the SEALs, had that become the mind frame?
You'd be killed; you'd be out immediately...
MACHOWICZ: Oh yeah, I mean what happens is -- Vince Lombardi had
a great quote, "Fatigue makes cowards of us all." Literally, what happens
with BUD/S, you will have work that will have mentally and physically
fatigued you to the point where you only have to blink for a
second, when you're on your third or fourth day of Hell Week, and
you're freezing cold and you're miserable and you just saw three other
people quit. You only have to have one moment... it only takes you 30
seconds to quit, and you've destroyed all that time that you've put in.
You lose sight of the target and it is over.
One of the things I did early during Hell Week was I would say, "Well,
I made it through one evolution, I can make it through one more. I
made it through two. I can make it through one more. I made it through
three, I can make it through one more. If I made it through four evolutions,
I can make it through one more. If I made it through four, I could
probably do another four. If I did eight, I could probably do another
eight. Oh, I've got one day down, let me try another day. I got two days
down, I bet I can do one more day. I got three days down. You know
what? I know I can do three more days."
Just let it go.And next thing you know, you start building thismotor ofmomentum,
this engine of momentum that just keeps driving you forward,
keeps driving you forward, keeps driving you forward. Because I'mtelling
you, that conversation is not a conversation you're going away from. That
is a conversation ofmoving forward.Andmoving forward toward a target
that you set for yourself and refuse to quit. People say, "Refuse to lose." I say
136 Chapter 14
"refuse to quit." Recognize the dialogue that leads to quitting and youwon't
have to worry about losing.
CONNORS: Paul "Bear" Bryant's famous quote, "The first time you quit it's
hard, the second time is a little easier and the third time you quit, you
don't even have to think about it."
MACHOWICZ: Perfect.
CONNORS: You talk about this in your book. Act as though it is impossible
to fail.
MACHOWICZ: Act as though it is impossible to fail. If you are doing
these things, if you are clearly on your target, if you are persistent and
committed to finishing and you are really committed to results vs. reason,
you will succeed. Success is not some magic mystery out there. It is
a clear connection to the target.
CONNORS: Let me go back and ask you a question regarding chaos. During
your combat missions, your life was very much on the line. If something
goes wrong - you're dead. How do you eliminate the stress of that
knowledge?
MACHOWICZ: Stay focused only on the target, that's how!
CONNORS:And they teach you that in the SEALs? They teach you howto...
MACHOWICZ: It's not even "teach," it's just "stay focused." What is the
target? You may have to ask yourself that moment to moment. What
The Mind 137
do I have to do now? What's the target now? This moment, this moment,
this moment...
Always come back to the target. I can't stress that strongly enough. I
don't care what's happening... the universe could be falling apart
around you. As long as you keep going, "What's the target? What do I
have to do right now? What's the target right this second?" The results
will take care of themselves. And to the outside world it will look like
nothing ever phases you.
CONNORS: Summarize your message to us.
MACHOWICZ: Intense focus on hitting the target and never quitting. It
worked forme inmy 10 years with the Navy SEALs, it works for the professional
athletes I work with and it works for the other very successful
people I work with. Live with the mind frame, "Not dead. Can't quit."
CONNORS: Thank you, Richard. This is a great way to end.
instructor rating in the U.S. Navy SEAL hand-to-hand combat program.
Even though he is not a trader, Larry Connors interviewedMachowicz
for TradingMarkets because so many of the insights in his book,
“Unleashing TheWarriorWithin: Using the 7 Principles of Combat to Achieve
Your Goals,” apply to trading. This conversation took place in late 2002.
LARRY CONNORS:Welcome Richard. I have a number of questions for you,
and our main focus in this interview will be on extreme achievement.
Our members tend to be type A individuals, many of whom have been
successful in a previous profession and are now trying to succeed in the
trading industry, which is a very, very difficult game. It is an extremely
mental game which has less to do with having the ability to get in and
out of positions than being able to sustain losses and handle chaos in
those positions. Most people can’t handle it. The failure rate in the industry
is high. And it’s high with people who are incredibly intelligent.
It also has to do with the fact that trading tends to be counterintuitive.
That confuses people because they have previously succeeded by being
intuitive and logical. Trading is just the opposite.Whatwe’re going to try
to do here is focus on achievement—why people achieve great success
— not only in trading, but in all walks of life.
Richard J. MACHOWICZ: Sounds great.
CONNORS: Themain thing that people are interested in is the fact that you
were a successful Navy SEAL. Let’s talk about the extreme training
process that one has to go through to become a SEAL. As I see it, it becomes
a mastery over two things. The first thing is the mastery over the
The Mind 123
SEALs which is one skill set, and the other
thing is the mastery over yourself, which is
harder to do. Do you want to talk about that
and take it from there?
MACHOWICZ: Sure.What it takes to make it as
a SEAL and to achieve extreme success in
anything in life really comes down to one
thing: How bad do you want it? There are
times when you think that the SEAL instructors
are literally trying to kill you. You have
to be able to generate the capacity to keep
moving forward in spite of that fact. Or at
least in spite of that belief. I think that’s the
real challenge, but I also think that it translates to everything you want
to do really badly in life.
It’s not some magic formula that’s going to allow somebody to go after
the thing they want to do. It’s the consistent progress or moving toward
the thing they want to do, regardless of whatever thing comes up—and
I call that thing “quitting.”
That quitting conversation will show up a hundred different ways.
You can say, “This thing is bullshit. This thing is crazy. I can’t believe
I’m doing this.” Or you can create things like, “Well, that person’s just
trying to hold me back,” or “I’m just not good enough.” Whatever. . .
I’m telling you, quitting sounds very reasonable. Literally, it’s a very
simple process of getting on target and moving forward vs. the conversation
that leads to quitting. And those conversations show up
every day for people. And really, that’s the battle. That’s the war. If
124 Chapter 14
“What it takes
to make it as
a SEAL and
to achieve
extreme success
in anything
in life really
comes down to
one thing:
How bad do
you want it?”
there’s a war going on, really the war is within yourself and one you
have to confront day after day.
Themajority of people who get selected to SEAL training will quit, drop
out or simply go away. You’ve got to be able to generate within yourself
themind frame that youmust always be going forward.And you’ve got
to want the thing bad enough to be willing to do anything to get there,
regardless of and in spite of all the obstacles, in spite of all the hurdles,
in spite of all the doubts that get in and the stress and the pain, you’ve
got to keep going forward.
CONNORS: Is it necessary to have the mind frame to reach extreme goals
that you are either going to achieve the goals or die? Because that
seems to be the common characteristic for many people, such as Navy
SEALs, who achieve extreme success. It’s tough for somebody to sustain
that type of mind frame, but is that the type of mind frame it takes
to get there?
MACHOWICZ: Well, it makes it very binary. You’re either going forward
and accomplishing or you’re not. It’s very clear under pressure, under
stress, under doubt, under hesitation, under pain, under intense fear, to
make that clear decision. You’re either going forward toward it, or you’re
not. It gets all the excuses out of there. I’mtelling you: quitting is very reasonable.
I can have amillion reasons to quit. But can you find the one reason
to keep going forward? And literally, by saying, “Well, I’m going to keep
going until I die.”As long as you’re still breathing, as long as you have a single
pulse in your body, you can still go forward. I think it justmakes it very
easy to distinguishwhether you’re going forward or you’re not.
Under stress and pressure, you think about the doubt. . . and it’s just self
doubt. I think everybody has self doubt. Everybody has those things that
The Mind 125
occasionally creep in. I don’t care how strong
you are. You’ve still got to be able to go one
step further. And as long as you can breathe,
you can still go one step further. You’re not
dead. And so I live by the axiom, “Not dead.
Can’t quit.”
“On the back of this picturewas a quote that said, ‘Aman can only be defeated
in two ways. . . if he gives up, or if he dies.’ “
I got a quote that really droveme forwardwhen Iwas trying to get ready
for the SEAL team and getting ready for BUD/S. It’s a six month course
and people get badly injured. We had four broken necks, broken legs,
and broken arms in the class. It’s a severe, intense course.And they have
this thing everybody knows about called HellWeek in which 80% of the
participants fail. . . I think we had a class of about 140 people and eventually
we finished with 23 or 24 people graduating. That’s a significant
drop off, especially considering the screening process you had to go
through just to qualify for the class. I was like 150 lb. soaking wet at 6 ft.
I was desperate to have some kind of advantage. Some kind of thing that
would give me an edge. When it was going bad, I needed something to
keep me going forward.
I was fortunate to have a friend whose brother had made it through
SEAL camp. I didn’t know the guy personally, but what happened was
he sent me a picture. On the picture was just his platoon jumping out of
an airplane. It gave me a visual representation of what I wanted to be
able to accomplish. Butmore importantly,when I turned the picture over,
there was a quote. On the back of this picture was a quote that said, “ A
man can only be defeated in two ways: if he gives up, or if he dies.” That
126 Chapter 14
“And so I live
by the axiom,
‘Not dead.
Can’t quit.’ ”
radically shifted where I was ever going to come from that day to the
day I die. Aman can only be defeated in two ways — he gives up or he
dies. I carried that quote withme until the ink disappeared off that piece
of paper.
CONNORS: Great mind frame.
Your means of execution to achieve your goals is centered around a
phrase you coined: “targets, weapons,movement.” You choose your target,
which is basicallywhat you are trying to accomplish. This targetwill
dictatewhatweapons youwill use to achieve the target.And yourmovementwill
be based upon theweapons youwill be using. I knowthis concept
is new for many people who are reading this for the first time, so
let’s walk through it.
MACHOWICZ: Yeah. I created this thing called the play dynamic for combat.
Basically, it’s: Targets dictate the weapons. Weapons dictate movement.
As long as you are very clear on what your target is, you don’t
even have to think, and weapons will show up. You don’t have to think
and the appropriate movement will show up. That way you see the
things that matter vs. all the things that don’t. That’s what we’re competing
for on a second-by-second basis, especially under stress and pressure.
You’re competing with all the information that doesn’t matter vs.
the specific information that does.And what happens ismost people fixate
on the minutiae that don’t matter vs. the one laser point that will
drive them to the thing they want to accomplish.
CONNORS: The target applies to anything in life. For the Navy SEALs,
you guys went quickly into a foreign country to execute a mission.
That mission became your target. That’s all that mattered. But that
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same focus applies to everything in life. I recently read an article by a professor
from Harvard Business School. His research found that there is no
formula to business greatness. There are, however, themes, and the number
one themewas a clearmission. So essentially, the peoplewho achieved
greatness in their businesses had a clear mission. They had a clear target.
Andwhen it comes down to trading, it is the same thing.Aclear target can
be wanting to earn $1 million a year, or wanting to become the #1 hedge
fundmanager in the world. That becomes a clear target.
MACHOWICZ: Yes, for sure. You just talked about big targets. I also categorize
targets as primary and secondary. . . once you get a target that
big, I call it the mission. Inside of that mission, there have to be incremental
targets. In other words, there is a target before the next target. I
call that target the primary target which will, if you hit it and knock it
down, set up the secondary target.
CONNORS: Give us some examples. Let’s say we know what the ultimate
target is, what the mission is. What are examples of the primary targets
here within this mission?
MACHOWICZ: In a SEAL team context, what is our mission? Let’s say,
we’re supposed to do a kidnap, what they call a body snatch. In other
words, we need to collect the general.We go to grab a specific person because
that person has intelligence, and we need to capture that person
alive. That is the mission. There can then be literally a hundred or two
hundred different targets inside that mission. Now all that matters is accomplishing
themission, but before you can accomplish themission, you
have to do planning. Youmake a target of setting up a good plan. In other
words, creating a time, a very specific time frame where we’ve got to
have a good plan by this time. Period. The end. Now that’s the target.
128 Chapter 14
Now you start to break up little things. Ultimately, inside of a mission
you have insertion — you could be jumping out of an airplane or coming
in by a boat or being inserted via submarine. Then you have infiltration
— the process of getting to the target, the main objective. And then
you have the actions you do, what they call actions on the objective.
What specifically are you going to do on the objective? Then you have to
leave the objective and exfiltrate, in other words get out of that dangerous
territory now that you’ve told everybody in the world that you’re
probably in that town. . .
CONNORS: So are these all targets on the way?
MACHOWICZ: Yes, because if I started focusing on exfiltration before I actually
got the guy, what are the odds of me being able to get the guy, or
to actually infiltrate?
CONNORS: It’s one step at a time.
MACHOWICZ: You’ve got it.
CONNORS: Let’s talk about this in trading terms then. Your first target
would be to identify the setup. Then it would be to properly get into that
setup. Then it’s to properly put in your exit strategy. You’re going one
step at a time. You’re not thinking about losing money or how you’re
going to spend the money or whether or not this is your third win in a
row. You’re not jumping ahead four steps — your total focus is on simply
executing the next step.
MACHOWICZ: Exactly. Which helps you stay focused on the main target.
The Mind 129
CONNORS: And it takes the chaos out of the situation.
MACHOWICZ: Exactly! In other words, thoughts or feelings or things that
don’t belong get thrown by the wayside and only what is essential to accomplishing
your overall mission is kept in the mix.
CONNORS: So targets dictate weapons; weapons dictate movement. We’ve
talked about the targets, let’s talk aboutweapons.Howdoes this allwork?
MACHOWICZ: Really, when we talk about weapons, I use it as a physical
metaphor because usually I try to teach it through a physical metaphor. I
want you to developweapons that easily knock down the targetwithout you
getting hurt.And that’s really important, for example, when you talk about
using stops in your trading.Minimizing losses is one of the steps in helping
you hit your target and one of theweapons you use to do this is to use stops.
What you’re trying to do is use specificweapons tomaximize a profit ormaximize
an incomewithout putting yourself inmajor jeopardy.
CONNORS: Go further. . .
MACHOWICZ: The weapons are. . . let’s call it a skill set. The weapons
could be skills, they could be strategies. They could be actual tools. They
could be the technology you are using. It depends on how you’re looking
at it. What your target is. Again, it really depends on what your target
is. But most likely it’s skills, or equipment, gear. . . whatever it is that
helps you knock down the target. And movement is simply the act of
making the weapon hit the target.
The longer it takes for you to pull the trigger. . . themore that doubt, hesitation,
pain and fear will creep in. . .
130 Chapter 14
CONNORS: I see this a lot where traders will not pull the trigger on a trade
. . . they have a movement problem. They have everything put together,
they knowthey’re supposed to take the trade, they knowwhere the entry
is, and then when it comes time to pull the trigger, they won’t do it.
That’s the movement you’re talking about. They become paralyzed.
MACHOWICZ:Well, that’s what happens. Somewhere in this chain of “targets
dictate weapons, weapons dictate movement,” someplace between
target and weapon, the whole world can fit in there. When I say the
whole world I mean your whole world of doubt, second-guessing, hesitation,
fear, the unknown.And the longer it takes for you to pull the trigger
– like you said – the more that doubt, second-guessing, hesitation,
pain and fear creep in to that mechanism. . .
CONNORS: How do you get them to not creep in?
MACHOWICZ: Go back to the target! Focus only on this one thing. Just ask
yourself, “What is the target?What is the target?” This incredibly reduces
the chaos and brings everything back into focus.
CONNORS: Always focus on the target.
MACHOWICZ: Yes. And the second half of this is having guts.
What I like to do — basically it’s a really simple question. I do this
thing called the “gut check.” I was really trying to find out what it was
going to take for me to be able to just really handle BUD/S and become
a SEAL. What it was going to take for me? Was it going to be
that the kind of shorts I wore would reduce chafing?Would it be some
kind of socks I wore to reduce some of the chafing or maybe try and
keep my feet warm? Was it going to be some kind of supplement that
The Mind 131
was going to help me? It turned out that all that stuff was garbage.
That didn’t matter. The one thing that kept coming back to me when I
would check in, trying to find out what that secret was, was you have
to have guts. You’ve just got to have guts. I got the experience of learning
what guts were by sticking through to the end. I got that visceral
feeling of what “guts” was. So what I wanted to do was develop a very
simple way so that you could get a gut check. If you could answer yes
to these three questions, you have the guts you need to take on anything
in life.
CONNORS: What are those three questions?
MACHOWICZ: The first question is: Are you willing to make a choice?
Now, a lot of people make choices every day. They choose to watch TV,
or to do something else, or they choose to be nice to somebody or they
choose not to be nice to somebody. But rarely do theymake a choice that
would substantially improve the quality of their lives. I’mwilling to give
the benefit of the doubt to the person willing to play the game, and yes,
a lot of people are willing tomake choices. But when we come to the second
question, we start losing people.
We probably lose half the people on the second question: Do you have
the courage to start?
Alot of people talk the talk, but when it comes to walking the walk, they
disappear. Really, that’s it. Are you willing to step up and show up and
get the work done?
CONNORS: Why do you think half the people stop?
132 Chapter 14
MACHOWICZ: I think people are afraid.
CONNORS: Why?
MACHOWICZ:Why? Number one, I think people don't think they're good
enough, for the most part. People think there's something inherently
wrong with themselves.
CONNORS: Self doubt.
MACHOWICZ: Yes, they just don't feel they're worthy. They're afraid to
even try. They're so sure they're going to fail. They're so sure they're
going to get screwed. They're so sure it's going to fall apart that they refuse
to even show up in the first place.
CONNORS: How do you overcome that?
MACHOWICZ: How? Recognize you don't even know what's going to
happen. You do not know from second to second what is going to happen
in your life. You've got an idea. You think you know. But the reality
is what's going to happen ten seconds from now you really don't
know. What's going to happen an hour from now? You really don't
know. A year from now? You really don't know. That's the state, that's
the condition of our lives.
CONNORS: So if you don't try, you do knowthat you're not going to succeed.
MACHOWICZ: But you knowwhat?You didn't even have an opportunity. The
mind doesn'twant to even go there. Itwill just assume that it knows that you
can't succeed, so it validates the fact that, guesswhat? "I knoweverything."
The Mind 133
CONNORS: How do you trip the mind
up to make it believe it will succeed?
MACHOWICZ: I don't think you have to
trip the mind up. I mean you can do
that. You can short-circuit that
process. You can.
CONNORS: And the third question is...
MACHOWICZ: Do you have the guts to
finish? Do you have the guts to succeed
at the mission you set out to
achieve? Do you know what the only
common characteristic there is
amongst the thousands of people
who haven't made it through Hell
Week?
CONNORS: What’s that?
MACHOWICZ: They quit.
CONNORS: The things that you're teaching here are not just appropriate for
Navy SEALs, they are appropriate for any walk of life, no matter what
you're doing.
MACHOWICZ: That's absolutely correct.
134 Chapter 14
“When I look
at the guys I’ve
worked with
that have been
successful,
the one thing
I see consistently
is the commitment
to finish. Yes, they
were willing to
make a choice,
they had the courage
to start, but the
thing that made
the difference,
was the commitment
to finish no
matter what.”
CONNORS: You've obviously been around extremely successful achievement-
oriented peoplewho have achieved extreme levels of success in their
field, including your teammates in the SEALs. I've read that fromapplication
time to the finish of BUD/Sonly one in 6000 get through the process. So
these are peoplewho are executing at a level in life beyondwhatmost people
can comprehend.You alsowork directlywith individualswho are professional
athletes, top names in the entertainment industry and some
very successful businessmen. If you could state a single characteristic, a
common theme, what would it be for their success?
MACHOWICZ: Avery clear target and perseverance.
When I look at the guys I've worked with that have been successful, the
one thing I see consistently is the commitment to finish. Yes, they were
willing tomake a choice, they had the courage to start, but the thing that
made the difference,was the commitment to finish nomatterwhat. Even
if they were going to finish dead last, they were going to finish. I think
that's the big thing. People do not finish what they start. A lot of people
will start things but never see it through to the end.
CONNORS: These guys pick a target and are always moving forward to
that target. Is that correct?
MACHOWICZ: Absolutely. If you're at least going forward to the target,
you're always moving forward in your world. And that's the most important
thing. You have one life. You've got to play it full out. If you play
it half-assed, if you play it partially, I'm telling you, on your deathbed,
you'll be wondering why you ever were born.
The Mind 135
CONNORS: Going back to the SEALs, had that become the mind frame?
You'd be killed; you'd be out immediately...
MACHOWICZ: Oh yeah, I mean what happens is -- Vince Lombardi had
a great quote, "Fatigue makes cowards of us all." Literally, what happens
with BUD/S, you will have work that will have mentally and physically
fatigued you to the point where you only have to blink for a
second, when you're on your third or fourth day of Hell Week, and
you're freezing cold and you're miserable and you just saw three other
people quit. You only have to have one moment... it only takes you 30
seconds to quit, and you've destroyed all that time that you've put in.
You lose sight of the target and it is over.
One of the things I did early during Hell Week was I would say, "Well,
I made it through one evolution, I can make it through one more. I
made it through two. I can make it through one more. I made it through
three, I can make it through one more. If I made it through four evolutions,
I can make it through one more. If I made it through four, I could
probably do another four. If I did eight, I could probably do another
eight. Oh, I've got one day down, let me try another day. I got two days
down, I bet I can do one more day. I got three days down. You know
what? I know I can do three more days."
Just let it go.And next thing you know, you start building thismotor ofmomentum,
this engine of momentum that just keeps driving you forward,
keeps driving you forward, keeps driving you forward. Because I'mtelling
you, that conversation is not a conversation you're going away from. That
is a conversation ofmoving forward.Andmoving forward toward a target
that you set for yourself and refuse to quit. People say, "Refuse to lose." I say
136 Chapter 14
"refuse to quit." Recognize the dialogue that leads to quitting and youwon't
have to worry about losing.
CONNORS: Paul "Bear" Bryant's famous quote, "The first time you quit it's
hard, the second time is a little easier and the third time you quit, you
don't even have to think about it."
MACHOWICZ: Perfect.
CONNORS: You talk about this in your book. Act as though it is impossible
to fail.
MACHOWICZ: Act as though it is impossible to fail. If you are doing
these things, if you are clearly on your target, if you are persistent and
committed to finishing and you are really committed to results vs. reason,
you will succeed. Success is not some magic mystery out there. It is
a clear connection to the target.
CONNORS: Let me go back and ask you a question regarding chaos. During
your combat missions, your life was very much on the line. If something
goes wrong - you're dead. How do you eliminate the stress of that
knowledge?
MACHOWICZ: Stay focused only on the target, that's how!
CONNORS:And they teach you that in the SEALs? They teach you howto...
MACHOWICZ: It's not even "teach," it's just "stay focused." What is the
target? You may have to ask yourself that moment to moment. What
The Mind 137
do I have to do now? What's the target now? This moment, this moment,
this moment...
Always come back to the target. I can't stress that strongly enough. I
don't care what's happening... the universe could be falling apart
around you. As long as you keep going, "What's the target? What do I
have to do right now? What's the target right this second?" The results
will take care of themselves. And to the outside world it will look like
nothing ever phases you.
CONNORS: Summarize your message to us.
MACHOWICZ: Intense focus on hitting the target and never quitting. It
worked forme inmy 10 years with the Navy SEALs, it works for the professional
athletes I work with and it works for the other very successful
people I work with. Live with the mind frame, "Not dead. Can't quit."
CONNORS: Thank you, Richard. This is a great way to end.
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