The 2 War Generals

Let me tell you a short story…

Two Chinese War Generals are preparing their armies for an impending battle. It is the 14th century.

General Ma spends his time training his soldiers to use various weapons – swords, spears, bows and arrows. He ensures his army is well versed in both armed, and unarmed combat. In terms of raw physical capability, each soldier is a fighting machine. General Ma focuses all his efforts on the content of battle.

General Li instead, spends 80% of his time studying the battlefield landscape and weather patterns – Is it a mountainous region? Or is it a swampy area? Is the place prone to heavy rainfall? Or is the climate hot and dry? What about the strength and direction of the wind? General Li focuses 80% of his efforts on understanding the context of battle while using only 20% of his time to train his soldiers based on what he has learned.

Spies of General Ma report: “My Lord, General Li spends most of his time walking along the dry savannah fields where the battle is to commence. He simply sits and gazes up at the clouds. Occasionally, he walks along the nearby river and takes a drink of water. Meanwhile, his soldiers remain in camp, sewing uniforms and building campfires! They spend only a few hours each day training for combat. They are a bunch of weaklings ill-prepared for war. We’ll win this battle for sure!”

Filled with confidence, General Ma continues training his soldiers hard. He knows that although he has the upper hand, he must not be lax in war preparations. This is, after all, a matter of life and death.

On the day of the battle, General Ma leads his troops to the battlefield. Heavily armed and armored, his battalion is a fearsome sight! As Ma approaches the field, he sees that Li’s army is already there and waiting.

“It looks like General Li is eager to meet his maker,” he chuckles to his military advisors. “And look! His men are wearing simple clothes with practically no armor… and what? No boots? They are wearing just sandals! General Li has gone mad! Does he expect to defeat me with such a paltry army? Pathetic!”

General Ma looks again at his adversary. He feels a cold wind across his face.

“It is time,” he says. “Sound the battle horn. Li will be defeated by sunset.”

General Ma steadies his horse. The battle horn thunders across the battlefield.

“Charge!!” General Ma roars.

Suddenly from a distance, he sees Li’s men bring out stacks of bows and arrows.

“Now, he must really have gone mad!” Ma exclaims, “There’s no way those arrows will reach my soldiers from that distance!”

“…And my horsemen will penetrate their front line before they can reload and fire again. This battle is as good as over!” He laughs in amusement. “This will be the easiest victory in the history of China!”

“Keep charging towards them!” He orders, “Kill every last one of them! Bring me Li’s head!”

Ma had already begun to imagine his victory march back to the capital city. He will surely be richly rewarded for defeating Li’s army!

But suddenly, he sees a flash of light in the distance.

“What is that?” Ma squints his eyes to see.

“General Ma! They are lighting their arrows with fire!” a scout reports back.

In a flash, Ma realizes what’s happening.

A rain of fire arrows blanket the sky, as they land just short of Ma’s soldiers.

“All men! Pull back! Pull back!!” Ma screams. He instantly recognizes the impending disaster.

The grass in front of his troops begin to catch fire.

The cold wind that was ignored just moments ago, has now begun to spread the fire rapidly towards Ma.

A few solders have already caught on fire.

“Retreat!! Retreat!! All forces! Pull back immediately!” Ma screams as he watches his men burn to the ground, one by one.

“My Lord,” an advisor whispers, “we must withdraw ourselves from this place!”

More men catch fire, as the wind continues to fan the growing blaze.

Ma’s soldiers struggle to run back as they are encumbered by the bulky armor and boots.

General Li orders his men to give chase. He isn’t too worried about the fire – after all, his men are wearing light-weight, flame-retardant uniforms.

“General Ma!” A scout reports, “we are flanked by two large rivers – to retreat we must cross them!”

Ma stumbles back and falls to the ground.

He realizes why Li had arrived early to the battlefield – to secure an advantageous position where the wind would be blowing from!

Now, his retreating army is trapped between a rapidly approaching wall of fire, and two rivers.

And with the bulky armor hindering his soldiers’ movements, they would either be cooked alive, or weighed down and drowned in the river.

A look of fear flashes across Ma’s face.

“It’s over,” he stammers in disbelief. “This battle was over before it even began.”

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Moral Of The Story

With most challenges in life, even a mediocre understanding of the environmental context is more important than mastery of the content.

While the content is concerned with answering the ‘how’ question, the context is concerned with the ‘why’.

Whether you are an honored General or a Forex trader, have you surveyed the environment you’ll be operating in?

Have you positioned yourself in an advantageous position to begin with? What are your strengths and weaknesses?

Are you properly equipped to fight the battle on your terms?

Or do you simply show up for battle with a bunch of “well-learned” techniques and expect to win?

Think about how you’ve been approaching your trading.

Are you like General Ma? Or General Li?

If you want to understand the environment context of retail Forex trading, check out my book, Forex Dreaming.

By |2018-11-11T04:44:05+00:00November 11th, 2018|Philosophy|21 Comments

21 Comments

  1. Jacoby January 8, 2012 at 1:28 am - Reply

    I am forever indebted to you for this information.

  2. Abel Munonyara February 1, 2012 at 12:33 am - Reply

    Dear Chris,

    I can not thank you enough for your for the previlege of reading Part 1 & Part 2 of your Trading Manfesto.
    If I had read them 2 years ago, I would be now claiming to be General Li!

    Thank you so much once more,

    Best regards,

    Abel.

  3. Elicia Forsythe February 15, 2012 at 12:17 pm - Reply

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  5. Chris Lee February 20, 2012 at 6:57 am - Reply

    Hey guys.. I’m very glad you like this post… it’s something I feel very strongly about and I had a great time writing it for you. 🙂

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  8. Winnie Whetsel March 11, 2012 at 8:38 pm - Reply

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  9. Donnie Eversley March 12, 2012 at 1:09 am - Reply

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  10. Willy Wisley March 12, 2012 at 4:40 am - Reply

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  11. Daron Laferty March 13, 2012 at 7:18 am - Reply

    WONDERFUL Post.thanks for share..more wait ..

  12. Philippe Gagnon March 15, 2012 at 2:43 pm - Reply

    OMG, what a exellent post. You got your message is very clear.

    Thanks, very much appreciated.

  13. John March 16, 2012 at 8:15 am - Reply

    Hi Lee.
    You have opened my blind eyes.I’ve been trading blindfolded.

    Looking forward to learning more from you.

    Cheers

  14. Kenneth Koshy March 18, 2012 at 2:01 am - Reply

    very interesting points you have observed , appreciate it for posting .

  15. Banjo March 18, 2012 at 11:27 pm - Reply

    Hi Chris!
    Some say that once you start searching for answers a teacher will come your way—–looks like you have showed up!!
    I intend to be a great student
    Banjo

  16. Frank March 19, 2012 at 1:52 pm - Reply

    Hi Chris
    Thanks for the honesty that comes through in your writings. The story about the 2 war generals had a real impact on me. I have a similar profile of general Ma, thinking that I can conquer the Forex market with “gadgets”, not realizing the importance of strategy planning. I trust that I can now sort this out by using your writings/experience. It is appreciated. Thanks. Frank.

  17. Ramachandra M0hanta March 28, 2012 at 5:53 am - Reply

    I like this blog. Very educative,useful for me

  18. Peter Ravindran March 17, 2013 at 12:49 pm - Reply

    It is really a knowledgeable blog. Thanks & Regards, Peter Ravindran

  19. Paul odibeli April 9, 2015 at 12:00 pm - Reply

    The truth of the matter is that this article is all about practical trend trading.Chris is sending us a message here. It is said that “the trend is your friend”,but how many of those “gurus”,actually teach “trend trading?”.
    Chris is a gift to our generation.It is said “that one needs the spirit of a prophet, to recognize a prophet” Please Chris keep up the good works & the good Lord(JESUS CHRIST),would richly reward you. Thanks & God bless you!!!

  20. Luis May 28, 2015 at 5:00 pm - Reply

    Hi Chris,

    Excellent article highlighting a key aspect of forex trading. Can you please share some sources or ideas on how to gain knowledge on forex fundamentals?

    Thanks,

    Luis

    • Chris Lee May 28, 2015 at 6:34 pm - Reply

      Hi Luis, there are 3 ways that I know of:

      1) Teach yourself by going to the library (or online) and reading up on macro-economics or international economics. Then piece it all together by relating the theory with what’s happening in the world right now.

      2) Get into a college or university program that teaches macro-economics. This will usually be in the form of a business or economics degree.

      3) Get a mentor or join a trading program that teaches you everything you need to know. I don’t see any good courses out there so that’s why I created the Icarus Project.

      Hope this helps.

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