Anti-Money Laundering in a Nutshell by Kevin Sullivan

Awareness and Compliance for Financial Personnel and Business

Many AML personnel like to check and select a box without understanding why. You need to understand the nomenclature of AML. Understand what is causing alerts in the AML system. It is crucial to understand the Bank Secrecy Act. The major players are the financial institutions, the regulators and law enforcement. These players need to work together in a dynamic environment.

What is Money Laundering?

Laundering is a method of ‘cleaning’ the funds so that it would not appear to be suspicious. The gangsters created businesses like Laundromats so as to ‘gamble’ and to ‘wash clothes’. This was to avoid suspicion as to how the funds came about. This term has been around since the beginning of the 20^th century. Why does a bad guy need to do it in the first place? If you have drivers who are paid to carry suitcases from one vehicle to another without knowing what is in the suitcase, chances are that it is hard to prosecute such people. These are known as mules. The trick is to employ the mules without them knowing what is going on. So when they get caught, they have little they know which they can reveal. AML is often very tactical and you may not know that it is happening. The industry is suspected to be about US $2 billion a year. In early stages, it is difficult to tell whether the source is for tax evasion, funding for terrorists etc. The aim is to ‘clean’ the source and make it appear legitimate. This could be done via ‘smoke screen’ transactions. Banks will perform due diligence on its customers, such as examining transaction timelines and transaction activity compared with similar businesses out there. There needs to be a predicate offense to initiate an AML case. The 3 stages are (1) placement; (2) layering; (3) integration. Placement is the act of talking bulk cash proceeds and bring it to a bank. This isn’t easy. Carrying a wheelbarrow of cash isn’t a good idea. The right way is to use a small denominations and use a business vehicle that is reliant on cash. However, law enforcement requires suspicious activity reports, currency transaction and cross-border declaration rules. Layering is where the launderer needs to make many small transactions. This is to avoid people from tracking him. One way is to use shell companies or move the money to other jurisdictions. Another way is to buy large value items and then sell them subsequently. Transactions above $10,000 must be reported to the Treasury Department. FATF has created an AML template to follow. If law enforcement wants information from a bank, they will need to send a subpoena. However, this requires time and the money might have been moved away already. Integration is where the funds are assimilated into the financial system. This is hooray for the launderer. Launderers often engage in transactions which are less than $10,000 at one go. Greed is a common cause of laundering. Terrorism is a possible cause as weapons cost money. Lastly, some criminals have an unbalanced mind. Every part of the AML team is important and plays a defined role.

Money laundering is the practice of integrating the proceeds of crime into the legitimate mainstream of the financial community by concealing its origin. – Kevin Sullivan

Methods of Money Laundering. There are only 3 ways: (1) through the legitimate financial system; (2) physically moving the money; (3) physically moving goods. For the first way, structuring deposits over a period of days, with each less than $10,000, is an example. One could hire other people to make deposits through different bank branches but to the same account. This is known as ‘smurfing’. Another way could be bringing the cash off shore into a country with strong secrecy laws. Cash can be hidden in funny places and then smuggled out. Domestic wire transfers are a type of means too. Gold is a method of laundering, and so are money service businesses (US Postal Service). Common money transfers are made through western union, Amex etc. For MSB, customer anonymity is usually maintained. However, MSBs are required to report suspicious transactions to the Treasury department recently. Records of wire transfers must be maintained for transactions above $3k. It is generally more difficult to track cash in a country with strong banking secrecy laws. SWIFT is the international message service that FIs use to send their messages for wire transfers. For SWIFT, you need to provide information like the International Bank Account Number (IBAN). SWIFT is the system that allows the transfer and transmits information signifying the transfer of funds. There are many fields of information required before a wire transfer can take place. Casinos are a way of laundering money. Casinos are required to file currency transaction reports. However, casinos have brushed up their AML programs in recent years. There are 3 methods of trade-based money laundering: 1) over and under-invoicing; 2) black market peso exchange (commonly used); 3) hawala (underground banking system). Hawala has no regulatory requirements and is ethnic in nature. In addition, there are no money trails available. Understand the red-flags of money laundering. Always ask for documentation, and use authentication when dealing with third parties. Cyber banking via the Internet is getting more common. Some cyber banks do exist. However, note that they do not have deposit protection and that once the bank folds, your funds are gone. A launderer can lease ATMs to other people and they will in-turn lease to others. This reduces the level of due diligence that is applied on them. Most pre-paid cards do not require identification and launderers can maintain anonymity. This is a viable way for launderers, although it is slow. Vehicles are often purchased in the integration phase of AML. It is difficult to launder money using credit cards. Laundering via purchase of real estates is getting more common. For LLC, it is difficult to determine who the beneficial owner is as an LLC can be owned by sub-LLCs, which in turn might be owned by sub-sub-LLCs. For a cash intense business, laundering can be easy as once the dirty money is comingled with clean money, it is difficult to trace. Life insurance products can be bought using dirty money and then cashed out prematurely. Digital currency is a big thing and can be manipulated by launderers. They are not regulated and depositors can maintain anonymity. There are a huge variety of ways in which money can be laundered. As long as there is crime, there is a need for AML personnel.

Federal Regulations – The Laws, Rules, and Guidelines to Fight the Good Fight. We need to stop bad guys from laundering money. The Bank Secrecy Act requires FIs to keep AML programs. There are many legal tools in the fight against AML nowadays. Any cash transaction via an FI exceeding $10,000 must be reported on a currency transaction report (CTR). This must be filed with the FinCEN. There is also a need to maintain a suspicious activity report. If the cash or bearer instruments are brought out of the US, a report needs to be filled as well. Wire transfers are not under the CTR scope. A CTR is important in the investigation. In some countries, their limit is $15,000. For non-FIs, cash transactions more than $10,000 need to be keyed into the 8300. It is a crime under the Money Laundering Control Act to further criminal activity, conceal ownership of property etc. The Financial Crimes Enforcement Network (FinCEN) was launched in 1990. The Annunzio-Wylie Act in 1992 requires banks to complete and report a suspicious activity report (SAR). Several high-risk geographical areas were identified as ‘high-intensity financial crime areas’. The Patriot Act in 2001 gives Treasure the power to deal with US FIs for foreign AM. Enhanced due diligence for correspondent accounts that are maintained for certain foreign banks must be instituted. Banks should share information on terrorism and money laundering with one another. For KYCs, comparisons must be made with known or suspected terrorist or terrorist organizations generated by government agencies. FATCA helps combat tax evasion by US taxpayers who have assets outside the US. The next chapter will discuss on how to build an AML program.

Build a Quality AML Program. Sometimes, AML falls under the Compliance Unit. FIs may hate regulators because of too much regulation. Regulators will say that there are not enough regulations and that FIs compliance unit must be beefed up. Regulators have power to sanction your organization if you are not performing well. Once something bad happens, heads will roll. Fines can be heavy and banks should never try to cut corners. Regulators can only conduct random inspections on the bank. Law enforcement can make recommendations. An AML systems need to achieve 1) prevent money laundering and terrorist financing; 2) to report suspicious activity; 3) to train all personnel on legal and internal procedures. Educate staff on the importance of AML. Compliance training is important and it should be on-going in nature. Internal procedures must document risk and the controls to mitigate risks. It should document due diligence checks. KYC guidelines must be established. Policies must be put in writing and cannot be documented in the head. Policies must also be approved by the board. Policies should be updated on a yearly basis and there should be documentation on what triggers alerts in transaction monitoring. An organization must have a designated compliance officer. There needs to be a process to update the regulations and the training programme must be addressed. An independent audit should be performed on the AML system. High-risk accounts must be reviewed thoroughly. All employees must be trained in AML. Training should be conducted annually. It should cover all pertinent regulations. Identify the risk, which can be customer related or issue-related risks. Risks analysis, management and risk review needs to be conducted. Risks can include product risk, legal entity, business type, country risk etc. For high risk clients, increased level of due diligence and monitoring needs to be instituted. High customer risks include foreign FIs, PEPs, foreign corporations, shell-companies etc. High product risks include trade finance, private banking, electronic funds transfer, lending etc. High geographic risks include any OFAC sanctioned country, jurisdictions of primary money-laundering concern, offshore financial centres etc.

AML is not an income-generating component of the institution. An AML unit can be quite expensive, and, in and of itself, there is no return on investment. Hence, that alone is reason for some FIs to be hesitant to invest and develop a compliance unit any more than the bare minimum. – Kevin Sullivan

KYC and Customer Identification Program. The terms can be used interchangeably. It means identifying your customer, monitor his transactions and update his files. These pieces of information must be reviewed too. Customer identification is the first step, followed by KYC. KYC must be done at the onset of the customer relationship. The officer needs to verify the identity of the person and maintain records of his identity. Documentation as to what type of records will suffice should be written too. Account Opening documentation must be kept and maintained. Be wary of shell companies. OFAC maintains a free list of names, entities that have been sanctioned. The transaction monitoring unit will clear the alert and see if the risk can be accepted. A due diligence actually means a background investigation. Basic due diligence is needed in order to satisfy the regulations. EDD is usually needed for high risk customers. A checklist should be used for Due Diligence. Evidence must be collated. Documentation is important when it comes to an investigation. KPIs should not be set on how cases per day etc. Do not put a time clock on investigation. Never put time limits on AML investigation. If you outsource your DD, you should have thorough oversight on the vendor. Some banks might outsource this to third world countries. Sometimes, when there is a material change in customer information, an EDD is required. The good guy may not be able to catch the bad guy because the good guy only studies problems which are already known. Trust your gut. Cultivate an investigative mind by learning to ask why. When you sense something is not right, please ask why. Keep abreast with the latest industry developments. Make use of new sources and technology. Justify, articulate and define everything. Learn to create risk-based due diligence. It is very important to ask ‘where is the source of funds?’ Risk ratings might vary over time. If the customer is too high risk, it is advisable not to deal with him/her. Learn to allocate a risk scoring methodology. Gather intelligence sources and check against that. Obtain public records. You can even pay for certain databases. It is important to purchase good transaction monitoring software. If you clear it in the system, there needs to be a reason for it. Ensure that the system is not generating too many false positives. Understand your correspondent bank’s AML processes. You have to trust that they have performed the DD work. PEPs can be a senior political figure, a member of his immediate family, or a close associate. Understand some of the KYC red flags.

If you think it stinks, it probably does. You do this job every day, and you work with people who do this job every day. If for some reason the hair on the back of your neck stands up, then go with the feeling. – Kevin Sullivan

A Suspicious Activity Report (SAR) is born. Some banks file more than necessary to avoid being questioned by regulators. The FFIEC prescribes standards for supervision of financial institutions. Writing a complete SAR is very important. How do you identify what is suspicious? When should you file an SAR? Sometimes, the system can help you flag out suspicious cases based on set criteria. The amount of the transaction doesn’t really matter. There are 30/60/90 filings. SAR must be reviewed before they are sent to FinCEN. There is also a narrative that must be written when the SAR is filed. Be short and brief. Don’t leave blank boxes. Use language that people can understand. The auditor will hammer you if you are supposed to file but failed to. Law enforcement will pick particular SARs of interest for further checking. Law enforcements usually need subpoenas before they can request for information. FinCEN will compile statistics of SARs. It is useful to understand trend analysis.

Tips for Law Enforcement and Financial Crimes Investigators. Profit is an essential aspect of most crimes. This chapter is dedicated to the law enforcement investigator and the FI investigation team. An individual does not need a CPA to perform an investigation. Law enforcement personnel need to have the right training to perform their role well. The compliance unit of the bank will be involved. The investigator should talk to the law enforcement agency. There are numerous regulators for the different types of FIs. FIs take regulators seriously. Law enforcement look out for criminal activity while regulators look at whether the guidelines and standards are being adhered to. Some of the regulators are the SEC, Securities Exchange Commission, Federal Reserve bank etc. Not all law enforcement agencies have access to the FinCEN portal to view SARs. SARs help provide leads for law enforcement agencies. SARs are confidential and information should not be simply shared around unnecessarily. You may be able to obtain KYC documents from the bank. Most of us do not think like bad guys. Once a bad guy using a fictitious ID, it can foil your plans dramatically. Explore the internet for possible sources of new information. Use your instincts. Always learn to be suspicious. Discover the facts as best as possible. If your hair at the back of your neck stands, it probably means something is wrong. Consider different type of hypotheses. Read the Association of Certified Fraud Examiners (ACFE). Learn to invest in your career and develop your career. Don’t be afraid to spend money and time on educating yourself. Financial crimes are growing.

The Importance of a Global Approach to Money Laundering. Many crimes are transnational nowadays. Money laundering is an issue that affects everyone. The FATF consists of many member countries. There is also the Basel Committee on Banking Supervision. Wolfsberg helps to develop and shape guidelines for banks and regulators. The IMF has also been incorporating AML concepts into its procedures.

The New Financial Crime Model. You can contact law enforcement immediately after you file an SAR. There is an increasing trend of fraud and AML units combining and joining forces. Fraud and AML personnel should be cross-trained. However, do take note of the confidentiality requirement of the cases. 95% of all criminal activity is committed because of greed. There are various ways in which a fraud can be conducted. Please understand the red flags for AML cases.

15 Secrets Successful People Know About Time Management by Kevin Kruse

The Productivity Habits of 7 Billionaires, 13 Olympic Athletes, 29 Straight-A Students and 239 Entrepreneurs

Managing time is the key. You will be able to accomplish a lot more in life that way. The author interviewed many successful people. Time management is related to happiness. Successful people think about values, priorities and consistent habits.

The Power of 1440. Understand what ‘1440’ is. Paste 1440 in front of you. It will show you the meaning of time and that you should be treasuring and valuing it. There are 1440 minutes in a day. Conduct a ‘dollar per minute’ analysis. The moment you lose time, you will realize that you can’t get it back. Time is the lowest common denominator. Everyone has the same amount each day. How often you are aware that you are losing time and that it is slipping by. Every minute is precious. Having healthy habits is a big bonus. Understand that time is a scarce resource

The power of proper priorities. Work towards your own goals, not other peoples’. Focus on a single task. This is indeed very crucial. Know what your MIT (Most Important Task) is. Work on time alignment. Set SMART goals. Pick focus areas. Place your MIT in your calendar. The first part of the day should be used for something productive, like your MIT. Prepare a to-do list the night before. Focus on what you are doing. If you are an employee, you might focus on what you are going to be appraised on.

Research suggests that most people are most productive and have the highest cognitive functioning in the first two hours after they’re fully awake. – Kevin Kruse

Stop making to-do list – Do This Instead. To-do lists cause stress. People tend to pick those items that are urgent and easy to complete. Unfinished goals can cause intrusive thoughts (Zeigarnik effect). Schedule time for it, not just create a list. Put everything on your schedule if you can. Time-block exercise on your calendar. Important items should be tackled at the start of your day. Don’t cancel them. But you may re-schedule them if necessary. Everything in your calendar should get done. If something clashes, you can re-schedule the urgent appointment instead. Block time for your own objectives.

The Procrastination Cure. Procrastination is the act of putting aside what is tough and doing what is easy first. 20% of men and women are all chronic procrastinators. People procrastinate not because they are lazy, but people they lack motivation. People have a ‘present bias’. The present enjoyments are always within reach. Your future self is going to sabotage you if you don’t do something today. ‘What pain will you feel if you don’t do something?’ Think of the pain when you procrastinate. Keep an accountability partner. This works as people don’t like to break promises to others. Use commitment levels to motivate you. Donate money to others if you do not reach your goal. Use self-talk and affirmation. For instance, say things like ‘I am a jogger’, ‘I am an entrepreneur’. Settle for good, and not perfect. If you feel imperfection is okay, you will at least start on something.

How to Leave the Office at 5:00 – Without Guilt. How do you stay calm and stress free? How did President Bush find so much time to read books? Learn to recharge and build adventure into your schedule. Prioritize your ideas and tasks. If something is important, you will naturally find the time to do it. There will always be more things to do. Understand that you can never do it all.

My day ends when I’m tired and ready to go home, not when I’m done. I am never done. Like a housewife’s, a manager’s work is never done. There is always more to be done, more that should be done, always more than can be done. – Andy Grove

Richard Branson’s Secret Productivity Tool. He always carries a notebook around. When you have an idea, it is important that you jot it down immediately. When some event has passed, always write it down. Keep a journal. Journal writing is crucial and important. Do not use plain pieces of paper as these are easy to misplace. Try to use an actual notebook and not type on a laptop. Hand-writing can enable you to recall better. Just down random stuff in your day. Write down inspiring quotes which you hear along the way. Use punctuation to give clarity.

The act of taking notes by hand involves active listening, cognitive processing, and finally recalling it to record it. People who take notes with a laptop tend to just robotically record spoken words, without doing the mental work to process it. – Kevin Kruse

Master Your Email Inbox with 321Zero. Many people spend too much time on emails and this is unproductive. Step 1 is to unsubscribe from newsletters. Turn off email notifications. Only check it 3 times a day and aim to clear all mail in 21 minutes. Remember to archive your mail. Apply the 4Ds – Do it, delegate it, defer it or delete it. Choose your own work routine. Do not let others dictate it for you. Keep the emails short. If you send less email, you will also receive less email. For those email that were sent more than 48 hours ago, simply chuck them aside. Spend less time on email and use the time on strategic activities.

Meeting Hacks from Google, Apple and Virgin. A lot of productivity is lost through meetings. Usually, meetings start late. Often, the wrong people are invited. The extroverts tend to dominate the meetings. People usually only discuss the simple stuff that they know. Set aside days when no meetings can be held. This will increase productivity in the company. Always remember to state the meeting agenda and the purpose of the meeting. Use a countdown clock to time the meeting. Have stand-up meetings. It is also possible to conduct walking meetings. Some people also hold 10 minute meetings. The use of smartphones is inappropriate. It is important for management to set the daily rhythm. Daily huddles should be in place at the same time every week. Routine can indeed set you free.

Parkinson’s law of triviality. Also, known as the bike-shed effect, this law states that organizations spend the most time on trivial issues and the least time on the most important issues. – Kevin Kruse

It’s very rare that a meeting on a single topic should need to last more than 5 to 10 minutes. – Richard Branson

One Little Word that Multiplies Success. There are endless requests for our time. However, it is important to be vigilant over the use of your time. There are always trade-offs in life. Although your calendar 3 weeks down the road might seem free, however, when the date arrives, you might be swamped with activities. Every yes is a no to something else. Understand about opportunity costs. We grew up learning not to say no to things. You can say ‘no’ in a polite way but explaining at you are busy etc. For instance, you can say ‘Unfortunately, my schedule is packed’. You can also suggest a time for them when you are free. You can refer the person to a colleague of yours. Saying no to friends is okay.

The Powerful Pareto Principle. Understand the 80/20 rule. This helps you identify the tasks that you should be focusing on. It can help you in business decision making. It can even be applied to reading and studying. Do you really need physical possessions to be happy? Just do the most important things exceptionally well. Figure out which 20% of your goals are most important to you. Focus on your most important clients.

The 3 Harvard Questions that Save 8 Hours a Week. Instead of asking ‘How can I do this?’ Ask ‘How can this be done?’ You can outsource some of your work. If you can delegate, you will feel less stressed. Discretionary activities which are non-value adding can be outsourced. Keep thinking of the following key words: 1) Drop; 2) Delegate; 3) Redesign. Outsourcing can increase your free time. For instance, you can hire a domestic worker. You are not good at something and do not like to do stuff, it is possible to outsource them. Some businesses are boggled down with admin work. As a result, they are slowed down tremendously. Some things need not be outsourced if you enjoy doing it and it aids in your recharging process. Learn to audit your time once in a while.

Focus on what you are great at and hire everyone else to do the rest. – Lewis Howes

Why Twitter Co-Founder Jack Dorsey Themes His Days. Focus each day on different aspects of the business. For example, Tuesday is product day. Create days for setting themes. There should be Focus Days, Buffer Days and Free Days (no work at all). You can set time for vacation days. Sandwich vacations with buffer days. Rather than just blocking internal meetings, also block free thinking times.

Don’t Touch (Until You’re Ready). When we process stuff, we often need to look at it multiple times. This is very unproductive. To be efficient, you should only process it once. This is known as ‘touch it once’. If the email is simple and can be replied to immediately, do so. If you can’t ‘touch it once’, calendar it. Or you can even create calendar invites for things. If something can be done in less than 5 minutes, do it immediately.

When we process our email, we might respond to each ‘ding’ by scanning who it’s from and what the subject line is. We then decide whether or not to open it. If we open it and read it, we then decide to leave it in our inbox so we can respond to it later…when we’ll read it all over again. – Kevin Kruse

Change Your Morning, Change Your Life. Imagine if you can find an hour of me-time every day. It is crucial to have an empowering morning routine to start off your day. Start off your day with sweat and exercise. You can incorporate cardio in the mornings too. For instance, you can do yoga as well. Wake up before 6. Drink a lot of water. Each a healthy breakfast and then exercise. Your willpower is at the highest in the mornings. Therefore, you should do your best work in the mornings. Take an inner bath. Exercise can help release endorphins which will make you feel good about yourself. Many famous people have very good morning routines that keep them perked up throughout the day. Believe in the power of morning rituals. SAVERS (Silence, Affirmations, Visualization, Exercise, Reading, Scribing). Invest the first 60 minutes of each day to hone your mind, body and spirit.

Energy is Everything. Everyone has the same 24 hours everyday. Get more stuff done. There will definitely be moments when you suffer from lack of energy. Sacrificing sleep is not a good long term solution. Writing came easily in the morning. Know when do you feel ‘in the moment’ and when you are the most productive. Match your capacities with what needs to be done. If you can increase your energy, productivity will shoot up the roof. Learn to schedule time for yourself. Get your blood pumping. Our body usually feels fatigued after 90 minutes of exertion, for instance. Therefore there is a need for a break every 90 minutes. Learn the Pomodoro technique. It is possible to get any task completed easily. Get enough sleep and exercise and minimize caffeine and alcohol. Power walking counts as a form of exercise. Productivity is about energy and focus, not time.

The E-3C System: Putting it all Together. Maintain a personal operating system. Learn from good habits of successful people. E-3C stands for Energy, Capture, Calendar and Concentrate. You can’t increase the amount of time you have. But you can increase productivity. Capture everything done which must be done in a notebook. This will certainly help you to increase your productivity. The second C is your calendar. Block time for your most important task (MIT). Do only one thing at once and do not multi-task. Do not let technology control your life.

Twenty More Time and Productivity hacks. Use your camera to take phones in order for you to remember things. Shut off your notifications. Drink a healthy protein shake. Do not waste too much time watching TV. Minimize travelling time if possible. Use dual monitors in order to improve efficiency. Have a stop doing list. Remember the end time so that there will be no overruns. Learn to hang out with productive people. Tell people to leave you alone. Pay bills electronically to save time.

Time Secrets of 7 Billionaires. Reserve the mornings for doing real work. Do only one thing at once. Avoid multi-tasking. You can work out during lunch to keep yourself fresh later during the day. A fresh mind holds the key for success for many people.

Time Secrets of 13 Olympic Athletes. Schedule everything in your calendar. The importance of rest is often overlooked. Plot out what a day should be like. It is crucial to write it down. Everyone needs a break once in a while too. Focus is essential. A strong level of discipline is needed as well. Have an agenda and a focus day every week. Rest and recharge is crucial for an athlete to be at optimal condition. It is also important to understand that you can’t do it all.

Time Secrets of 29 Straight-A students. Do only 1 thing at any one time. Make a schedule. Consider using an app called ‘SelfControl’. Remember to schedule some me-time as well. There is no need to study in big groups. Learn to give yourself play rewards once in a while. Learn stuff on Wikipedia. Give yourself goals as well. Set realistic small goals. Learn to say no to friends. Stay organized and manage your time well. Maximize productivity by making full use of idle time. Surround yourself with smart people.

 

As a Man Thinketh by James Allen

A Practical Guide to Living the Purpose Driven Life.

Thought and Character. People are makers of themselves. A man is literally what he thinks. His character is all his thoughts summed up. Man can derive either joy or suffering from such thoughts. In order to achieve a noble character, Man must think in the right way. He is the master of his destiny and the master of thought. As such, he holds the key to every situation. When things aren’t working out well, Man is conscious and can correct his thought. If he digs down further, he will examine cause and effect and the effect of thought. All this is the means to attain Wisdom, Understanding and Power.

As a man thinketh in his heart so is he – James Allen

Effect of Thought on Circumstances. Man’s mind can be cultivated or neglected. Just like tending to a garden, Man can rid the garden of weeds (of impure thoughts).  Man’s character will be shaped by his outer environment as well. However, it is linked to thought-element within himself too. Thought will lead to action and action will lead to opportunity/circumstance. Nothing can influence Man’s thoughts. A man who wants to acquire wealth must be willing to make great sacrifices. If a man who wants to get rich starts to shirk his work, or complains that his wages are too low, deserves to stay poor. It is very important for your thoughts to harmonize with your goal. However, at times, good thoughts might not lead to better circumstances immediately. If a poor man thinks life is unfair, then something is wrong. A man can be rich and cursed or be blessed and poor. Indigence and indulgence are examples of wretchedness. Look for the hidden justice in your life. Use your circumstances in order to discover your powers and possibilities within himself. You cannot choose your circumstances, but you can choose your thoughts. The world is your kaleidoscope.

Man, therefore, as the lord and master of thought, is the maker of himself the shaper and author of environment. – James Allen

Man is buffeted by circumstances so long as he believes himself to be the creature of outside conditions, but when he realizes that he is a creative power, and that he may command the hidden soil and seeds of his being out of which circumstances grow, he then becomes the rightful master of himself. – James Allen

Men are anxious to improve their circumstances, but are unwilling to improve themselves; they therefore remain bound. The man who does not shrink from self-crucifixion can never fail to accomplish the object upon which his heart is set. – James Allen

Suffering is always the effect of wrong thought in some direction. It is an indication that the individual is out of harmony with himself. – James Allen

Let a man radically alter his thoughts, and he will be astonished at the rapid transformation it will effect in the material conditions of his life. Men imagine that thought can be kept secret, but it cannot; it rapidly crystallizes into habit, and habit solidifies into circumstance. – James Allen

Effect of Thought on Health and the Body. The body is the servant of the mind. With good thoughts, the body will seem radiant and energetic. Anxiety and fear opens the body to decay. You must have clean thoughts. Learn to beautify your mind whenever possible. For those that have lived righteously, aging is a calm and peaceful process.

Strong, pure, and happy thoughts build up the body in vigor and grace. The body is a delicate and plastic instrument, which responds readily to the thoughts by which it is impressed, and habits of thought will produce their own effects, good or bad, upon it. – James Allen

Thought and Purpose. Thought and purpose/goals must be linked. If you are aimless, you will achieve nothing. Everyone needs a central purpose in their lives. One should find an object and steady and focus one’s thoughts on it. Even if he fails to achieve his purpose, he would have gained a deep strength of character. If you don’t have a purpose, fix your thoughts on a faultless performance of their duty. Try to avoid thoughts of doubt and fear as much as possible. Your every thought should be imbued with power. You must be conscious of your mental powers.

The Thought-Factor in Achievement. Your weaknesses and strengths are brought about by your own doing. The weak man must be willing to help himself. A man must learn to overcome weakness and selfish thoughts. He can rise by lifting up his thoughts. There can be no achievement without sacrifice. Achievement comes from effort. Do not allow arrogance, selfish and corrupt thoughts to enter.

He who would accomplish little must sacrifice little; he who would achieve much must sacrifice much; he who would attain highly must sacrifice greatly. – James Allen

Vision and Ideals. Humans need to dream. Most people have no goals/dreams in their life. One must have a vision in his heart, in order to realize it. As you dream, you shall become. Dreams are the seedlings of reality. You will gravitate towards the thing that you secretly love. You will become the master of your dream. Some men think that others have become successful just via luck and become jealous. They do not understand the hard work and sacrifice that others have undergone.

Cherish your visions; cherish your ideals; cherish the music that stirs in your heart, the beauty that forms in your mind, the loveliness that drapes your purest thoughts. – James Allen

The Vision that you glorify in your mind, the Ideal that you enthrone in your heart – that you will build your life by, this you will become. – James Allen

Serenity. Calmness of mind is really important. He knows how to adapt himself to others. The more peaceful you are, the greater your chance of success. The strong man is revered. They are never temperamental.

A Real Look at Real World Corporate Governance by David Larcker/Brian Tayan

Preface. How do you assemble the best board of directors? How do you pick the best CEO? This books examines the factors for corporate success.

Introduction. Societal leaders should do more. Lehman Brothers went under and there was a need to shake up the industry. The Dodd-Frank Wall Street Reform and Consumer Protection Act was passed in 2010. Is this the solution to all problems? There is an issue of ‘procedure over substance’. There might be unintended consequences to improving corporate governance. High-level ideas might not be met well at the ground level. As it is empirical in nature, corporate governance can be research and studied. This is better than just theory. It is essentially the theory of separation between owners and the management. The fear is that the management protects self-interest at the expense of shareholders. This is essentially an agency problem that needs to be solved. One will want to do so in a cost effective manner. The requirements must be clear as those that are ambiguous are not effective in the long run. The issue of poor corporate governance is actually quite poor in recent times. The problems are there but finding the solutions are much harder. We need to focus on the big-picture issues.

Board of Directors. Most of the board members should be ‘independent’ of management. They are elected by shareholders. The board’s role is to advise and monitor management. They have a right to question management’s plans in order to ensure that it is adding to shareholder value. Sometimes, they can also offer strategic advice to management. They are also expected to maintain an oversight function and monitor management. What does it mean when a board is functioning well? How do you know that the board selected can perform all of the above satisfactorily?

Lehman Brothers – A Case of Form over Substance. A board also has to provide oversight so that regulatory and legal requirements are being met. Some of the ‘best practices’ in the market have not been proven before and appear vague. There are issues when choosing board members as giving them a 3 year term might seem too long. Does independence standards help to improve corporate performance? Very little. Interlocked directors might lack independence but they have the know-how of the two companies and can form synergies. How can you tell whether a board is effective? The Lehman Board had diverse directors on-board. What went wrong? Upon closer inspection, you will realize that there is no one of financial expertise on-board. In addition, there is a lack of people with current business experience. Some of them were also well into retirement and couldn’t be expected to understand complex finance. Those with non-profit backgrounds didn’t help to value-add as well. The guy appointed to chair audit committee didn’t know about finance. There were also not many finance committee meetings. Structure of the board is important. However, there is little evidence to show that it is effective.

Are CEOs the best Directors? A CEO is very important as a candidate for a director in another company. This is because he has the right experience in making decisions etc. It is not uncommon for CEOs to sit on the boards of other organizations. However, this trend is declining. This is because companies have guidelines that prohibit outside directorships for their current CEO. Now, the trend is to recruit more junior senior management or retired CEOs. Current CEOs may not be the best bet. This could be because they are too busy caring about the affairs at their current company. CEOs have the ability to deal with failure/crises. In recent studies, there is little evidence to show that hiring CEOs as directors can positively contribute to operating performance. Is there a shelf life to director experience? Earning fees elsewhere might also impair their independence.

Are the Directors of Failed Companies Tainted? After a failure or scandal, the stock price will plunge. The damage might be long-lasting as well. The company might face lawsuits as well. Lastly, there might be turnover in the company too. Non-executive directors from failed banks managed to find directorships elsewhere. The reputation of the directors might get hit. Is it the directors’ responsibility to detect any malfeasance? There is some evidence that shows that executives of failed companies are treated more strictly. The Board is assumed to have less time to detect problems and hence cannot be fully blamed for any malfeasance. This is an issue that must be discussed in greater detail.

Part II: Accounting and Controls. Hiring an external auditor has a deterrence and detection help. External auditors only check on a sampling basis. They tend to focus on revenue accounts that rely on management estimates. This leaves room for manipulation. Auditors are expected to maintain professional scepticism throughout the audit. Accounting requires discretion at times and there might not be ‘correct’ accounting. Malfeasance can still occur even in the audited accounts. Revenue recognition/expense recognition/misclassification/OCI/tax accounting are all areas that can go wrong.

What’s Wrong with GAAP? In the US, GAAP is used. Companies can still retain considerable discretion over financial reporting. Non-GAAP information might also be reported as a supplement. These often include non-cash items, amortization, restructuring etc. Non-GAAP often paint a rosier picture of the company. SOX requires a company which non-GAAP earning to reconcile them with GAAP earnings and provide both figures. Often, one-time costs are included in the GAAP earnings. It is important to try and steer clear from non-GAAP adjustments. However, non-GAAP earnings might have higher information value. Non-GAAP earnings usually do not include one-off items that are unlikely to recur. Fluctuations on mark-to-market instruments also hit GAAP earnings even though contracts specify that some options cannot be exercised until expiration. Companies have to report a gain when their credit quality deteriorates as they can repurchase their bonds in the open market at a discount.

Royal Dutch Shell: A Shell Game with Reserves. For investors, it is difficult to know the frequency to which accounting manipulation occurs. Management is often involved in accounting fraud. There often has to be multiple failures of governance issues. The organization might have poor culture. Fraud escalates over time. Shell overstated their oil reserves by over 23% in 2004. How did such an incident occur? Governance and leadership failures occurred. Royal Dutch Shell was known for their scenario planning. Decision making was institutionalized. Lower oil prices in the 1990s and 2000s put pressure on profits. Standards for rigorous training fell and managers were given less autonomy. Employees were asked to contribute ideas on operating. The culture was shifting unknowingly. Management also promised investors unrealistic results on looking for new oil reserves to replenish used ones. Oil companies are required to disclose their proven reserves as it indicates their future profitability. These do not affect the current balance sheet though. Reserve calculations are not audited. Valuers’ are supposed to select the most conservative estimate. Management did not communicate important information to the board. There was a lack of oversight by the Board. How do auditors satisfy themselves that estimates are accurate/reasonable.

Baker Hughes: De-Corrupting Foreign Practices. What can a company do to fix its problems? How did Baker Hughes respond to FCPA violations? It improved its practices. Effective governance solutions are business-like. It is common to accept bribes etc. FCPA was enacted in 1977. It was illegal for a US company to offer payments to a foreign official for the purpose of ‘obtaining or retaining business’ or ‘securing any improper advantage’. If your company has dealings overseas, it is very difficult to track. There is a fine line between facilitating payment and a bribe. The company, Baker Hughes, started strengthening their reforms. Before hiring agents, sufficient due diligence according to FCPA must be conducted. Compliance will review large value transactions etc. The company’s business operations improved thereafter. Division managers were more aware of the regulations etc. Controls should not just restrict activity, it should promote positive performance. Can company’s act and improve controls even before a crisis emerges? That is the challenge. What metrics should be measured.

Even at its best, there is a limit to how effective internal controls can be. Controls restrict activity but they cannot prevent malfeasance. At some point, an awareness of correct behaviour needs to be ingrained in the culture of the company. – David Larcker and Brian Tayan

Part III: CEO Succession Planning. The CEO is extremely important for the company. There are 4 ways to select: 1) CEO-in-waiting; 2) horse race; 3) external recruit; 4) inside-outside approach (two-prong). Board members tend not to favour external candidates. As for internal candidates, there is a risk that they may not perform as they have not assumed such a role before. Succession planning is a process that must be managed well. It is the board’s responsibility to choose well. The right structure must be set and be in place.

Sudden Death of a CEO. A well groomed company might learn to adapt to changing situations. Most boards require at least 90 days to find someone. This is a topic that not many boards spend sufficient time on. For sudden death cases, it is imperative to find someone suitable fast. Internal candidates should be constantly groomed to take up greater leadership roles and responsibilities. Poor succession planning can have an effect on future profitability of a company. Succession planning should be treated seriously. Disclosure of such plans may not be wise as well. The stock price immediately after the sudden death of the CEO reflects whether the company had good/poor governance mechanisms. The benefit of hiring internally is that it is much faster.

HP: The CEO Merry-Go-Round. The Board must plan for contingencies. The current CEO must also be open and receptive about such discussions. HP is an example where multiple breakdowns occurred. HQ acquiring Compaq was a major issue as the board didn’t agree with it. It appeared that HP was moving away from its core business model. There was a HP tried to grow through external acquisitions rather than grow organically. There were also issues with disclosure of financial information with the board and a sexual harassment scandal with the ex-CEO. There were frequent changes in CEO from 2000 to 2011. The board were not clear on their strategy of hiring a CEO. Is it right to constantly view internal candidates as bad?

Apple: Is CEO Health Public or Private? The SEC encourages companies to disclose information about whether a company will be adversely affected due to vacancy in leadership. Health information is private in nature. Should such information be disclosed? When Steve Jobs’ health failed in 2008, the Board covered it up. In Jan 2009, Apple claimed that it was a hormonal imbalance that caused him to lose weight. Warren Buffett had no qualms about disclosing his state of health to his shareholders. He felt that such information would allow shareholders to make informed decisions of the company. How extensive should the disclosure be?

Part IV: Executive Compensation. This is a controversial process indeed. Compensation must be at a level where it attracts, retains and motivates people. It should be paid in a manner that encourages unnecessary risk taking. The compensation committee should design a suitable package. It should use benchmarking and evaluation against the external labor market. The plan must be approved by the Board. Now, shareholders can give their ‘say on pay’. The Board must consider what reactions their pay package will have on significant shareholders. What is a ‘correct’ pay package?

What is a CEO Talent Worth? Some believe that CEOs are over-paid. In such cases, shareholder activism is encouraged. Is the rise in CEO compensation commensurate with the growth rates in revenue of the company? The highest paid CEOs and celebrities earn about the same amounts. There is a distinction as CEOs of large companies earn substantially more than CEOs of small companies. It is important for a certain amount of pay to be based on performance.

What does it make to make $1 million? There are various methods to calculating executive compensation. It is not so straightforward as there might be vesting periods, contingent payments and accruals. The first method is the ‘expected compensation’ for the year. The next method is ‘earned compensation’ for the year. This refers to those that an executive ‘earns the right to keep’ as cash. The last method is ‘realized compensation’, meaning how much executive can keep as cash for a given year. Which is preferred? It depends on whether you are forward or backward looking in nature.

Netflix: Equity on Demand. It is important to align compensation with corporate objectives. Netflix offers a lot of flexibility and room for empowerment in their culture. They treat employees like adults. Pay is very attractive at Netflix as they do not want employees to leave. However, they expect employees to work hard and to do the job of 2 normal workers. Only the best performers get retained. Their involuntary turnover is higher than the industry. However, those that get cut receive a severance package. Employees are definitely receiving a competitive wage. They have unlimited vacation time. They are however, expected to take as much as they deem is necessary. They also can choose how to be compensated, either via cash or stocks. Usually, one will not be able to exercise stock options immediately. If you expect the company stock price to rise, it might not wise to exercise it so soon. Many companies use BS model to estimate liability at balance sheet date for financial reporting. Stock options are good because they encourage risk taking and provide better alignment to company’s objectives. Netflix doesn’t offer cash bonuses. Employees can choose a compensation mix that is right for them.

Conclusion. The board must be qualified and engaged in their work. They have possess the requisite skills and knowledge. Case-by-case analysis must be made in order to assess board quality. Controls can only do so much to protect the organization against fraud. Succession planning is an on-going process and must be executed well. There is no ‘one-size-fit-all’ governance solutions that can be implemented. To have effective governance, one needs to learn from case studies etc.

What I Talk About When I Talk About Running by Haruki Murakami

Foreword. A true gentleman should keep quiet about how he stays healthy. This is a book about being healthy. This book will reveal how running has shaped me. People have different mantras when running a marathon: Pain is inevitable, suffering is optional. I finally decided to write about running. I tried my best to write honestly about myself and my running experience. Some of them are important and valuable life lessons.

No matter how mundane some action might appear, keep at it long enough and it becomes a contemplative, even meditative act. – Haruki Murakami

Who’s Going to Laugh at Mick Jagger? It is Aug 2005 and I am in Hawaii. The summer was sweltering. However, the gentle breeze makes me happy. I run an hour a day, 6 days a week. I’m aiming to increase the distance at the moment. My strategy is to stop the moment I feel I can run more. This enables me to carry on the momentum the next day. Mundane memories have value to me too. We are made up of such memories too. In Massachusetts, I ran 36 miles a week. This is my standard for serious running. When I was busy, sometimes I might stop running. The older I get, the busier I seem to be. Also, my interest in triathlons meant that I needed to swim and cycle once in a while too. I started running in 1982, almost 23 years ago. Long distance running suits my personality. I was never a fan of team sports. Goal setting is very important for me. Rivalry in running doesn’t concern me. For recreational runners, we want to beat a certain timing. One should always aim for personal bests. As a writer, there is no such thing as winning or losing. Running is a metaphor to me. The only opponent you have to beat is yourself. Everyone will hit their peak as they grow older. My peak as a runner was when I was in my late 40s. I could complete a marathon in under 3 hour 40 minutes consistently. I hired a swimming coach to improve on my strokes. However, I couldn’t improve on my running timings. Cambridge is the home of the Boston Marathon and running happens along the Charles River. I usually listen to rock music when I run. I lost a lot of weight via consistent and serious running. I spend close to 6 hours a day without talking to anyone and it doesn’t bother me. When I worked at a jazz bar, I learnt to socialize with others. Private time is important for my mental well-being. Usually, when I run, I don’t think about anything. I run in order to acquire a void. Once in a while, random thoughts will emerge. My thoughts like the clouds in the sky, always fleeting. When I was younger, I couldn’t imagine myself being 50. Everyone grows old and no one can escape it. You simply have to learn to accept it. The world is made up of all kinds of people. Sometimes, pain and criticism are a necessary part of life. In order to be independent, sometimes, we all need to go through some emotional hurt. Sometimes, I have to put my body to the limit to heal the loneliness. When someone criticizes me, I go running for a slightly longer distance that day. I will absorb the bad points and improve myself. There was something significant about running even in my 50s. Sometimes, I need to experience pain before I realize something.

When it comes to other people, you can always come up with a reasonable explanation, but you can’t fool yourself. In this sense, writing novels and running full marathons are very much alike. Basically a writer has a quiet, inner motivation, and doesn’t seek validation in the outwardly visible. – Haruki Murakami

People’s minds can’t be a complete blank. Human beings’ emotions are not strong or consistent enough to sustain a vacuum. – Haruki Murakami

Especially for a writer, solitude is, more or less, an inevitable circumstance. Sometimes, however, this sense of isolation, like acid spilling out of a bottle, can unconsciously eat away at a person’s heart and dissolve it. – Haruki Murakami

Even if my time in races doesn’t improve, there’s not much I can do about it. I’ve gotten older, and time has taken its toll. It’s nobody’s fault. Those are the rules of the game…I’ve got to accept it…But what choice do I have, anyway? In my own way, I’ve enjoyed my life so far, even if I can’t say I’ve fully enjoyed it. – Haruki Murakami

Tips on Becoming a Running Novelist. I was in Hanalea, Hawaii. I ran a jazz club for about 3 years. Although I wasn’t an excellent entrepreneur, I made the jazz bar work via hard work and dedication. The work was tiring but I persisted. I was almost 30 back then. This was when I decided to write a novel. It all started when I was watching baseball. I remembered that was a moment when I could write a novel. I had a strong desire to write a novel. It was 1978. My first book was Hear the Wind Sing. My novel won a prize and was well received. I wrote Pinball, 1973 later. Running a service industry business was tough as you had to greet every customer with a smile. Running two jobs was tough and I quit the jazz bar to focus on writing. The next year, I wrote A Wild Sheep Chase. The problem with writing was that I needed to exercise to lose weight. Thankfully, I managed to quit smoking as well. I preferred doing things without being forced. I liked to study at my own pace and to the level I want. I learnt translation on my own, which I was rather proud of. As a writer, I tended to wake up early with the sun. I know that I’m a morning person. I always tried to improve my relationship with my readers. I just had to please the minority of the repeat customers. That would be good enough. When I first started running, I could only do about 20 to 30 minutes. I incorporated running into my daily routine. I was born with a strong and healthy body. I cut back on alcohol and started to eat clean. I realized that I could maintain my ideal body weight. Exercising can slow down the effects of ageing. Even if you lose weight via dieting, your muscles will naturally weaken, so will your bones. I don’t think having a tremendous amount of willpower will allow me to run for 20 years. Running simply suits me better. That is why I do not recommend running to others. You can’t force someone to take part in a marathon. Most of the important things in life can’t be learnt. There are many days when I wake up and I don’t feel like running. Whenever such thoughts emerge, I tell myself how fortunate I am that I can work from home and I will pick up my shoes and run. I started running when I was 33. This was also when I became a novelist.

Running has a lot of advantages. First of all, you don’t need anybody else to do it, and no need for special equipment. You don’t have to go to any special place to do it. As long as you have running shoes and a good road you can run to your heart’s content.’ Haruki Murakami

I’m struck by how you really need to prioritize in life, figuring out in what order you should divide up your time and energy. If you don’t get that sort of system set by a certain age, you’ll lack focus and your life will be out of balance. – Haruki Murakami

Athens in Midsummer – Running 26.2 Miles for the first time. I ran the New York City Marathon on November 6. I prepared myself for 5 months. I ate good fruits and vegetables. Napping helps to clear and refresh my mind. Gradually increase the amount of exercise your body can take. I focused on quality of exercise now. There was once when I suffered from bad cramps and could only walk. Once you stop running, you start feeling incredibly cold. The issue was that I wasn’t well prepared enough. At my age, you really get only what you pay for. I always tried my best to learn from my mistakes. I was featured in ‘Runner’s World’. I ran a solo marathon in Athens before. The heat was unbearable. Although I had trained for the distance, running in the heat is a different proposition. I started the run at 5:30am. I usually run without a shirt. I encountered a dead dog on the road and a dead cat as well. The commuter road in which I ran on was depressing. However, I faced headwinds, which slowed me down. Now, I’m completely exhausted. At 23 miles, I felt like stopping. Now, I hit the 25 mile mark. It was like a bloody oven and my eyes were stinging. After hitting the finish line, I had no feelings of accomplishment. It was a great sense of relief. I took 3 hour 51 minutes. Later on, I ran the Honolulu marathon. I get the exact same feeling at 22 miles of running, I get upset at everything.

Muscles are hard to get and easy to lose. Fat is easy to get and hard to lose. – Unknown

I think certain types of processes don’t allow for any variation. If you have to be part of that process, all you can do is transform – or perhaps distort – yourself through that persistent repetition, and make that process a part of your own personality. – Haruki Murakami

Most of What I know About Writing Fiction I learned by Running Every Day. I ran the NY marathon for 3 times already. My legs start to scream at the end of the race. I do not take 2 days off in a row when running. If you follow proper procedure, they will conform. If you don’t work out for a while, they will lower their limits. When you are training for a race, you must not let them relax for too long. There was a lot of things I have to do but I will just to slot in running. I bumped into professional athletes in my running course in Japan. Writing involves some talent, but the problem is you can’t control its amount of quality. The next element is the ability to concentrate on whatever’s critical at the moment. Being able to focus is very important. When I write, I just write and I don’t think about anything else. Without focus, you can’t accomplish anything. The next skill to have is endurance. For a fiction writer, you need at least 1 year of concentration. Unlike talent, focus and endurance can be honed. Writing novels is manual labour to me. It is not manual labour, but it is dynamic labour going on inside you. Training your focus and endurance is paramount. How do you sustain that? It varies from author to author. A lot of the lessons from running is applicable to writing. For this, I am very grateful to running. Running helps you to push your limits and achieve goals. My muscles take time to warm up. People can adjust their tendencies, but not their essence. Since I started running, my natural pulse is only 50 beats per minute. Those who pant a lot while running are the beginners.

Muscles are like work animals that are quick on the uptake. If you carefully increase the load, step by step, they learn to take it. As long as you explain your expectations to them by actually showing them examples of the amount of work they have to endure, your muscles will comply and gradually get stronger. – Haruki Murakami

Muscles really are like animals, and they want to take it as easy as possible; if pressure isn’t applied to them, they relax and cancel out the memory of all that work. – Haruki Murakami

No matter what, though, I keep up my running. Running every day is a kind of lifeline for me, so I’m not going to lay off or quit just because I’m busy. If I used being busy as an excuse not to run, I’d never run again. I have only a few reasons to keep on running, and a truckload of them to quit. – Haruki Murakami

People sometimes sneer at those who run every day, claiming they’ll go to any length to live longer. But I don’t think that’s the reason most people run. Most runners run not because they want to live longer, but because they want to live life to the fullest. – Haruki Murakami

You open the fridge and can make a nice meal with the leftovers. All that’s left is an apple, an onion, cheese, and eggs, but you don’t complain. You make do with what you have. As you age you learn even to be happy with what you have. – Haruki Murakami

Even If I Had a Long Ponytail Back Then. I was back in Boston. It was summer. I witnessed the change in the seasons of the weather. We wear gloves, wool caps and face masks while running in winter. Seeing water is important for a human being. The water changes all the time. Runners can detect every change in the shift of the seasons. The Boston Marathon was almost here. Mizunos are my favorite brand for running. I liked that their shoes were not gimmicky. I often get overtaken by younger girls. But I’ve been through more pain in life than they have. The girls were after all young University students. I often see the same people on my running path. I agree that writing novels is an unhealthy type of work. We are all aware of the toxins on this earth. There is no one right way to be a novelist. In order to write, I have to keep myself as healthy as I can. They complement each other, the healthy and unhealthy aspects. Literary burnout might happen if you are not careful. To me, writing a novel is like climbing a steep mountain. However, needless to say, one day your body is going to give way. However, I would like to postpone that till as long as I can. I rarely give talks in Japan and only have given a few in English. Often, I have to practice much before giving a speech in English. Sometimes, I will practice a speech in my head while running.

Nobody Pounded the Table Anymore, Nobody Threw Their Cups. I did an ultramarathon once before, covering 62 miles. After running, you understand more about yourself. Your view of life will be transformed. It happened at Lake Saroma in Japan. We run around the shores of Lake Saroma. The cows do not bother about the runners. It is a pleasant event to be participating in. However, if you are too slow, you will be disqualified. This is the first time I ran more than a marathon. The muscles were tightening. I ate some snacks at the mid-point of the race. This was 31 miles in. My legs had tightened so much although my breathing was still regular. Thankfully after about 20 minutes of this, my legs functioned normally again. The will was there, but the body wasn’t. There were still 25 miles to go. Different parts of my body started hurting like crazy. I didn’t want to give up now. Through sheer grit, I covered 13 miles. I imagined myself to be a machine. ‘I’m not a human. I’m a piece of machinery. I don’t need to feel a thing. Just forge on ahead.’ This was a mantra to be. My muscles were extremely hard now. I saw a lot of other runners walking, but I came here to run, not to walk. At 47 miles in, I realized that my body passed through a stone wall. At that time, I didn’t have to think anymore. Exhaustion was the status quo. I was on auto-pilot and didn’t think or feel anything. I hardly knew what I was doing. My mind wasn’t so important to me at the end. I completed the race in 11 hours, 42 minutes. There was a sense of relief, pride and happiness inside me. After a few days, my legs recovered. My wrists also started hurting. After the ultramarathon, I lost enthusiasm for the act of running. I make it a point to complete one marathon a year. I suffered from the runner’s blues. Maybe I was just tired of running. Even today, I’m glad I completed an ultra-marathon. Now, I focus more on triathlons and squash. Gradually, I started running daily again. I didn’t understand the cause of my runner’s blues. That’s life.

I don’t care about the time I run. I can try all I want, but I doubt I’ll ever be able to run the way I used to. I’m ready to accept that. It’s not one of your happier realities, but that’s what happens when you get older. Just as I have my own role to play, so does time. – Haruki Murakami

I’m nothing more or less than a professional writer who knows his limits, who wants to hold on to his abilities and vitality for as long as possible. – Haruki Murakami

The end of the race is just a temporary marker without much significance. It’s the same with our lives. Just because there’s an end doesn’t mean existence has meaning. An end point is simply set up as a temporary marker, or perhaps as an indirect metaphor for the fleeting nature of existence. – Haruki Murakami

Autumn in New York. The rain would not relent and it caused damage. I joined the Boston half marathon. However, I didn’t give it my all in order to save energy for the NY marathon. This race was good training for me to test my pace. My knees have started to hurt recently. My body tends to ache between seasons. Your knees suffer pounding as a long distance runner. You cannot replace your knees. I have been lucky not to get any major injuries. I started to worry about my knee. My public reading at MIT went very well. I was also working on the translation of The Great Gatsby by Scott F. Fitzgerald. It was a week before the marathon and my knee seemed okay. I tried to visualize the race and that made me happy. I placed my things and took a flight from Boston to New York. In November, New York is beautiful.

18 Til I Die. I’m training for a triathlon. Cycling helps to build my thigh muscles. To me, biking was more troublesome than running or swimming. Also, I have to ride through town and I feared hitting someone. Also, you must have the right body posture when navigating a bend. Biking is my weakest link as it requires agility. It was a wonderful bike. ’18 Til I die’ is a Bryan Adam’s song. When you ride competitively, you need to lean forward and keep your face forward. You will need to master this pose for at least an hour each time. If you do not keep your face forward, it can be dangerous and accidents can occur. Cycling training is even tougher than running training because it is very boring. Cycling has got to be the most unpleasant of all sports. I have plenty of records in my house. I was obsessed with record collecting. I thought I could do 3 hr 45 minutes easily. My legs wouldn’t move and I experienced a cramp in my right calf. I completed it in just over 4 hours. In all 24 marathons I participated in, I have managed to complete all of them. It seemed like my training went to waste. The next year, I took part in the Boston Marathon. My timing was also about 4 hours. It is always a beautiful thing to be able to complete a marathon. However, I wasn’t satisfied with the time. Maybe age was simply catching up with me. As long as my body allows, I will still run marathons. I don’t care what others think and say about me. I ran and wrote because I wanted to.

One day, out of the blue, I wanted to write a novel. And one day, out of the blue, I started to run – simply because I wanted to. I’ve always done whatever I felt like doing in life. People may try to stop me, and convince me I’m wrong, but I won’t change. – Haruki Murakami

At Least He Never Walked. I realized my body was not perfect. I figured it was better to use my good points and make the most of what I have. I had nothing to prove to anyone. In my previous triathlons, the weather was atrocious. Today, the weather was great. In 2000, I was disqualified because I didn’t swim. I find it easier to swim in the sea than in the pool. In a regular race, you can’t rely on breaststroke as it slower than crawl and your legs will get exhausted. In the waters, we often get kicked because people want to take a shorter route. Also, my technique for crawl was not the best. I hired swimming coaches to improve my form. My wife found me a great coach. She revised each small movement over an extended period of time until I improved my form. Too much rotation and you lose resistance and your speed decreases. A year and a half later, I was able to improve tremendously. The coach also realized that I hyperventilated before races. I achieved my goal of completing a triathlon. I was usually nervous before races. We all share the same bond of training hard and working out together. I had to tell myself not to panic while swimming. Suddenly, my googles fogged up and this bothered me a great deal. As a result, I didn’t swim straight, wasting valuable time. The leg muscles won’t work during the run, especially after biking. It takes time for the muscle groups to adjust. My wife greeted me with a smile at the finish line. I gave it my best. Running long distances might not seem logical, but that was the life I chose. One day, on my tombstone: I would like it to read ‘Haruki Murakami (1949 – 20**) Writer (and Runner) At Least He Never Walked.

Whether training for competitions is good for anything or not, in the final analysis, what’s most important is what you can’t see but can feel in your heart. To be able to grasp something of value, sometimes you have to perform seemingly inefficient acts. But even activities that appear fruitless don’t necessarily end up so. – Haruki Murakami

Afterword (On Roads All Round the World). I have published essay collections and travel writings too. After writing this book, I still participate in running activities. Running for 25 years has produced many good memories. The people you see along the way are life’s small pleasures. Many people have helped and encouraged me along the way.

Comforting Thoughts About Death that have Nothing to do with God by Greta Christina

Death can seem appalling if you don’t believe in an after-life. In 500 years, no one will remember you. In 5 billion years, the Earth will be boiled. It can make life seem trivial and absurd. But it is certainly possible to not have religious or spiritual beliefs or be an atheist and still be okay towards death. Death allows our life to have meaning. Time passes and we are aware of it passing. With the passing of time comes loss. Without loss, we won’t get to fully experience life’s great moments. The world changes due to the passing of time and I don’t think anyone would want the Earth to be still and captured in one frozen moment. Even though you might pass on, but time still had a part to play during the years you were alive. Your segment on that timeline would have always been there. Dying does not make your time which you were on Earth disappear. We don’t know what happens when we die. However, what matters is we get to be alive and connected.

The fact that time will continue after we die does not negate the time that we were alive. We are alive now, and nothing can erase that. – Greta Christina

The Meaning of Death, Part 1 of Many. For atheist, there isn’t a meaning of death. It simply happens because it happens. This is nothing depressing. As an atheist, you get to create your own meaning in life. How can death shape your experience of life? I see death as something that connects me with the universe. You don’t have to feel guilty when someone else passes away. No one tortured them. Death is just part of the way the world works. The world can seem bleak and cold at times. However, we are part of this world.

You don’t have to torture yourself trying to figure out the motivations of the physical universe. It doesn’t have any. So you can accept the inevitability of death, and get on with your life. – Greta Christina

Motivation and Mid-Life Crises. I went through a mid-life crisis at 40. I realized that time was short. I was aware that I needed to work hard and start writing. Now, I do freelance writing. When you are older, your priorities become clearer. You know that you have to make sacrifices with these priorities. I am a deadline-driven person. Since death is inevitable, might as well use it to give your life meaning. Death has given me clarity on my life. Death is not so bad after all.

Fear, Grief and Actually Experiencing Your Emotions. Go through with it. Death is natural and you didn’t deny it. The fear of death is natural. Sometimes, the best way to deal with strong emotions is to avoid fixing them but just try to feel them. Things don’t have to be permanent to be meaningful. To some, they think that death is no different from not having being born yet. You can create your own meaning in life. We can give companionship and witness to others. It can be incredibly comforting. This is someone who can be by your side when you need them. It is okay to think about death once in a while. It is just human to do so.

The idea that death is a deadline: that knowing life is temporary brings focus to our lives, inspires us to treasure the people and experiences we encounter, and motivates us to do something valuable with the short time we have. – Greta Christina

Lydia’s Cancer and Atheist Philosophies of Death. How can atheist philosophies improve life? Our cat has cancer. What sort of treatment should the cat receive? These are all small and difficult decisions. All animals will eventually die. What you can do is to make the cat as it can possibly be when it is still alive. There are no simple decisions which can be made. Research has shown that those who have religions will try to delay death when it’s clearly imminent. Religion pretends that death is not permanent. For atheists, we believe that when people die, they are fucking dead forever. Ensure that you have time to think about your death. Learn to make informed decisions.

We understand that our own time here is limited. We understand that all we can do for ourselves and for one another is to make that time – however much time it is – as happy and joyful and meaningful as we possibly can. – Greta Christina

Do We Concede the Ground of Death Too Easily? Many of us assume that an having an after-life is favourable. The fear of death cause people to cling to religion. Do you really in a heaven where everyone can live happily ever after? Conflict helps to strengthen us and build our character. What will happen who those make it to Heaven? How will you feel if your loved ones are in Hell? Would our personalities change in Heaven because it is too blissful? Secular views of death are better because they can withstand scrutiny. Your understanding of death should be grounded in reality. We don’t have to be afraid of talking about death. You don’t have to continue living a lie.

Difference between Pessimism and Realism. Atheism can coffer comfort in the face of death. Comfort doesn’t mean eradication of pain and grief. It doesn’t make the grief disappear, but it can lighten the load. Religion doesn’t eradicate grief. Even people who believe in an afterlife might doubt their beliefs. The problem with believing in an afterlife is that what if you go to heaven but your loved ones go to hell? Belief in an afterlife is also not based on any strong groundings. Atheism doesn’t leave you with cognitive dissonance. One’s perspective towards death is truly personal and there is no right or wrong. One should try to frame it such that it is positive and hopeful and meaningful. You should frame reality in a way that offers meaning and hope. Atheism is a safe thing to practice in real life. One can always find new forms of comfort and meaning with atheism.

Grief Beyond Belief: How Atheists are Dealing with Death. There is an online support group called ‘Grief Beyond Belief’. Community groups like this are useful and help give strength. Many non-believers pretend to accept the concepts of the afterlife etc. Religious beliefs about death can make atheists feel alienated sometimes as well. The concept of an afterlife is not shared by everyone. Usually, a death of a close one is often a trigger for questioning or abandoning religious faith. Sometimes, religious people hijack the funeral proceedings and make it seem religious in nature. Sometimes, they do so and are not aware of it. In some cultures, ‘atheism’ might seem invisible. Many people fault atheism for being inferior to religion because it sees death as the ultimate end. The atheism community is certainly growing in numbers.

We point out that a philosophy that accepts reality is inherently more comforting than a philosophy based on wishful thinking – since it doesn’t involve cognitive dissonance and the unease of self-deception. – Greta Christina

Atheists in Foxholes. People suggest that in near moments of death, people will turn to religion. This is untrue. There are many atheists who have had near death experiences but who are still atheists. When people want to believe something, they tend to exclude or dismiss all contradictory evidence. Hence, this is a poor argument. Some spiteful religious people might say that atheists are immoral or that they don’t have meaning in their lives.

Atheism and the Argument from Comfort. Religion doesn’t universally offer comfort. Religion might expose young children with images of Hell. Some people who give up religion feel that a burden has been lifted from there. Atheists see the world as it is and understand that it operates based on physical laws. Death is simply a problem that has to be faced.

Humanism in a Shitstorm. I want to work with other humanists and learn about tiehr trials and tribulations. I had cancer, but thankfully, it was treatable. However, I didn’t turn to religion. Humanism has been a profound comfort for me. I understood that things happen because of natural causes. We have little control over what happens to us. I have the power to learn from my experiences. Being able to be born is a miracle already.

There’s no way I’m going to be the same person after this shitstorm than I was before it. But I get to decide what lessons I learn from it. I get to infuse it with meaning. And that’s the power I have. – Greta Christina

The Elephant Vanishes by Haruki Murakami (Part 3)

Family Affair. I didn’t like my kid sister’s finance. My sister sensed that way too. My sister were chatting now. The spaghetti we had was awful. She said I was narrow minded and was a very negative person. According to her, I hurt others along the way. I explained to her that it was my life. She wanted me to look at the good side of others. I didn’t have a steady girlfriend. She was also being harsh on me, I felt. We used to be very open with one another. I asked a girl out to a bar in the afternoon and we had some drinks. It was Sunday and I couldn’t my sister later on. I lived with my sister now. Once, she was in the living room and cried for 2 hours and I comforted her. Later on, she dated a computer engineer and she paid more attention to her appearance. The moment I saw the guy, I knew I hated him. They were sort of getting to get married. My mum had a lot of questions on the guy. His parents were okay people. Later that day, my sister, the guy and I went for coffee. The engineer was Noboru Watanabe. She left me a note, wanting me to go for dinner with them. I had something on, but she adamant that I go with them. My sister was starting to nag more and more. She helped to do the laundry. I had to help her buy groceries that day. We were hosting Noboru for dinner at our place. He didn’t drink alcohol. When he was in our place, he helped to fix the sound system as it was spoilt. Noburu left the house to buy a soldering iron. I worked with an appliance manufacturer, although I was not keen on electrical devices. According to my sister, I just liked to have fun. I defended myself by saying I could think whatever I wished, since nobody got hurt. She was angry that all I thought about was myself. Noburu thought I would want to get married after he married my sister. I left and headed to a bar after dinner. I met a girl at the bar and we chatted. I accompanied her to her apartment and we had sex. I was piss drunk and later puked out my dinner. My appearance in the mirror looked like an old man and I was shocked. My sister and I chatted and she wondered whether she went overboard in her criticism of me. She was worried about her future.

You have to make an effort to always look at the good sides, always think about the good things. Then you’ve got nothing to be afraid of. If something bad comes up, you do more thinking at that point. If things don’t work out, that’s when you think again. – Haruki Murakami

A Window. It was finally springtime. Your letter was a pleasure to read. It was on hamburger steak. In fact, I ordered it the next day. I look forward to your next letter. It was my part time job. I got money writing for a company called ‘The Pen Society’. We were assigned to Pen Masters of the opposite sex. There were many people under me. Many of the people at the Society were lonely. I received many letters and learnt a lot. Once, a member invited me to Hamburger Steak at her place. Although it was not allowed, I signed up. The hamburger was simply perfect. She mentioned that she didn’t write. I mentioned that she had talent and shouldn’t give up. She was married. She had difficulty conveying messages to her husband. However, she loved writing to letters as she felt people could relate to her. She praised me for my writing. Should I have slept with her? 10 years have passed now and I forgot where she stayed

Even now, I have no idea. There are lots of things we never understand, no matter how many years we put on, no matter how much experience we accumulate. – Haruki Murakami

TV People. It was Sunday evening. TV people showed up. I don’t like Sundays much. I often get a headache. It is usually extremely painful. The TV people are very small and unnatural. My wife was out that day. On Sundays, I don’t get much done. I was on the sofa the whole day. It was indeed an unproductive Sunday. People in the TV seemed really small. The TV people helped to connect the TV. They had to move some of my stuff to place the TV on the table. They messed up some of my wife’s things. The screen was blank but the TV people didn’t seem to care as they had completely their jobs. The TV people do not speak at all and are completely efficient. It was a professional’s job. They all wore dark-blue jackets. They seemed very robotic. After testing, they left without even looking at me. I didn’t do anything except to observe them. My wife noticed it when she came home by didn’t react to it at all. It was strange for her not to react as she usually cared about arrangement of things. Even though I switched on the TV, my wife was oblivious to it. I had difficulty sleeping as I kept thinking of the TV people. I worked in the advertising department of an electrical appliance manufacturer. I climbed the stairs to my office and thought I saw one of the TV guys. However, he ignored me again. I found it hard to concentrate at work. My section chief was someone who I didn’t like. He praised me for a comment which I made during the meeting, which I didn’t remember even making. Another day, I saw the TV People again. Nobody reacted to the TV people. When I mentioned about it to a guy I knew at work, he disregarded and ignored my comment. Later that night, I switched on the tv, but it would not even start now and show the white noise. I kept reading and reading the newspapers after work as there was nothing to do. I had a dream where everyone was turned into stone except for the TV guys. Then, I imagined the TV guy walking from inside the screen to the outside environment. He said ‘We’re making an airplane’. It looked like an orange juicer instead. The two TV people were working on fixing the airplane. They later said ‘Shame about your wife. It’s gone too far: She’s out there’. I didn’t understand the context. The TV people were saying my wife was gone. The two TV people continued building the airplane. Now, the ‘orange juicer’ started taking shape of the airplane. The TV guy said the plane needed a coat of paint. My palms seemed to shrink. He said the phone will ring in 5 minutes as I eagerly anticipated my wife. I realized I couldn’t even speak now.

The Last Lawn of the Afternoon. I moved laws when I was 18, 15 years ago. A lot has changed. I loved looking at junior-high-school kids. Back in the day, I was mowing lawns. Memory seemed like a fiction to me. I had a girlfriend then. A few months later, she wrote to me and wanted to break off our relationship because she found someone else. I mowed lawns for people to earn cash. I didn’t know how to spend the money I earned. I decided to get a Sony transistor radio in the end. One day, I decided to quit lawn mowing. The boss mentioned I did great work. I actually enjoy mowing lawns. There was once when I slept with a housewife. As he was short of staff, I agreed to mow for 1 more week. My last job was near the Yomiuri Land Amusement Park. The weather was perfect. A lady was in the house and she looked large and also bothered. She showed me the lawn and I said I could do it in 4 hours. The sun was overheat and I was sweating profusely. She offered to make a sandwich for me and I agreed and thanked her. After lunch, I returned to the lawn to mow. When I was done, she mentioned that she liked me. She offered me a beer and I accepted it. She praised me for my good work. Her husband had passed on. She asked me about my school. I told her I couldn’t mow next month because I had to concentrate on my studies. She brought me into her house as she had something to show me. She unlocked a door and I entered it. There was plenty of dust. It was a bedroom. It seemed rather plain to me but fairly neat. She offered me a vodka tonic. She said I had a healthy body and won’t get drunk. She wanted me to look at her wardrobe, which I did. They were full of female clothes. In the drawers were clothes as well. I wondered why she was making me do all these. She wanted me to guess about the girl from her clothes. I said that I thought she had good grades etc. Now, she let me leave. She gave me a ten-thousand-yen note which I accepted. I left and went for a drive-in to order food. I was worn out and needed some sleep. All I wanted to do was mow a good lawn. As I drove, I thought of people with different homes, having different yards and living different lives.

The Silence. I was talking to Ozawa and asked whether he had punched a guy in an argument before. We were traveling together. He represented his school in boxing matches. He was 31. I did business with him. He was a really quiet sort of guy. In 8^th grade, before he learnt boxing, he did hit someone. His uncle ran a boxing gym, so he joined. Boxing was a solitary pursuit. He liked it because he could get to the bottom of the depth. He hit a classmate called Aoki. Something about him pissed Ozawa off. Aoki was the star at school and extremely popular. Once, I scored better grades than Aoki and everyone was shocked. He spread a rumour that I cheated and I confronted him. This was when I punched him and he fell. I didn’t apologize to him although I felt sad inside. From then on, Aoki ignored me forever. We tried our best to ignore one another. One of my classmates, Matsumoto, committed suicide. That shocked everyone. Everyone was supposed to mourn his death. At that time, I didn’t know why he killed himself. Once, I was summoned into class and the headmaster asked if I ever hit Matsumoto before. It turns out that someone was hitting him. Somehow I guessed Aoki was behind it. The headmaster was convinced I hit him. Everyone thought it was me. Even the teachers tried to avoid me. Every day was lived in silence. 2 weeks later, I lost my appetite. I told my parents I was just tired. I imagined punching Aoki till he turned into a pulp. Later, I bumped into Aoki again and we glared at each other. I thought of how pitiful his life was and didn’t feel like punching him. I didn’t care about him at all. It was a stare-down and I could tell he wavered. Later, I knew I was home free. I held out for another 5 months of silence. However, I didn’t believe in people. That incident still affects me till today. I can’t believe how people think highly of Aoki, who doesn’t have an idea in the world. He was a monster and hurt others, without taking responsibility for his actions. Ozawa and I agreed to go for a beer to chill.

There’s all different kinds of loneliness. There’s the tragic loneliness that tears at your nerves with pain. And then there’s the loneliness that isn’t like that at all – though in order to reach that point, you’ve got to pare your body down. If you make the effort, you get back what you put in. – Haruki Murakami

People who go through a heavy experience like that are changed men, like it or not. They change for the better and they change for the worse. On the good side, they become unshakable. Next to that half year, the rest of the suffering I’ve experienced doesn’t even count. I can put up with almost anything. – Haruki Murakami

The Elephant Vanishes. An elephant disappeared from the town’s elephant house. I read about it in the newspapers. The house looked very empty. It happened on May 18. The zookeeper was missing too. There was nothing unusual about the elephant and zookeeper before it happened. It was a very old elephant. I was interested in this matter and kept articles on the elephants since it entered the zoo. People wondered why the town should be made to take ownership of it and paying for care and feeding costs. There was much debate about who should provide land and take care of the elephant. It was a homeless elephant at the start. The town held events for the elephant and gave it bananas. There was a steel cuff attached to it, which he could have broken free. The elephant’s keeper was in his early 60s. The keeper and the elephant had an outstanding relationship for over 10 years. They seemed to work via telepathy. Even the reporter was surprised at its disappearance. The keys to the cuff were intact and were not moved. Also, there was high fencing and there was no way it could have escaped. There were also no elephant marks nearby. The police were planning a thorough search of the area. The zookeeper was Noboru Watanabe. Many authorities were combing the woods. However, they failed to find it. I couldn’t find a clue either. After a few months, there were less articles on it. I met her at a company event. I told her the importance of unity in household appliances. I described our world as being very pragmatic. We had things in common and started to chat. She was 26 and I was 31. She was really an attractive woman. We ordered cocktails at the hotel lounge. Later, I told her about the elephant. My answers seemed tentative and she sensed something was not right. I told her I was probably the last one to see the elephant before it disappeared. I saw the elephant house from a cliff. I saw that the keeper and the elephant had strong feelings for one another. I admitted that I like elephants and found them exciting creatures. That day, I didn’t spot anything unusual. However, their size of the bodies seemed to change. It was like the elephant got smaller or the keeper got bigger. The balance between them changed. That was the visual image conjured in my mind. I regretted telling her about the elephant as she had many questions for me. That was the last time we met. Everything didn’t seem to matter to me much. People seemed to have forgotten about the elephant now. It won’t be coming back.

I would being to think I wanted to do something, but then I would become incapable of distinguishing between the probable results of doing it and of not doing it. I often get the feeling that things around me have lost their proper balance. – Haruki Murakami