The book of Financial Risk forecasting by Danielsson gives the following example about VAR manipulation. I have two questions:
1) If $0> VAR_1 > VAR_0$ , why the following figure plots it as $-VAR_1> -VAR_0$. I think $-VAR_1$ should be placed at the left side of $-VAR_0$.
2) I am not clear how does the manipulation strategy marked with yellow work. In other words, why it can lower the expected profit.