Gambling Derision

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For someone who’s interested in risk management, gambling and casinos provide abundant examples of the psychological element that comes with risk taking.  Especially from those who have a shallow understanding of risk, I often read a lot of derisive commentary about gambling. News flash: casinos aren’t the only businesses that want to lure more customers and keep them spending for as long as possible.  I’m pretty sure McDonalds does this too, so does your local grocery store, so does the cable and cell phone companies. And its not because they are sinister, its because they are seeking profits.  Maybe eating french fries 3 times a day isn’t very healthy, and we all see a full isle of chips and pop in the grocery store, and texting all day is probably a waste of time. Gambling all the time in casinos is probably going to blunt your senses.  But eating, gambling, or chatting with friends on Facebook all day long all are each unhealthy. Compulsive gambling leads to financial ruin, but eating hamburgers all day will probably cause weight gain and other health issues too.

The derisive comments I read in books and other media about gambling is usually connected to the author’s personal opinion of the value of gambling.  Often times, its assumed by a critic of gambling that the activity is a complete waste of time.  The author will fail to understand the positive elements of gambling such as the thrill, the escape, the philosophical elements of leaving yourself exposed to pure chance.  A lot of people find playing cards for stakes with friends to be a fun experience. A better understanding of the individual nature of value is something more of us should understand.

 

 

Review: Gamblers Fight Back: A Professional Gambler’s Journey of How to Survive and Thrive in the Casino

Gamblers Fight Back: A Professional Gambler's Journey of How to Survive and Thrive in the Casino
Gamblers Fight Back: A Professional Gambler’s Journey of How to Survive and Thrive in the Casino by Greg Elder

My rating: 2 of 5 stars

Gamblers Fight Back by Greg Elder is a short book providing some insights into the author’s personal gambling experience. Gamblers Fight Back is organized into sections ranging from Elder’s general comments on casinos to descriptions of some aspects of three types of gambling games: video poker, blackjack, and sports betting. I suspect this book is an attempt by the author to squeeze additional revenue from his experience as a full time gambler. Overall, Gamblers Fight Back provides little value to anyone interested in the life of a career gambler.

The first few chapters set the stage for why the Elder decides to dedicate his full time to gambling. Before turning to gambling full time, he pursued careers in insurance sales and eBay power selling, but after these efforts failed, he was inspired by the book Million Dollar Video Poker by Bob Dancer to take up gambling full time. Unfortunately for Elder, Bob Dancer may have simply been lucky (although his book, Million Dollar Video Poker is a fabulous read). Bob Dancer manages to parlay a $20 stake into a million dollars over the period of a few years, but Dancer has recently acknowledged his good luck based on the size of his bankroll. Bob Dancer was also playing video poker during an earlier era in Las Vegas when opportunities for video poker advantage play were much more available (for higher stakes) and he played during an era when Las Vegas casinos were less sophisticated regarding the design and co-ordination of slot club promotions. Many of the advantage play gaps found in casino promotions during Bob Dancer’s run no longer exist.

Greg Elder sets up a series of “straw man” arguments to lure readers into the possibility of full time advantage gambling without going into the specifics of bankroll requirements and the daily process required. The introductory chapters of his book focus on how to avoid getting kicked out of the casino (since you are such a threat to casino profits) and the proper psychology of a full time gambler (since one of the main things preventing you from gambling full time is your own psychology). These sections mirror the themes of a recruiting pitch for a multi-level marketing program, but provide little value to a sophisticated reader.

The book ends with sections devoted to video poker, blackjack, and sports betting. While the blackjack and sports betting sections contain very little insight, the video poker section talks about playing 9/6 JoB, which is a starting place for video poker advantage players. Although Elder fails to outline the specifics of how he suggests players gain an advantage over the casinos, a knowledgeable reader can piece together the advantage plays including point multipliers, mailers, and drawings. A much more serious omission is the detail these strategies yield and the bankroll requirements. I fear this book gives players enough information to get themselves into trouble without tackling the more substantive issues of risk management. This fear is highlighted by the author’s description of his own busted bankrolls.

One major frustration I have with Elder’s book is his use of the term “professional” when referring to full time gamblers. Professionals have characteristics such as being a member of an association which upholds standards of practice, educational requirements, and various standards of care. Examples of professions are doctors, lawyers, and dentists. Full time gamblers are not professionals; they are simply full time gamblers. Your career may be as a “cashier”, but you are not a “professional” cashier. By attaching the term “professional” to a full time gambling career, the author attempts to elevate gambling to something it is not.

Gamblers Fight Back provides some advice that is outright dangerous to readers. While outlining the strategies players should use when mastering various video poker, the author suggests creating a laminated reference card in order to avoid mistakes. This is a great advice for casual gamblers, although full time gamblers should know applicable video poker strategies perfectly. Where the author misleads the reader is his suggestion that gamblers should use a mobile in the casino. This is a dangerous suggestion since using a mechanical device is not allowed in Nevada and most other North American gaming jurisdictions. If a reader where to take this advice, and hit a jackpot, they would give the casino an excuse to refuse payment.

It becomes apparent midway thru the book that the author is not a successful gambler. He includes a whole section on how to grub stake a bankroll, but his suggestions would leave the would-be gambler seriously undercapitalized. The author goes on to describe his $12,000 bankroll as he is playing $1 JoB. This is a very risky gamble based on bankroll size and exposes the player to likely ruin.

I wonder about the author’s logic and math. Can someone really make consistent profits playing 9/6 JoB in Las Vegas? The best promotions seem to be double points, which bring the game return close to even (when played perfectly) coupled with mailers and drawings. At 500 hands per hour, $25 per hand, and an advantage of 0.5%, this means potential profits of $60 per hour and a bankroll of $500,000. A $5,000 bankroll using the same characteristics would mean $3 per hour; surely a fun activity for a vacation, but not a full time career.

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Gambling and Homelessness

I was very disappointed to read an article published in the National Post referencing a study published in the Journal of Gambling Studies since the article misrepresents gambling addiction.  The National Post article, referenced below, implies that problem gambling is a cause of homelessness. This is a misrepresentation because the homeless are more likely to have all sorts of problem addictions including various drugs and alcohol.  Gambling is not a cause of homelessness, but gambling addictions are the outcome of the challenges that the homeless have.  Also, those who struggle with addiction are also much more likely to struggle with more than one addiction. The addictions are an outcome of other mental illness.

Articles such as the one published in the National Post imply that if we reduce gambling, then we can reduce homelessness. But this logic is flawed because it’s not gambling addictions that are causing homelessness, but rather, addictions or all sorts are the outcome of other mental illness which is the root cause of homelessness.

As per the two articles below, about 35% of the homeless are estimated to have had a gambling problem, but 50% of the homeless also have alcohol or other substance abuse. The addictions are an outcome of other mental illness.

A definition of Gambling

What is gambling? Most of my friends describe gambling as “taking risk for money”. But “taking risk for money” doesn’t differentiate gambling from many other risky activities. Gambling is something distinct from simply taking risks, and gambling is usually not entrepreneurial (although so called “professional” gamblers would have you believe something else). Gambling usually involves taking risk with monetary consequences. How do I define gambling?

Gambling is wagering stakes on an event or game. Let’s break this definition into its constituent parts. The first word, wagering, is a key component of gambling. Wagering is what makes gambling distinct from other types of competitions, whether they be sports or other games. The wagers must also be for stakes of value, and not just “friendly wagers”. Monetary instruments are the most common stakes, but the stakes can be anything of value (positive or negative). The events and games which gambling is based on can be essentially anything, since essentially everything in life has some degree of uncertainty.

A bet is the act of placing a wager.

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