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| date | 2000-11-14:16:42 |
| Humans |
Gambling is not a game of chance. If you gamble, you are certain to lose. Many people disagree with this assessment, and this is what the gambling industry makes its money on. The amazing thing is that casino operators are remarkably honest about their customer's certainty of losing. Anyone who can do simple arithmetic can see plainly that they are certain to lose, and yet many people still keep playing. Some of them are doing it for the entertainment value, and this is reasonable: casinos often offer cheap food and entertainment, if you gamble modestly. But many people seem under the delusion that they can win, and it's that delusion I'd like to try to dispell. I realize I won't succeed, but it seems like something that needs to be said. There are two basic forms of gambling: betting against the house, and betting against other players. Sometimes, as in blackjack, the house is itself a player. Roulette is an example of a game that is purely betting against the house, and I'll consider it first. Slot machines fall into this category too. These games are called "games of chance" because the outcome of each play, of each spin of the wheel, is selected from a distribution of possible outcomes. In roulette, for example, the outcome is between red, black and green. By "green" I mean the zero (and sometimes double-zero) spaces on the wheel, which mean the house wins. For a wheel with both zero and double-zero (which is the most common in North American casinos today, I'm told) the average outcomes are: Red: 18/38 Black: 18/38 Green: 2/38 This is the distribution of outcomes: just under half the time the result is red, just under half the time the result is black, and just over one twentieth of the time the result is green. You can think about spins of the roulette wheel as choosing outcomes from this distribution with a probability equal to the fractional value given each outcome (the values add up to one, which is important because for every spin there is some outcome.) I've not considered individual numbers on the wheel because the following analysis applies to them as well, and the outcomes for betting on individual numbers is worse than just betting on red and black. Suppose you decide to play a "martingale", which is the closest thing to a winnning strategy in roulette. It consists of betting on red or black, and doubling your bet each time you lose until you win, at which point you start over again with the minimum bet. Because a red or black bet pays 2:1, this strategy will keep you in the game for a while. Suppose you always bet red (nothing changes if you bet black, or even if you switch randomly back and forth between red and black.) 9/19th of the time you will win. 10/19th of the time you will lose (the crucial 1/19th difference between winning and losing is due to the 0 and 00 on the wheel: they are why the house always wins and you always lose, in the long run.) That means that on average, every time you bet you'll lose 1/19th of your cash. Of course, it isn't evenly distributed across your bets: most times, you'll win a little. But eventually you are certain to come up against the table limit, at which point you'll be unable to double your bet and you'll go broke all at once. This would happen even without the 1/19th tilt in favor of the house, but that ensures it'll happen a good deal faster. Blackjack and all other casino games are similarly, legally and openly "rigged" to ensure that you the player will lose. For a while it was possible to win at blackjack by tilting the odds ever-so-slightly in your favor by card counting, but most casinos now use infinite decks that reduce the utility of this strategy to nearly nothing: the big gains from card counting always came near the end of the deck, and by shuffling in new decks as they go the marginal gain to be had from information about exposed cards is no longer enough to change the outcome. Another trick is trying to read the roulette wheel. The idea is that no wheel is perfectly fair, and if you look carefully at where the ball goes onto the track you may be able to judge where it'll come down, assuming it doesn't hit one of the paddles on the edge of the wheel that are supposed to randomize its motion even further. Perfect uniformity is hard to get in a distribution of random numbers, and I'm sure most wheels, if analyzed carefully enough, would show some regularities. A couple of Caltech students even built a tiny computer into a shoe so they could analyze wheels on-the-fly. But that is cheating, which violates the basic spirit of gambling by bringing intelligence to bear on a fundamentally stupid enterprise. So far as I know, no one has ever successfully read a roulette wheel by eye and mind alone. Only when gambling on the outcome of sporting events, including horse-racing, is there any role for intelligence, and in those cases it is considerable. Odds-makers and the betting public sometimes make mistakes, and a person with a comprehensive knowledge of the game and the players should be able to win fairly consistently. But to do so requires what all success requires: hard work, dedication, knowledge, insight, intelligence and discipline. Why did I put this mostly mathematical screed against gambling under "Humans"? Because gambling is a particularly stupid form of human behavior, unless done solely for whatever entertainment value you get while losing your money. So what is one to do? There are four strategies. One is to simply not gamble. Another is to gamble a bit, for the entertainment value, making sure you risk nothing more than you would pay for any comparable entertainment. A third is to gamble once. This is the way to maximize your lifetime winnings and limit your losses. Figure out all the money you will ever bet in your whole lifetime. For me, that would probably be about $1000. Go to your local casino and put it on one turn of the wheel, betting red or betting black. If you win, collect your winnings. If you lose, chalk it up to experience. By only giving the house a single chance to take your money, you've given yourself the best chance you have of winning. On average, though, you will still lose. The final strategy is the only one that wins: become the house. Set up a casino of your own. Because (I presume) internet gambling establishments are very cheap to run, I think they ought to have games that are less strongly biased against the customer than the typical casino games--they should also provide some direct entertainment value, so they provide something positive for the money. If you become the house, though, you've got a heavy responsibility: the bulk of a casino's take often comes from a very small fraction of its customers. Gambling is potentially adictive, and you have a responsibility to see to it that what should be a little harmless entertainment doesn't wind up doing someone great harm. I believe it ought to be illegal to induce in someone a compulsive behavior--to remove an individual's power to choose--and then profit from it. |