Gambling and poker talk

I was watching the TV news with my parents and a piece about this lucky young lotto 6/49 winner came on. He scored $4.5 million off a $2 ticket.

I got talking to my dad about what we each would do if we won a large amount. We agreed that it was smart to just set the money aside and live comfortably off the income stream by investing the money conservatively and never have to work again.

He asked if I play lottery and I confirmed that I don't. He plays a few dollars each week. Of course I don't play lottery because it has a negative expectation.

He asked if I gamble at all. I was a bit hesitant to answer. I gamble when I feel I have an edge like in some online poker games. I don't like talking about poker to people who don't play for real money. It's too much of a disconnect, and the stakes I play are too low to really consider meaningful real money. Basically I don't have anyone to talk about poker with in person but that's OK.

My dad warned me against playing poker for real money. Too late there, I'm not quitting. His reservations about it were that you could go broke playing and you can't get ahead. It's kind of funny because he's against gambling at poker but he plays lotto tickets and slots at the local casino.

His concerns about poker are worthy of addressing.

You can go broke playing

This isn't really true. With modern table stakes poker is a limited liability investment. Your potential loss when you sit down at a game is capped by the amount you choose to put in play. You cannot lose more than that and you cannot be forced to pay more than you initially put in to stay in a hand.

Internet poker is the same, you cannot be in debt online. The only money you can put into play online is funds which you have put into your bankroll. The sites don't have any uncontrolled access to your outside funds.

So with proper bankroll management and observing the Kelly criterion you won't lose your house playing. Of course an individual can choose put money in play that he can't afford to lose. But that's a flaw in personal discipline and bankroll management, not in poker itself.


In a raked game everyone goes broke eventually

My dad described a scenario where players of equal ability play in a raked cash game. He was correct that given enough time the rake would slow leak enough money out of the game that eventually all of the players would end up busted to the rake.

The poker my dad played was against his buddies in an occasional home game in the 1960s and 70s. These were casual players and the only time they played for real money was on their poker night against each other. There was a cap, around $100 I think, on how much any one player could lose on one night.

The poker and beer night game my dad played against his buddies was indeed an EV zero game. Nobody had a meaningful edge on anyone else. This was before the local casino was built and before Internet poker so basically it was the only game they could play. In a raked EV 0 game everyone eventually busts to the rake unless they deposit new money to keep the game going.

The difference today is that with the Internet modern poker players have the ability to seek out EV positive games. We can go from site to site, game to game including hold'em, stud, draw, horse, razz, Omaha, etc. There are cash games, sng, and mtt. We can play fixed limit, pot limit or no limit. Real money stakes range from pennies up to thousands of dollars.

The modern poker tiger has an incredibly large jungle of territory he can freely roam to find games that are beatable above the rake. So the 'EV zero' dilemma is a non issue because an Internet player can just get up and leave an unprofitable game and find a game with enough positive EV to beat the rake.