(If you haven’t already, you should read << Riding the positive wave first)
I have a confession to make. I am not learning Blackjack only for Blackjack’s sake. I’ve come to love the game and I intend to play it forever, but I am doing it because of the Stock Market.
I won’t disturb you with my Stock Market ideas, don’t worry. Suffices it to say that I’ve been there and lost. Until now, I had never risked any amount that would actually affect my life, so it’s OK. But I got hooked by the idea of living from the Market, that whole cliché of financial independence, you know. I soon realised, however, that I wasn’t ready for the Market. I suffered from all the behavioural biases that affect decision-making in trading; in my opinion, all of them derivatives of fear. Moreover, I couldn’t (can’t) totally reject the Efficient Market Hypothesis and actually believe there were indeed profitable patterns in the Market that could be exploited by ordinary humans like me. So I decided I had to study much more to find out.
In the meantime, I found something “easier”: Sports Betting. Here, the patterns were much more discernible. We know there are patterns in sports; we have been handicapping them since we are children, right? Maybe, but the Bookmaker knows these patterns much more precisely, so he constantly put up great lines to make my life miserable again. Although I fared much better in this endeavour, I clearly realised I was not ready for Sports Betting either. My biases were still there and I lacked the necessary mathematical and statistical skills. I had huge piles of books about both trading and sports betting, but I knew I needed to climb down once again the stairs of the learning process that would, hopefully, one day lead me to the Stock Market again. But I didn’t know exactly where to go from there, so subconsciously I let the usual obligations of daily existence put me in a stall with respect to my dream.
Then, last Christmas, my 8-year-old niece beats me in Blackjack and I decide to study it deeper. I could see that, even if just by a crazy hunch, my niece would vary her bets at the right time and win much more than I could. I, on the contrary, had no reason whatsoever to vary my bets, but to chase my losses or to placate my steaming. To my surprise, I found out that the game provides a mathematical certainty as long as (i) you can keep finding decent games; (ii) you can play accurately enough and; (iii) you are able to play the game long enough to reach the long-run. It was my chance of practicing the math and the statistics I needed for Sports Betting and the Stock Market. Also, there was a clear path to be followed; all I needed to do was to “stand on the shoulders of giants” and practice, practice and practice. And so I did. This time, it would be easier…
Las vegas, 3:30 a.m., a while back.
I get to the hotel devastated. As soon as I walk in the room, my wife turns around in the bed complaining about the smell of smoke. It is not only other people’s smoke: I have been smoking profusely (I smoke very sporadically when I drink too much, but in Vegas…). In the last two sessions, I had to re-buy-in 9 times in total and I lost almost all of it. What made things even worse was the fact that I had finally found a great game: 0.5 cut-off in a 6-deck game! When I saw the dealer first cut 0.8 decks off and then 0.5 decks off, I was in paradise. I had never played such a game even in the Cassino Vérité software. Now, by the end of the shoe, the running count (RC) would equal the true count (TC) and in the last round, I might have to double the RC to get the TC. Fantastic!
Well, the last round came after I had already lost a few maximum bets (max bets). After the first card left the shoe, the cut card appeared. There were four people in the table, so the lady dealer dealt 10 cards. I am playing at first base and the RC is +6. There were 17 cards remaining, so I would have to triple the RC to get the TC. Oh my! I have a pair of sevens, dealer has a 3; I split. I get another 3; I double to a 4. The other hand receives another 3; “Wow!!” I shout, “I have to double again!”. For each move, I have to reach for my wallet and I look like I am steaming (well, I am). The dealer, clearly worried about me, says “You don’t have to double”, stressing the word “have”. “A man got to do what a man got to do”, I say exaggerating my accent, and I double to a 7. The TC now is 36! It is my lucky number! Seriously, 36! The RC was +9, but at that time I was multiplying by 4 to get the TC (52/13 cards left). I had never imagined that situation even in my wildest dreams. I had been in a wildly volatile 8-deck game before where the RC varied from -21 to +33, but that was crazy. I would bet my house if I could. Everybody was staring seriously at me and I was standing, spinning around my feet, drinking my beer in large sips, smoking and making weird sounds; each bet was much larger than any other player’s at the table, so I was the center of attention.
In the middle of that, the Pit Boss (PB), probably seeing all the bills I kept taking from my wallet, comes and asks for a player’s card. I control my desire to tell him to go take a walk and say without breathing “Sir, I am about to have a heart attack here, can I talk to you later?”. Smiling, he says “You really look exhausted”. I say “Just give the dealer her bust card and I won’t look like that anymore, I promise, OK?” and he leaves smiling.
The shoe had only 4 low cards left; she hits a T (a ten or a face card), then a 3… (That’s it! Beautiful! Come on, T, T, T, T!) …. then a 4. The dealer has 20! I lose it all. Everyone is silent at the table. “That shouldn’t have happened”, someone mutters. The PB is smiling with a “shit happens” expression. I am not smiling. I say “thank you“, give the dealer a red chip (she was sincerely touched by the gesture), wish everyone good luck and leave.
The next day I play three more sessions. I have to re-buy-in seven more times and lose a substantial amount in every single session. To make things worse, in the first session of the day I receive the largest amount of heat of the trip by a very annoying Pit Boss who wouldn’t shut up. (By the way, I, at least, managed to never play rated during the entire trip like I had planned). I had played that game before, but penetration got much worse with that specific dealer. I decided to play through to get to a better dealer or to a good count, whatever came first. Well, the dealer never left (neither did the PB), but I was determined to reach a good count, show my max bets and get some of my money back. After more than an hour, the count eventually surged, but I wasn’t absolutely sure of the correct figure; I showed my max bets anyway, lost, the shoe ended and I left. The second session was a great game in a relaxing atmosphere, but all I could do was lose. After many max bets were gone, I said “OK, I am out of money. Bye.” and left. But that was a lie. I had money and the shoe had not yet ended and the count was beyond +3. “Beyond +3″ means I didn’t know the count for sure, got it? I knew it was still at my max bet level, but I left anyway… and I was pissed off! My third session was in a part of the city where I couldn’t find any decent games, but I played anyway because I wasn’t feeling pain enough: I had to lose more. I play a heads-up game with a beautiful and (finally) fast dealer. When my mood is terrible and my counting is failing, I get the dealer I always wanted. Murphy’s Law is perfect, isn’t it? I begin to not follow my bet ramp exactly while keeping a flawed count. Thanks to the dealer’s speed, I manage to lose a lot fast while playing through ridiculously negative counts until it tanks so much that even my distorted mind realizes I must wong-out. The dealer seems relieved when I do. I guess the way I was losing was so ugly that even she wanted that to stop. It is still early swing shift, but I call it a day (thankfully).
In the beginning of the night, my wife was making her hair (or whatever), so I was alone in the room. What happened? What did I do? I wasn’t worried about the money, that was not the point. That was never the point. The problem was that nothing, absolutely nothing out of the normal was happening and I was losing control. I had been training my mind to accept the variance of the game since the beginning; I know the numbers involved; I know the difference between the short-run and the long-run; I have posted detailed graphs in the Blackjack forum about it, so I know how it goes. Do I really? I even thought that some sort of cheating must have occurred in that 0.5 cut-off game. I had played there before and had also lost. There were only 3 low cards in the shoe when the 4 came out, so maybe that game was rigged; that’s why penetration was so good. What!? Are you serious Skull!? There were 3 low cards out of 11 cards to be dealt, so there was a 27.27% chance of receiving a low card. If you had a 5-shot revolver pointed to your head with only 1 bullet in the drum, you would have “only” a 20% chance of having your brains smashed across the floor; would you consider it a mathematical impossibility and let the guy pull the trigger? So shut the F!@#$% up and suck it up! Get a hold of yourself!
I was ashamed of myself for those thoughts, but what did I expect? I had stopped messing around with the Stock Market because of all the cognitive biases I possessed and it was the same thing with Sports Betting. Was I thinking that all the biases would be gone just because there was a supposedly mathematical certainty in Blackjack? Have I forgotten about the three necessary premises for this certainty to realize itself: finding decent games, accuracy and long-run? Did I think I would be OK with losing just because I rationally understood the variance involved? The truth is “Yes, I did”, but now I was playing like an idiot, effectively annihilating any chance of ever getting to the long-run; my anxiety to recoup the losses was avoiding the selection of good games, making me bet negligently and lose concentration, thus destroying my counting’s accuracy. And what’s worse: the amount of money that I was losing, although significant, was well within the constraints of the replenishable trip bankroll I had brought; it could never justify such a reaction.
These thoughts, although devastating, couldn’t inflict in my soul even a tiny bit of the amount of pain another simple and obvious realisation could:
I AM JUST A GAMBLER.
(Continues on A fearful digression >>)