= 27d567bc2d48d9f40e9ccc20ea370b15)
Constant comments on Verifying Rationality via RationalPoker.com - Less Wrong
You are viewing a comment permalink. View the original post to see all comments and the full post content.
= 783df68a0f980790206b9ea87794c5b6)
Loading…= b715d02e85f7b3b4ae65ca3d3e450868)
Subscribe to RSS Feed
Powered by Reddit
= f037147d6e6c911a85753b9abdedda8d)
You are viewing a comment permalink. View the original post to see all comments and the full post content.
Comments (154)
I'm frankly confused about the whole issue of poker (both online and real-life). I know a lot of smart people who claim to have made ridiculous amounts of money playing poker casually in their free time. Judging from what they're saying, it would seem like there are so many suckers around playing for real money that a highly intelligent person willing to study the game can exercise a ridiculous amount of arbitrage.
But if I accept all their stories at face value, then why on Earth do all these smart people toil at difficult jobs for mediocre salaries when they could be earning much more money gambling? In particular, why do even all these people I know who boast about their earnings at poker still maintain difficult and demanding day jobs? (Of course, they can reply that gambling is only a short-term opportunity while the career is more important in the long run, but they could still invest more time in gambling while scaling down their careers temporarily with a clear net profit. And even if that's not possible, with such vast profit opportunities, one would expect they'd be playing far more even in their presently available free time.)
I don't know what to think of all this. Whatever the truth might be, either I know a bunch of otherwise honest and down to Earth people who are lying or delusional about this issue, or there is actually a screaming opportunity for making money on easy arbitrage that few people bother to exploit, and even they only partly and incompletely. Both possibilities seem to me highly implausible (but the latter more so).
Otherwise whip smart people tend to be delusional about gambling. This applies also to the stock market. Gambling is a minefield of meaningless patterns which trigger our pattern detectors. I presume that's a large part of why it's so fun.
Some people reading that will say, "yes, I already know that for most people gambling is a pandora's box of rationality-killing delusion-inducing spurious patterns, I've incorporated into my thinking, so belaboring the point is just wasting my time". But what I have found is that, however much I think I have incorporated that insight into my thinking, I did not incorporate it fully enough.
My guess about your smart acquaintances is that they have been lucky and are delusional. As for why they don't dive into their delusion, quit their day jobs and destroy their life savings, which is the point of inconsistency that's puzzling you, it may be that on some level they suspect that they may be delusional.
Point of clarification: I am not saying that it is impossible to do what is proposed here, which is to systematically study the game and come up with a winning strategy. This has been done on multiple occasions. My guess about your acquaintances is based on your describing them as "casual" players.
Reading the discussion here, I got the impression, which is consistent with my prior expectations, that with the systematic method proposed in a given hour you only win, on average and with a lot of variance, a small fraction of the amount that you bet. Whereas what you seem to be saying is that your friends are claiming enormous wins. Such big wins are probably mostly due to luck. The drip, drip, drip of slow and unsteady profitability of a systematic method applied over an extended period, does not seem to be what your friends are talking about. In short, their wins as you relay their descriptions sound like free money, whereas the systematic method (which is all I really trust to work) sounds like a job.
Yes, in fact it happens that some of the same people I know claim to be able to beat the stock market too. I think your theory is probably true: both in gambling and on the stock market, people get deluded by occasional lucky windfalls and fail to keep track of the big picture. Yet few of them actually get deluded to the point where they'll go ahead and bankrupt themselves; the others remain rational at some level and refuse to actually put really significant sums where their mouth is, although they will brag around about their wins, possibly talking under honest delusions (but not actually acting on them, as with most beliefs that are held for signaling value).
Of course, as the EMH predicts, being smart and hard working people, if they really applied themselves to gambling systematically and full-time, they would probably be able to squeeze out something of roughly the same magnitude as what they earn in their existing day jobs. (But certainly nothing like these spectacular wins they're talking about.)