Probabilities and Luck

 

Probabilities, Chances, Hobbies, and Luck – A Powerful Combination for the Faithful

By Charles L Harmon

For most of us life is a gamble. There are so many things that are not under our control that no matter what we hope our lives turn out to be we seem powerless to force life to give us the things we desire. That’s where probabilities, chances and luck somehow creep into the mix.

If one was to try to do battle with fate you might think its even money bet that anything could happen during a lifetime. That might be true, but probability theory implies something different. It says there is more to any bet than just its odds.

In life there are just too many uncontrollable factors influencing and affecting things that almost whatever we do, or even don’t do, could either help or hurt us in the game of life. Plain and simple, there are things that happen beyond our control.

For gambling, odds seem to rule, but there is that unknown factor that can help or hurt any gambler. That’s lady luck. While there seems to be little or nothing that one can to do about that fickle lady there is an even more ominous enemy or all-powerful friend lurking in the ever present background.

That’s the edge. All gamblers want to have an edge in whatever games they play. Play long enough and smart enough with the edge in your favor and you’ll almost always come home a winner over a long period of time.

The long period of time and playing smart is usually the downfall of most gamblers. They cannot play long enough and/or aren’t playing smart enough to overcome the slight edge that does them in.

The edge is what can almost assure you big winnings if everything else is in your favor. On the other hand, lack an edge in your betting or gambling activities and well, unless lady luck is on your side, you can kiss your money goodbye.

Go to Las Vegas, Reno Nevada, Laughlin Nevada, Atlantic City, Monte Carlo, Macau, or any other large gambling locations and it’s pretty easy to see expensive and luxurious shops, buildings, and other extravagances that only lots of money can buy and support. Walk down the main drag in Las Vegas and if you haven’t been there before you’ll stare in amazement at the buildings, lights, expensive stores and other symbols of luxury most of us could never afford to own.

As stated earlier, there is more to any bet than just the odds. You can see it vividly in the bright lights of Las Vegas. It’s the edge. That edge, even though not very big can triumph in the long run. On an even bet the edge can overcome all odds and produce winner after winner all in favor of the one with the most money. Give it a little help with a small odds advantage and the winnings can flow like water in the form of money won.

Here’s a little story to illustrate the edge in gambling or betting;

In one of the smaller countries of the world an order of priests or was it monks, a rogue order, to be sure, were very interested in having their own business. They wanted to pursue hobbies like anyone else and the best way to do it was to have their own business. It took a lot of convincing their superiors but they were smart and the combined strategy the four worked out sounded so good they were granted their wish.

The main condition they had to meet was it had to generate more money than bingo and use no funds from their religious organization. Also whatever they did had to be fair and not rip people off. Of course that was not their language, but I am taking the liberty to tell it like it is.

Rapfhuu wanted to buy an old Corvette and soup it up. Having a hot car was his secret dream and a hobby of souping up cars he never had. Zuzu had always wanted to have his own plane, now complete with a large flat-screen 3D TV and bar (no alcohol allowed). He had always dreamed of traveling the world and his own plane would help tremendously in pursuing that dream.

Crazee wanted to take two weeks off and go on an African Safari to see the wild animals and how the other half of the world lived. He had always been interested in conservation and a safari would be a good start. Mystee longed secretly to be a world-class gambler. Originally he thought playing poker was the key, but later decided he wanted the thrill of owning a casino.

They had picked up a nickname during their deliberations on the business and somehow it seemed to stick. They were now called the Phflabulous Four. Tricky spelling, hard to understand, and dubious meaning, but everyone called them that.

All of them secretly had visions of taking a couple of years off, away from their daily obligations and living a normal life enjoying their hobbies and fulfilling their dreams for those two years at least. Of course this was all hush-hush and could never get out lest their dreams and permission to operate the casino be quickly and permanently revoked.

They all analyzed their ideas, wants, and needs and came to the surprising conclusion that Mystee’s gambling could be the answer to all their prayers. Mystee actually wanted to own a large casino rather than piddle his time away gambling. That was the clue to all of them that what they should do was open up a casino. It wasn’t good for religion, but good to help fulfill their dreams.

After seven days of serious thinking the group had a plan they deemed workable. They would open a luxurious casino, The Fairness Casino, which would have three games; a coin flipping game that they determined was as fair as they could possibly make it yet still turn a small profit, the standard game of craps, and slot machines.

Both craps and the slot machines were to have half the take of the same games as Las Vegas.  The Phflabulous Four felt proud of themselves. The Fairness Casino had the lowest odds for those games in the world and their golden coin flipping game also had a very low house take.

The profit from the games should allow all of them to pursue their dreams (if they could get away with it).

They had read several books and checked out many other sources of information. In fact, their meager computers had been severely overworked and overloaded. But one thing they took to heart was that they had to get money from other sources to start and run their other business.

Taking a lesson from the overpaid Wall Street crowd and some of the biggest businessmen around they opted to start an IPO (Initial Public Offering) and sell stocks for their business. To make it easier to get money they had the stock reasonably priced, but offered hundreds of millions of shares. It was touted all over the news and made a worldwide sensation. That helped them tremendously to the tune of many billions of dollars raised by that lone IPO…

After a short period of time they had sold out their original offering. Then the building began. It didn’t take long because of all the big incentives they offered to get their casino built as quickly as possible. It worked. Within six months they had a huge complex with extra large number of state-of-the-art machines, video surveillance, hotel, restaurants, and all the other amenities you’d find at a top Las Vegas casino.

They had hired a world famous mathematician and others to verify their golden coin flipping game would generate enough money to operate and make enough profit so all of them could fulfill their dreams. The house percentage of that game was low, too low to mention here but I will say it was less than 1%.

Their highly visible golden coin flipping game was simple, dirt simple. It was just flipping a coin, a golden coin rumored to have come from a goose that laid golden eggs and coins. Heads you win, tails you lose. Of course when you lost the casino won or kept your bet.

The golden coin had been thoroughly examined and certified by several certification groups to be free of any biases, plus it was of unusual purity being 100% fine gold. Actually it wasn’t just one coin, all the coins were certified. Their secret goose had laid thousands of pure gold coins and they had an equivalent number of people flipping the coins to handle the anticipated large crowds.

You might wonder why The Phflabulous Four didn’t just cash-in their gold coins or hoard them. They told me their goose had become ill and no longer could lay any more eggs or coins. Furthermore, they were not coins that could be spent but bore a likeness of the goose on one side and a flock of baby goslings on the other. In addition, the Phflabulous Four were not supposed to have a goose to begin with so it had been assumed and taken on faith that the goose that laid the golden eggs and coins was from a higher authority.

The casino had limits on how little and how much you could bet but no limits on how long you could bet. If you could last 1000 times they let you. All bets were such that if you lost, you lost all the money you bet. If you won you had your money tallied and received 100 percent of what you bet plus your original bet. Because their take was low it had to be rounded up to the nearest 1 cent for a dollar bet and payoffs of just a few dollars. For larger amounts their actual percentage, or rounded up to the next penny if necessary.

Of course their standard games of craps drew large crowds too because of the low take in the game. As usual the thousands of slot machines were always full and got a ridiculous amount of action because of the higher payoffs due to the lower take than normal.

The casino was an instant success. People flocked there from everywhere. Many thought they could parlay their money from a dollar to thousands. Some did. Others went broke. Some well heeled individuals walked off with wads of money while some of those same people walked away broke.

Swallow a toad in the morning and you will encounter nothing more disgusting the rest of the day.
Nicolas de Chamfort

When the dust settled after their first quarter and taxes were due they were surprised to find no taxes were due because a religious organization owned the casino. Their tax attorneys had assured them well before their plans were finalized, but the group had their doubts.

Putting it mildly they had garnered billions in profit after paying off all debts. Their superiors were elated to say the least, and even encouraged them to advertise more to draw more people into the trap, er I mean casino.

A whole year went by and money was flowing into and out their casino like water. It was routine to see armored trucks bringing money out of the casino all hours of the day and night.

Well let me cut short the rest of the story. I see my editor signaling me to cut it off and get back to work. I nodded ok so now I better stick to it.

After another year The Fairness Casino had made so much money they decided to put in a bid to buy the government of their country which was in dire straits.

Unfortunately so many people had lost money in the casing going for the pig payoff there was a dire shortage of tax revenue. Some of the high government officials had used public money at the casino and lost, so that all emergency funds had evaporated. A vote was put to the people about the sale of the government and a unanimous yes, sell was the result.

The government was sold to The Fairness Casino and the Phflabulous Four all took off for their two year leave. Two more years later The Fairness Casino was looking for another government to buy, having several hundred billion dollars cash at its disposal for a quick cash deal. A year later and hundreds of billions of dollars richer, The Fairness Casino bought out five governments on the neighboring continent. And so the story goes…

Two questions arise. How did The Fairness Casino make so much money? How could an almost break even game pump out so much money? The short answer is the casino started and continued to have much more money than any individual. It had an edge in that respect. It could outlast any of its patrons. They all individually, and even combined in many cases, had less money than the casino.

Compare that to life. So even when life is fair, it really isn’t. The fact is, especially in any type of gambling, your chances of coming out a winner are proportional to the deepness of your pockets. The house or casino wins by virtue of being the house, the entity with the deep pockets. You’ve heard it before, when someone sues; their attorney always goes after the person or entity with the deepest pockets.

This idea of deep pockets explains why people who appear most at home in the most expensive casinos look so, let’s just say, well groomed, debonair, rich. They have lasted the longest, not necessarily by being best, but because they had the most money to start with, the deep pockets, the most money to waste, er I mean gamble. On the other hand it is possible that luck was on their side, but don’t bet your life on it. Yes, they have the secret to making a small fortune at the tables — start with a large fortune.

Does luck play a part in all this? It’s hard to say and even harder to pin-point it, but most people would agree that it does. So if you’re like most and hope to come out ahead in gambling or the casino you have to consider the effects of luck or wish for good luck to come your way.

Copyright © 2010 Charles L Harmon