Cyrus
11-16-2003, 09:55 AM
Having recommended the book on a non-poker situation ("Other Topics Forum", don't ask), I re-read recently John Feeney's Inside The Poker Mind myself and here's a quote:
"Consider a player who's burning up money so fast that he will soon be faced with a choice of either quitting poker, or financial ruin.
Reading [books] may help such a player slow down his losses enough to keep him in the game as a long-term modest loser. ... This may cost him more in the long run."
Is this correct?
I had this concept discussed about Blackjack elsewhere but there the parameters are fewer. In Blackjack, when I consider the size of my Bankroll and calculate only what I currently have in the bank, I may be severely underbetting my advantage. (I assume throughout this post that our hero has the advantage, in Poker or Blackjack.) The way to calculate one's true BR is based on the well-known concept of the net present value of future inflows of disposable income. (I am making the assumption that our hero gambles/invests in Poker or Blackjack with his disposable income only.)
For instance, if all I have right now is $10,000 as DM (Disposable Money) but I will be getting another $10,000 in a month's time, I should be including in my current BR the present value of that future inflow (after discounting it against my cost of capital borrowing).
But is this correct for a losing player?
A player who is actually a losing player, as in Feeney's example, might be mucking the parameters big time: For example, he may not confine himself to DM only -- hence Gamblers Anonymous.
Then, there's the issue of perception, which I suspect is what Feeney alludes to, there. A player with $10,000 of monthly DM may be losing all of it, as a matter of fact, and not get 'hurt' or worried. He may lose $240,000 in two years' time, slowly, and the slowness of it may alleviate the pain. Or, he may lose in one big chunk tonight the NPV of the $240,000 -- say it's $200,000.
How he will do that? The player will borrow. (This will cost him the cost of capital borrowing I mentioned. and the player will repay the borrowing, this is not a factor.) But Feeney may be suggesting that losing in one big chunk an amount of money that's (mathematically) equal to the same amount being lost over a longer period of time OR LESS is a shock that jolts that player out of the poker economy. And the poker economy suffers every time a losing player opts out of the poker economy having lost LESS than his lifetime NPV of DM.
Is this what Feeney's saying?
A side issue arises, of course, when the player is losing slowly and thus feels (over-rates himself) he can borrow more than he can really afford! This mucks both the parameter of his DM and his assumed ability to repay. So, there's another issue to consider: If the losing player remains uneducated, he might bring to the poker economy more money (by being extravagant and risk-ignorant) than otherwise.
--Cyrus
PS : Note that Feeney stresses that all this is considered from the point of view of "players whose only interest is their own earn". In other words, no moral consideration enters this debate.
"Consider a player who's burning up money so fast that he will soon be faced with a choice of either quitting poker, or financial ruin.
Reading [books] may help such a player slow down his losses enough to keep him in the game as a long-term modest loser. ... This may cost him more in the long run."
Is this correct?
I had this concept discussed about Blackjack elsewhere but there the parameters are fewer. In Blackjack, when I consider the size of my Bankroll and calculate only what I currently have in the bank, I may be severely underbetting my advantage. (I assume throughout this post that our hero has the advantage, in Poker or Blackjack.) The way to calculate one's true BR is based on the well-known concept of the net present value of future inflows of disposable income. (I am making the assumption that our hero gambles/invests in Poker or Blackjack with his disposable income only.)
For instance, if all I have right now is $10,000 as DM (Disposable Money) but I will be getting another $10,000 in a month's time, I should be including in my current BR the present value of that future inflow (after discounting it against my cost of capital borrowing).
But is this correct for a losing player?
A player who is actually a losing player, as in Feeney's example, might be mucking the parameters big time: For example, he may not confine himself to DM only -- hence Gamblers Anonymous.
Then, there's the issue of perception, which I suspect is what Feeney alludes to, there. A player with $10,000 of monthly DM may be losing all of it, as a matter of fact, and not get 'hurt' or worried. He may lose $240,000 in two years' time, slowly, and the slowness of it may alleviate the pain. Or, he may lose in one big chunk tonight the NPV of the $240,000 -- say it's $200,000.
How he will do that? The player will borrow. (This will cost him the cost of capital borrowing I mentioned. and the player will repay the borrowing, this is not a factor.) But Feeney may be suggesting that losing in one big chunk an amount of money that's (mathematically) equal to the same amount being lost over a longer period of time OR LESS is a shock that jolts that player out of the poker economy. And the poker economy suffers every time a losing player opts out of the poker economy having lost LESS than his lifetime NPV of DM.
Is this what Feeney's saying?
A side issue arises, of course, when the player is losing slowly and thus feels (over-rates himself) he can borrow more than he can really afford! This mucks both the parameter of his DM and his assumed ability to repay. So, there's another issue to consider: If the losing player remains uneducated, he might bring to the poker economy more money (by being extravagant and risk-ignorant) than otherwise.
--Cyrus
PS : Note that Feeney stresses that all this is considered from the point of view of "players whose only interest is their own earn". In other words, no moral consideration enters this debate.