Where is the money coming from in high stakes poker?
 

I've been thinking about this for a while. At SSNL, most players suck. They saw the WSOP on TV and they've got $200 burning a hole through their pocket. They make a deposit and after about a month, sometimes less, go bust. This makes it pretty easy for a decent player to win at low stakes.

However, these guys don't go to 5/10 or 10/20 tables. They can't afford it. My picture of high stakes poker is the same people seeing each other every day because that's what they do for a living. All high stakes players must be very good, right? I would think they just pass $ back and forth, with no donkeys constantly contributing. In addition, the casino takes a rake, so there is less and less money between these good players.

I'm obviously wrong, because people do make money at high stakes. I just don't understand how. How could there be a losing player at 5/10? Wouldn't you have to be a complete idiot to continue losing $1000 a day? What am I missing?

Re: Where is the money coming from in high stakes poker?
 

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All high stakes players must be very good, right?

[/ QUOTE ]
Hah.

There is enough luck in poker that even bad players can book some big wins, which will keep them coming back even though the wins are outweighed by bigger losses.

Also some people just have more disposable income to gamble with.

Re: Where is the money coming from in high stakes poker?
 

rich people suck and play poker too

Re: Where is the money coming from in high stakes poker?
 

Good players at low limits will take shots at higher limits. $$ from lower stakes can "trickle up" to the higher stakes. Also, just because many people are good at higher stakes doesn't make them equal. Some of them are better, and these are the true long term players.

JKratzer

Re: Where is the money coming from in high stakes poker?
 

[ QUOTE ]
rich people suck and play poker too

[/ QUOTE ]

This is the answer.

Re: Where is the money coming from in high stakes poker?
 

I'm guessing a combination of several places:

1. A lot of those people with $200 burning a hole in their pocket that will bust out quickly aren't exactly the type who are thinking, "Boy, I'd better stick to the 10NL game since that's all my bankroll will support." A lot will be just as likely to try 5/10 as .05/.10 just because they have no concept of bankroll management and they think that they're experts because they've watched the WSOP on TV.

2. There are rich people out there who just have money to burn. You may have started at .05/.10 with a $100 bankroll, but your average multi-millionaire is going to waste his time with that. Of course their play will be every bit as bad as the newbies at the small stakes and they'll get eaten alive by the sharks at the higher levels. That doesn't mean they'll hesitate to redeposit and try again though.

3. People are playing above what their bankroll allows. Some guy who plays regularly at $1/$2 decides to "take a shot" and finds himself horribly outmatched. Just because someone's playing $5/$10, doesn't mean they've really demonstrated the skill to win there.

4. Sort of related to the previous item, but most people, even solid players, reach a point where they simply don't have the skill to beat the next level. Not everyone that is crushing the .05/.10 game is going to eventually be a winner at 10/20. At some point they're going to move up to a level that they can't beat, lose some money, and drop back down. They'll make their money back at the lower level, take another shot, and lose again. Figure this happens many times before they finally get the hint and then multiply this effect by all the players out there and you'll see a "trickle-up" effect where money that is won by good players at lower stakes is lost at the higher stakes when they try to move up.

Re: Where is the money coming from in high stakes poker?
 

Read "The Professor, the Banker, and the Suicide King." It's the story of the largest game ever. Andy Beal lost well over $10,000,000 to the world's greatest players.

He is just an extreme case. LOTS of people have more money than brains. We call them "Whales" because they are much bigger than mere fish.

In the past most of them played craps, roulette, etc. Now that poker is fashionable, some of them play poker. A few of them take lessons and become reasonably competent, but some of them are as outmatched in the big games as the newbies are in the tiny ones. In fact, occasionally someone gets drunk in a big game and throws money away just like a drunken tourist in a small game.

David Sklansky has written quite a bit about the way that the players in the really big games all live off a few fish. They don't have much edge over each other, but they have a huge edge against the fish.

Regards,

Alan

Re: Where is the money coming from in high stakes poker?
 

I was railbirding party 100/200 today and believe me, the bad players are there too.

Re: Where is the money coming from in high stakes poker?
 

[ QUOTE ]
Read "The Professor, the Banker, and the Suicide King." It's the story of the largest game ever. Andy Beal lost well over $10,000,000 to the world's greatest players.

He is just an extreme case. LOTS of people have more money than brains. We call them "Whales" because they are much bigger than mere fish.

In the past most of them played craps, roulette, etc. Now that poker is fashionable, some of them play poker. A few of them take lessons and become reasonably competent, but some of them are as outmatched in the big games as the newbies are in the tiny ones. In fact, occasionally someone gets drunk in a big game and throws money away just like a drunken tourist in a small game.

David Sklansky has written quite a bit about the way that the players in the really big games all live off a few fish. They don't have much edge over each other, but they have a huge edge against the fish.

Regards,

Alan

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I think it is highly inaccurate to describe andy beal as having "more money than brains." He's such a highly successful businessman, that coming up with 10M or whatever for his match with the pros was easy. The top poker players in the world however, had a tough time with it, had to pool their bankrolls, and still had to get him to reduce the stakes.

Re: Where is the money coming from in high stakes poker?
 

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However, these guys don't go to 5/10 or 10/20 tables.

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Go play a 5/10 game (or just watch one) for ten minutes or so, then see if you still think this statement is true.

Re: Where is the money coming from in high stakes poker?
 

Just wanted to say this is a great thread, and I'm looking forward to more responses from people. This question has been on my mind as well.

I'm going to buy the book that Alan mentioned.

Re: Where is the money coming from in high stakes poker?
 

I win a bunch in my regular game and then go move up a level and lose at first. Then I go back down and win a bunch and move up and break even. Then I go back down and win and move up and win a little. Then the new higher limit becomes my regular game and I repeat the process.

I am really just a transporter of money from the low-limit fish to the pros, so they don’t have to waste their time.

And every game has people just like me, no matter what level you're talking about.

Re: Where is the money coming from in high stakes poker?
 

And what's really funny is that most of the rich guys dumping thousands in poker games are doing a minute fraction of the damage to their net worth that many of the low and middle limit players do on an ongoing basis. There's the real story.

Re: Where is the money coming from in high stakes poker?
 

I'm surprised that rich people start out at 5/10. It seems like the equivalent of a guy going out and playing his first round of golf at Augusta. I just can't imagine putting $1000 on the line at a game I know I'm severely outmatched. I guess that's just what you do when you're rich.

Re: Where is the money coming from in high stakes poker?
 

Lets not forget the small stakes players who have a huge day in a MTT, sometimes winning well over 10k, then decide, "hey I can afford to play much higher now" and don't realize that they are wrong untill they loose half of it.

Re: Where is the money coming from in high stakes poker?
 

although to most of us low limit players 5/10 seems like high stakes, to a successful businessman that is nothing. my friends uncle has made himself a pretty penny from nothing. he plays poker some and went to vegas last spring. he walked in one night and sat 100/200 and lost and didn't care because he thought it was fun. one bet in that game is my bankroll, lol. but to him it was pocket change for a good time.

Re: Where is the money coming from in high stakes poker?
 

Let's not forget to add the people with gambling addictions who are trying to move up in stakes to recover from their losses quicker.

Re: Where is the money coming from in high stakes poker?
 

I agree, the limit is not an indication of the players ability. And also, everyone gets "stuck" to some degree but I believe that instead of moving up to a higher limit, you should move down until you've recapped you initial investment. That is why "bank roll" management is so important and entering a higher limit should only be entered with an ammout that could reasonably be expected to be won at the next lower limit.

Re: Where is the money coming from in high stakes poker?
 

A guy who makes 100X as much as you in income feels the same way about 100/200 as you feel about 1/2. Losing there affects them financially with about as much impact as I feel if I lose at 1/2.

Greg

Re: Where is the money coming from in high stakes poker?
 

Overestimation.

Re: Where is the money coming from in high stakes poker?
 

Housewives, construction workers, pro athletes, and ben affleck.

Re: Where is the money coming from in high stakes poker?
 

There are 7.5 millionaires in America. If 0.1% (1 in 1000) of them plays high stakes poker, that's a pool of 7500 fish playing high stakes poker. At $5000 each...you get the picture. Some multi millionaire whales can dump several hundred K very easily. A billionaire/100s of millions whale can (and do) dump a mil without breaking a sweat. This money gets passed around and keeps a lot of high stakes players well fed.

These are very conservative estimates BTW, and there is no reason why people making say 70K a year wouldn't play high stakes from time to time. Add to that people taking shots from lower levels, and you got your fish.

Re: Where is the money coming from in high stakes poker?
 

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There are 7.5 millionaires in America.

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Who's the half millionaire?

Re: Where is the money coming from in high stakes poker?
 

lol...7.5 million millionaires.

Re: Where is the money coming from in high stakes poker?
 

I think I just found where the money is coming from...

Re: Where is the money coming from in high stakes poker?
 

In online poker, there is proably another source: casino and cardroom players.

Since B&Ms have more expenses per seat-hour (and in the case of casinos, expect a higher return), it isn't cost-effective for most of them to offer much less than a 3/6 or 5/10 (There have been more low tables in some venues in recent years, to bring in more 'poker boom'/TV players).

Players who are accustomed to playing 5/10 aren't going to get much excitement or satisfaction from playing 1/10 their usual stake, even if 5/10 is the lowest regularly run game at their usual room, but in amny ways, online .50/1 can be as tough or tougher (faster pace, almost no physical tells, a larger pool of unknown players, more players with many thousand games under their belt. etc.)

Personally, I don't play B&Ms enough to be entitled to an opinion, but I see why there might be a big adjustment, and I've certainly heard "online poker MUST be rigged" arguments from self-styled (semi)pros who can't beat .50/1

When a B&M 5/10 player (with all due respect, a (near)bottom level in a casino) sits down at a online 5/10 game (a fairly advanced level), they are likely to be fish. Even if they are fairly good, they will have significant adjustments to make. Yet they usually believe that they have a significant advantage due to their "extensive" "real poker" experience -- not realizing that a four-tabling online player can rack almost a week's worth of weekend evening B&M games in a single hour (or a year's worth in under a week), and that so-called "real-world poker" isn't superior to online -- at best, it's merely different. Online players won't lay down their good hands out of respect or trembling fear of the B&M "regular". Many eagerly welcome such players.

Poker is streaky enough to allow a player to make sizeable donation, convinced that they are "due". They may win enough sessions to convince them to keep playing/contributing at their accustomed level, off and on, for years. We've had a few threads discussing how early win streaks can be the worst thing for a new online player.

I mean no disrespect to B&M players. No matter who you are, or what game you play, making appropriate adjustments is one of the fundamental challenges of poker (right up there with discipline, reads, and poker knowledge). This is just a special case where even the *need* to adjust can be well camouflaged.

Many B&M players are quite good online, but even they acknowledge that MOST B&M players are +EV for a skilled opponent in their accustomed B&M setting. How could such players NOT be at a disadvantage online?

Re: Where is the money coming from in high stakes poker?
 

That's definately true. I was wondering where the online 15-30 fish came from, until I heard a bunch of the Commerce 20-40 fish talk about playing the Party 15-30 game. Even though the Party 15 game is orders of magnitude tougher than the Commerce 20 game, somehow they didn't even seem to notice this!

Re: Where is the money coming from in high stakes poker?
 

Andy Beal is unquestionably a very intelligent businessman.

But he was the biggest poker fish in history, even though he played very well.

THE critical decision in poker is game selection. If you play against better players, you will CERTAINLY lose over the long term.

He played against the best in the world and lost over $10,000,000. That makes him the biggest fish of all time.

Regards,

Al

Re: Where is the money coming from in high stakes poker?
 

Al,

Don't you think the "Andy played well" party line from Doyle and the other Big Game players may be just a continuation of Doyle's story in SuperSystem 1? Namely, don't make the big fish feel bad, or you'll kill your action. Isn't it just slightly possible that Doyle and Todd are telling Andy "Hey, good playing kid" when in reality they're just fattening him up nice for the next time he's got $20M burning in his pocket?

Re: Where is the money coming from in high stakes poker?
 

[ QUOTE ]
Andy Beal is unquestionably a very intelligent businessman.

But he was the biggest poker fish in history, even though he played very well.

THE critical decision in poker is game selection. If you play against better players, you will CERTAINLY lose over the long term.

He played against the best in the world and lost over $10,000,000. That makes him the biggest fish of all time.

Regards,

Al

[/ QUOTE ]

Is it really that simple? Didn't Beal almost bust the pros bankroll?

Re: Where is the money coming from in high stakes poker?
 

[ QUOTE ]
[ QUOTE ]
Andy Beal is unquestionably a very intelligent businessman.

But he was the biggest poker fish in history, even though he played very well.

THE critical decision in poker is game selection. If you play against better players, you will CERTAINLY lose over the long term.

He played against the best in the world and lost over $10,000,000. That makes him the biggest fish of all time.

Regards,

Al

[/ QUOTE ]

Is it really that simple? Didn't Beal almost bust the pros bankroll?

[/ QUOTE ]

Yes, and he beat the majority of them. They are also unwilling to play at the stakes he would like.

I think calling Andy Beal a fish is ridiculous.

Re: Where is the money coming from in high stakes poker?
 

Out of fairness, I should have mentioned that good online players can also help fund the B&M tables. The casino setting and table rules can be unsettling (vs. paying off/on at will in your underwear). Single tabling the slower tables may lead to boredom, and definitely increases variance. Table selection/changing is an entirely different issue. Reading/hiding physical tells becomes important. The minimum B&M stakes are often higher than their accustomed play, and the visceral impact of physical chips and money can make them scared money when they're down.

As I said, I have full respect for B&M players, but by calling 5/10 "high stakes, the OP was clearly asking about ONLINE play. The influx of 5/10 B&M (low stakes) players probably contributes greatly to online "high stakes" 5/10.

The convenience of online vs. B&M play, the larger table availability, the allure of slightly lower stakes (that may still betougher because they are not the lowest stakes online), plus the common drive to "get even", may lead B&M players to return periodically despite many losing online sessions. (A few winning sessions will only increase their play.) On the other hand, online players who lose in B&Ms are less likely to make repeat B&M trips to play at higher than their accustomed stakes; it's easier to go back to their familiar lower stake online game and "catch up" there.

Re: Where is the money coming from in high stakes poker?
 

Something also I found out this weekend, the amount of hands you play in live is much smaller, it takes online players a while to figure out they are not long time winners, usually when you clear the 50k hand beating a level, you can consistently beat it, but to reach 50k hands live would take several months.

Which means people can play live just going up and down, up and down, never realizing, that they arent going to beat the level long term and move down. They could be playing 5/10 forever because it takes months of careful record keeping and what not. Most people dont do that, the average person will never realize they are long term losers.

Figured this out this weekend, because some old lady kept trying to get me to play more hands in a crazy high low game when I was getting crap, in her mind she was a long term winner, also she kept saying it, lol. I saw her play for several hours as I was folding a lot, and she could not be a long term winner the way she played, but she had never realized this.

Re: Where is the money coming from in high stakes poker?
 

When I lived in rural VA, I played in a regular game at the Moose Lodge. These were blue collar guys who played 5/10 and 10/20. Badly. Some of them took pot shots online, and started at the same levels, generally 5/10. They lost.

Re: Where is the money coming from in high stakes poker?
 

You wrote: "Don't you think the "Andy played well" party line from Doyle and the other Big Game players may be just a continuation of Doyle's story in SuperSystem 1?"

No, I think there is significant evidence that he played well. For a while he was ahead several million dollars.

Perhaps he was just lucky, but anybody who could beat the best for millions is very tough. He just wasn't tough enough.

Regards,

Al

Re: Where is the money coming from in high stakes poker?
 

You wrote: "I think calling Andy Beal a fish is ridiculous."

He lost OVER TEN MILLION DOLLARS.

If that doesn't make him a fish, how much does he have to lose to qualify?

But he was even more foolish. He often played against a series of opponents. When one great player became tired, another would replace him. If Andy was beating expert A, he was replaced by expert B.

Allowing them to play as a "tag team" was incredibly stupid. Not only were they better players; they were also more rested, and they were able to compare notes, discuss strategy, and bring their COMBINED abilities against him.

If giving such huge extra edges to the world's best players is not fishy, what is?

The purpose of poker is NOT to prove that you're almost good enough to win, nor is it to prove how macho you are. It is very simple: TO WIN MONEY.

Regards,

Al

Re: Where is the money coming from in high stakes poker?
 

[ QUOTE ]
The purpose of poker is NOT to prove that you're almost good enough to win, nor is it to prove how macho you are. It is very simple: TO WIN MONEY.

[/ QUOTE ]

I agree with you that Andy Beal was a fish in the game he chose. But I believe you yourself wrote that people play poker for many different reasons. I certainly play for money, as do most people. Andy Beal however doesn't need money, there's no way he would play for money. I suppose that in order for playing poker for money to be worth it for Andy Beal from an oppurtunity cost perspective, he would have to player higher than 4k/8k. He played because he is highly competitive and wanted to beat the best.