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The Man Who Broke Atlantic City

theatlantic.com

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Re: The Man Who Broke Atlantic City

#31

Post by pragmatic »

schleyfox wrote: post #22
krschultz wrote: post #13

Earlier quoted context omitted.

Then you probably shouldn't click through to anything published by The Atlantic. (Or for that matter, the New Yorker, the New York Times, etc). This isn't a blog post or a new article. This is a short story. I thought it was interesting and I thought it was well written. HN has a strong bias against anything artfully written (read: more than the bare minimum of words). I guess I shouldn't be surprised considering the…

Sadly, I think this is an increasingly recent phenomenon (get off my lawn). It's kind of funny given the style and length of HN favorites like pg and Steve Yegge.

Steve Yegge and pg are more on-topic for HN.

Re: The Man Who Broke Atlantic City

#32

Post by ImprovedSilence »

TylerE wrote: post #18
nostromo wrote: post #4

The short version: Because of the recession casinos are desperate for high-rollers. To lure them in they offer perks. Some of those perks include slight modifications to the rules and a "loss discount" -- for example: losing $500k only costs you $400k. This guy negotiated rules that changed his odds to 50/50. Then he negotiated an 80% loss discount, which meant for each $1 of upside, his downside was $0.80. So to pul…

No, that still doesn't make sense. The loss discount was on a per-trip basis, not per hand, so basically if at the end of the week you were down $100k, you only owed $80k. The rules were generous but NOT totally even. The house still had around 0.25%, which is low, but not unheard of. Even on the Vegas strip you can find Blackjack games open to the general public under 0.50% house edge. Of course, that's with optimum…

I agree, but it appears that while he doesn't "count", He plays a more general "averages" game. Per the article: "More useful, for his purposes, is running a smaller number of hands and paying attention to variation. The way averages work, the larger the sample, the narrower the range of variation. "

Edit: I would guess he's developed some algorithm for keeping track of swings and general variation, so he plays not hand by hand the way counting goes, but rather "batch" or "streak" While will also have wild swings of him making and losing lots of money, but if he keeps tabs on these variations, he can swing them in his favor over time.

Re: The Man Who Broke Atlantic City

#33

Post by jyu »

TylerE wrote: post #18
nostromo wrote: post #4

The short version: Because of the recession casinos are desperate for high-rollers. To lure them in they offer perks. Some of those perks include slight modifications to the rules and a "loss discount" -- for example: losing $500k only costs you $400k. This guy negotiated rules that changed his odds to 50/50. Then he negotiated an 80% loss discount, which meant for each $1 of upside, his downside was $0.80. So to pul…

No, that still doesn't make sense. The loss discount was on a per-trip basis, not per hand, so basically if at the end of the week you were down $100k, you only owed $80k. The rules were generous but NOT totally even. The house still had around 0.25%, which is low, but not unheard of. Even on the Vegas strip you can find Blackjack games open to the general public under 0.50% house edge. Of course, that's with optimum…

It depends on the number of hands he played. As it mentions in the article, the house edge is based on billions of simulated hands. If he played nonstop for 1 week, that is at most 14,000 hands (100 hands/hr x 20 hrs/day x 7 days). Card counting or not, this is a statistically insignificant number of hands.

This article describes someone with a lot of money playing blackjack with bad bankroll management who quit while he was ahead.

Re: The Man Who Broke Atlantic City

#34

Post by TylerE »

jyu wrote: post #33
TylerE wrote: post #18

Earlier quoted context omitted.

No, that still doesn't make sense. The loss discount was on a per-trip basis, not per hand, so basically if at the end of the week you were down $100k, you only owed $80k. The rules were generous but NOT totally even. The house still had around 0.25%, which is low, but not unheard of. Even on the Vegas strip you can find Blackjack games open to the general public under 0.50% house edge. Of course, that's with optimum…

It depends on the number of hands he played. As it mentions in the article, the house edge is based on billions of simulated hands. If he played nonstop for 1 week, that is at most 14,000 hands (100 hands/hr x 20 hrs/day x 7 days). Card counting or not, this is a statistically insignificant number of hands. This article describes someone with a lot of money playing blackjack with bad bankroll management who quit whil…

The std. deviation of blackjack is quite low. 14,000 hands would be a fairly large sample for blackjack, for live hands. Now if we were talking about something like video poker, then yea, 14k hands would be nothing.

Re: The Man Who Broke Atlantic City

#35

Post by jacques_chester »

nl wrote: post #15

“They began offering deals that nobody’s ever seen in New Jersey history,” he told me. “I’d never heard of anything like it in the world, not even for a player like [the late Australian media tycoon] Kerry Packer, who came in with a $20 million bank and was worth billions and billions.” Kerry Packer's gambling is pretty legendary. There's a story about how he was in a high-roller room in Los Vegas and there was a Tex…

His best ever gamble was selling Channel 9 to Alan Bond for $1 billion, before getting it back a few years later for $250 million.

He later said "You only get one Alan Bond in a lifetime ... and I've had mine".

Re: The Man Who Broke Atlantic City

#36

Post by shareme »

What is surprising is how easy it is to compute the odds..its just permutations and combinations..not that hard its a 100 level math course in most colleges.

What makes it different is that we needed two things to leverage the $1 million he put up per Casino and the Casino management being fool-hardy enough to believe that they computed the odds on the change in rules and discounts correctly.

It would be like say oh stacking the deck in that the founders get one class of stock and everyone else another class which allows the founders to retain ownership control of a start-up.

You do not need to card count as he changed the rules to only have hand shuffled six decks in the shoe..I can with a certain memory system compute the odds on cards dealt from that shoe and so can you..its not hard..its simple math..

Re: The Man Who Broke Atlantic City

#37

Post by cantbecool »

dsrguru wrote: post #17
po wrote: post #2

This stuck out to me: Made famous in books and movies, card counting is considered cheating, at least by casinos. In most states (but not New Jersey), known practitioners are banned. The wagering of card counters assumes a clearly recognizable pattern over time, and Johnson was being watched very carefully. The verdict: card counting was not Don Johnson’s game. He had beaten the casinos fair and square. Card counting…

Yeah this article is awfully written. Its portrayal of counting as even possibly unfair ("he had beaten the casinos fair and square [by not counting]") is ridiculous, and it does a horrendous job explaining his method. His method isn't even addressed until half-way through the article, the article is littered with totally unnecessary comments like "He plays perfect cards" (if you're not counting, every hand's decisio…

You couldn't have written it any better. Mark Bowden, the writer of the article, is superficially looking at the situation and not telling us Don's methods of success. I'm more interested in what tactics Don is doing rather then the romanticized story behind it all. That's just me though.

Re: The Man Who Broke Atlantic City

#38

Post by gamble »

ImprovedSilence wrote: post #32
TylerE wrote: post #18

Earlier quoted context omitted.

No, that still doesn't make sense. The loss discount was on a per-trip basis, not per hand, so basically if at the end of the week you were down $100k, you only owed $80k. The rules were generous but NOT totally even. The house still had around 0.25%, which is low, but not unheard of. Even on the Vegas strip you can find Blackjack games open to the general public under 0.50% house edge. Of course, that's with optimum…

I agree, but it appears that while he doesn't "count", He plays a more general "averages" game. Per the article: "More useful, for his purposes, is running a smaller number of hands and paying attention to variation. The way averages work, the larger the sample, the narrower the range of variation. " Edit: I would guess he's developed some algorithm for keeping track of swings and general variation, so he plays not h…

Probably the best evidence for your argument is the fact that he apparently negotiated a hand-shuffled shoe. I'm amazed anyone would agree to it, since it's pretty much a giant warning sign that the guy is planning to exploit poor shuffles.

Re: The Man Who Broke Atlantic City

#39

Post by lotharbot »

krschultz wrote: post #13
raldi wrote: post #9

Earlier quoted context omitted.

Thank you for the summary. I hate when articles open with a teaser then bury the explanation.

Then you probably shouldn't click through to anything published by The Atlantic. (Or for that matter, the New Yorker, the New York Times, etc). This isn't a blog post or a new article. This is a short story. I thought it was interesting and I thought it was well written. HN has a strong bias against anything artfully written (read: more than the bare minimum of words). I guess I shouldn't be surprised considering the…

> "it is sad to me when people do the 'TL;DR' thing"

HN has a strong bias toward allowing people to allocate their time based on their preferences. The tl;dr convention is tremendously useful because it allows people to make an informed decision as to whether or not to read the article, based on a summary which is (typically) more accurate than the headline.

In particular, if someone thought the article might have something new to say about the math of blackjack, the original comment would have dispelled them of that notion and therefore saved them some aggravation.

On the other hand, if someone was looking for a short story about the personality behind a famous gambler and didn't want to get bogged down in math, your comment may have enticed them to read. Thus, both comments are of value.

Re: The Man Who Broke Atlantic City

#40

Post by dustingetz »

hey guys, i actually think he might have positive expectation:

he negotiated a .25% houe edge (roughly half of normal perfect play) and if he loses 500k he gets 20% back, each session independent.

check this analysis. he is +EV by martingaling his wins - 7/8 times he loses 400k with a 20% discount (400k x 7 x .80 = 2 240 000), 1/8 times he wins 400k x 8 with no reverse-discount = 3 200 000, so that's a mil in EV. if he pushes his martingale as far as he can his expectation grows superlinearly, which is why he martingales his wins until they cut him off.

is this math right? if he was -EV, the house would let him keep playing, hence telling him he can continue to play under normal rules. note he refused.

update: an easy way to see this (gross oversimplification) is if he plays only one hand/session he stands to win 100% of the money 49% of the time and loses 80% of the money 51% of the time.

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