Mamas, Don’t Let Your Kids Grow Up To Be….

…business people.  Encourage them to be poker players instead!

In case you missed it, the winner of the 2012 World Series of Poker (WSOP) is 24.  He earned $8.5 million.  Second place and $5.3 million went to a 26 year old.  And a 21 year old Arizona State student took third place and $3.8 million.

Look Ma, I won $8 million!

Look Ma, I earned $8.5 million!

Booms and recessions come and go.  Similarly, certain professions are hot and then cold.  Remember when a law or medical degree was the coveted document? They faded to the MBA.  Now, science, technology, engineering and math (STEM) are being heavily promoted.

But the state of the economy and college degree du jour are irrelevant if you’re a good poker player.  As you can see from the ages of the top three finishers in this year’s WSOP, youth is not a handicap (as it is in many other professions).  How many other professions have multi-millionaires under 30?

What I like about poker is that it is the definitive “individual” endeavor. Whether you do well or poorly, you are almost entirely responsible.  I say “almost” because there is that element some call “luck” but which is more accurately termed “variance.”  You cannot account for luck, such as boarding (or not boarding) a plane that ends up crashing.  But you can account for variance.

If poker was principally luck, then if you sat down for a one on one game against one of the top professional players, the probability of your winning is 50%, or the same as flipping a coin.  I don’t know any “poker is luck” folks who’d plunk down $5,000 to play one on one against a  professional.  (There’s nothing I enjoy more than knowing another player believes poker is principally luck because I’m probably going to take his chips.)

Another aspect of poker I enjoy is that it is a game of multi-faceted strategy.  A chimpanzee can win a hand with the best cards.  The point is maximizing the chips you win with that hand.  Too many unsophisticated players will shove “all in” with a great hand and win just a minimal amount when they could have won a lot more with a bet sized just enough to get one caller.

A large part of poker strategy is “playing the player” regardless of what cards anyone has.  You’re at a big disadvantage if you’re playing someone you don’t have a good profile of.  If you don’t notice that one player is “loose, aggressive” while another is “tight, passive” then you may be betting when you should be folding or vice versa.

Because it’s not too often that you have the absolute best possible hand.  You may have the best likely hand.  So if you don’t notice that a “tight, passive” player is calling you, then you may have lost the hand and be giving away your chips when you should have been checking to see what his reaction is.

That’s why when I played small stakes (up to $5 buy in) poker tournaments online before the federal government shut the sites down, I only played single table tournaments.  I could profile each player during the first two levels, which I rarely entered.  What was each player calling or raising with? How did they size their bets when bluffing and when they had a monster hand?

By the time I began playing at level three, I had profiled most of the other players but they had almost no information on me.  I had played few hands and typically folded them after the flop.  So I had an advantage.

When the online sites I played on were shut down, I had turned my initial $100 into about $200 and had played hundreds of tournaments. I may not see any of that money, or perhaps only a small percentage. But if the brouhaha that developed leads to legalization of online poker, then I don’t mind.

And I think it will.  Here’s why.

That’s all I want for Christmas!  Shuffle up and deal!

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4 responses to “Mamas, Don’t Let Your Kids Grow Up To Be….

  1. I can’t imagine accomplishing what these young men have. They’re not only skilled players, they have the guts to take big risks which is not something many of us would be willing to do.

  2. Well I think Terri nailed it. In order to be a successful (rich) poker player one has to be mentally prepared to lose everything and start over from scratch. I remember as a youngster playing a lot of poker. Some all nighters at the dorm and surrounding apartments. I also remember switching to Pinochle because I didn’t want to be consumed by making money at poker, just wanted to have some competitive fun.

    In retirement my mindset is much more conservative than in my rebellious youth. I am almost totally risk averse.

    • The WSOP has a “senior” event limited to folks 50+ and with a buy-in of “only” $1,000, as opposed to $10,000 for the “main” event. That $1,000 is low enough to probably not attract the big name senior players, like Doyle Brunson. I’d like to play in that.

      When online poker arrives, I’ll limit myself to $5 buy-ins and below. I like the competition. And even $1 buy-in changes the play dynamics from the “all-in” fests of the free chips “fun” tables. If you can keep getting chips for no money, why play sanely?

      Even $1 screens out most of the “shovers.” The few that show up are soon taken out. As they keep losing and losing, they either stop shoving or stop showing up. $5 is cheap entertainment.

      As for risk, even though you’re retired I’d think that the capitalist in you would recognize the need for risk. With retirement less than a year away, I have not balanced my deferred comp to what the “experts” say you should have vis a vis stocks and bonds. I am still at a good 85% stocks.

      Of course, I will not need to use that deferred comp for a few years, so I can keep a high profile in stocks. I want to ride that market back up.

      That Vice Fund I got into a few years ago has a 2012 year to date return of 21%. At about $22, that’s still about $2 below the 2008 peak value, but when it dropped to $12, I was buying so I could ride the price back up. So, I’m still ahead even though the price is below 2008.

      A T. Rowe Price Health Sciences Fund that is part of my deferred comp portfolio has a 1 year return of 32% and a 3 year average return of 21%.Go! Go! Go!

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