Speaker 1: Good afternoon. You're listening to Gambling with an Edge.
Speaker 2: Now Here are your hosts, Bob Dancer and Richard Munchkin.
Good afternoon, Welcome to Gambling with an Edge. Bob Dancer
and I'm Richard Munchkin. Today we're speaking with tit Schllelle,
a senior writer for Bloomberg, about his new book Lucky Devils,
which is a biography of Bill Bentter, Rob Wrightson, and
Bill Nelson. Kit Schallelle, Welcome to Gambling with an Edge.
Speaker 1: Thank you for having me.
Speaker 2: Before we get into the book itself, tell us a
bit about your background. What kind of writing do you
usually do and where are you based.
Speaker 1: Well, I'm a journalist by Trey. I've been a journalist
for twenty years doing various different jobs, latterly and investigative
journalist looking at you know, big crime, war, corruption stories.
And then the last few years I write solely long
magazine features and books, and I tend to sort of
hone in on subjects that are poorly understood, hidden behind
layers of secrecy. Kind of secret world is what is
what draws me in?
Speaker 3: Could you give us an example of some other than gambling?
Speaker 1: Oh, there's plenty yeah. So I wrote a story a
couple of years ago about deep sea treasure hunters, which
is this kind of unique subculture of tech minded normally
people who work in Wall Street and in finance, who decide,
you know, just as a hobby to spend their millions
using undersea robots to find sunken Spanish galleons and warships
carrying bars of gold. And like a lot of things
I write about, they were quite keen for the wider
world not to know what they were doing. But once
I heard about them doing it, I kind of I
had to know more, and when I get I must
know more about this than I know. It's a story.
Speaker 3: Well, part of the part of the problem, don't they
have If people know they've found things, are governments of
various countries trying to say that belongs to us and
you can't have it.
Speaker 1: Yeah, you got it. Finding the treasures the easy bit.
It's keeping it that's the challenge.
Speaker 3: It's just like gambling. Learning learning how to get an
edge it's easy, but learning how to get the money
out of a casino is difficult.
Speaker 1: Once you find Once you find a Spanish galleon loaded
with the goldaballoons suddenly everyone starts claiming it. You'll have
ten or fifteen different people coming out of the woodwork.
The Spanish government will claim it, you know, some Peruvian
tribe will claim it. Various other shipwreck hunters will say
we found it first, and yeah, that was a fascinating one.
But lots of things like that, also, computer hacking, corporate spying,
sort of organized crime. It's those sorts of things that
I tend to lure me in.
Speaker 3: And you're based in London.
Speaker 1: Yeah, I'm based in London, which is a good place
to explore the world. It's also of a good place
to write about gambling. I think the gambling revolution that
happened in the US more recently, the UK was a
few years ahead. We embraced universal gambling quite early on,
and as a result, you know, we've got one of
the more developed betting markets in the world. So lots
of big online companies are based in the UK and
there's a big betting scene here and that's kind of
what got my attention to start with.
Speaker 2: So how did this particular book al about and how
did you get these guys.
Speaker 1: To talk to you? Well, I by a complete accident.
I stumbled across the world of advantage gambling. A few
years back when I heard about Bill Benter, who of
course is the godfather of computerized besting on horses. He
was doing it long before anyone else, really, he sort
of pioneered the scene. I heard about him in a
conversation with a friend who works in sort of venture
capital in London, over a couple of beers, and he said,
we were talking about horse racing, and he said, you know,
there are these guys in Hong Kong who who do
it like a hedge fund. They use algorithms and high
power of computers and they made a billion dollars. When
I heard that number, it sounded fantastical. But I went
away and did my thing and spent a few months
calling people and trying to find out. And I found
out about these computer syndicates, and it turned out the
rumor was largely true. You know, there was this American
team in Hong Kong who had done really well. I
got the name Bill Bentter, and once I met him,
I was I was hurked really at.
Speaker 3: How did you mean him?
Speaker 1: I just booked a flight to Pittsburg. Yeah, yeah, yeah.
He wasn't very keen to talk to me. At first,
and maybe he still isn't you know, as you know,
being an advantage gambler, you know you have to have
a level of discretion, you have to be it helps
to be hidden from view, and actually publicity can be
a big hindrance. I got to build towards the end
of his career, or he'd been doing it a long time.
And you know, I think once he realized that I
wasn't trying to steal his formulas or compete with him.
I was interested in his job. I was interested in
the sort of the work that he had done to
build his model. I think, like like anyone else, you know,
this was his life's passion, and you know, someone who
was genuinely interested in it, and someone who showed up
largely uninvited in his hometown. I think I think he
just thought it'd be easier just to just to talk.
And Bill was my gateway into the community. He's been
really helpful introducing me to other people. It was through
him that I learned about roulette prediction and I got
into poker bots on you Once you realize there are
people who do this for a living, you start seeing
it everywhere. And it opened up this whole world that
I didn't know existed.
Speaker 3: So Bill introduced you to Bill Nelson and to Rob Rightson.
Is that how you met them?
Speaker 1: I can't remember if Bill introduced me to Bill Nelson.
That may been, that may have happened indirectly. But he
made me, he made me aware of Rob Rysmon's existence.
And then I had a whole other challenge with Rob
persuading him that it would be a good idea to
spend some time with me, which is maybe even more
difficult than Bill Benter because Rob didn't love the idea
of being in the media.
Speaker 3: Again, well, yeah, you know, I think he has a
great ambivalence. You know, he likes it, but he realizes
that maybe it's not the best idea.
Speaker 1: But yeah, like I said, there's benefit to getting people
towards the end of their careers. I mean, look, when
you're in your twenties and you're starting out and you're
desperately seeking an edge, you know, I think you're very
unlikely to sit down with a journalist or a writer
and talk about it. But once you've been gambling for decades,
you know, anyone as they get towards the end of
their career, they become reflective, they start thinking about what
it means to do the job they do. It's natural.
They also have a kind of unique perspective that I
found really interesting. They've been betting at an elite level
since the some cases the late seventies, but early eighties onwards,
you know, four decades worth. They know this gambling industry
kind of inside and out. They have a perspective that
almost no one else in the world has. And look
right now, we have an American president who's a former
casino owner. We have people betting on the second coming
of Jesus. It's the gambling world has changed so much.
It's spread into popular culture and the economy and sports
in a kind of an unprecedented way. So speaking to
people who have done this for a whole lifetime was fascinating.
Speaker 3: You know. I wrote a book that was a collection
of interviews with professional gamblers called Gambling Wizards, and I
got the idea. I was on a plane to Hong
Kong to do some work for Bill and you talk
about it in the book, where the jockey club in
Hong Kong had stopped accepting phone bets, and so he
needed people to run to the bet shops. We had
these in ormous printers and we would print the tickets
and run to the bed shops. Anyway, when that happened,
I was reading a book on the plane going over
to Hong Kong called Market Wizards. That's a collection of
interviews with commodities and futures traders, and I was like,
you know, gamblers are way more interesting than these people.
And so when I got there, I said to Bill, hey,
I have this idea. He had a copy of Market
Wizards there in the office in all Koch and I said,
I want to do this with professional gamblers. Will you
do an interview? And he was like I can't. You know,
I can't. I can't handle that kind of you know, exposure.
He goes, but you know, Alan'll do it. And I
was like, oh, okay, So I called Alan. He was like, yeah, okay, sure,
no problem.
Speaker 2: And yeah.
Speaker 3: So see, I just was twenty five years too early.
Speaker 1: Yeah. I do think that's the gambling community I think
is not It's not treated as seriously as it might
be by the by the wider media. You know, gambling
is often dismissed as being a vice or disease or
societal problem. And I keep you I see it time
time again, the way the mainstream media cover this subject.
Speaker 3: And also they just get so much wrong. They just
you know, and often they will equate professional advantage players
with cheats or there's just no end of the mistakes
they make. It's like they don't really do their homework
when they read these articles.
Speaker 1: Well, it's I think the tendency is to view it
as a problem, and I just disagree with that approach fundamentally.
I always have, you know, I think gambling is anibly
important part of human nature. We've been doing it since
we lived in caves. It is ingrained in us. Actually,
you can argue it's one of the reasons that as
a species we've become so successful. Our ability to imagine
complex risks and you know, calculate probability. That's why we
got in boats and traveled across oceans to populate new land.
That's you know, that's why we developed technology. It's the
reason that we traveled into space. A lot of the
good things that we do as human beings come from
our ability to tolerate risk and and and and do
those formulas in our heads or using a computer. None
other species can do that, So it isn't inherently negative.
It's just like anything else. It's part of us. And
you know, I wanted to I wanted to write a
book the treat that paid attention to gambling as a
very human trait and and developed that and interrogated that
rather than dismissing it as like a cancer on society.
Speaker 3: Well, your book also seems to be about this moment
in time when gambling went through this massive shift because
of computers. Right the way that people approached it trying
to get an advantage. I think people had always tried
to get an advantage gambling, but suddenly, with the access
to computers, everything changed, and it changed. And in your book,
you know, you show the way it changed in horse racing,
in sports betting, in roulette, and in poker.
Speaker 1: Yeah. I think this was a genuinely amazing moment in
the history of technology. I really believe that. You know,
you've got thousands of young, highly intelligent, mostly men, it
must be said, descending on Las Vegas. They're all mathematically minded,
they've all read ed Thorpe's Beat the Dealer, they're all
card counting. And that moment happened just as the home
computer became a household object. It was this technology was
just starting to creep into the regular consumer economy, and
so you had those two things coming together at the
same time, and the result was some really remarkable technological innovation.
I mean, and if you look at the devices that
were being made back then for the purposes of beating
casino games, they're amazing. You know. You can go to
the Barona casino outside San Diego and San Diego and
you can see these these ancient wearable computers and the thing,
you know, made in the nineteen seventies or eighties. The
surprising thing about them is how good they look. They
look they don't look dissimilar to Apple devices from the
nineteen nineties. They're small, you know, they're functional, and they
were made in people's garages and apartments, you know, using
bits and pieces that they cobbled together, so you know it.
It was this flourishing of a certain type of talent.
And one of the reasons that advantage gambling is a
small communities. I think a lot of the senior members
of the community can trace the lineage back to this
time and place, and they spread across the world, and
their ideas spread across the world. That's what I think
made me pay attention. This didn't just stay limited to
Las Vegas. Bill Benter went to Hong Kong bill Nell's
and took his roulette technology around Europe. Rob Wrightson his
pokerbot empire, you know, spanned the globe and these ideas
permeated the gambling industry from quite a small starting point.
Speaker 2: So we mentioned Bill and Alan Woods in Hong Kong.
So for our listeners who aren't generally familiar with that
what they did. They started out as partners, had falling out,
and your book describes a falling out from Bill Benter's
point of view, said she couldn't talk to Alan because
he's dead. And so what exactly did they do in
Hong Kong.
Speaker 1: Well, their approach was to look at horse racing as
a statistical problem two, instead of betting using instinct or
a sort of vague assessment of the form guide or tips.
They you know, they said, you know, this is this
is a collection of data points that we can using
a computer, and if we do that, we will have
an advantage over anyone else who's gambling. And back then
that was true, you know, in the early nineteen eighties,
they just weren't people using computers to analyze horse racing data.
They were the only ones doing it. And of course,
Hong Kong was and remains one of the biggest horse
racing markets in the world. They chose it purely because
of its size, because they wanted somewhere where they could
operate and not be noticed, not attrapped assension. So yeah,
they flew to Hong Kong with three bulky k Pro
computers in their luggage. They hold these machines over there.
They spent a couple of years collecting data from the
racing books and then they built this thing from scratch.
And you know, they both Alan Woods and Bill Benter
benefited hugely from being first. It's the same in markets.
You know, if you're the first options trader to use
the Black Skulls model, you've got a huge advantage over
everyone else and you get a golden period of a
few years before the rest of the world catches up
with you. Because Bill bent and Allen Woods were so early,
they once they got the model working, they had some really,
really profitable years. It still do I believe, Well, it's
Bill Benter's still this is still his job. He's still
tweaking his model. These days, he will be using artificial
intelligence models rather than his you know, his guest work
con trial and error. But fundamentally he's doing the same
thing he's always done, which I find fascinating. I mean,
to have the focus and the dedication to spend your
entire working life on an equation for horse racing is
a remarkable thing.
Speaker 2: Well, one of the reasons they selected Hong Kong, I
believe is the horses didn't come and go. The horses
stayed there. You didn't ship in a lot of horses
to Hong Kong to go to the races, and so
you could build up data about all the horses in
the market more easily. Later when Bill was in Pittsburgh,
this is not the case. It is very possible to
truck in horses to and from Pittsburgh, and so there's
not the same database of horses that you have. There's
always new ones that you don't know about, and some
of the ones you have all those data on have
moved away. Well.
Speaker 3: It's actually also that in Hong Kong there are only
two race tracks and far fewer horses than there are
here in the US. You know, many many more tracks
here and many many more horses to keep track of.
But if you have a small pool of horses to
deal with, then.
Speaker 1: It makes that job easier. What they were doing was
experimental science. You have to remember back then this just
simply didn't exist. There was one academic paper, but it
was kind of half asked. I mean, they did it
as an intellectual exercise. They didn't do it to make
a profitable business. They did it to see if it
could be done. You know what mathematical lessons they could learn.
So this was something new to the world. You can
imagine the appeal of having a contained environment to do
your experiment that. You know, what you're talking about is
a data problem and once you have once your method
is proven, you can apply anywhere where where there's horse racing.
And of course now you know, any racetrack in the
world will have advantage players using computers to calculate odds
and try and beat the market.
Speaker 2: Hey, it's always spoken about Bill rob Wrightson started out
in blackjack and then move to other games. So how
did he use computers to help him in blackjack?
Speaker 1: Rob was part of that advantage playing generation that was
quite quick to adopt wearable technology. So he and his
friends would use the AFT wearable computer, which was a
sort of homemade gadget made by an enthusiastic but quite
religious fella who sort of soldered them in his attic
and sold them to gamblers who wanted to use them.
And they were just it was car counting. Plus it
was just a way to be extremely accurate and efficient
in the way you counted cards, inputting data using a
toa switch, receiving data back through an earpiece or through
a buzzing patch somewhere in your body. And I think
once Rights and his friends realized just how good that
advantage was, you know, it wasn't a big leap to say, well,
if this works in blackjack, we can do it in
other games as well. And of course Rob took the
technology that he had used to beat blackjack and started
thinking about poker. Poker had been his passion since he
was young anyway. You know, poker is fundamentally a sort
of mathematical problem at its heart, and I think he
recognized very early before many people that the way poker
was played back then was inefficient and suboptimal. You know,
he could early on, he could see the way the
pros even the pros played the game had flaws, and
so he spent many, many years and enormous sums of
money building a building some of the world's first poker
bots functionally. You know, he had MIT graduates and math
professors and programmers, and he had a whole team dedicated
to doing this, and it took a long time to
pay off. Poker is an enormous challenge, much harder than blackjack.
But he got there, and he ended up making a
significant amount of his career earnings in poker.
Speaker 3: When he and again he got there first. You know,
later we heard all about game theory optimal and these
various other people who were working on programs to solve
but again he got there first, and rather than write
an academic paper about it, he used it to make
a tremendous amount of money.
Speaker 1: Well, he had the incentive the academics didn't have, which
was that, you know, this the stakes for him were real.
This wasn't an intellectual exercise, This wasn't some arcane challenge
that he took on. This was his way to make
to make his fortune. So you know, his incentives were
were make or break, and he had a gift for it,
and you know, he's very proud even now to talk
about how his early poker bots would beat the academic
models out of Carnegie Mellon University and Alberta in Canada.
Those are the two universities that were at the forefront
of poker AI and Rob used to test his model
against them, and his were better. And you know, you
can imagine why he His testing ground was real life.
You know, the academics tended to do a lot of
their experimental work in the university. Rob would take his
theorems out into the poker rooms in LA and around California.
You know, he knew the game better, and he had
this gift for mathematics, and he had a particular talent
for attracting the right people to his operation. I think
one of his gifts was recognizing that he needed expertise
in certain areas, so he assembled this team. He had
real world poker experience, and his early bots were really good.
I mean they were better than anything else out there.
Speaker 2: Well, he was part of a company that did on
the providing games on the Internet, and he would put
a lot of bots out there, and at the time
there was no law against it. Later on, there a
lot of sites have tried to stop that, but at
the time it was a new idea and very successful
and profitable to him.
Speaker 1: Yeah, Rob was there at the turning point. This technology
was a quirky curio. Throughout the eighties and nineties, there
was sort of a vague awareness that computers were trying
to play poker, but honestly, they played it badly. The
wider gambling industry didn't take it that seriously, so Rob
got in before the penny dropped. I think that this
was an effective way to play poker and could potentially
lead to a superior software that could beat almost any
human opponent. But then I think it was the late
nineties in early two thousands was the moment when the
bots got good enough that people started noticing their existence.
People who played poker online would notice that they were
playing against opponents who didn't seem to be human. They
didn't play like human beings, they played differently, they didn't chat.
The platform started noticing it, and this backlash happened quite
quickly against the idea of competing against the bop and
you can you can imagine why people were upset by it.
You know, if I finished work after a long day
and I log onto my computer to play online poker.
I want to play other human beings. Proved my metal
against other players. If I'm playing against software, it's no
fun and it feels unfair. So that Rob was right
there at the forefront when that backlash happened, and it
was a really interesting moment in poker history because the
game hasn't really been the same sense.
Speaker 3: Yeah, I know it. At that point, he trained a
bunch of women how to play, and people the online
poker sites thought the women were bots. And I remember
at the time there was one in particular who set
up a webcam showing her playing because one of the sites,
I think it was Full Tilt, had stolen a bunch
of money of hers, claiming she was a bot. And yeah,
so he could teach the humans to play as well well.
Speaker 1: He taught them to play like machines. Though. That was
the difference. The woman you're talking about, she was a
poker machine. I mean she she didn't have much poker
experience before she met Rob Rightson, but she trained hour
after hour after hour on his software that taught her
game theory, optimal poker. She was a good sponge for
that knowledge. She learned to play very much like a bot,
and it made her an extremely effective player. But she
played just like a computer, and she thinks about poker
like a computer. She thinks of the game in terms
of am I over five hundred games?
Speaker 2: Not?
Speaker 1: Am I going to win this hand? Okay? So you
know she's got this very mathematical approach to the game.
It was ironic that, you know, at that moment, Rob
had this empire of poker bots, thousands of them deployed
on all the main poker platforms, using various software tricks
to hide the fact there were bots from the operators.
But the ones who caught heat, the ones who had
their money sees, were the humans that he had trained
to play like computers.
Speaker 3: Do you know if she's still playing, She.
Speaker 1: Is still playing.
Speaker 2: She is.
Speaker 1: Yeah, I met as far as I know. I met
her couple of years ago.
Speaker 2: Yeah.
Speaker 1: She likes to go to you know, she's this tiny
Chinese lady. She likes to go to poker rooms full
of men and take all that money.
Speaker 2: Yeah.
Speaker 3: Did you talk much about Core, the banking operation in California.
Speaker 1: Yeah, that's part of the book, but it's I mean,
the focus of the book is advantage gambling and the
player banking thing was a source of income for Robert
good One, but I wouldn't categorize it as advantage play.
It was just smart business, right yep.
Speaker 2: The third subject of your book is Bill Nelson coming in.
When I started reading the book, I had not heard
of Bill, although we very possibly came close to each
other when I was doing graduate work and economics at UCLA.
He was in the business school at UCLA with their
next door to each other, so we very likely passed
by each other, But I did not know who he was.
So how does he fit into your story?
Speaker 1: Yeah, he's He's not as well known to the others,
but he he has sort of separated himself from the
community of professional gamblers. He's become disenchanted with the life
over the years, and so he doesn't go to blackjack ball.
He doesn't really move in those circles now. He lives
in relative peace in Poland. But you know, the reason
I wanted to write about him was that he did
remarkable things in roulette. Back when this was an experimental technology.
He made it work. He spent most of his career
as a roulette specialist, predicting roulette first with wearable computers,
and then he learned to just do basically the same
thing in his head, which was far easier and far
more profitable. And then later on his career sort of
transitioned into bias wheel play, going right up into twenty
ten when he had a big night in Caesars Casino
just finding a wheel that was a bit too predictable
and hammering it for eighteen hours straight. So he's had
a fascinating roulette career. I thought I had to include Roulette.
Roulette is the game that most people struggle to understand
how it could be beaten. You walk into a casino
and you find your average gambler and you say, there
is a way to beat Roulette. There was a way
to reliably make money from Roulette. They won't know what
you're talking about, most of them. So that was the
one that had the big surprise factor. Bill also happened
to be part of the computer team which was maybe
the world's first data driven sports betting operation out of
Las Vegas, So he was part of that operation as well,
So he was away into different areas of the gambling
world that I wouldn't otherwise have got to see.
Speaker 3: He was actually instrumental in the whole group. My understanding
is he's the one who introduced Mike Kent to a Middland,
which Mike Kent was the one who developed the software
to analyze and beat sports, and Middland was the one
who put together the group of gamblers were betting all
across the United States.
Speaker 1: Yeah, he was arguably a founder member. I mean at
the time. He the funny thing was that he was
fixated on roulette. You know, you know how it is
the professional gamblers, they they they find a challenge and
then they you know, they will dedicate their entire life
for two years to solving the problem with roulette. So
he was fixated on roulette at the time. But he
met Mike Kent in Vegas in the in the late
nineteen seventies, very early on when he first arrived and
introduced him to the people that would become part of
the computer team. He was also prosecuted by the FBI
along with the other members, and went through that whole
experience of feeling the might of the American federal government
bar down on him for betting on sports, and that
that was also a fascinating moment in the history of gambling.
You know, it's easy to forget now that these days,
when you can bet on any game in any way
you want, a thousand different ways, it's so so widespread,
it's so available. But back in the late seventies and eighties,
you know, sports betting was niche and mostly illegal. If
you wanted to do it, you had to know basically
a crook, or if you were in Nevada, you had
to go to one of the sports books, which were
not glamorous places to go and put money down on
your game. So it was very different back then, and
you know, the attempt to prosecute the computer team was
indicative of a moment in time when America was still
railing against the idea that people might want to bet
on sports for leisure. There was still this pervasive attitude
that it was somehow sinful or that it might damage
the sporting events themselves. And of course that's gone away
completely in the last few years in the States, but
back then it was it was a real issue. It
was criminalized.
Speaker 3: Well so, actually, my understanding is that the FBI could
not believe that any group of people could be making
that much money just by betting, and assumed that they
must be book makers. And that was really the problem,
because the person making the bet, I don't think is
created is committing a crime. It's the person accepting the bet.
Speaker 1: Well, that was an open question back in the nineteen eighties.
To be fair, even the FBI didn't have a clear
answer as to whether the act of making a bet
was illegal. But you know, I think another issue that
the Computer team had was that because they operated in
Las Vegas, and because this was the tail end of
the Mafia era of Las Vegas, some quite senior members
of the mob became aware of what the Computer Team
were doing, and of course they wanted a slice, And
so the FBI had wiretapped everyone more affiliated in the
Las Vegas area, and they heard these guys, these wise guys,
talking about the computer. What's the computer doing? I need
the computer's tip. And of course, if you're an FBI
agent and you hear that, it sounds it sounds bad.
It sounds like you know the Matthi' into this. You
don't know who's behind it. It's it's betting on sports.
It sounds criminal. So I think that started them down
a path that the FEI probably should have turned back from.
But once they once, once there was that mafia that
the width of sort of organized crime. They couldn't seem
to stop themselves, and they and they carried on this
prosecution that turned out to be a huge embarrassment of
the agency.
Speaker 3: I think, Yeah, you know, I I I got exposed
to the world of roulette a number of years ago
and was really shocked because the world of professional blackjack
players it's it's it's not that big, and people all
tend to know each other. And then I found out
there was this whole world of roulette players out there
that the ven diagram of the intersection of those two
is tiny. They're just is very little overlap. I mean,
Bill was in the blackjack world fifty years ago or whatever.
But yeah, it's really interesting that there's still a big
subculture of people who were out there trying to beat Roulette.
Speaker 1: Well, I mean, Broulette goes back to ed Thorpe. Yeah, no,
as he was a sort of developing card counting as
a systemic method, using his computers to wage the shifting
odds in blackjack. At the same time he was doing that,
he spent a long he spent many years working on
a roulette computer that he said was effective and worked,
but he couldn't quite get it to work in the casino.
But he wrote about it in the book that everyone
read Find Me An Advantage. Gambloo hasn't read To Beat
the Dealer. Do they still read it? I'm sure they must,
but anyway back in the day.
Speaker 3: Yeah, he touch about it more in his recent book
Man for All Markets.
Speaker 1: Yeah, he goes into more detail well about who he
was working with. It turned out to be Claude Shannon,
who is the father of information theory and an incredibly
influential scientist. So it tells you something that these two
men were so taken with the idea of roulette that
they dedicated years of their life and considerable resources for
making a computer. I think it comes from the same mindset,
but yeah, there was a diversience at some point. I
think Roulette is a big game in Europe, so at
some point the knowledge that Roulette could be beaten spread
And when I was looking at professional roulette specialists, my
search led me to know all over Europe, to Germany
to Croatia. I heard there were a group of Chinese
players in Macau who were predicting roulette using a computer.
This knowledge sort of disseminates itself through the very small
and closed off worlds of professional gamblers, and if it
works its spreads and roulette prediction. That definitely happened.
Speaker 3: I've quoted Bill Benter. Bill Bender said back in about
nineteen eighty sooner or later everyone has a Roulette project,
because Bill had been working on roulette as well before
he ever, you know, got to got to horses.
Speaker 1: Yeah, Bill, Bill tried Roulette. It's you can see the appeal.
I mean, it's Roulette is an amazing puzzle. And the
idea of predicting Roulette feels like a superpower. The idea
that you could have a computer that could tell you
a section of the wheel that the ball will land in.
You know, it's it feels superhuman. But actually writing this book,
I learned some of the most effective Roulette methods a
low tech essentially low tech you know, bias will play
I believe has diminished in recent years because the wheels
have gotten much better and then much better at spotting discrepancies.
Speaker 3: But well, Bill Nelson had a lot to do with that.
He did know. They had those old wheels all over Vegas,
and you know, they smacked a number of casinos, and
so they came out with this wheel called the starburst
where the ball just scatters all over the all over
the place.
Speaker 1: And him and a couple of others, a couple of
other very good roulette predictors, led to a change in
the design of the roulette whel that we can still
see today. Go into any casino anywhere in the world.
Look at the shape of the wheel. The shape of
that wheel is different to how it was forty years ago.
And the only reason for that is because people have
predicted roulette. So you know, the industry had spent a
lot of money replacing old wheels. I mean, these things
aren't cheap. And I think that's that's proof if anyone
needed that, you can roulette is beatable. But it speaks
to this arms race that's that's still going on between
the gamblers who want to make a living from gambling
and the casinos and the bookmakers and the operators who
don't want them to make a living. And you know,
I feel like the gamblers I write about and then
and their sort of modern equivalents, they tend to have
an advantage because it's all they do. They will spend
years of their life developing a system for a five
percent advantage in the casino game or in a sports
book or or whatever it might be. And there are
thousands of them, maybe millions. I mean, no one knows
the numbers, but they're all very smart. And I always
feel like the industry is always a couple of years behind.
But there is always a moment when they realize they're
losing so much to advantage players that they need to adapt.
It happened in Roulette, happened in Blackjack, it happened in
you know, fan duels and DraftKings and those sports books.
There's always an industry pushback and they tend to change
the technology to prevent the advantage that's been paying out
for people, and then the gamming community has to find
a new edge, but they always seem to you know,
this goes on and on. It'll never end right.
Speaker 3: And I think the reason that the casino is always
so far behind is because the people running the casinos
now really don't understand gambling. Much like we were talking
about the journalists earlier. Now it's the people running the
casinos are people coming out of business school who really
don't understand the games. And it isn't until they really
take a beating that they finally go, well, maybe we
should hire somebody to tell us what our problem is.
Speaker 1: I also think that there's truth in the idea that
card counting was really good for casinos. Oh yeah, the
idea that is possible to beat a game that should
be waiting against you is very compelling and it inspires
a lot of people to try their luck. And now
the reality of card counting and any advantage gambling system
is it's extremely difficult to make it work. It takes dedication, intelligence,
bank raw management, mathematical ability, all sorts of They have
to be in your favor to make it pay. Lots
of people burn out. But I don't know what the
precise numbers are, But you know, what's the number of
failed card counters for every one card counter that makes
a living out of it? You know, the casinos make
more money from failed car counters than they than they
lose to successful ones. I think that's true for any
advantage system. So you know, if you're a marketing professional
for the for the gambling industry, the existence of an
elite zero point one percent who can make a living
betting is a boon for them because it sets an
example for the something to aim for. It's aspirational for
the rest of the world's gamblers to come and try,
and of course most of them fail, and the casinos
make money they you know, yeah, it's it's like a
cost of business. It's like it's a price they're willing
to pay to hoover up billions of dollars that they
make from their regular business.
Speaker 2: That's so willing sometimes.
Speaker 3: Yeah, right, your.
Speaker 2: Book is called Lucky Devils. What is the genesis.
Speaker 1: Lucky Devils? I wanted the book to be about people,
not systems, And there's kind of a religious theme in
the book, or at least a moral theme in the book.
Gambling is evolution from being a sin and a vice
and something undesirable to being entirely mainstream and corporate the
way it is now. You know. That was that's a
sort of cultural ethical revolution that's happened in America and
around the world that I wanted to sort of reflect
from the title of the book, and also, you know,
the idea of luck. Of course, the Lucky Devils they're
not lucky. They make their own luck, you know, luck,
Lucky is the opposite of what they do. Luck is
what I do. When I go into a casino and
I put one hundred dollars on black at the rolette
table and win or lose. That's my only bed of
the evening. That's you know what what advantage gamblers do
is is large numbers. It is more akin to a
hedge fund or a market operator than it is to
a true gambler who relies on luck. So there's a
bit of irony in that title too. Yeah.
Speaker 2: So there are a number of other gamblers out there
in that are successful different games than we're done by
Bill and Rob and Bill, do you plan to write
one or more additional biographies about other gamblers?
Speaker 1: I don't know. I was interested in the culture of
advantage play and I felt like there was something to
learn from these people and the way they work, the method,
the mindset, you know, the way they approach risk and uncertainty,
I think is interesting. The way they can separate their
emotional half of the brain from the rational part of
the brain. They don't celebrate when they win a bet.
You know, when when when Bill Bner's computers are betting
in Hong Kong and he hits a long shot bet,
he doesn't whoop and cheer. You know, it's it's it's
a very different way of thinking about the world. It's
cold calculus. So I was fascinated by that. Look, the
gambling world is changing so rapidly. I mean the latest
thing is prediction markets, which of course claim they're not gambling,
but of course are. And that's that's a whole other
other phenomenon, and you could write, you could write several
books about what's happening now and prediction markets. People betting
on wars when they have inside knowledge of military strikes
that are about to happen. The idea of people betting
on the second coming of Jesus or against the second
coming of Jesus and earning a five to ten percent
return every year, the idea of sort of securitizing the future.
It's all very strange and unfamiliar. So yeah, maybe maybe.
Speaker 2: If any of our listeners wanted to get in touch
with you, how could they do that.
Speaker 1: I'm on x formerly Twitter, I'm on LinkedIn. You can
find me on the Bloomberg website or my details on there.
I would just discourage anyone to ask me for gambling advice.
I always I always think that some of the worst
qualified people in the world to dish out financial advice
a journalists Stephen, financial journalists never ask a financial journalist
for financial advice. We don't know any better than you.
But that's particularly true when it comes to gambling. I
write about it. I like the stories. I'm a terrible gambler.
I'm not good at it, so I'm happy to share
stories with people. But I don't have the secret sauce.
Speaker 3: Yeah, I don't think you have that worry with this
our audience. I think I think our audience many of
them are knowledgeable gamblers, and if they had questions, they
would probably direct them at either Bob or me and not.
Speaker 1: And that would be that would be a wise approach.
Speaker 2: Richard usually ask people their favorite restaurant in Las Vegas?
Have you been here enough to have one?
Speaker 1: I do have one about.
Speaker 3: It's not usually I qualify that as one that's not
in a casino. But but since you're not here very often.
Speaker 1: No, Well, I've spent I've spent a lot of time
in Las Vegas, and I'm just having to look it
up because i haven't been there in a while. It
is the original Lindo mitchak.
Speaker 3: Oh, that's a good road.
Speaker 1: Lindourepan that's the one. Yeah, I've I've come to Vegas
a bunch of times in the last few years researching
this book. And also I wanted to know the town better.
I mean, it is it is the place where this
this whole world sprang from, and I didn't know it well.
And I wanted to see the sides of Vegas that
the tourists don't go to. So I wanted to. I
wanted to, you know, I wanted to go spend some
more time downtown. I wanted to spend some more time,
you know, seeing how how people actually live. But yeah,
that that that Mexican restaurant phenomenally good, great fun and
a real scene. That's that's my spot.
Speaker 2: Yep.
Speaker 3: I often when I'm meeting people, I often meet them
at that restaurant. So yeah, it's a good one, all right.
Speaker 2: Right, very good, Thank you, Kit, Thank you Richard. Go
out and hit lots of royal flushes, everybody. Good day.
Speaker 1: Free audio post production Byophonic dot Com.