Poker, Gaming, & Life Expanded Edition
Author David Sklansky
Synopsis of Poker, Gaming, & Life
This volume is a collection of recent articles written by David Sklansky that have appeared in various publications including Card Player, Poker World and the Two Plus Two Poker Strategy Magazine. A few have never before appeared in print. Most of the articles are about poker or gambling. However, David has recently branched out into other areas that lend themselves to his unique style of analysis and some of these essays are contained in this book.
From the original book, “Poker and gaming” topics include Being a Favorite, Are Great Players Born? Talent Versus Discipline, The Importance of Position, Never Go Broke, When Time is Not of the Essence, and Is Your Wallet Fat Enough? “Life” topics include What It Is that Makes an Issue Controversial, Coincidences, Some Thoughts on Dying, Legitimate Grievances, and Crime and Punishment. This expanded addition also contains 32 additional essays, many of which address no-limit hold ’em. “Essays for the Expanded Edition” include Pros Versus Wannabes, Bluff Raising as the Big Blind, Evaluating Expected Value, and Expert Non-Optimum Random Strategy. Though these essays vary greatly in content, you will find them very thought provoking. Thus, Two Plus Two Publishing proudly brings you these latest examples of David Sklansky’s work.
Exerpt from the book Poker, Gaming, & Life: Paying for Information
Suppose that while you are playing blackjack for $100 a hand, the dealer offers to flash his hole card on the upcoming deal if you give him a big enough tip right now. What is the most that you can give him and still make this a good deal for you? It may surprise you that even if you take ultimate advantage of this situation (take insurance, hit 19 or 20 if necessary, splits tens, and so on), you can't pay more than about $12 for this information. If you were to pay, say, $15 per $100 bet, you would lose more in the long run than if you played your normal game. Even $12 would be too much to pay if there is the slightest chance that you could misread the flashed card. A little reflection ought to help you see why this is so. For one thing, many of your decisions will not change even if you know his hole card. For instance, if you are dealt 19 and his upcard is eight or less, you would stand whether you knew his hole card or not. If you are dealt 14 and the dishonest dealer shows his ten in the hole with his six upcard, you will stand just as you would if you hadn't seen his card. Furthermore, it frequently can occur that even though you change your strategy because you know that his hole card does, it does you no good, and may even cost you money.
When the dealer has 20, your hitting 18 rather than standing as usual will rarely help. When you stand on 15 because the dealer has a nine showing and a six in the hole, your revised strategy easily can cost you $200 when the next card is a baby and you turn what would have been your $100 win into a $100 loss. ("Wise-guy" double downs in this situation, while profitable in the long run, sometimes may cost $300 — when you lose $200 while the "ignorant" play would have won $100.) So you can see that even obviously important information, such as what is the blackjack dealer's hole card, is not as valuable as it might appear when you take into account that it often will not help you, and sometimes will even hurt you. If you add to this the possibility that the information might not be 100 percent accurate, it is worth less still.
One of the plays that some experienced poker players make is to bet or raise early with certain mediocre hands in order to "find out" what they are up against. The rationale is that if their opponent raises or reraises, they can dump their hand early. This saves future bets that they would have had to put into the pot had they not solidified their information by putting in an extra bet or two in the earlier round. So, in essence, they are "paying" for information much as in the blackjack example. But are they paying too much? In general, I think they are, and the reasons are analogous to what we said concerning blackjack holecard information.
When determining how much information is worth (and, therefore, what is the most that we can pay for it), we must know four factors. They are:
- What are the chances that the information is accurate?
- What are the chances that the information is different than what we already assumed?
- How often will changing your original assumption also change your decisions or strategy?
- How much do you gain, on average, when you do change your strategy based on your newfound information?
Let's look at these factors one at a time.
If we are talking about poker, factor No. 1 can be of enormous significance. This is because your opponent is under no obligation to give you accurate information even if you "pay" for it. In other words, when you raise him, he may reraise without having a strong hand, or just call when he does. Against players like this, risking extra money to gain information is usually just stupid.
Factor No. 2 can be very important, but is frequently underestimated or overlooked. The thing to understand is that it does you no good to learn information if you already were assuming that the information was true. So, if someone who has just checked out all the cardrooms in Las Vegas offers to tell me where the best game is for $200, I have wasted my money if he tells me that it is at the Horseshoe and I was going there anyway. In other words, the more likely that the information simply will confirm your original opinion, the less it is worth.
Now, even if you do get information that you did not expect, it means nothing if this new, surprising information does not change your strategy. This is factor No. 3. In poker, it would mean that it is silly to risk extra money to find out that your opponent has a strong hand if your hand has a reasonable chance to draw out on him, and, thus, you must keep on playing anyway. (So, ironically, the few times that the play may be right is when you have few or no outs, rather than when you do have outs. For example, if the flop in hold 'em is
8h 4h 2h
an extra raise early with
may be smarter than with
against a player who will give away whether or not he has flopped a flush.)
Finally, even if you have gotten accurate information that changes your opinion and changes your play, this information still may not be all that valuable. It isn't if the new play that you will now make doesn't increase your mathematical expectation that much. If my Vegas informant had steered me to cardroom B instead of to cardroom A, his $200 fee was still exorbitant if the game there was worth only $20 more per hour than games elsewhere. If, because I find out that the dealer has 17, I don't double down on 11, I gain only just a little. These are two examples of factor No. 4.
It is important to understand that the concepts just discussed regarding the value or fair price for information apply to any decision-making situation, not just gambling. Furthermore, the four factors that go into this can be quite precisely used and related in an algebraic formula. But I have spared you for now.