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Math Help - how do casinoes stay in business?

  1. #1
    Member agentmulder's Avatar
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    how do casinoes stay in business?

    Hi to all, happy holidays.

    Something has been bothering me for quite some time so I would like to put it out there (here)

    Many times i have heard the theory that casinoes slightly skew the odds in their favor.

    suppose the game is 48% to 52% so it's skewed in their direction by 4%

    you play a set of 100 games 1 dollar bet each game

    at the end of that set, you would expect to have 96 dollars

    if you keep playing you keep losing

    you lose 4% on every bet you make, whether you win or lose...you still lose...eventually, if you keep playing long enough you lose all your money.

    My own opinion is that casinoes cheat, the odds are not slightly skewed... more like 40-60 cause they want you to lose your money faster.

    If you keep playing you will lose all your money so looking at the total picture it is 0% for you 100% for THEM.

    Comments welcome.
    Last edited by CaptainBlack; December 30th 2011 at 08:41 PM. Reason: changed out deliberate trolling religious type
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  2. #2
    Super Member ILikeSerena's Avatar
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    Re: how do casinoes stay in business?

    Hi agentmulder!

    Yes, you have it right.
    Playing in a casino is a sure way to lose your money exactly in the way you describe it.
    I do believe that they don't skew the odds more than is already known.
    That would be criminal and I don't think they could afford the scandal if it came out.
    It is known however that gambling machines have odds that are more skewed than 4%.

    Still somehow people find a thrill in it.
    Their elation when they win appears to weigh heavier than their frustration when they lose.
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  3. #3
    Member agentmulder's Avatar
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    Re: how do casinoes stay in business?

    To me, i find it funny when i see a picture of some guy who hit the slots jackpot...what they don't show is pictures of the 10000 losers that came before him. HAAAH-HAA!

    I'm a bit paranoid...I have a cousin who can do amazing things with a deck of cards, in my opinion i think you can very easily make a machine to shuffle cards into any configuration you want.

    Another point, they watch everybody...if you win a lot, they accuse you of cheating and arrest you...or worse. If you win a little they give you a free room so you can stay there and lose it all...and your own money, cause you get hooked.
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  4. #4
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    Re: how do casinoes stay in business?

    In the U.S. many of the individual states allow some form of gaming. In the states that do, that state strictly regulates the win/loss ratios. It varies from state to state. But of course the rules must be set so that the gaming houses will make a profit. Remember that is a great source of revenue for the state government itself. So if one chooses to play, the odds are against you, but loss ratios are regulated.
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  5. #5
    Super Member ILikeSerena's Avatar
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    Re: how do casinoes stay in business?

    Actually, there are ways to win with for instance Black Jack.
    People with a good memory and/or a counting system can predict which cards will show up.
    So if the stack of cards is not replaced in time by a new stack (shuffling does not suffice), at some point in time the gambler can win big money.

    Obviously it is in the interest of a gambling house to replace the stack in time, but a gambler can delay that by giving away free drinks and such.
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  6. #6
    Member agentmulder's Avatar
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    Re: how do casinoes stay in business?

    lets consider 1 game of blackjack and only the first 4 top cards 7,8,10,10

    tell me... can you win this game? no matter how you play?

    If decks can be stacked they can determine when you get a winning chance.
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  7. #7
    Super Member ILikeSerena's Avatar
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    Re: how do casinoes stay in business?

    It depends on how many people are playing.

    In a casino blackjack is usually played with a variable number of persons.
    As such the casino does not know who will get which cards.

    I think an adept gambler is better equipped to determine when he gets a winning chance.
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  8. #8
    Member agentmulder's Avatar
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    Re: how do casinoes stay in business?

    my limited experience shows me the dealer wins most of the time, if the dealer doesn't win enough to their liking, they change the deck or the dealer or both, how is cheating not involved if i am correct in my observation?
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  9. #9
    Super Member ILikeSerena's Avatar
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    Re: how do casinoes stay in business?

    The rules of the game favor the casino with some fixed percentage, so yes the casino will win more than average.

    Changing the deck and/or the dealer is the method of the casino to protect itself against gamblers that remember the cards and who try to bribe the dealer.
    The casino is in its rights to do that afaik.
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  10. #10
    Member agentmulder's Avatar
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    Re: how do casinoes stay in business?

    according to this wiki article

    http://en.m.wikipedia.org/wiki/Blackjack

    the house edge in a fair game is between 0.5% - 1%

    That means on $1000 worth of bets the house makes 5 - 10 dollars

    I think they make a lot more than that because they cheat.
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  11. #11
    Super Member ILikeSerena's Avatar
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    Re: how do casinoes stay in business?

    I believe the house will win more because most players do not make the most of their chances.
    They pick inferior odds.
    As it says in your wiki article: "The loss rate of players who deviate from basic strategy through ignorance is in general expected to be greater."

    I would not be able to make any founded claim on whether a specific casino cheats or not.
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  12. #12
    Member agentmulder's Avatar
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    Re: how do casinoes stay in business?

    Quote Originally Posted by ILikeSerena View Post
    I believe the house will win more because most players do not make the most of their chances.
    They pick inferior odds.
    As it says in your wiki article: "The loss rate of players who deviate from basic strategy through ignorance is in general expected to be greater."

    I would not be able to make any founded claim on whether a specific casino cheats or not.
    The dealer must hit below 17

    The dealer must hit 1 card or stand on 17

    don't you find it suspicious that the dealer looks at the hole card?

    why is the dealer looking at the hole card? The dealers strategy is set whether the dealer looks or not.
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  13. #13
    Super Member ILikeSerena's Avatar
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    Re: how do casinoes stay in business?

    I have no idea.
    To be honest, I have never gambled in my entire life.
    The simple fact that it is a sure loss game (which you accurately explained in your OP) makes it uninteresting for me to play.
    I am too mathematically minded to just ignore that.
    Do you feel differently?
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  14. #14
    Member agentmulder's Avatar
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    Re: how do casinoes stay in business?

    I feel the same way. I hven't gambled in 20 years but before i learned some math i lost quite a bit of money as a young man.

    Where i grew up gambling was illegal except on new years eve, i guess that's why i'm thinking about it now. Even though it was illegal we gambled anyway as young men...late at night... when the cops were asleep lol!

    We gambled with each other in pubs, it was fair, i didn't lose much, sometimes i won, then when I got to the U.S. and hit the casino i lost.

    I don't want to play a crooked game either where the player is gauranteed to lose.

    What bothers me (a little) is that i believe the public underestimates just how crooked casinoes are.
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  15. #15
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    Re: how do casinoes stay in business?

    Quote Originally Posted by agentmulder View Post
    What bothers me (a little) is that i believe the public underestimates just how crooked casinoes are.
    You just answered your own question from the topic title.
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