You probably read it right

But that, on its own, doesn't make these "stats" valid. Or any stats, for that matter:



As you can see, the mortality rate is well below 10% on average. But even if it is less than 10%, we don't actually know the real rate because we don't know how many people had caught the disease and recovered from it on their own, i.e. without making it into the stats. However, if the number of new cases begins to diminish, that's basically it. The virus cannot infect more people than there are in the world, so the real death rate can turn out way under 1% in the end

If we take the States, there are literally millions of people already sick or have been sick

So if the virus was as lethal as it is portrayed by the mass media, the death toll would have already been in the millions, if not dozens of millions. Since we are not there yet, and most certainly will never be (because of the coronavirus), we instantly face the question of how things really are (if we are honest to ourselves). Am I the only one who sees that the reality is different from how it is being painted?

It is true even further

Your or my friend may quit halfway with 20% of our money, but that would work out only for a very limited number of players. If we take 80 players or even more, then it will be roughly half of them leaving with 20% of their money lost. But their loss is our win, no matter how you look at it. So, at the end of the day, given the irrationality of most players, those who don't leave halfway will end up losing all. Otherwise, it is "a zero-sum game" (read, 50-50)


The point is, I'm not sure that the house edge is any guarantee at all, at least as long as we take a real casino with real players. Variance and irrationality are these guarantees, hands down

That's what I mean

It is not like it is completely impossible per se provided you are already smart enough, but it would require an effort of a diverse team of experts to teach you all the tricks and turns of the trade tailored to your specific psychological makeup. If you could afford it, it is unlikely you would be interested in trading in the first place. So we are left to ourselves dealing with our inner demons as good as we can

I don't think it is very likely in real life

An expert in trading is not necessarily an expert in teaching as these are two entirely different areas. You can be a trading genius but if you don't know how to effectively transfer your skills and expertise to someone else, you are busted. Further, true experts are extremely unique, i.e. their expertise cannot be copied like you copy a sheet of paper merely because it is built on very particular personality and character traits (read, it may not be transferable at all)

Remember Steve Ballmer's famous developers?

So I have four words for you. It is variance, variance, variance, variance. When you go all-or-nothing path, the house edge as it is commonly understood will be of little help as luck (another term for variance) will be dominating the scene in this case. And now, all of a sudden, it is one bankroll against another. Put differently, if your bankroll is way bigger than the casino's (and there are no limits on how much you can bet), the house edge becomes irrelevant as the size of your bankroll will be your own "house" edge. Now reverse the situation and read this post to see how casinos are earning dough


Then let's get it straight, it is not an analogy


You're welcome, bro!

This is what I've been doing with doges, and you know what? People are still in deep denial, and refuse to accept the fact that with small house edges of 1% at the outside, variance beats the house edge hands down (read, you should be extremely unlucky to bust if you do everything right)

That largely depends on your personal preferences

For example, it is unlikely I will ever have anything to do with Ripple because it is essentially a private currency issued by a private entity (Ripple Labs), with the implication being that once the government cracks down on them for real, you can kiss your money goodbye. On the other hand, EOS seems to be a real deal, which is at least worth looking into. I don't know how you can discard it for the sole reason "not every top coin is a good coin"

Truth be told, I didn't cherish a lot of hope, either

Regarding stats, I remember a former Canadian casino operator or owner posted some of the stats that might be of interest to us. If I remember correctly, he said that there had been only one occasion when someone lost on a 50% win chance in a streak of 24 rolls out of a few billion bets recorded. The post should be still somewhere in the 2014-2015 threads on this board or its parent. Don't know if he is still active on the forum, though

You know what they say?

Right, there is nothing so practical as a good theory (the emphasis on good, obviously). And the theory says that on finite timeframes (dealer's choice), it is not something which "might work to a certain extent in reality" but rather something which would work most of the time given enough sample size (to make the theory fully applicable)
 

This would be sheer luck, indeed. However, you don't need luck for that at all. A bunch of wily and artful gamblers can slowly but surely drain a casino's bankroll empty, and drive it out of business without any luck involved. Ironically, it would turn to be a matter of extreme luck for the casino to stay afloat in that case


It can't possibly be a zero sum game for the simple reason someone is set to bust at the end of the day

And I'm not sure what martingale has to do with that unless you actually mean the opposite of what you have written above. A thought-out martingale strategy takes away from the house edge, in whatever form it may exist. It is hard to beat a mighty bankroll, but if your goal is limited only to taking something from it, a small piece of the pie, the more the merrier

This is not the only way to make profits

When you bust, all your money becomes casino's. And the bigger the bankroll of a casino relative to your bankroll, the higher are your chances to bust even if the odds are equal, i.e. when there's no house edge as it is commonly understood. Put differently, a bigger bankroll already gives a casino advantage over you, and this is a house edge on its own, and as such it can generate profits in exactly the same way as a regular house edge


People often appeal to theories, even resort to posting some arcane stuff, without truly understanding the very basic ideas behind these theories, how they work in practice. But let's return to my example of tossing a coin. You have 10 dollars and your friend has 10 dollars too. You pay 1 dollar for each loss and receive 1 dollar when you score a win. And one of you will inevitably bust in the end, and it won't take long, probably in fewer than 100 tosses

This is what statistics actually says

It is next to impossible for several reasons

First, all casinos are more or less small fish, and they have to be very careful in managing their bankrolls. There are people who have more bitcoins (for example) than most online casinos would ever dream of. In these circumstances a no house edge business model may not be economically viable (though it remains to be seen). Second and most important, people are taking a small house edge (say, 1%) as something legitimate. In other words, it won't give any substantial advantage by reducing it further (apart from happy hours and similar ideas)


Again, we don't know how much of an online casino revenue flow is due to house edge and how much of it comes from variance (i.e. people being irrational) and sheer bankroll size. The point is that the house edge can be easily overcome by variance if you know how to take advantage of randomness. The bankroll size, on the other hand, is unbeatable. To repeat, it is a statistical certainty that cannot be meaningfully challenged

It is ironic how people start to make references to probability theory without actually knowing how it is going to play out in real life. In real life, though, if you play long enough on square odds, you will either bust or bust your opponent first (all other things equal). So 50-50 here refers to the odds of busting if the bankrolls are the same at the outset. In other cases, the higher the discrepancy between the bankrolls of the players, the sooner the one with a smaller bankroll is going to bust (and still faster if the stakes can be raised at will)

Something quite different from balancing out, however

That's what happens when your government pursues political goals before economic ones

The Chinese have been devaluing their national currency countless number of times in the past, and you didn't exactly need an MBA's degree to foresee such developments and expect more devaluations in the future. Moscow thinks it bought the Chinese support in the international scene but China knows better than that. And who is going to pay? Common folks will be paying, as always

How do you know that the profits casinos earn come from the house edge?

Or at least the majority of them? We don't know that for sure. Moreover, as my example with a coin tossing shows, if your bankroll is incomparable to that of the casino, you are going to lose even with a relatively small negative house edge as the size of the bankroll itself is an effective house edge on its own, unless you utilize something like a safe martingale setup. But in the latter case you will be able to continually earn small profits despite a positive house edge

If it turns out that the house edge is not how casinos turn in most of their profits, I leave it to you to decide on how charitable this type of gambling would be


Your analogy is skewed on so many levels

It would fit (to a degree) if users would have to pay for using these "free" products. And lo, it suddenly emerges as a perfectly viable business model in plenty of areas such as a mobile telecommunications industry where a network operator gives you a cell phone virtually for free provided you use it according to a specified data plan

And while we are at it, you are mistaken even on purely technical grounds. I don't know about Apple, but Microsoft offers a lot of its products for free as they earn by providing support. Just recall the inkjet printers manufacturers who are selling printers below cost of production, and then earning by selling extremely overpriced ink cartridges 

I certainly agree with you. However, the ranges of house edge we currently see in the industry (~1%, while sometimes even less than that if we account for things like rakeback) are not a good protection against variance. If we postulate this (which seems to be a valid assumption anyway), then we have only one avenue left through which most online casinos are able to profit and prosper. And this is same variance which leaves gamblers' balances empty with no way of retribution

Luck is on the side of the big bankrolls

I understand when people don't read entire threads

As I don't read them either, especially when there are dozens of pages (even though this thread has only a dozen posts all in all). But why not read the fucking OP, as small as this one? Just the first paragraph of it? But seriously, it is not my logic which seems idiotic (note that I'm speaking in your terms exactly), it is your post which makes it blaringly obvious that you didn't care to read the OP. Since if you did, you would know that:


Wouldn't reading just one sentence suffice to understand the point?

This is always the case if the number of players is above a certain threshold (give or take)

The truth is, perfectly rational players could easily take out any online casino with a sensible house edge (say, 1%). It is a statistical certainty. Since we don't see it happen very often, it only goes to prove that most players are not rational. So, in a way, we are already there. Regardless, it would be tremendously interesting to see the financial stats of a real online casino to assess how much of their profits actually comes from the house edge and how much from busts

But that's how things turn out to be

In fact, it is not very difficult to show how the bankroll size can be an effective house edge in real life. Imagine you are tossing a coin with your friend. When you lose you pay them a dollar, if you win they pay you as much. Pretty simple setup, isn't it? And it looks like your chances are equal. And they are, at least as long as you toss a coin a couple times or so. However, if you have only 10 dollars while your friend 100, their chances of busting you are 10 times higher than yours busting them. This is the "house" edge that a bigger bankroll provides

This is not entirely my idea, so, as they say, don't shoot the messenger

Let's imagine an extremely wealthy casino whose bankroll size by far exceeds the bankrolls of all its players combined. Will this casino need a house edge to earn profits? As I see it, the house edge would make for more revenue flow, but it will still be making profits with a zero house edge simply because it will be able to stay in the game longer than any other player. Put differently, the sheer size of its bankroll will be the house edge on its own

I know every casino wants money, and it is unlikely we will see something described above in real life. However, it would be interesting to hear about examples which follow the logic of the bankroll size being a house edge in and of itself. If you know of such cases, especially when the advantage of this kind is subtle or even deliberately disguised, please share them with the inquiring minds here. Don't hide your knowledge under a bushel