May 26, 2010

Gambling: The Zero Sum Economy

We don't live in a zero-sum economy. Creating a business worth X amount of dollars does not mean that my competitors automatically lose X amount of dollars. Just like the plow increased everyone's harvest, innovations can increase the wealth, time and value of everyone involved.

But, gambling's different. Let's say I enact my gambling theory from yesterday. I get great at poker. Play people worse than me. And win lots of money over time.

All I'm really doing in this situation is siphoning money off idiots. I'm not earning money by adding value to anyone's life. I'm solely taking it away. If you can get past that, it's a no-brainer. But, it's a tough one to get past.

3 comments:

suzzy said...

Very good Eric! The money you won off of the idiots in the poker game was only weird money. You won't find real money in a poker game. The real money was created by the mind behind the plow.

Justin Elder said...

Over time doesn't ehlp because you would have to have an unlimited bank roll. If you ended up losing big the first few times because you had a full house but your opponent gets a straight on the river then you it's possible you lose a significant amount of your bank. In theory it works...

Eric Olsen said...

i think in practice too, unless you commit yourself to playing 100% of your assets each hand. but what about the money that you use on stocks right now?