July 5th, 2010

poker chips

The Poker Paradox

I have dedicated poker bankroll, which I built for over many years.  I started the bankroll using "fun" money I made officiating high school basketball and volleyball.  The bad news is that my poker bankroll has been going south for over 8 months.  I am on an extended losing streak.  The last month, has been the most brutal I have experienced since I started playing over a decade ago.  

The good news is that I am playing better than I ever have and my bankroll is large enough to sustain me through extended losing streaks.

Nolan Dalla, a long time professional poker player and writer has an explanation for  "The Poker Paradox", which all serious players must understand to succeed.

We live in an uncertain world. Although there are outcomes that can be predicted with great confidence, most things in life are determined by chance. For instance, we know with relative certainty that the sun will rise tomorrow morning. This is irrefutable, based on thousands of recorded trials since the beginning of time. But when we try to get more specific, things begin to go astray. We have no idea if we will actually see the sun tomorrow, since clouds may come and it may rain. But we know the sun will be there because our experience and all scientific thinking tells us so.

While it's comforting to know the sun will rise tomorrow morning, most of our attention is geared toward questions and issues that are far less certain. We spend most of our time seeking ways to control nature's irregular forces - otherwise known as "chance." When controlling such forces is not possible, we prepare ourselves for inevitable downturns in a cataclysmic interchange of ups and downs. We buy umbrellas, put money into a savings accounts, take out insurance policies, get flu shots, and so forth - all ostensibly to inoculate ourselves from impending future loss or danger.

In many ways, poker mirrors the cosmic forces of the universe, because it mixes events that are predictable with randomness. For example, the best poker players win the most money in the long run, but that's no guarantee the best players will win money on any given day. Just when we think we've figured things out, when we believe we have the answers to all the eternal poker questions, a disruption comes along and crushes our illusions. This is because poker consists of an ever-changing environment, with chaos theory playing itself out daily inside every poker room. All the subatomic particles bombarding around the card room create a poker situation that is intrinsically different from every other. In fact, no two decisions are ever the same at a poker table.

One of the most difficult things for poker players to recognize is the difference between luck (outcomes that are determined purely by chance) and skill (outcomes that are usually far more predictable). An example of this occurs when we go on losing streaks. We initially ascribe the unfavorable run of cards to being unlucky. "Running bad," we call it. Early in a bad streak, players rarely consider the possibility that they may be doing something wrong. But the longer the streak progresses, the more questions they begin asking themselves. If you're losing, perhaps your game is not as solid as you think. Perhaps your opponents improved over time, or changed the way that they play against you. Perhaps outside influences in your life have impeded your ability to play your best poker. In all of these cases, your level of skill in relation to your opponents' skill deteriorated. Therefore, losing is a predictable outcome. If you don't play as well as your opponents, you usually lose - it's that simple.

All successful players must eventually muster up the courage to ask themselves tough questions, starting with: If I'm losing, am I doing something wrong? Is it me, or is it the cards? The trouble is, these are impossible questions to answer (in most cases). Good players would not be winners were it not for a definitive set of skills that have been developed over time. If you've been a winning player eight out of the last nine years, you are clearly far above average as a poker player (since most poker players lose money in the long run).

So, what should you do if you are/were a winning player but suddenly find yourself in the middle of the worst losing streak of your life? Should you change your game, and if so - how? I think that in order to answer this question, you must look deeply into the past. Perhaps you used to beat your local game on weekends when playing against "tourists," but now you find playing in the afternoon against retirees and semipros to be much tougher. Perhaps when your private game was a full game, you were a regular winner - but then you began losing when weak players quit the game because now you're playing against stronger competition. Maybe you used to crush the game back home by playing a loose and aggressive style, but find that that same strategy just doesn't work on your trip to California. Poker rooms everywhere are filled with players who were probably winners at one time or another in their careers - in certain situations. Inexplicably, many of these same players became losers for reasons that seemed beyond their control.

But were things really beyond their control? In some instances, the answer is no. A player who is running bad might be doing absolutely nothing wrong. He may, in fact, be playing very well (minimizing losses to the greatest extent possible), but is simply getting drawn out on and taking a lot of beats due to a bad cycle of luck. This happens to all players. I once theorized that the longer you play poker, the more losing streaks you will experience, and the longer those losing streaks will be. That might seem to be a contradiction - suggesting that experienced, winning poker players will have the most and lengthiest losing streaks. But, it's inevitable, because serious poker players put many more hours into the game than amateurs - which translates into years spent at the poker table. While the casual tourist rarely, if ever, goes on a losing streak (because he plays so infrequently), the full-time pro will inevitably find himself in the middle of several bad runs over the course of a lifetime.

Talk to anyone who has played poker seriously for more than 10 years. In the 15 years or so that I have played poker seriously, I have run (really) bad twice. One losing streak lasted for almost eight months. I went from making in excess of $25 an hour for two consecutive years to a losing year - without any indication of what was to come. When I was winning heavily during 1993-1994, there were no warning signs of the train wreck that was ahead. Going from a $27-an-hour winner to a loser (temporarily) forced me to ask myself some very tough questions. It was mentally anguishing.

During that eight months of running bad, I started doubting myself. Was it me? Was I doing something wrong? Was I playing in the wrong games? I went back and examined my records, and discovered that I was playing at the same limits, against pretty much the same types of players, in the same circumstances. So, I concluded that the bad run was attributable mostly to a bad run of luck - at least initially. But, how could luck run bad for eight months? For me, that translated into about 700 hours at the poker table. Eventually, I concluded that the losing streak was a combination of several factors, namely the following: (1) I failed to improve my game and became somewhat complacent over time; (2) My opponents became better players; (3) My opponents began identifying ways to counter my strategies that were once so successful; and (4) I failed to readjust my game for the changes that were taking place. Of course, I made this discovery well after the fact. It's almost impossible to figure things out when nothing is going right and you've lost confidence. It's like not being able to see the entire forest when you are standing in the trees.

Players in the midst of losing cycles are the most vulnerable to sustaining additional losses. Indeed, the longer that a losing streak lasts, the more difficult it seems to break the horrendous chain of events. What could be a small, relatively minor slump destroys some players. Unable to cope with losses, they go on tilt, play higher than their skills or bankrolls allow, change their styles of play (when no changes are necessary), or, in the case of the worst players, play the same way but play more hands, thus making things much worse for themselves.

The uncertainty of not knowing - Is it me or is it the cards? - is the great paradox of poker. Interestingly enough, this question does not limit itself to running bad. The converse of this question is when you are running exceptionally well. Most players who win large amounts of money or go on great runs over a period rarely mention luck's role in the results. Almost invariably, short-term winners ascribe their success to superior poker skills. Since even bad players occasionally enjoy extended runs of good fortune and win lots of money over a short period, they may actually think they created their own pot of gold. So, they return to the cardroom or the tournament circuit and repeat the same mistakes over and over again - until the laws of probability start to kick in. Of course, these players end up being losers in the long run.

In every card room, players are struggling with these questions. Short-term winners believe they are good players, and thus don't make changes - which makes for good poker games. Good players who are short-term losers start abandoning the fundamentals, and go on tilt - which makes for good poker games. In a sense, the poker paradox is what makes poker games beatable.