On Facebook someone said he needed $1000 for furniture. He asked what the odds were that he could win it on Lotto. Someone responded, “Go to the casino and put $500 on Roulette. Pick black, if you win, you doubled your money. If you lose, then bet $1000. Sooner or later black will come up…”
This is the Martingale better system. It works like this: bet $1. If you win, pocket the extra $1 and start over. If you lose, bet $2. Continue until you win. At the end of this sequence, you will always win $1. Always!
There is a catch, of course. You have to have a really big bank roll to back this up. If you’ve spent much time flipping coins, you know that getting heads six times in a row is not all that uncommon. To allow for this, you would have to have a $63 bank roll. And there is a still a 50% chance you would lose on the seventh flip (or roll or card deal or whatever). So you are risking enormous amounts of money for very little reward. And it is a very time consuming way to make money. If you had enough money to make it worth while, you would be far better off in the stock market.
Yesterday, Matt Yglesias wrote about this Facebook suggestion. But he did so in order to make the lamest comment I’ve ever seen. He noted that on a roulette wheel, there are two numbers (0 and 00) that are neither red nor black. Thus the odds of winning are less than 50%. Okay, but that makes no difference to the Martingale system! You could use the system by taking 21 red. It just means that you would have to have a much larger bank roll. But otherwise the theory is the exactly the same. The odds don’t matter in the least.
I’m surprised that Yglesias has been making so many elementary thinking errors recently. I think it comes from his putting out so many articles each day. He should slow down and try for a bit more quality.
There is another issue with the Martingale system: table limits. If you are at a table where you can bet $1, it is unlikely the table will allow you to bet $30. Of course, you could just go to another table or another casino. You don’t have to play the same game. You could bet $1 on a coin flip, move on to the roulette wheel, and when your bets get above $1000, you could go onto the stock market. The theory is the same. If you up your betters exponentially, eventually you will get all your money back. Plus one dollar!