An Eventual Gambling Problem : Insights from Genting

I read the Time Magazine article “Asia Growing Gambling Addiction” [1] with a heavy heart. I find Casino seriously distasteful because it is mere exploitation of the irrational, the superstitious and usually, the uneducated. This might be considered racist, but when it comes to gambling, the average Asian cannot count. Don’t think. And frankly, stupid.

If you have been to Genting, you know what I mean. Genting casinos games have the tables with one of the the worst odds in the world. Just take the “Pontoon” tables for example.

First, Genting does not have Blackjack tables, which is the only beatable game in Casinos through card counting (which is possible if the dealing is not done through a continuous shuffle system). In its place in Genting is called “Pontoon”. This is basically blackjack without the 10s in UK. If you understand blackjack, the more 10s and Aces in the deck, the higher the odds for the player. Pontoon is also the game that the Royal Statistical Society concluded can’t be beaten. If you have access to JSTOR, you might look at an article on this. [2]

The beauty about this is that in Genting, their variant of Pontoon is actually not the unbeatable English Pontoon above. It is worse than that. It is actually a variant of the American game Spanish 21. By calling it Pontoon confuses people, and the Genting dealers will describe the rules as “similar to blackjack.” However, Genting does not even use standard Spanish 21 rules. It only allows doubles on two hands. This is significant for two reasons. To apply a successful basic strategy in Spanish 21 games, one must double and double often, and on many cards. Without card counting (impossible under a continous shuffle system), you can reduce the house edge to about 2.08% which means you will lose less in the long run. But because 99.9 % of the gamblers in Genting (mostly Singaporeans) are still under the impression this is Blackjack or UK Pontoon, they refuse to double save on 8-9-10s, which means they are seriously in trouble – which gives them worse odds than random play.

Already lost? Yes. Most gamblers don't even bother knowing the rules of the game.

According to Edward Thorpe (who I really respect, not only because of his mathematical ability in the casino, but also in the stock market [3]) if you play without any strategy in Pontoon, the house has nearly a 30% edge (if I don’t remember wrongly). This means that if you Randomly play a 100RM a hand (which is the minimum bet sum for Pontoon in Genting) for 100 hands (one hour) you will lose about 3000 RM. And if you are "lucky", you will lose about 1000 RM. If you are unlucky, about 10000 RM.

And these “Pontoon” tables in Genting are so popular that on weekends due to the Singaporean crowd, you can forget about finding a seat, with Singaporeans clamoring to lose their money. So when Genting won the bid for the IR in Sentosa, I was pissed. If Singaporeans clamour to lose 3000 RM per hour in Genting, they will pay the entrance fee and lose more, this time in SGD. Maybe that is why Genting won the bid. They sure can lure those with money to burn. Who knows?

This is seriously an Asian problem, not an Asia one. If you go to casinos in British Columbia, Canada, you will see Chinese, Chinese, Chinese. I hope this is not taken to be racist, but the Chinese seemed more predisposed to getting addicted to gambling. Same thing for The Crown, Australia, which is supposed to be the largest Casino in the Southern Hemisphere. Same thing for Star City, Syndey. One seems to find unusually a large percentage of Chinese. Perhaps the locals prefer betting on sports than on cards, but I won’t know. I see Chinese.

So I really hope that Singapore apart from those psychological and family-centric help efforts – they must ensure that house edges are displayed at every table. Currently, I think only odds and payout might be provided. Actually odds as these people understand will be provided in any case because it is part of the rules of Gambling (Casino pays 3 to 2 on Blackjack is “odds” to the layman). This helps no one except the casinos. Gamblers will ask in any case. I hope I am not seen to be dissing the psychological and family-centric help thing here. Look, all those things are great, but - for cigarettes - you do put the warning labels right? And in this case, because the risk is mathematically quantifiable, that should be provided. Not everyone should end up in the addiction clinic. That might be too late. Information as any economists will tell you, will help a lot in making rational choices - or at least make irrational choices in the least irrational way.

So we should put house edges (Display "House has edge of 15 percent even if you use optimum strategy" - aka "everyone at this table is a rich fool").

But Gamblers tend to blow their fortune tables with a relatively low house edge too ( they think they can beat the house - aka at about the very high 5 percent house edge) because that is when it gets really addictive. When a player gets punished too much, the non-pathological tends to quit. So it is not enough to display the House Edge alone.

Another thing the state can do is to follow British Columbia Casinos where they provide basic strategy tables for games like Blackjack where if you just follow blindly, the house edge will significantly reduce – about 3 percent. Otherwise, all these family-centric and psychological help is useless to aid the "My-Mind-Can-Change-Card-Outcome" or "I-just-have-to-pray-harder" variety. Gamblers are traditionally masochistic. They have traditionally embraced relatively better odds games but make their odds worse by playing lousily. The classic example is Blackjack and more recently, Caribbean stud poker (which already has bad odds in the first place) comes to mind. Where the odds are about even, they tend to choose side bets with terrible odds.

Personally, I think gambling against the odds not wicked or immoral per se. And I won’t really call Gambling a disease per se. After all, it is beneficial when it can be beaten. Won't think that a disease in that case, will you?

But my point here is that the average Singaporeans who is addicted to bad odds in Genting already, is seriously quite screwed when the IR arrives. Someone should really tell them the house edge, the odds, and if he still chooses to play, the optimum strategy. And if he still does not follow that, nothing will save him.


[1] http://www.time.com/time/magazine/article/0,9171,1678672-1,00.html

[2] http://links.jstor.org/sici?sici=0035-9238(1972)135%3A2%3C221%3ACP%3E2.0.CO%3B2-C

[3] http://www.bjmath.com/bjmath/thorp/paper.htm


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There are actually far worse odds in the world than at the tables of Genting. Lotteries typically have worse odds, but I feel its level of harm to individuals much less. Other terrible bets:

1) Keno, a popular casino lottery game boost a house edge of 25 percent. Unsurprisingly this was invented in China.
2) Betting ties in Baccarat is horrible in Genting too. It is so bet that if you bet it, the dealer might sneer at you. (At about 14.5% house edge - I think Ties pay 1:9 in Genting, is higher than the average 1:8 payout in other Casinos).
3) Insurance in Pontoon. (Its so bad I could scream. 30 percent house edge)
4) Roulette with O,00 (5.6 percent. Not terrible but why bother when you can find one table with only one 0 making it half the edge)
5) One of the Chinese Favourite with various names "War" or "Tie War" (About 19 percent)


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