Bad Beats And The Black Swan

There is more to poker than life. – Tom McEvoy

Black Swan (2010) – Vinyl Writers

Let me explain. This is true. I used to play poker. Mostly online, because I’m not a people person. And I can’t sit still that long anymore. I was ranked in the top 5% of the world. Top 5% in the world turned out to be about break-even. Not even minimum wage for all the hours.

I’m old enough, I can still remember back in the day, you wanted to kill some time, you read a book.

Me being me, became a student of the game – just like running or mixed martial arts – and ended up with a piece of a poker website – pokerheadrush.com.

Civil unrest, pandemic, depression, simultaneously, all led by a sociopath running for re-election.

And I can’t help thinking of the sage words of the philosopher Janis Joplin.

Which I will paraphrase. “It’s all the same thing, man.”

Fear of a 'Black Swan' Event Is Worse Than the Actual Event Itself ...

I remember watching WPT champ Nam Le – a young man – play at the same table as 11-time-bracelet-winner Phil Hellmuth, a more experienced, older man.  Nam Le took his bad beats in stride, expressionless, while the Poker Brat seemed shocked – shocked!, I tell you – every time something happened which he did not predict.   Nam Le was not exactly surprised, while Hellmuth acted like Columbus discovering America.  Stuff happens.

”Imagine a speck of dust next to a planet a billion times the size of the earth,” writes Nassim Nicholas Taleb in The Black Swan. “The speck of dust represents the odds in favor of your being born; the huge planet would be the odds against it. So, stop sweating the small stuff. Don’t be like an ingrate who got a castle as a present and worried about the mildew in the bathroom. Stop looking for the gift horse in the mouth — remember that you are a Black Swan.

”What the hell is a black swan?,” you ask.

The black swan is a highly improbable event, unpredictable, with an immense impact.  Such an event is typically explained afterwards as being more predictable than it really was. Before Australia was discovered, all swans were assumed to be white. When a black swan was first seen in that country, previous assumptions about swan color proved baseless. 

The lesson is this: just because we have not observed something happen in the past does not mean it might not happen tomorrow.  Or even the next hand.

And bad beats, for example, can hardly be described as something that hasn’t happened before.  So, why act so surprised?

“Experts, [Taleb] argues, “are certainly flawed—overconfident, narrow-minded, overly committed to a particular picture of the world. But the fundamental reason for their failure is that they are playing an impossible game. The future—or at least those parts of it that really matter— is, by its nature, genuinely unpredictable. We can’t read the tea leaves because they don’t exist.”

Overconfident?  Narrow-minded??  Paging Mr. Hellmuth.

COVID-19 Is No Black Swan — It's in Technicolor

As a species, we seem to desire predictability.  Life is best lived in stable, understandable patterns.  We don’t easily accept change and we detest – in particular – unexpected change.  But since we cannot control the future, we really should not be so surprised if some surprising event occurs. Predicting predictability – when we cannot know – leads to tilt.  And tilt leads to a diminishing bankroll.  Not to mention suffering.  Why do that to yourself???

What does the Black Swan have to say about longevity in poker?  About going busto??

How many times have you sat there trying to put your opponent on a hand you could beat?  How many opponents have you seen do just that???   A small pair puts the opponent on over-cards or AQ puts him on AJ.   We see this phenomenon all the time. 

“…Things in the real world are far messier than in recorded history or in memory,” says Taleb. ”But we find it hard to live with such messiness, so we tend to look for causes and patterns that do not exist.” This is the narrative fallacy, the belief that, after the event, every outcome, even a surprising one, has a cause which might have been predictable.

We are chronic explainers: once an event has occurred, we hurry to create an explanation that makes it look predictable. The site is rigged…the Doom Switch…the withdrawal curse…crazy Scandinavians. There must be a reason.

Fallacies blind us to the existence of the black swan.  The Platonic fallacy, for example, is a view of the world as safe, structured and comprehensible.  It’s a human self-defense mechanism at its core.  Otherwise, we’d never be able to go out the door in the morning.

In a nutshell, Taleb’s advice is to assume that really crazy things can happen and to set yourself up, so that you can benefit from good crazy things without being hurt by bad crazy things.

“We underestimate the share of randomness,” Taleb writes. “Lucky fools do not know that they may be lucky fools.”

Our failure to accept the reality of black swans, James Surowiecki says Taleb suggests, actually magnifies their impact, because it deludes us into believing we understand the risks we’re taking in a given pursuit. If we were more aware of the limits of our knowledge and more cognizant of the real risks we run, we could do two things: limit our exposure to fields where potential catastrophes are possible and maximize our exposure to potential windfalls.”

Is this what Hellmuth can’t seem to quite grasp?  If it wasn’t for the black swan, he’d win every tournament??

All might be chance. The point is, we cannot know.   The least we could do is admit it.  And deal with it.

Cliff Notes: Put yourself in situations where favorable consequences are much larger than unfavorable ones. 

And don’t be surprised if things don’t turn out exactly as you expected.