Nate Silver

24:15If you go into the airport, it probably turns out that like all these different routes are roughly equally good or bad because people are strategic and they're optimizing against one another in competitive situations. What I like about game theory is that it gives other people credit for being intelligent and being able to make adaptations. One idea that I talked to some people in the book is called strategic empathy. So it means that put yourself in your opponent's shoes and think how they behave in a given situation, right? A lot of people in like the politics world, I think, lack this trait, right?

24:48They tend to assume that the world is static, but instead people I think are reasonably capable and intelligent about things where they have skin in the game, investment, repeated experience. So game theory says, if everyone is playing strategically and not just me, then what's the best course of action I can take? And not the best course of action is a more defensive action. It's how do I not get exploited or manipulated by other players? But that's why I like it. I mean, I think, you know, if you can learn how to play against an optimal opponent who is smart and intelligent and playing their best, then it's actually pretty easy to play against a suboptimal opponent, right?

25:29If you played on the biggest stages in the world, so to speak, then playing in some smaller town is probably pretty easy, but the reverse is harder. If you're playing against someone and you realize that they're really good, how do you know they're really good at poker? Does it just mean they won or can somebody be really great at poker and be losing? There is a lot of randomness and variance in poker, so like literally you could have a good poker player who lost a period of 10 years, which is why it's kind of insane, right? Like I ran some simulations for the book and like, internament poker, a winning player in the long run, a theoretically winning player, who have a losing year, like almost half the time, right?

26:09Because a lot of the price pool is concentrated in these upside cases where you win a million dollars in a tournament or win 500k or two million that might happen like once every 10 years or something. So look, what makes someone a good player is that they're unpredictable? A lot of players know that when you play aggressively, that you need a combination of good hands and bluffs, right? But you also need a combination of hands when you play passively or conservatively, right? I mean, the most common action in poker is just to check, meaning to say, I pass my turn and now it's your turn to act and then I'll react to that.

26:45A lot of players when they check always have mediocre hands and therefore they're very predictable. A player who can have a strong hand sometimes as part of the range that they check or play passively is like much tougher to play against. They're doing a lot better job of being unpredictable and randomizing and a player like that and I'll gain more respect for. So in Game Theory, if everyone who's playing is working strategically for the best and for themselves, when you say strategically, does that mean that they know what's the best path for themselves? Under Game Theory, you assume people have perfect knowledge of the situation.

27:23But so that seems like it doesn't exist in the world. I think when people have a lot of practice with something, then, you know, like I said, there are these computer programs that have been around for 10 years that literally have a solution to poker. But some of the best old school players like the late Doyle Brunson or Eric Sidel or they kind of learned it through trial and error and kind of survival of the fittest where you're like, this just seems to work most of the time. And I can't quite explain why, but like in, you know, so Game Theory is important when it comes to conflict like in terms of like nuclear conflict and things like that, right?

28:00Somehow the world has gone, I guess 80 years now, having nuclear weapons and not having one detonated in more time. Personally, I'm still pretty nervous about nuclear weapons to have the capacity to destroy the world. But the Game Theory dictates that like you should not launch a first strike because you'll get nuked back and like relative to a lot of academic theories, it's held up relatively well in practice. If you're not tired and if you're playing well, you'll follow your intuition. Describe your intuition, what you think it is, how does it work, how do you get the signals? It comes mostly from pattern matching and kind of recognizing people.

28:40It can come from like a, you know, a deep place recessed in your brain. I mean, you know, I mean a deep run in the main event of the World Series poker one year ago now in 2023. And an important hand, I saw an opponent of mine bat a big amount and then kind of gradually went into like a turtle shell. He kind of put his, his hands to the back of his head and kind of was like buried a little bit in the table and he'd been like very confident before and then became very quiet and seemed to want to like escape the situation. And I realized that two days earlier I'd had a conversation over lunch with a friend who played a very big hand in a televised game who had an opponent do almost the exact same thing, right?

29:24That wasn't an usually clear case of pattern recognition where like, you know, I recognize this exact combination of behavior, boldness, then coupled with turtle shell from a player who was not a professional was an amateur. That's important, right? Because a professional can like can fake that behavior from an amateur. It's more likely to be authentic. And so sometimes it's something you can quantify. Sometimes it's not. Again, you're looking for things like is someone anxious, activated, nervous. That's hard to fake. What that means is different from player to player. If I am tired, then I'm kind of thinking more in terms of like the pure math, but it's something again just from like processing thousands of thousands of poker hands.

30:06There's some intuitive part of your brain that can pick up on these things. You're talking about your opponent being the person. You're not considering the cards. You don't think maybe he's got a flush. No, you are for sure considering that. Yeah, look 80 % of the time your decision is based on the underlying math of your hand, right? You have a very strong hand, so you make a big bet where you have a very weak hand, so you fold. So yeah, we're purely talking about the kind of 20 % of like reasonably close decisions. And if you know the math, you kind of know what a close decision is and what's not, right?

30:41Because sometimes you'll face a situation where you're like, oh my gosh, my opponent feels intuitively so strong to me, right? But maybe a situation where she has very few chips and you're getting such good odds, 10 to 1 or 8 to 1 that you kind of are locked into calling, right? So you have to like take an extra half beat and pause and think about the underlying math of the situation. Think about like if I'm folding to her here, am I ever calling with any hands at all? So we're talking about the 20 % of the time when you have a close decision, but like, but you know, but the close decisions are where the skill comes in.

31:18In football, if you kind of go for it on fourth down, when you're losing the game, you have no other chance except to throw a Hail Mary even, that's an easy decision, right? It's a marginal situation in which your skill tends to matter more. Can you raise more chips than a person has? No, this is kind of a myth, right? And there's like a lot of like poker movies from the past where someone has to like go call their investors and round up chips. Poker is played for table stakes. So if you have 5 ,000 chips and I have 3000 chips, then we play for it. Where the lesser amount of those two is, who are playing for table stakes, which in that case would be 3000 chips.

31:55What's the state of online gambling? I think pretty bad and pretty sad. You know, one of the problems with having these computer programs, we can go in 15 seconds and have like a game theory optimal solution to poker is that it's very hard to prevent a cheating online. You know, some of the sites will give you tests where if you play too perfectly, build a side that you cheat. Some sites will have you hooked up to a video monitor, but like I would be I would be cautious about playing poker online. It's too easy to cheat and also like, you know, I think poker is partly a people game. And it's a lot more I think a lot more fun to play against people where you're kind of getting their vibe and being able to read them.

32:37So yeah, I think online poker is probably going to be pretty broken more often than not. And even some of the best player at poker points of talk to says, yeah, I make like a very, very marginal profit online. Like it's fun. I'll do it sometimes. But I'll treat it as like as training where I know I'm probably losing expected value. I'm doing it for entertainment, if for practice, but the issues with being able to like bring up another browser window and have a optimal solution is pretty hard to overcome. Tell me about luck. I suppose I don't believe in luck exactly, at least in the sense of like some people being naturally lucky or unlucky, but I think luck plays a very important role in life.

33:21You know, not to get too morbid, but like a few weeks ago, we had one of the two presidential candidates who paused to look down at a slide of I guess immigration statistics. And therefore just had his ear clipped instead of being perhaps killed or assassinated, you know, that's something that you would have to say comes down to luck or serendipity or whatever else. Certainly in poker, you're very aware that the turn of a playing card, a tiny little playing card piece of paper basically can have profound effects on your kind of future well being. And so I think people greatly underrate the role of luck in life.

34:01When you're waiting for a card to come, do you wish for a certain card? I have learned over time that like probably having like a little bit of an optimism bias is okay in poker, because otherwise you can be self sabotaging and kind of like self defeating. Like one thing I've learned for example is that like you never want to book a flight home until you're out of the tournament because subconsciously you'll find ways to end the stressful situation. And say, oh, I've done well enough wouldn't it be nice to go and get a steak dinner with my friend and then I'll take a little flight home and have a nice little sparkling water on the plane and whatever else.

34:43You don't want to do that. You want to kind of force yourself to be present because poker is actually dull a lot of the time. So having a bias and saying, I believe that I can win this tournament. I believe I can go deep in this tournament. I think that's better than the alternatives for sure, right? You know, it doesn't work to say, oh, I wish I was dealt like pocket aces. Like it doesn't actually manifest that very often. But like an attitude where you see yourself as deserving of good outcomes, I think is is helpful.

35:19If you have a hand where if you draw an ace, let's say that would much better your hand and you're aware of your last cottage coming. Do you ever have an internal conversation of I hope it's an ace or no? In the sense, Rick, that like you want to be prepared for any eventuality. If there are 52 more cards that can come, then some implicit part of your brain is planning for all of that. But yeah, you want to think about that in advance, right? Because I mean, there's no clock per se in poker. But like if you pause for a long time to react, and that can give away information. Or if you kind of make a facial expression when you get a good card or a bad card, and that can give away information.

35:59So like, so you want to be meticulously planned, but also able to react in the moment. I mean, sometimes you know, one thing you can do if there's an important card coming is actually to watch your opponent first. Watch how she reacts, and then look at your card when she's looking at her cards. Like that's a better way to avoid giving off information and you might learn something about her. What is effective altruism and why do people who practice it end up in jail? Effective altruism is a good brand name, a clever branding exercise made by two Oxford professors, which describes originally described finding more effective ways to give to charity.

36:44It's kind of what the effective altruism meant originally. But let's say you give to some charity, the American Red Cross or the March of Dimes or whatever else, right? Are they actually using that to help people? And is it cost effective or not, right? That was kind of the original impetus for it. And it was discovered, for example, that like, you know, in developing countries, cheap interventions like building anti mosquito bed nets, they're called, can save lives for a few thousand dollars at a time. That was the original branding of it. What happened is that once people were like, oh, we can kind of quantify the utility of anything.

37:23It's like the expected value terms from poker applied to like everything in life. Then I think some folks got a little carried away, you know, one reason why people ineffective altruism are very interested in artificial intelligence, for example, is because it's seen as a very high stakes problem. If you talk to Sam Altman, the CEO of OpenAI, he literally believes that like AI could cure global poverty or could destroy the world if the computers are unaligned and act malignantly toward us. So it's a very kind of high stakes problem. But look, I'm a mathematical guy. I've like literally built statistical models.

38:00I think there is sometimes a hubris and thinking you can quantify everything. So I mean, estimation under uncertainties of very valuable skills I've talked about. But you know, you also sometimes have people who who are hubris stick and get with numbers, but misapply them. Don't have the right life experience. I think sometimes people can be a little bit gullible as part of that pattern sometimes. I mean, one thing I like about poker is that like the bottom line is a bottom line, right? That you have a financial incentive to make better decisions. And of course, that can be corrupting in lots of ways, especially if there's a native like creative process.

38:42But it does prevent against a little bit of like gullibility. To a poker player, someone like Sam Beckman -Freed is somebody that we are probably more skeptical of. We've seen a lot of smart young assholes basically, and they talk a big game and some of them are very good, but some of them just have been on a winning streak and are not. That skill at the end of the day. And so, you know, having some degree of skepticism I think can be valuable and effective altruism or EA sometimes lacks that. With that said, I mean, I think they have like, I think done a lot of good in areas like charity, for example.

39:17I think they're smart people who are trying to make the world better. And I respect that and admire that. It's a young movement. There's not very much happening kind of philosophically in the world anymore, right? This is kind of like a breathing, living philosophy that's had like a lot of influence on people from like Bill Gates to Warren Buffett to Elon Musk. People donating billions of dollars are now donating it in a smarter way that like literally saves lives. So I have a lot of respect for that. But I, you know, people can get very carried away with theoretical models that are like not much better than like scratches on the back of an envelope.

39:53How is it different playing at a televised game versus a non televised game? So there are a couple of differences. One is that you can actually get feedback. If it's a 15 minute delay, then you're kind of friend can text you and said, oh, that hand where you thought your point was bluffing. Actually, he wasn't bluffing or vice versa. There was a somewhat scandal at the World's Here's a Poker just this past month where a player was getting advice from a guy using a laptop in between hands. May or not be technically it's the rules, but like that situation where, you know, you're seeing the hands on TV and therefore you have extra information.

40:30But also it increases the pressure factor. So for me, I'm happy whenever I get on a TV table, not because I like being on TV. I mean, I don't like watching myself on TV, but because I have for better or worse, been on TV a lot for news programs, for media, for podcasts. And therefore I have practice performing under pressure, whereas someone else might might lose their shit, right? Go on tilt is a term that we use in poker and they're embarrassed to like be playing poorly on television. So any circumstance that ups the pressure. Again, it's like not that I perform better under pressure. It's that I think I have less of a down slope than maybe other people who have less experience do.

41:15You know, I never used to believe in all this shit about like being in the zone. If you're performing or something as an athlete, you know, Michael Jordan, we talk about being in the zone. But now I kind of do and talking to people who have studied the physiology of these systems, like, you know, your body has millions of years of evolutionary training to respond to stress. I mean, humans are very good at picking up on situations that like even like subtle signals where there is risk to be had. And like finding that balance between on the one hand being very cool under pressure. But on the other hand, like, you know, your body provides you with a lot of feedback.

41:51When we're under stress, we actually become more intuitive, not less intuitive. It becomes harder to kind of conscious long form processing. And we kind of are getting extra information. Our blood flow increases, our heart rate increases. So anything that increases the pressure, just having had enough life experience at this point of being in pressure situations. Then I think that's a comparative advantage for me. How important is math in the picture of poker? Can you be a great poker player without being great at math? The short answer is no. The longer answer is maybe you can learn it through wrote trial and error or through kind of wrote intuition.

42:29If you play thousands of hands, you might unintentionally get there. But yeah, like I said before, like, you know, the 20 % of decisions that are based on people reading factors and intuition. I mean, that kind of separates out the good players and the great players. I mean, it's like a lot of other things in life where like the world maybe sadly has become too efficient to permit someone who is a flawed but gifted, but not gifted mathematically to succeed, right? Which is sad, I think, in a lot of ways. But like, you know, the algorithms have come for everything including poker and like at this point you're probably giving away too much with basic strategy if you're not like reasonably good at math.

43:13How do you describe the personality type of the gamblers you've met? So there are really different types of gamblers, someone who plays poker, though, to focus on them. I mean, they have like a rebellious anti -authority streak because it's like one of the only professions where you truly set your own schedule where you like literally have no boss. I mean, poker players, I think, underestimate how important it is that you have regulated gambling so there's less cheating than there would be in the fact that taking, you know, it's actually a hard thing to do is like to deal a poker game, for example.

43:45But there are people that kind of don't quite fit into the norm to mainstream society. You know, are they counter -cultural? I mean, I think maybe in some ways but not in others. But there are some, there are people who kind of march to their own, march to their own drummer. They have kind of like an anti -authoritarian streak. Have you ever experienced cheating in a game? In like home games, I've seen people like fairly blatantly cheap, but no, to my knowledge, I'm sure I have been cheated. But I'm selecting games where there's a high degree of trust, right? I'll play in some private cash games in New York, but like, you know, when a friend of a friend invites you to a game, especially if they think of you as a skilled player, why is this friend of a friend inviting you to a game if they think you're a winning player?

44:35Maybe because in that environment, then you're not a winning player or because you're being cheated potentially. And so I think a smart, canny gambler knows that what seems to be good to be true usually is. Tell me about superstition in gambling. I think people are uncomfortable with luck and uncertainty. And so, you know, people are trying to manifest luck through superstition, through always betting a certain way or always behaving a certain way. I mean, the one thing that can be good, superstition wise is like, you know, if you have a routine for how you look at your cards, right? You look at your cards when it's your turn to act, then maybe before the three cards called the flop or dealt, you look again.

45:19So to have consistent patterns and how you behave is useful, but not for superstition reasons, just to avoid giving away information about the contents of your hand. You would never wear your lucky socks to a particular game because you won last time you wore them. I mean, I might, but my friend Maria Kana -Kova is another poker player slash journalist I have a podcast with her. And at one point I mentioned like having a lucky hat that I wore and she like practically hit me. She's not a violent person, but she was so mad at me for even feigning in the direction of superstition that she was upset with me.

45:51Tell me about the lucky hat. It was a Yomuuri Giants hat, which is a Japanese baseball team. I unfortunately lost the lucky hat at some point. That's tragic. For sure, although I've had some good poker sessions since then. It was a very beat up looking hat, but yeah, look, I don't believe in that. Because what you learn in poker is that sometimes your your body does things that your mind is kind of almost not wanting to do, right? All of a sudden you call and put your chips in when you don't want to or you throw your hand away when you don't want to. Like that's actually usually bad, right? When you have this bifurcation between your mind and your body versus being more holistic and saying, I am making a conscious decision because I'm picking something up on some intuitive level.

46:37And so, you know, anything that can put you in a better mindset, I mean like I said before, like, you know, having an open time horizon. So you don't feel like you're rushed or have to get home. I mean, you know, in this past world series of poker, we're in a political year, I cover politics and like there was a lot of news about politics as I was playing poker. I'm sure that was bad for my poker game, right? Because like, you know, what you basically want to do is like avoid extraneous distractions, which is hard to do. I mean, you know, most poker players, including me, are on their phone a lot in between hands.

47:10But when you're in a really high -stakes situation, all of a sudden, you don't need to look at your phone in between hands. Because every decision is so important that all of a sudden you like pick up on things like out of nowhere, you pick up on like how your opponent is breathing. Are you kind of simulating in your head? What if this unusual card comes and how will I react then or this situation, ABC, FXXYZ? So you learn about like the importance of focus, because most of the time you're not that focused, right? Most of the time it's boring, you're looking at your phone, you're on Twitter, whatever else.

47:40And then in these rare moments, you see kind of how much more capacity you have when you are fully present and immersed in the moment. If you replace the lucky hat with the same hat, but a new one, do you think it would still hold the same lock? No, I think it would be very bad karma, right? Like a fake, a fake lucky hat. I just rather have an entirely new hat, I think. You know, attachment is something which in poker is harmful generally speaking that if you lose a big pot, but you still have chips in front of you. Now you have $5 ,000 instead of $10 ,000. You're never going to get the $10 ,000 back.

48:18You have to play the best you can based on the $5 ,000 and roll with the punches. And by the way, the reverse is maybe even more important. When you go from having $10 ,000 to having $20 ,000 chips, but you still have a long way to go in the tournament, you still have to play aggressively optimally. It's easy to kind of get complacent and lazy when you've been on a winning streak and you still have to be kind of proverbially hungry and play your best. Are you always aware of how many chips you have or no? I'm always aware of how many chips that I have for sure. I mean, that's the kind of the most rudimentary and basic mathematical fact of poker.

48:57You know, looking at your opponents chips, I mean, in a good situation and a tournament, then people will stack their chips neatly, but in a cash game, you're playing you're at the area in Las Vegas. And it's two in the morning and there are drinks on the table and people eating burgers and things like that and lots of things going on, right? And six different colors of chips in play and stacked in messy situations. And yeah, like literally counting people's chips is actually an important skill in a situation like that because it's not always optimally designed to make information transparent.

49:37Have you brought your open time horizon technique into your life in other ways? You know, one thing poker teaches you is that some decisions are much more important than others. So like with like big career decisions, I tend to take my time making those decisions. Whereas like where should we go out to dinner types of decisions, right? People can get obsessed because the decisions close doesn't mean it's important. You know, again, like I said, I've gone to the airport later, it's probably close, whether I take the train or Uber, you shouldn't spend very much time focusing on that. So understanding like kind of like what what a priority is in life and which things it's worth being more meticulous about when I'm writing a book, I mean the books 550 pages, you have to be more organized and meticulous about that when it's a long term repeated situation.

50:37You have to be more organized and meticulous about that. You have to be more organized and meticulous about that.

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52:10The decision fatigue apply to poker. Decision fatigue applies to poker and a lot of things in life. One thing I worry about in fact is that we're in a world where we have more choices than ever before. And if you're someone who has a lot of agency as a term by you. So agency means being able to be in charge of your own decision making process and being able to make good transparent choices. If you're a person with high agency now, then I feel like more and more the world is your oyster. But if you're under duress of any kind and most people are, they're having bad day, they have physical ailments, they have mental ailments, they're under stress, their choices are constrained.

52:54Then I worry that we have this kind of paradox of choice where our choices are manipulated by algorithms or by other people. Where we're operating under duress and making suboptimal choices where we don't have a long enough time horizon and we're trying to satisfy our current need instead of what will make us happier. Five days from now, five months from now, five years from now. And so, yeah, I mean, look, one of the most important things I learned from the book talking to people who are successful at risk taking is that they have a longer time horizon. I know I've used that term. It's like a little bit of a buzzword by just being there like, you know, I think nearly always if you are focused more on the medium to long term, most people are impatient in the United States were especially impatient, I think.

53:40And there's so much instant gratification that we can derive from using our phones or from, you know, whatever, right playing the long game is, I think, one of the biggest advantage you can have in life. What are some of the things that you've learned in poker that have worked their way into your life? Not being worried about looking silly because nothing is ever 100 % in poker. You can think you pick up the biggest tell ever in your opponent and that she's bluffing or he's bluffing and then, then he has a full house and you're totally embarrassed by that. But like, not being afraid to look foolish about kind of trusting your process more.

54:23And again, about like, patience because, you know, you might get, if you're playing live poker, you might face one really important decision every hour or so. So being prepared for that when it's a lot of monotony and a lot of boredom, being prepared to take advantage of opportunity when it strikes, I think is a good life lesson. What are some of the techniques that you've learned or practiced to calm yourself for poker? I mean, things like having more sleep can help, although, you know, Las Vegas is often a pretty hard environment to sleep. If everything goes optimally, then like, like having a little bit of like cardio in the morning, I think actually helps a fair bit, just kind of get your kind of blood pumping in your mind flowing a little bit.

55:12But, you know, having as much of the day blocked off as possible, poker players are very good at like contingent planning. They'll say, I'll get dinner with you, contingent on us both surviving the tournament. But if not, then no hard feelings, I'm not going to worry about it too much. But especially for me, because I am a pretty busy guy, half the reason I play poker is because you're able to kind of clear out your schedule and say, I'm just going to focus on this thing that I enjoy for the day. And there might be other things too, like if you go hiking or something where it's a physical activity where you're not tempted to be on your phone all the time.

55:47That's half the reason that I like poker is just the focus I'm able to place on it. What's the relationship between gambling and science? Gambling plays an important role in the development of probability theory, like Blaze Piscale, you might know Piscale's wager was like actually develop probability theory based on trying to solve a gambling game for a friend. Game theory, I mean, Vinoiman, who was instrumental in helping the Manhattan project to be developed and maybe one of the bigger geniuses of all time, develop game theory from studying poker. Some, you know, signal processing algorithms that usher in the information age, people who built those also built algorithms to bet on college football, things like that.

56:29So there's always been like a certain type of nerd who's always been motivated by not just gambling for gambling sake, but trying to beat the system somehow, right. That's always been the dream of like a certain type of geek basically is can I use math to kind of money ball my way into making money somehow and having this cool life as a gambler kind of living on the edge of the system, so to speak. So that's always been and by the way, I mean, what venture capitalists do in Silicon Valley is not entirely divorced from gambling. I don't think they understand expected value that if you make a bunch of long shot bets and you aggregate all of them into like a fund or something, then the masses that sooner or later one of them will pay off its expected value and so and so the gambling kind of risk taking component for better or worse, I think he's becoming more and more rewarded in society certainly Silicon Valley and Wall Street and even the kind of capital G gambling industry in Las Vegas, it's still growing every year.

57:32That for better or worse seems to be rewarded in our capitalists economy. Do you remember when money ball came out was that a new story to you when you read the book? It was not new to me. I mean, I have been kind of in the money ball revolution, I guess, is kind of one of the people who's using stats to try to understand baseball a lot better. Yeah, and I'm kind of aware of it like in some ways like my story, founding 538 applying statistics to politics was kind of the same version of money ball. I think actually in politics, people are more data averse than they are in sports, for example, but no, that was that was always my world money ball for sure.

58:09So I always felt very familiar. Tell me the story of 538 up until then you're a poker player professionally. Is that correct? So I graduated from college in 2000, took a job as a consultant, was pretty unhappy at that job and quit that job because I started I picked up poker and all of a sudden I would say up until sometimes all night, right. Then you kind of catch a cab to work at nine in the morning and I make far more money playing poker than I would at work. It's just the so called poker boom where there were a lot of new players and new players at poker are usually bad. There's a steep skill curve learning curve.

58:45So when you have a lot of new blood and poker, then that's an opportunity. After three years of that, the US Congress passed a law to basically outlaw internet poker. I became much more curious about politics for that reason. I want to see the bastard to pass the law voted out of office. Basically, this is 2006. I'm living in Chicago. Half a year later, a guy named Barack Obama begins to run for president. I'm not ashamed to admit that at 30 years old, living in Chicago, a guy from my school University of Chicago, who seems very different than a typical presidential candidate runs for president.

59:21Meanwhile, we're in this kind of post money ball world. There's like a lot of, it's a good time to be really interested in data and really interested in politics. And that's kind of how I founded 538, which I worked at from 2008 until 2023 when it was sold it eventually to the Walt Disney company, a giant corporation. But now I'm back being independent again. How did it start specifically in the beginning? And then why did you leave in 2023? It started because I most things that I do, it's because I want to build a better product and the product that doesn't exist somewhere else. I want to know, for example, this is spring, 2008, where their Hillary Clinton or Barack Obama had a better chance of defeating John McCain.

1:00:03It's very long, prolonged primary they had. And there were no good models of this. I decided to like, kind of teach myself and build one myself. The reason I left 538 is because I didn't really have a lot of choice. You know, we sold 538 or I sold 538 to ESPN and then it was transferred to ABC News, which are both part of the Walt Disney company. And one problem with the Walt Disney company is that it's this giant big glacier moving very slowly. And so you have almost no agency over your part of the business. If you have a pandemic and the theme park industry gets hit hard or if TV streaming the economics of that change a lot or televised sports and ESPN, where the movie business changes and there's radicalized in different ways.

1:00:49That has 10 ,000 times more effect on Disney's bottom line than whatever 538 is doing. So we faced a lot of headwinds. They laid off three quarters of the staff one morning, you know, my contact was up six months after that. And I knew at that point. I mean, I don't think they would have offered another renewal, but I knew at that point that I was going to leave. And it's been. It's been one of those things where I think I've been very lucky. I mean, I'm one of those people I've learned that like I much prefer independence. I much prefer not having to be too many people's boss. I much prefer kind of owning my own product and having incentives to work harder.

1:01:25And so, you know, that's a case where I think I've had a good a good turn of fortune something that seemed at the time like it was a loss of an option has actually been very freeing in a lot of ways. Was it completely independent until you sold it to ESPN? There was a period where it was licensed to the New York Times for three years. So we licensed it to New York Times for three years and then sold to Disney slash ABC News slash ESPN for 10 years. So licensed means you made your content and they distributed it. Is that correct? Yeah. So basically I blogged for the New York Times instead of for myself, but also got to work with their terrific graphics team and their editors now and then they even put me in print.

1:02:06So that was fine. Right. You know, even though the times is a very complicated institution that I have mixed feelings about. But that was I think a pretty happy time and then kind of from like the. The moment I felt like where I sold to the Walt Disney company kind of always felt like a little bit cursed to me. I don't know why, right. And also, I think the kind of perception there's something about kind of being like scrappy and independent, even if people know that you have a pretty good lifestyle and there's something about that that is authentic and. And sympathetic and it just kind of suits my temperament a lot more, I think.

1:02:44You talked about you had a job. You were playing poker all night. Will you playing poker because it was fun or was it something else back then it felt like an ATM because there were so many inexperienced players. There was something called the poker boom that began roughly 2003 for a couple of reasons. One was the availability of poker on the internet. This is before they were like algorithms to help you cheat on the internet. Partly because there was a guy named Chris Moneymaker, kind of out of central casting the name Moneymaker, who won the World Tour's a poker main event in 2003. And he had been like a accountant at Deloitte and two, I think in national Tennessee.

1:03:24Very much in every man guy. I think in his late 20s, you know, we embodied very relatable guy. And he did he tell these pros and wins the world series of poker for a couple of million bucks. He's on TV constantly and he inspired a lot of people to say, hey, look, I have a boring, cubicle job. I want to be the next Chris Moneymaker and of course, you know, most players were not as lucky as Chris Moneymaker or as skilled as Chris Moneymaker. He's a pretty good player. Therefor there was lots of dumb money in the game and like any opportunity in gambling or investing, I mean, dumb money only lasts for so long.

1:04:01Right. It persisted for about two or three years and then the games dried up. But yeah, I mean, for a period of time, you could click buttons, kind of, and have an expected value of like earning a hundred bucks an hour or two hundred bucks an hour. And you know, that's pretty appealing if you're in your late 20s early 30s and like basically playing like a video game for money in your experience does dumb money dry up in politics. That might be the one exception. I mean, I think politics kind of almost selects for people who are in certain ways, kind of irrational, I suppose, although I would say, I mean, we're recording this about a week after Democrats decided to nudge their press.

1:04:45And then we had a president out of out of a reelection bid for their vice president instead, which was actually like a, I think a smart calculated decision that Kamala Harris so far is polling better than Joe Biden was. I don't know if she's a favorite against Trump, but she increases their odds. So that was an admirably probabilistic decision. I think that they that they made, which isn't always true in politics as much. What's the impact of AI on gambling? In terms of poker, I mean, you now have much more fast computer solutions. So that increases the potential for cheating, but also increase the potential to like train yourself really effectively to be able to actually go and use a computer program and practice in a laboratory environment where you can kind of play against a perfect opponent is pretty valuable when you're sitting at a real table against a very good opponent.

1:05:35And in some ways, actually levels of playing field a little bit, I think, in poker. In other walks of life, I mean, the scary thing about AI is partly that we don't exactly know why it works so well. If you talk to like the smartest engineers in Silicon Valley, they think it's kind of a miracle that chat, or other large language models are this kind of magic box where you can ask it a question and it will give you sometimes a really good answer, sometimes a less good answer, but it's kind of magic kind of passes the turning test almost people don't understand quite how just doing all this matrix algebra worked so well.

1:06:14And so it's a high risk, high reward thing. We might be in a climate in the short term where people over rate the capabilities of AI, that's kind of great leap forward. It's less clear to me that we're going to have continuous leaps forward. I think in some ways it produces a greater premium in some ways on human creativity. I think if you look at like AI art, for a while, I would use like AI generated images on my newsletter, you have to have like a photo that you caption that gets more signups, whatever else, right. But they kind of fall in the uncanny valley a little bit where there's not the intentionality behind a creative act that a human has and that cheapens it and debases it a little bit, right.

1:07:00If I go to Canal Street in New York where there are knockoff artists and buy a replica of the Mona Lisa, that's not the same thing. It's even technically a more better version of the Mona Lisa with more vibrant colors or something like that. I think it will force us to confront what makes us human in different ways. But I hope it kind of increases the value of human distinctiveness and uniqueness. I'm not sure it will, but that's what I hope people think about more.

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1:08:54Considering we don't know how AI works and how much faith is being put into it, how much do we know about how anything in the world works? Is AI a great example of how little we know? No, I think AI is unique in that respect. We understand how nuclear weapons work and we know that they're very dangerous, but we know exactly the physics of it to the point where, I mean, it was kind of crazy in a way, the Manhattan Project, where a bunch of physicists do a lot of theoretical math, and they detonate a plutonium bomb that, if it had gone wrong, could literally have ignited the Earth's atmosphere on fire.

1:09:33So that was very precise math. With AI, let's kind of have some relatively simple algorithms and just apply a shitload of computer power to the use and just keep it running for months at a time and see what happens and all of a sudden it's able to answer any question that you ask of it. I mean, this is very unusual for a technology. It's why there's a pretty strong consensus that we should proceed cautiously and carefully. Again, I know that there's any guarantees with AI. It may be that language is more mathematical than we thought, that language involves bluffing and strategy and ambiguity. It's kind of a game that we're playing the way we choose to speak, for example.

1:10:15It may just be that like language is kind of more like Chester Poker than we thought, but having some respect for the fact that this kind of magic box worked, I mean, you talk to engineers open AI to call it like a big bag of numbers, right? Almost mystically, we have to adjust our expectations for that and understand that if there's another big leap forward, we don't know what we're going to get necessarily. As someone who uses language both in speaking and writing, how close can you get to your inner experience through words? I think speaking and writing are actually quite different. Spoken English and written English are not two different languages exactly, but it might be like, you know, two different dialects at least.

1:10:58I kind of learned this when I had to recently narrate my audiobook, where some things come through a lot better if you're verbalizing something. You can give somebody an inflection or an accent, and some things are worse, like the beautifully written paragraph with lots of parentheticals, and M -dashes and things like that may not translate as well in linear kind of spoken speech. But look, I think writing is one of the hardest things that people do. Like almost nothing else, I found that I write a lot better when I'm well -sliped, and when I am able to block out other stresses, and like literally I might write like five times better under optimal conditions and so optimal ones, which is like not true for, I think I played poker five times better on a good day than a bad day.

1:11:50I'm a very verbal thinker. Apparently there are some people that don't have as much of an inner monologue. I think one thing we learn from chat GPT and large language model is that there are probably implicit ideas that we verbalize internally, but like the words are in approximation. If you have a thing where you can't quite put your finger on something, then that's because we have an imperfect representation of our image of the world through words. And we like stored data in weird ways. Sometimes we'll know that of this friend of mine, she's a female, and she's a five -learned name that begins with S, but you'll confuse like a Sarah for a Susan, or something like that for a Sally.

1:12:36I hope that one reason that we go slowly with AI is both to avoid the downside risk, but also because I think it says something profound about cognition and particularly linguistic cognition. What's decoupling in poker? De -coupling is the ability to block out context. So the example I gave in the book is that, you know, so Chick -fil -A is obviously a chicken sandwich restaurant in the US. The founder of Chick -fil -A is conservative politics, has been anti -game -erage at different times. So decoupling is be able to separate out two things that are not intrinsically related to one another, to say like, I don't like Chick -fil -A's politics, but they make a really good chicken sandwich.

1:13:19Do you have a politics example that like, you know, I'm somewhere on the center left, right? I thought Joe Biden did mostly a good job in his first term. I also thought that he was way too old to run for president for a second term. So that's decoupling, right? So we'll be able to say, let's uncorrelated these things and remove all the context that we have. And that's important. It's important to be able to, you know, analysis, the term analysis kind of comes like the prefix anal, right? It means to cleave things apart, just kind of literally what it means, and to separate things and disaggregate things and not have this kind of morass, where everything's about, oh, context and whatever else.

1:14:01It's like being able to see things for the underlying component structure, the underlying pieces that make them up. And what is consensus thinking? Consensus thinking is not quite unanimity, but it's a process that results from people having a conversation with one another and having ideally the wisdom of crowds. It's a fine balance strike like a lot of things in general, things like markets or a consensus mechanism, where markets are, everyone has their financial incentive to be correct. Markets are wise, most of the time, but when they're wrong, they can be really wrong because of group thinking, because of conformity and everything else.

1:14:39And so like where do you strike that balance between conformity and disconformity, between contrairinism and being just a jerk, right? Like that's, you know, I think the average person is probably too conformist. I think Silicon Valley gets pretty far, despite having lots of flaws, just by saying, let's not trust conventional wisdom, let's invest in these weird eccentric founders, who might be jerks, but there's a one in X -Chance that they'll build a new company, Facebook or Google, that's worth 10 ,000 times our investment. But consensus ideally should be like a conversational process. The consensus that emerged in the Democratic Party to replace Biden or encourage him to step aside, that was an example of a consensus that emerged through kind of conversation, because it wasn't one at first and then as people like evaluated more information and thought things through collectively and have this dialogue, then it emerged.

1:15:38How does it work in poker? In poker, there probably isn't a consensus as much. I mean, again, poker is very unique in that you are playing purely by yourself. You can be alone wolf. Most things aren't like that. I think poker players get spoiled sometimes and thinking how much you can apply that to other walks of life. You know, there can be like a consensus about how the community plays a certain hand. It may be that in a certain situation where a certain type of card is dealt, that the average player bluffs too often or bluffs too little. So you're trying to have, you're trying to train your implicit algorithm based on, you know, what's my image of how the average poker player would work?

1:16:18Then you might upgrade that to say, okay, here is a 55 year old guy with a baseball cap and a backpack or a 32 year old Chinese American woman or whatever else. You try to adjust and adapt to that based on your stereotype of how that person plays. But in poker, we don't need to worry about consensus, which is one of the nice things about it. Tell me about the shared knowledge in poker. You would think that if you had a system, it would be better not to share that information and to share that information yet. There are quite a few teachings on poker. Yeah, I think people have trouble, this is one reason why you can take advantage of them I suppose in poker.

1:16:58People have trouble keeping ideas to themselves, right? Which of course is good and creative processes like art. But in poker, I mean, this is also how journalism works by the way, that like people are really bad at keeping secrets. So like as a journalist, people will share things that's probably not in their narrow, best interest to share. And poker is kind of similar. If you're, if you're still at your craft and you've devoted a lot of time, thousands of hours, studying a certain craft, you think you have insights. Yeah, you can make money by like running a training site and getting clicks on YouTube or whatever else.

1:17:31But like people have this, I think, compulsion to share information that's I think deeply ingrained in our psyche on some level. Tell me about the psychology of bluffing. So when you're playing a poker hand, you're representing, you're always representing in poker, a combination of strong hands and bluffs. It's always kind of a multiverse that you're presenting to people. With that said, when to pull the trigger on a bluff can depend on the state of mind that you think your opponent is in. But you know, you have to also avoid being to risk averse yourself. One reason why some players literally randomized their action is to ensure that they bluff a proper percentage of the time.

1:18:16It can be easy in a moment to be to risk averse, but we know it's hookah players, right? If you are an old guy who sits down at a table or a young guy and you don't play a hand for two hours and then all of a sudden you go all in, we probably know that you have aces or kings, one of the strongest hands. And you say, and half the time the guys will show their hands, say, I had aces that time, we're like, we know, right? We know from your betting patterns because you never bluff. It is like literally the way poker works is that bluffing is what makes the game. So if you're not bluffing ever, then you're not playing poker properly.

1:18:51So if you're playing poker against a computer, does the computer bluff? Yes. In fact, computer is bluff at random based on the contents of their hand and not based on their image of you or whatever. But yeah, computers like bluff their faces off. They bluff way more than humans used to bluff. And so by studying computer solutions, people have learned it's important. Again, poker is game of bluffing, but also a game of information. So you want to conceal information and that means being unpredictable in poker and computers play very unpredictably and are therefore hard to play against. So would you say bluffing has increased in the game of poker since computers have been playing it?

1:19:31Oh, for sure. Yeah, people were not bluffing enough and now they're approaching the proper ratio of bluffs. But still 90 % of players don't bluff enough to encounter an over bluffer is a rare treat. But even then, even someone who bluffs too much. Number one, mathematically, the targeting dealt strong hands sometimes. So even if you bluff too much, you will have a good hands too. And number two, they force you to make decisions for a lot of money routinely. That's much less pleasant than somebody who is predictable and passive and conservative. If you were going to play a game of constantly bluffing versus constantly checking and playing safe, which would lead to a better outcome more often?

1:20:20Oh, the bluffing for sure, especially in poker tournaments where you have to take risk. If you play the World Series poker this year, you had 10 ,000 participants and the tournament lasts for two weeks. You have to take risks at several points in those tournament and put your life on the line, so to speak, by definition to emerge in first place out of 10 ,000 people. And like aggression and unpredictability is a much better failure mode in poker. Sometimes you may be making what's called a value bet, which means I think that I have a slightly stronger hand than you, Rick. So I'm going to wait your more money to try to extract a little bit more value out of you.

1:21:05It's an aggressive play. Now what you'll find is that you actually have a slightly worse hand than you, but the person will fold the better hand, right? Because they are intimidated by you. So therefore you kind of got the right outcome for the wrong reason. But when you take aggressive actions and you're active, you're making your own look a little bit. And you can make the right play for the wrong reasons and you still benefit from that. Or as if you're passive and letting other people dictate the action, then you can't really make your own luck as much. Why would you ever not bluff? A, because you know your opponent has a strong hand.

1:21:39B, because your image is poor and you expect to get calm. Tell me about the idea of your image being poor. People tend to overreact to small sample sizes in poker and much of life, as much as it's useful to like train unlimited information. So yeah, if you've shown a bluff within the past 15 minutes, people may assume at least amateur players, a professional would not make this mistake, right? But an amateur might assume that this player, bluff too often or sometimes there's reverse psychology that, oh, this guy just bluffed. Therefore he would never bluff again, sussing out the type of psychology, reverse psychology, reverse, reverse psychology is kind of one of those intuitive things you do from like thousands of hours playing poker.

1:22:23But yeah, people in it based on the, you know, all these semantic clues, the combination of you showed a bluff in the previous hand and you're dressed with a backward baseball cap, right? And you're drinking a corona and things like that. People kind of develop semantic portraits of people based on that.

1:22:45How many different games have poker are there? There are dozens of forms of poker, but there are two forms that are far more popular than in their form, which are Texas Hold 'em and then Omaha. Texas Hold 'em is two cards, Omaha is four cards, it's a lot more complex in that way. But those are games that involve the optimal combination of luck and skill, where good players win often enough to incentivize a class of professional players, but also the bad players have plenty of good days where the cards hit them right and they can go home with more money in their pocket. When you say two cards, how do you get a flush with two cards?

1:23:25I don't understand. So in Texas Hold 'em, each player has two private cards that are just their cards. I see. And there are five shared cards or community cards. You're making the best five card poker hand with your two personal cards and the five shared cards. And in Omaha, how does that work? A little more complicated. So now you have four personal cards and five shared cards, community cards. You have to use exactly two of your personal cards and exactly three of the shared cards to make a hand. So you can easily, if you're tired, Omaha, there are many different hand combinations you could have.

1:24:01You have to be careful. But basically you get nine cards instead of seven cards to make a five card hand, which therefore means that it's much easier to make a good hand. In Texas Hold 'em, making three of a kind is a very strong hand. In Omaha, three of a kind will usually lose. And when did Texas Hold 'em become the game? Gradually in the 1980s and 1990s, maybe later than that though. So Texas Hold 'em lends itself very well to tournament poker. Mixed for good TV where you can be forced to put in all of your chips on any hand. That makes for good television, makes for a lot of drama. And so with the poker boom years, I guess I should place this in like the early, lots, early 2000s.

1:24:46Texas Hold 'em was a very good game for TV and evolves this kind of wrist reward ratio that's like very, very appealing and dramatic for people. It was a story in the book about rock paper scissors and the use of a randomizer. And something about the odds didn't make sense in the story. So humans are so predictable. So rock paper scissors, the optimal strategy is just to pick a play, a throw, what's called at random. And then you'll win a third of the time, tie a third of the time, and lose a third of the time. When human beings try to play rock paper scissors against a computer, the computer wins about 50 % more often than it's supposed to.

1:25:26Because humans are so bad at randomizing their behavior that like it's very predictable how humans behave when they're trying to actually be random. And this is like how like fraud is detected. If you look at some foreign country and where elections are rigged, right, Iraq under Saddam Hussein or something, and people will try to come up with a bunch of fake numbers to represent different precincts or districts or whatever else. They're actually very bad at that, right? And they'll have like too many numbers ending in 9s and 7s and things like that and too few ending in 0s. And so we leave a paper trail whenever we try to randomize unless we're actually literally behaving at random.

1:26:08Tell me about the banter at a poker table. There's a lot of talk about certain subjects, a lot of talk about poker itself, which sounds obvious, right? But I've like never been involved in a hobby where people talk about the craft out loud, maybe more than poker itself. That's interesting. There's talk about cryptocurrency is a big subject in poker. There's usually talk about politics, which I try to avoid, but can't always, you know, more and more. There's talk about health and fitness, I think for a long time, poker players have the stereotype of being schlubby, smoking, drinking, eating donuts and like people have learned that physical fitness matters a lot in poker.

1:26:47There's, you know, fairly often talk about like psychedelic drugs, which might not seem like a big overlap, but these are people who are, you know, kind of on the margins of society, but also pretty smart, attends to overlap with interest in these different types of topics. And so, you know, poker is predominantly male, about 95 % male. There are some terrific female poker players, including my kind of like podcast, kind of co -host, Maria, kind of, Kovah. But I think poker appeals to men in part because you can ramp up and ramp down the level of conversation that you aren't, right? It's socially acceptable to go to a poker table and be very talkative as long as you're not obnoxious or to be more quiet and just kind of observe and participate more passively.

1:27:31Would you say that the banter is usually just chatter or might it have some psychological purpose? The professional players very well might have a psychological purpose in mind. Just being friendly and opening up to people, people will reveal all types of things that it's not in their interest through reveal. Which by the way, if you're playing like a low stakes game, just go ahead and be friendly. It's not going to make that much difference. But just being chatty can help a lot. Maria Ho was another very good poker player and she has a scenic ability to to be fully engaged in conversation while she's concentrating, right?

1:28:11Most people, including me, can't necessarily do that in a high stake situation. So just another way to like disarm her opponent and get information out of them. You know, sometimes I'll ask a question that's like literally meant to break somebody's shell and put someone at ease or break the concentration flow. I'm deciding whether to call a bluff or not, right? And I'll say, are you French? For example, French poker players have reputation being kind of wild and bluffy. And the actual content of the questions irrelevant, maybe I know the guy is French. I'm just trying to see whether he's at ease with a disruption in their environment and the kind of contents of the question don't matter very much.

1:28:58So yeah, you develop a lot of like little curve balls like that to try to learn things from people. What are some of the sort of obvious distractions that might happen at a table? I mean, one problem is that you're playing poker in casinos most of the time and casinos are extremely noisy environments. They're like slot machine jackpots and alarms. There's the nightclub where you have scantily clad women going by and whatever else. Lots of sound and noise and kind of light and fury and so learning how to block out those distractions is important. It's considered bad etiquette to like intentionally distract your opponent, you know, poker players.

1:29:41We are kind of tradesmen or tradeswomen in a way is poker players. So etiquette matters, I think, in poker. But yeah, if you're in a casino environment, you know, the first place I went after the pandemic for the book was a giant casino, the hard rock seminal casino in Hollywood, Florida. And like, you know, a casino in Florida is every bit of the glorious like shit show that you would expect. And so you get pretty used to being focused on this mathematical and human decision you're making despite the distractions around you. Do you ever choose a move that goes against the odds just because of an intuition or a feeling?

1:30:17Absolutely. And the better you know the odds though, the more you know how much of a deviation it is. If the math says that I have to fold this hand 100 % of the time unless you have a physical tell in your opponent, then you should probably still fold, right. If the math says that 80 % of the time you should fold, but 20 % of the time you should call because your opponent might be bluffing too much, then you might use your intuition to say, this is one of the times I'm going to take my 20 % right. Something I feel intangibly or tangibly about the situation feels like that's going to I'm going to pick this play that's rare, but not totally outside the boundaries of the math of again.

1:30:58Are there ever any examples where it's totally outside where 100 % of the time you're supposed to fold, but for some reason you have a feeling I want to play this hand. Maybe three times out of a year playing poker, I'll just feel so strongly about something that I'll make a play I know would be grotesquely wrong in a computer simulation as opposed to being on the margin. Give me an example of what could get into you that would allow that behavior. I mean, I remember one hand where like I paused for a while and like, you know, trying to say if an opponent was bluffing and he was like literally almost turning green right he was so nervous.

1:31:37A case like that, that was enough information revealed where I was pretty confident about about the play is the amount of time that you wait before you play giveaway too much information. It can I tend to play pretty quickly I find that like if you do trust your intuition then you can sometimes talk yourself into an action which isn't good like one thing particular I sometimes have an intuition to fold and then we'll talk and you're kind of rationalizing instead the fact that like oh because it's boring to fold you don't get the thrill of seeing what cards your opponent has you give up on the chance to win the pot and to make money and so folding is intuitively not very satisfying and so if you kind of like think through a problem then you can sometimes rationalize too much.

1:32:45I've tried to slow down a little bit when I play just taking a few seconds to pause and consider your action I think can be a good habit but I play pretty fast and usually fast player for someone who's seen is being pretty mathematical. Is there ever a time when it takes you time to make a decision as opposed to being able to play fast. So sometimes more information is revealed if you're playing against an amateur player then courting them in the hot seat for a couple of seconds or a couple of minutes rather and seeing how they react can be valuable sometimes you can explicitly do math right you can say let me like literally quantify what are all the hands that they might have and what is the size of of the bet relative to the pot and do I like literally have the odds to call.

1:33:36So those are like the two circumstances basically but you're trying to do a lot of your kind of subconscious processing before you make a decision because you are giving away information if you take two minutes to make a decision first of all they can like call the supervisor and say you're taking too long now it's time to go you know make a decision now we have to fold so there is eventually a clock literally it will be called on you you know I think I like playing poker in a little bit more in flow and that can mean more rapid and you kind of use. You're longer decisions for times when you think your opponent might reveal more information how quickly from the time that you first look at your cards do know what you're going to do so for me I try to wait until it's my turn to act and see what my opponents have done and then decide which is maybe unusual I think some players are trying to like anticipate from the first instance what they'll do next but I like to play in flow a little bit more it's interesting because if you like a computer I mean these computers now can give you.

1:34:36You very powerful mathematically accurate solutions but they take several minutes to come up with with an answer or at least they used to now with AI that can make shortcuts that are faster but like formally solving a poker hand with an algorithm can take minutes hours even to get a very precise solution and yet human beings process of stuff in seconds before giving away information so like so the math is actually very complex and probably some part of your brain. The third question is doing some matrix algebra across with pattern recognition somewhere and just like when you have a feeling where you can't recall something you forget all I made plans on Thursday and forget who I made plans with and then the answer kind of like pops into your head five minutes later there's some element of that I think in poker where some part of your RAM your CPU is solving a hand and then you discover it later on.

1:35:33But like I said, I mean live poker right I I also believe in the power of intuition Walk me through an entire hand. How did the cards get dealt? So at first in Texas hold on which is a game I play overwhelmingly more than any other game each player is dealt to private cards and they act clockwise. So there's a dealer the player to the left of the dealer acts first By the way position is very powerful and poker. It's game of information if you act last in poker It's not a first move revenge is a last move revenge actually in poker see what Emory else does and then you get to decide how to act So there's a round of betting you can always have three decisions You can you can call fold or raise at this point you've only seen your whole cards You don't see the cards that everyone has that's right and maybe a third of the time the hand is actually over before there are any Face -Up cards somebody raises I have Ace King in good hand like that everybody else folds or I raise You re -raise and I fold so maybe a third of the time you never actually see any cards face up It's purely based on the clues people are giving with their betting and sometimes also verbal or physical patterns And there's never a card scene face up until at that point so the first thing that happens is to cards a dealt and then people bet Based on those two private cards right I mean the first time I play Texas hold in my thought it was like a miracle How can you have a game of poker where you're like where this whole most important round of betting actually that Three flop it's called betting round is probably the most important Jumping off point for a poker game and you have people making assists for thousands of dollars where Where there's never any kind of public information revealed except through their through their betting patterns and their other physical patterns And based on the two cards that you get you pretty much know automatically what you always do Usually not one irony of what computers have taught us in poker is that most hands involve what are called mixed strategies which means that you know if you have a hand like let's say 10 -9 of diamonds which is a hand that can make Flushes and Straits but doesn't have any aces or kings It's a speculative hand that can sometimes Luck into making a very good hand and somebody raises Before you have a chance to act a Computer will say sometimes you're supposed to call Sometimes you're supposed to fold and sometimes you're supposed to re -raise because unpredictability is so important So you know you might think if computers is being very deterministic and definitive But they actually say that like you have to actually behave Literally at random sometimes is that the same as saying there's no right answer?

1:38:17Yes, it is saying literally it's saying that you're indifferent which in game theory terms means that the three answers have the same expected value there's some life lesson in this people tear their hair out about these kind of really close decisions When sometimes you're just indifferent just do whatever you feel like right or flip a coin and decide at random most decisions in an efficient Pochart economy or an efficient economy you are probably are probably pretty close Why would we assume if it's a random choice That making choice a every time is the wrong thing to do so this is where it gets a little complicated Let's say there's a certain hand where half the time I'm supposed to bluff and half time I'm supposed to give up in fold So on the one hand to anyone instance It's 50 -50 However, if every time I face that decision I always bluff or always fold Then I become too predictable which is why it's important to literally Randomize or at least be self -aware enough of like what are my overall tendencies or frequencies?

1:39:24Hooker players call them in terms of you know, am I airing too far in one direction or another? Okay, so the two cards have been dealt you bet the first time what happens next So now the maybe the most exciting moment in poker is Three community cards called the flop are dealt all three at once one two three Oh, it's kind of what's called the flop you like kind of flop down the big board of cards basically and so yeah you go from having Zero information about shared cards to three cards now and so this kind of Radically make some hands go up or down in value and you have another betting round and yeah So the betting doesn't happen after each flop card only after all three are turned over Only after all three I see you go very quickly from having very little information to having quite a lot of information, okay, and unsurprisingly this can Cause radical turns of fortune where you thought you had a great hand But now all of a sudden you're probably have a flusher astray and it's a reorientation of of the world When does the betting end so there are four betting rounds so before the flop After the flop when three cards are dealt Then the turn card is the fourth Community card that's dealt and the turn is all about all about leverage If you had a small advantage before Now is when you turn the pressure up and make a larger bet There is still some element of chance There's one more card to be dealt the river that we'll talk about in a moment But the turn is all about Pressure and and leverage it's a pivotal street is like I think they're right the right word for it Okay, so the fourth card gets turned You bet again and then then the river which is the name of my kind of world in the book But the river is the fifth and final card in Texas hold them And then poker cramps forms from a game of randomness to a game that's actually fully determined All the cards have like literally been dealt.

1:41:21There's no more random element in the game And so now it's the kind of mano a mano or person versus person confrontation test of Will's and insights and are you bluffing or do you actually have the hand that you're representing and if you don't Call or raise You don't get to find out what the other person has is that correct You don't and that curiosity gap if you if you fold then Then you don't although along with the theme of people Giving away information for free The some people Can't resist showing you a bluff or can't resist even kind of Being a friendly human being and saying oh you made a good fold right it might be to encourage you to make other fold in the future It might be just because they're friendly so those sometimes voluntarily show you the cards but the The curiosity gap if you call people are required to show you their hand or require to say I was bluffing and throw their hand away So at least you get the satisfying outcome that curiosity gap probably causes people to Call more often than they should do you find yourself in that position or no?

1:42:29I'm sure I do. I mean yeah a lot of players Probably call too much and I'm probably One of those lot of players that calls too much. I'm trying to I'm trying to fix that But the desire to like gain more information and learn what your opponent had can be Can be hard to turn off remember one hand where like My opponent Was giving away very strong physical tells he was like slowing down way too much and being much too deliberate which is often a sign of having a very Strong hand and I had I had a computer. I would have to call with And I got level like I I kind of knew that he wasn't bluffing And I still call because I was so Proud of my read I was wanted to confirm How good my intuitions were and they were right and it was knocked out of the tournament as a result So it's like an $1 ,100 indulgence mistake basically was a $1 ,100 tournament just to satisfy my curiosity Typically how many people are in a game typically anywhere from eight to ten There are also short -handed forms of poker.

1:43:37She can play heads up which is two players or six max You know in general The fewer players the better I think if you have ten players just like Very literally a lot of waiting around and doing nothing So if you're playing if you're setting up your own game in your backyard then Then probably you know no more than eight players maybe closer to six is better if you invite 12 friends over to play poker have two games of six and not one game of 12 like it's very very slow and very boring Tell me about your emotional state after a session of winning versus after a session of losing when you win, I mean you can be very jazzed up for period of time it can be a feeling that's euphoric but also you're experiencing a physical response gambling for high stakes will and should give you a physical response one of the people I Talk about in the book is a guy named John Coats Who was a derivatives crater at I don't know where Deutsche Bank, I think and had been an academic Witten to Wall Street and Thought these traders that I work with are total freaks They're making these gigantic bets and they're kind of crazy and kind of nutty and started trying to study the physiology Of traders in a Wall Street trading desk and he found that the people who had a higher Stress response actually were were better traders believe it or not Now they were able to channel that into thinking very efficiently under stress Into learning how to get the feedback their physical body was giving them and combine that with the math That's very again very poker like I think a lot of these things are about 80 % Mathematical routine and 20 % intuition under times of stress and uncertainty So if you're playing a high stakes game then you'll you'll be jazzed up you may need some time to decompress Poker also if you play the world's here's a poker then you might play for 12 hours a day It's actually like it's physically demanding one reason why These days most poker champions are younger players because like it actually involves physical stamina That's why actually some poker players eat healthily these days If you lose then just go on and do the next thing in your life whatever makes you happy treat yourself to like a nice dinner You know to some extent dwelling on and revisiting Hands can be helpful to some extent.

1:46:07I mean sometimes you know Go and say okay I made this big bluff and it didn't work now It can go like kind of look up the answer in a computer and say okay At least did I mathematically make the right play and you kind of like comfort yourself through that But in general what's passed is passed and resilience is important Especially if you're in a hand where if you lose half your chips half your stack Amateur players sometimes go on tilt and lose their shit and lose their entire stack a guy who was a big chip lead In a major poker tournament and he's having the time of his life and then he loses a bad beat or something I mean that player can be very vulnerable to To going on tilt so like Steadying yourself.

1:46:51Maybe you give yourself 30 seconds or something but you have to get like back in the saddle Very quickly when you have an unfortunate or losing hand and that's I think a pretty valuable life lesson How much does winning come down to the cards you're dealt and how much does it come down to You reading the other players in the short run the cards matter more I'd probably give the 80 20 Ratio again. I mean part of what poke makes poker appealing is that like I'm not very good at basketball to begin with right but like if I go and play In the world series of poker I can be sitting down with You know fill ivy or Daniel and gron you or Maria Ho were like the best players in the world literally are playing the same tournament as I do If I go play pickup basketball I'll never get to play against Lebron James or or Stefan Curry right now and pick up basketball There's a 100 .000 zero zero zero percent chance that I will lose a pickup game to Lebron James in poker even a mediocre amateur player Would beat the best player in the world 20 % of the time or 25 % of the time and a player like me who's pretty good Almost professional level, but certainly not fill ivy or someone I might win a third of the time.

1:48:09That's what makes poker Kind of democratic and participatory is The ability for any one player through the look of the draw to be any other player on a given in a given poker session What's the Nash equilibrium the Nash equilibrium is named after the Princeton professor John Nash who was Russell Crowe in a beautiful mind Which is a game theory solution which explains What is a solution that results at everybody is playing their hand optimally One canonical example is called the prisoners dilemma where If you and I Rick are both jailed and charged with the crime And we can cooperate and get a shorter sentence or snitch on the other person And if I stitch on you and you don't stitch on me then you're screwed or otherwise you can screw me over and vice versa The Nash equilibrium in that solution says you're supposed to actually snitch at the other person and like not cooperate or the Nash equilibrium in nuclear deterrence theory says that fortunately we shouldn't Pull the trigger and and fire a nuclear weapon at Russia because then they'll strike back at us and everyone will be dead right So it's a game theory optimal solution that results when we're each playing our hand individually and not Cooperatively and the quarter parts important oftentimes if we do cooperate We better get a better outcome which is why trust is important and why Ethics are important actually ironically When it's every man for himself everyone winds up worse off sometimes What is a cold deck a cold deck is a situation where You suspect you're being cheated and I mean canonically it happens when When you're winning a bunch at blackjack or something like that and the casino Decides they want to win their money back so they'll put it in a deck that's like been rigged in their favor This does not happen very often in big American corporate casinos It's a very highly regulated industry So in public poker games or casino games You probably should not worry greatly about being cheated in private games Maybe you shouldn't being being cold decked is one term for when you're being exploited What's the last time we know of a casino cheating Look, I'm sure it's happened in individual instances what it often is is a casino employee collaborating with a player to cheat there was a scandal at the belagio some years back The last mob scandal in Vegas.

1:50:50I think the start -ust Had some profit skimming scandals that lasted until about the 1980s But for better or worse like everything else Commercial gamblers become very corporatized there are Literally people that work for hair as or scissors or mgm That hire like aerospace engineers to develop algorithms To tell you how to like gamble more on slots right they know how to manipulate the payout probabilities so that you win Just often enough to keep you coming back and it's a kind of metaphor for Capitalism and some of the more predatory forms like esophage capitalism Tell me about the anxiety over a dealer switch So this is kind of I think mostly an unhelpful superstition where people will sometimes try to change Their luck by asking for a new dealer But the reason why actually in both poker and Casino games like blackjack The dealer will be switched up every half hour if not more often and this is a device to prevent collusion and cheating A lot of the procedures that you see in poker game are meant to prevent Cheating and you might ask why they exist.

1:52:03So for example Why are poker cards so cards are either red or black you have black clubs and spades and red diamonds and hearts Why not have Four colors instead right it might seem more intuitive to have like four colors The reason why is that if player is cheating and trying to see the cards as they come off a dealer's hand Then having two colors instead of four Is harder to detect and also red and black are actually Both dark colors that look fairly similar under dim light and so therefore everything that's a way to prevent Cheating or unintentional revealing of of information There's a story in the book we talk about test with four decks and unconscious stress being recorded Yeah, it's called the Iowa gambling task where they would simulate they did I think originally with like actual decks of cards and now with computers Where people have to pick from like four decks of cards and some decks are unlucky and have lots of bad outcomes and some are kind of slow and steady And after maybe picking up five or six cards from each deck you begin to detect the pattern.

1:53:15It's not that subtle But what the experiment found is that people begin to develop it an intuitive dislike of the unlucky decks Before they actually consciously process that right that they're playing on the computer you can like see their mouse cursor scrolling over toward The more benign decks and not the unlucky decks you can see what they're doing with their eyes and things like that Because again, we have like millions of years of evolution where it's a fighter flight response Fast switch quick reflex Under conditions of stress where you have to react quickly and so our intuitions and our bodies actually actually teach us something I understand what you're saying if we don't have Intellectually enough information to make the right choice How could we intuitively make the right choice before we have the information we need because we we exist in three dimensions You know the most important evolutionary condition for human beings were not particularly Strong species was movement The ability to move around to find food or to get away from stress or from predators or to find mates or things like that or Or change houses when the seasons change So that physical system actually still provides with a lot of information that the tuition by the way brick that I'm like a little skeptical about How far AI systems can go when they don't have physical bodies and don't have physical inputs that they're accumulating from the world So yeah, I just saying not everything in pokers on the side of things where Deliberate Daniel Coniman called it system two processing words deliberate slow thought that is very valuable and that is A lot of it, but look a poker player should use all the information that she has and that includes information that she picks up Through her body as well as deliberate thought from from her mind What are some of the most counterintuitive things you've learned From the time you originally started playing poker until now I mean, I think at first the notion that like that bluffing is not just optional but mandatory I mean, I think that takes a long time to learn One poker trait that's also a good life lesson is what I call razor fold So there are three basic actions in poker you can raise and up the stakes You can call and maintain the sentence quo or you can fold and opt out of the rest of the hand If you play like you know an amateur poker game I will sometimes deal like a backyard Game and Brooklyn we've never played poker before Their mistake is they call Take the middle ground way too often Instead of the more decisive actions of raising or folding and I think this teaches us a lot about life where We are too willing to model through in a situation where we'll be fine Especially if you become accomplished and privileged then you can Model through and not make changes But sometimes the middle ground is the worst ground I think for example to bring in a slightly politicized example, but during COVID Instead of taking Boulder strategies and saying okay, let's really kind of knit this thing in the bud Or let's acknowledge that people have to have some type of life balance here.

1:56:31This is going to persist for a long time We went back and forth and tried to have it both ways and wound up Both having a lot of loss of life and a loss of freedom and economic well -being and other types of well -being and so There's a lot of value sometimes I've been willing to to fold or to quit and to take a bold Course of action that I think people are Are too reluctant to apply sometimes. What is poker face poker face is your ability to maintain a neutral Expression and not reveal information in the face of Of stress or in the face of having information that you don't want to reveal It's something that Poker players begin to do and sink to leave you are playing one of these amateur games.

1:57:14I play in some like amateur tournament against like New York finance guys, right? And they have like The worst poker faces in the world What most people do intuitively is Act the opposite of what their hand is and that becomes very predictable, right? So they'll scratch their chin if they have like a really strong hand Thinking they're being tricky and and trying to trick you But of course if you have any intuition for human behavior at all You'll detect it. They're doing the opposite. They're lying to you, right? And so therefore You can give off intentional fake tells meaning Fake information that people might mistake for real information, but you generally don't want to do that Have a routine apply the same process every time Look at your cards in the same way put your chips into the pot in the same way And avoid giving away information because your opponents are smarter than you assume and you're usually only hurting yourself What do you talk about in the book when you refer to white magic?

1:58:14White magic is a term self -applied by a player named Phil Helmeth A legendary player. He's won 17 world series of poker bracelets. They're called what you get for winning an event A very egotistical player. I find filled slightly charming Some people find him fairly annoying, but white magic is his ability to kick up on intangible reads of people based on his intuition and his Experience he's very very very chatty and Talkative and some people would say if you're listening to this film. I'm sorry Some people would say annoying as well. So he's trying to provoke people into breaking their poker face and revealing information And some people can't control themselves and often do that and so he He's a player who relies very heavily on intuition He is criticized for not being as mathematically advanced as other players But in certain environments, especially against amateur players He has an a canny ability to read them and to unsettle them.

1:59:20Have you experimented with meditation at all to improve your poker game? I haven't and I think I probably should the closest I come is that if you're going for a run or a walk. I think that can help a lot I think you know you get breaks every Two hours in a poker tournament. You'll have like a 15 minute break, right? some people like to go and Chat with their friends when that happens. I hate doing that. I like to Walk around and contemplate a little bit myself instead, but no, I'm sure meditation would be Would be very helpful. I mean, you know, removing extraneous distractions. I mean you learn playing poker that like stresses that way on you If you're in an argument with the friend or a partner or a parent or something That has a way of budding you in the ass If you're hungry or tired or restless that has a way of of catching up with you sooner or later if you secretly don't Want to be there if you're bored and the back of your brain is kind of like you know what?

2:00:32I don't have very many chips anyway. I would have a higher expected value by going and having like a Sushi dinner and a nice glass of sake or something Your subconscious will find a way to kind of guarantee that you that you lose and so Yeah, I think the idea of Avoiding attachments would be very valuable, but no, I do not meditate myself You mentioned a book from the early 2000s on luck And you said that you disagreed with how the book defined luck And it defined luck as some sort of optimism and you see it in a different way So I think the author of that book calls a lot of things luck that are really being opportunistic the economist term is having Optionality you want to have a lot of choices if you walk down a hallway where there are more doors You one of those doors might be open and you might have an opportunity to take advantage of that when you when you wouldn't Later on you know being in an environment where there's a lot of stimulus or stimulation I mean, I think I think Rick I was maybe in your book I was reading the other day and like you talk about this as part of the creative process a little bit where you never quite know Where inspiration comes from but it can be from Taking a walk or from a conversation, you know, and then like to have Optionality to have serendipity in your life.

2:01:54I think you can kind of you know quote -unquote Make your own luck a little bit. What is beginner's luck and is it real? It's real in the sense that Luck exists right you can have a situation where where you happen to have a good Turn of fate or turn of fortune You know there is something to be said for the notion of Sometimes somebody who doesn't know what they're doing Actually is more unpredictable Because they'll make a play they don't know what the right play is and therefore They can wind up unintentionally Playing like a very good player because the good player and poker Knows how to randomize and how to be unpredictable so there's something to be said for that But in general poker has a steep learning curve.

2:02:41It's a technical game It's a game that benefits from experience and so Why the game survives is Kind of a mystery to me because you generally get your butt kicked When you're an amateur an experienced poker player by definition actually players who survive or probably players who do have beginners luck And get lucky in this period where they're probably Nine hums out of ten supposed to lose money And they kind of pull the lottery ball out or the one time out of ten and start playing pretty well from the start and then Before they know they're actually good and then start to become a winning player But yeah beginners luck is is luck But it's very helpful to have and put you on the right trajectory is poker the most popular of all gambling games No Poker makes up about one percent of Las Vegas casino revenues wow the most popular casino gambler game unfortunately is slot machines Which are also the worst game for the player of every $100 that you put in a slot machine Then Vegas takes about nine bucks or ten bucks out of that hundred dollars whereas in blackjack They think about one dollar out of every hundred dollars that you bet the expected value of that bet So yeah, if you learn nothing else from the casino chapter in the book Don't play slots slots are a bad game for the player and they're also engineered To manipulate your Failures of probabilistic reasoning.

2:04:05They're engineered to Maximally make you keep betting until you lose all the money you brought with you Have you ever lived in Las Vegas? I haven't I like Las Vegas quite a bit It's a unique town where I think people are kind of authentic The kids themselves are like a fastening kind of cross -section of America But you get off the strip. I mean you have like a lot of like working -class people It's very ethnically mixed. There's actually very good food in Vegas The weather is awful for about three months out of the year in july august But actually very pleasant low humidity for the rest of the year I like I like the American West in general and I like Las Vegas, but my partner likes Likes water, you know likes Beaches likes things like art and culture that you have some of in Las Vegas, but but it's it's an acquired taste I think And tell me about the place that you gamble in Las Vegas So all over the world here's a poker is held at at the Paris casino Which has like a replica Eiffel Tower.

2:05:11I mean a lot of Vegas is very tongue -in -cheek. It's objectively ridiculous to be in like a replica Half -sized Eiffel Tower or to have fake volcanoes exploding or they have this giant sphere now It's actually quite impressive architecturally So you get very used to just Being in your zone and and walking through the lobby where there are ridiculous things happening and you see kind of all the Bachelor ofette parties and all the tropes and it forces you to be very focused Do you know anything about horse racing? Very very little I went to aqueduct racetrack to do a photo shoot the other day and but yeah apart from that have been to a racetrack like twice I think in my life And what about other types of sports betting?

2:05:53So I Do some sports betting. I'm a big NBA fan in particular For the book I undertook an experiment where I bet what wound up being a total of about two million dollars on the NBA One season. This is not two million dollars at once. It's like making you know a thousand one thousand dollar bet So it adds up to being quite a bit Yeah, I'm a sports fan and I'm competitive so I find sports betting fascinating The big thing I learned in running the book I didn't know beforehand is that if the casinos the betting sites draft hangs for example if they think you're a winning player then they'll BAN you or limit you to betting only a few dollars at a time.

2:06:34So it's a little bit of a I mean rigged is a little bit too strong of a term. I don't want to get Get sued or anything like that But they only want losing players betting with them And so if they're taking your action you should ask why that is why are they taking this bet if you expect to win Well probably you're you're fooling Yourself in some capacity What are the other things that people bet on well people increasingly bet on politics Through things called prediction markets And I should say full disclosure I consult with a prediction market site called polymarket So I have equity in that company When Joe Biden had his difficult debate in June Instantly within 15 minutes traders at prediction markets began betting that Biden would then Drop out of the race which it took almost a month but but later on he did So yeah and look the stock market is a form of Gambling I mean obviously cryptocurrency is a form of of gambling Yeah, people bet on lots of things it just that we only call certain things gambling and Just because it's not in a casino doesn't mean that you're not undertaking the same process although of course Investing the stock market has like a positive expected value you make money 8 % per year Over the long run which is pretty good and so Yeah, play the stock market if you've had the gambling urge then Pick some companies and invest in them and that's better than playing slots for sure is most online gaming Done by offshore companies most of it so in poker there are a few states now I think Nevada, Michigan, Pennsylvania, New Jersey Where they have legal poker, but yeah, most of it is very much in in a gray market And historically those sites have had histories of folding up overnight of Of having cheating scandals of not being very well regulated Yeah, a lot of gambling types are kind of Libertarian and don't believe in like the heavy hand of the government.

2:08:37I'm semi -libertarian myself But you actually want regulation of gambling or you'll get cheated. I mean for many many years poker was known as like good a cheaters game. It's like only been in the past 30 or 40 years maybe even shorter than that where Most of the time you can be in a safe regulated environment where people win your money Fair and square, but yeah, regulation and gambling are simpatico and they should and you should want anal -retentive regulators like you know, I talked like Nevada gaming board, right and they're like basically like Literally ex -copts a lot of the time. They're like no every statute and every law You want people who like that or who are really strict because like a little bit of cheating turns into a lot of cheating Really fast and your edges are small in poker So even a little bit of cheating can can make you into a losing player What is middling?

2:09:33Middling in sports betting is the act of betting on both sides of the game Where you're guaranteed to win either way because you take advantage of different point spreads It's a form of like arbitrage to use the kind of Wall Street term So if I bet on the Kansas City chiefs At minus three which means that you subtract three points from their score. They're the favorite at one site And then a bet on the 49ers at plus five mean they're a five point underdog at another site Well, if the chiefs win by four points exactly then I win both bets. I've hit the middle Otherwise, I just break even so I get my money back basically So yeah, it used to be that 20 years ago the market was so Inefficient that you could sometimes just look up different casinos and have a guaranteed profit through arbitrage alone those days are are pretty much over now You know if there's free money lying on the ground then Somebody will pick it up and so now you have to work much harder to have an advantage in sports betting How are the sports lines determined by the people who make them?

2:10:42So initially it's basically like a series of like Nerd sitting in a boiler room somewhere and it'll be you know the NFL schedule will come out for the next week I'll know the schedule I suppose and they'll probably look at some computer model and then have a conversation So should we make it you know packers by three and a half or four or whatever else those initial lines are actually Not very good Because it's just like one or two smart guys having a conversation and giving a first estimate The reason why betting lines are tough to beat is because People reveal their hand and you have skilled betters betting into those lines So if I say that line should be four points and not three I'm gonna bet $10 ,000 now on the packers well The casino knows that and then will then Adjust their lines accordingly.

2:11:32So it's like not that hard to beat some you know random college graduate It's really hard to beat the consensus of all the sharp sports petters in the world Who reveal through their preferences who they think is gonna win meeting the wisdom of crowds is Is quite difficult most of the time. So it's basically crowdsourced Absolutely. Yeah, that's interesting and that's one reason why so I talked about how like you know some sports books like graph kings will not take Action from smart or the term and gambling is a sharp better a sharp better as a winning player But some old -school bookmakers believe in crowdsourcing They'll let me bet say a thousand dollars on an NBA game Knowing I have some theoretical edge on that bet Because by game time they're taking 50 million dollars in bets from amateurs who are drunkenly walking through the casino or or Going into the game and want to bet a thousand bucks in the Celtics because it's gonna be fun or whatever and so So they are basically kind of paying you an expected value for the information but yeah crowdsourcing is the key to To bookmaking how has the fact that you're a Known statistician on television impacted your book or life out in the world poker players are very Observant so being aware that and I won't necessarily say I mean the smart -of -book players will not reveal how much they know about you but being aware that That people will have preconceptions about you when I kind of start to playing a lot more live poker for the book I think people assume no he's a statistician therefore he must be very cautious and precise and therefore he probably doesn't bluff enough So for a period of time I could like get away with like bluffing constantly and people wouldn't catch on but but poker players are observant once I began to play more They played against you before or they know your reputation.

2:13:24So so now I try not to exploit that image as much and being aware that like I know who you are your another player We never had a conversation right but I might know who that player is they know who I am We've never had a conversation in our lives and they'll say a nice hand Nate and I'll say oh nice hand Steve Or whatever and like it turns out that we knew each other the whole time new a lot about one other I just didn't want to say anything about that to pretend to kind of bluff as though we were naive about who the who the opponent was How often do you play once every couple of months in terms of like going to a tournament?

2:13:59I mean, it's been less this year with the book coming out and an election year. I mean the one downside to poker goes that It's a very time -consuming hobby a poker tournament Can last at a minimum usually several days. So So you have to kind of block your schedule out I mean, it's the opposite of a meditation retreat in terms of like the degree of call that provides you It's a stressful experience, but like it's nice to like actually block parts of your calendar out and so this is kind of Time for me. Of course like when you go to poker tournaments like a lot of my friends and poker players you're a little bit like part of a Traveling circus.

2:14:35It feels like you see the same friends in Vegas and and florida I played a tournament in Paris earlier this year, which was kind of wonderful in a strange way But yeah, I love playing poker But there's an opportunity cost in terms of it's probably not the most economical use of my time So even though you have left 538 you're still continuing on your political interest in statistics Yeah, I mean that I had some notion of escaping From politics, but I got caught up in it again. I suppose I mean, I'm also trying to build um of a newsletter called Silver Bulletin. I'm trying to build Building audience for that.

2:15:17I mean, I look I one thing I found is that like working for this giant kind of corporation Where I don't really I don't really own my own work product. I was spending a lot of time Doing things I didn't want to do it was owned by ABC news which Is a proud network, but the average ABC news viewer is like 70 years old or something. So About half the problems I had my frustration with covering politics was actually about the Value in which I was doing it and now that I'm back on my own I've found I've been like reinvigorated in a lot of ways, but you know look. It's a calculated Risk I was out on a limb early in the election by saying I thought that Joe Biden was too old then this was really hurting him in the polling and his chances of defeating Trump And it turned out that that was right and he actually exited the race And you know being able to speak to a smaller audience But a more self -selected audience I think is valuable and so I felt I felt very reinvigorated by it But I'm looking forward to November 6th the day after the election or maybe November 10th it'll probably take a few days to count the votes When I can kind of put politics aside aside again, but for the time being I'm very All -in on kind of gambling on myself.

2:16:31So to speak I guess and maximizing for this election What are the strangest things you've seen people bet on people will Make what are called prop bets on almost anything One player I know named Dan Smith Made a bit with a much more athletic poker player and a tennis match except Dan got to use a tennis racket and The opponent had to use a frying pan instead to play tennis and still beat Dan it turned out One famous prop bet from back in the day is a poker player bet another player $100 ,000 to get a male player to get breast implants And keep them for a year and the player turned out to like the breast implants and kept them permanently It turned out The term degenerate or degenerate it's usually shortened to is actually a term that's used with like with some affection In the poker community from like playing what's called credit card roulette So you go out to dinner with six players you get some nice sushi or something you have a $2 ,000 bill Well instead of dividing the bill You'll have the waiter or waitress pick one credit card at random and stick somebody with the whole bill That's a kind of poker player credo or code is to Insert variants and landeness and luck and gambling into into everything that we do Does ideology ever bump up against statistical thinking For sure crystal nobody nobody is objective We all have our biases created by our experience and The smarter people are including people who are smart statistically can Can be very creative about lying to themselves can be very creative about Confirmation biased So it's very difficult to actually Achieve some approximation of objectivity actually one reason why betting on things is worthwhile and good Is because it forces you to have skin in the game and bear consequences for for your biases basically So you know more than once I've had somebody who I think is making a Forecast of the election or something else that I think is coming from a place that reflects their Partisanship or ideology and I'll say okay.

2:18:43Are you actually willing to let's let's bet Let's bet a substantial amount actually on this because I'm actually trying to provide accurate information And I think and I think you may think you are but I think you're not and every time they don't Actually take the bet that can be like a little bit of a telepotentially related to that you talked about The research in some scientific journals coming under attack for findings not being repeatable or falsifying data How could a gambler improve the trustworthiness of science? So one of these things that these prediction markets do is they can actually say Here is this famous academic paper We're going to conduct a replication of it try to redo the experiment and you can predict how likely it is that the experiment will actually Replicate but also like look one thing I found is that gamblers traders investors have to make decisions quickly And that's a valuable skill is making decisions based on limited and complete information and You know look I think academia is Usually too slow for the fast -moving world that we're in if you think that AI is one of the most important Technology with the power to potentially cause destruction Since nuclear weapons well the Manhattan project was developed by the Central government and by other governments and by academics that they hired AI is being developed by Private companies which on the one hand Might make it more dangerous.

2:20:10I mean The profit motive is valuable in some ways, but but you know more predictable in some ways, but You know they may not Push the stop button if they If they needed to if we could make them money But on their hand like you know Academia is just too slow. I call this community the village the contrast to the river my book is called the village and Academia the media Journalism I'm more sympathy I'm more sympathy for because journalism is the first draft of history But you know we need things that are more fast -moving Have you ever considered taking astrology into account when making bets? I don't and I wouldn't although I had a friend who kind of half Trollishly or jokingly Gave me a tarot card reading the other day just a simple one where it's like past present and future and the past card was The devil The present card was the wheel of fortune and the future card was some card representing Serenity so the narrative I told myself is that like I think a lot of people who were Gamblers are gambling the Jasoner are in some ways very much ruled by their demons Pulled by their not addictions, but their compulsions I say So where that is that like you were pulled by your demons you have a lucky year this year Maybe the newsletter goes really well the book goes really well things kind of fall into place and you get lucky and then I'm 46 right in the roughly second half of my life then I'll find Serenity which I don't think I have Right now so hopefully that that piece of astrology is precious I hope One if in a secret however long with time to make a comment on what you think, and whats everything