A More Honest Gamble
LAS VEGAS -- As the stock market was swooning last week, there I was, wide-awake at 3 a.m., pondering my next move. I dont play high tech or small caps. I ignore semiconductors, telecoms and certainly dot-coms. Im oblivious to margin calls, and I abhor options. I dont go short or long. And while I skip over blue chips, I do favor green-green and red $25 casino chips. Keep Merrill Lynch. I prefer blackjack at Mandalay Bay.
With four of those green quarter chips I have just purchased two cards now staring coldly up at me. A 7 of hearts and an ace of spades -- an 8 or 18, depending whether I count the ace as an 11 or a 1. Holding it as a soft 18 would be acceptable -- its what just about every how-to-play book recommends. But Ziggy, my favorite dealer at the Mandalay -- who is sitting across from me with his knowing smile -- looks down at his one showing card, a 10 of clubs. Ziggy smiles because he knows that I know that he argues against the book -- insisting that a player should hit the soft 18 when the dealers showing a 9, 10 or ace.
Not that Ziggy is guaranteeing anything.
I give it a try. I scratch the table for another card, and Ziggy slaps me with a red 6. Now I have a miserable 14. I have to hit again and am in danger of busting. But out comes a 7 of diamonds that brings me to a cool and triumphant 21. Ziggy flips over his hole card. A queen of spades gives him a losing 20. This is what Ive been telling you, he says as he pushes over my $100 in winnings.
About an hour later, when I am up about $1,800, I have my epiphany. Lets solve the stock-market crisis by turning Wall Street over to the casinos.
Why not? Playing blackjack or roulette or buying corporate stock are all forms of gambling. Its just that casinos are more honest. The game never changes and the odds never budge: The casino has a 5.26 percent edge on the roulette wheel. And only about 2 percent at blackjack. Slot machines run at about 3 percent to 4 percent.
You say you dont like those odds? Are you sure? Well, if youve invested any amount in even the most sure-fire, no-fail stock over the last couple of years, youve been more wildly reckless than a guy who plays, say, his wifes bra size or his idiot cousins IQ on the roulette wheel. As the June 10 edition of Fortune magazine reported, of the 40,000 stock recommendations made by 213 brokerages during the year 2000, the most recommended stock declined 31 percent in value. And -- yes -- the least recommended stock went up a whopping 49 percent.
In other words, all the stock touts, including gargoyles like Kudlow, Cramer, Cavuto, Insana, and Citigroups horrible Mr. Jack Grubman, simply did not, do not and will never have a clue. And why should they? Thats why its called gambling -- not winning. And therein resides the real crime of these stock-market shills -- to have participated in a grand conspiracy to convince the American people that playing the market was anything but rolling the dice. (And, as it turns out, shaved dice.)
As a result, weve now got a whole generation of Americans who believed -- until roughly 10 days ago -- it was their God-given birthright to rake in 18 percent a year for doing nothing more than sitting on their asses.
Which brings me back to the wholesome integrity of casino gambling. There is no pretense on either side of the table. No dealer or croupier ever tells you what to bet. Mercifully, there are no 21 analysts or any Caribbean Stud Poker researchers. The very notion is ludicrous. Everyone knows that the luck of the draw or the spin of the wheel is serendipitous. All you know are the odds. Blackjack pays 3-2. A full house 5-1. A straight-up number on the wheel pays 35-1. A corner pays 8-1. Red or black -- even money, of course. Take em or leave em.
With the house advantage built into the game, theres no need to dupe the player. No need to call in Arthur Andersen to cook the books. Every transaction, every exchange of money, is videotaped. Think somethings fishy; the eye in the skyll be happy to rerun the tape for you. Try that with your Enron 401(k)! a
There hasnt been a major casino scandal since the days when Frank Lefty Rosenthal (the De Niro character in Casino) was running the Stardust. And when the casino boys do cheat, they leave us civilians out of it and just rip each other off. Whens the last time you saw an upstanding casino owner get hauled off in handcuffs like Adelphia gangster John Rigas did last week? (And just to put Rigas fraud into context: The $60 billion he is alleged to have shaken down from stock investors is enough to construct almost a hundred new Mirage Hotels.)
Likewise, only the most delusionary player believes he or she is owed any payback from the house. You risk, you dont invest. During the 30 years I have played in a casino, Ive yet to see one defeated player start moaning that he just lost his retirement fund because he busted out hitting a 15. At least Ive never seen anyone publicly admit to such tomfoolery, because only a moron would risk his future pension on an uncertain bet.
Unless, of course, you are one of those 70 or 80 million Americans who just learned the hard way.
So lets get on with the plan. We shut down all the brokerages. Caesars Palace or Harrahs takes over your old and now-depleted J.P. Morgan account. Programming on CNBC is replaced by 247 keno games. New roulette wheels will be minted, and the numbers will be replaced by the names of the Fortune 500. No more poring over boring P&E reports. No more wondering if accountants are hiding losses. You just pick any company you like the name of, and if it comes up on the wheel, you win. If not, you walk. Free drinks and comp show tickets as long as youre playing. And staring face to face with the odds, the bet is you wont be tempted again to put your kids college fund on the line.
In the meantime, I like 18 red.
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