Several years ago, while doing research for a school project, a group of MIT students realized that, for a few days every three months or so, the most reliably lucrative lottery game in the country was Massachusetts' Cash WinFall, because of a quirk in the way a jackpot was broken down into smaller prizes if there was no big winner. The math whizzes quickly discovered that buying about $100,000 in Cash WinFall tickets on those days would virtually guarantee success. Buying $600,000 worth of tickets would bring a 15%–20% return on investment, according to the New York Daily News.
When the jackpot rose to $2 million, the students bought in, dividing the prize money among group members. But they didn't stop there; they were so successful in their caper that they were eventually able to quit their day jobs and bring in investors to front the money they needed to purchase the requisite number of lottery tickets.
Original Submission
(Score: 2) by MichaelDavidCrawford on Tuesday June 09 2015, @06:05AM
... because I know how to solve The Chocolate Chip Cookie Problem:
WITHOUT USING A CALCULATOR!
Tell me how many chocolate chips must be mixed into the dough required to bake one hundred thousand chocolate chip cookies, such that ninety-eight percent of the cookies contain at least two chips.
Among the reasons there are so many successful casinos is that so many people have a poor understanding of probability.
Yes I Have No Bananas. [gofundme.com]
(Score: -1, Troll) by Anonymous Coward on Tuesday June 09 2015, @06:15AM
Don't forget to tighten your necktie so tight that you choke to death on your cookies.
(Score: 0) by Anonymous Coward on Tuesday June 09 2015, @06:43AM
OMG! MDC has a stalker! Calling the Hairyfeet Suppression Society! Take this AC down! Mod bombing is authorized, with extreme prejudice! Let us never hear from him again.
(Score: -1, Troll) by Anonymous Coward on Tuesday June 09 2015, @06:50AM
It's Crowford's own fault for being such egotistical crowing rooster all the damn time, man. He attracts stalkers like a willing rape victim.
(Score: 2) by aristarchus on Tuesday June 09 2015, @07:04AM
Really! First one I have seen. And not a very good one, either. No biting sarcasm, no insightful criticism, no coherent thought! Ah, must be bot that lost the DARPA challenge.
(Score: 1, Offtopic) by MichaelDavidCrawford on Tuesday June 09 2015, @07:28AM
I regard it as being of fundamental importance that my essays on mental illness are widely read. Unfortunately that comes at the cost that many will dislike me for promoting myself.
Consider that I use my real name online, or even where I don't my identity is plainly apparent from my writing style. I chose to do that specifically because of the widespread criticism that Stephen King receives. Even so, King keeps writing.
Just yesterday, the grieving mother of a young schizoaffective man wrote to me to thank me for writing Living with Schizoaffective Disorder [warplife.com]. This afternoon I phoned a police officer who is investigating the widely reported suicide of a teenage girl.
My ability to help people like that means quite a lot more to me than any crap I might catch from ACs at soylent.
Yes I Have No Bananas. [gofundme.com]
(Score: 1, Offtopic) by MichaelDavidCrawford on Tuesday June 09 2015, @07:22AM
he spent money on google adwords ads in hopes of making me unemployable.
I was good friends with Tsutomu Shimora at Caltech; he has a word for people like modus:
"Anklebiters"
Yes I Have No Bananas. [gofundme.com]
(Score: 2, Interesting) by tftp on Tuesday June 09 2015, @06:35AM
Among the reasons there are so many successful casinos is that so many people have a poor understanding of probability.
Among the reasons there are so many successful casinos is that so many players have a poor understanding of probability and don't realize how important that is. Those who do not play in casinos have no particular reason to worry about chips in cookies. The theory of probability, just as any math above basic arithmetic, is not in high demand in most occupations except science and engineering.
(Score: 0) by Anonymous Coward on Tuesday June 09 2015, @06:47AM
Among the reasons there are so many successful casinos is that so many players have a poor understanding of probability and don't care. People don't play in casinos to make money, instead they get jobs that pay money. Responsible players budget an amount of money they are willing to lose, and they play for the thrill that they might get from winning some small amount of it back if they're lucky. A good understanding of probability would only cheapen the thrill.
(Score: 3, Informative) by MichaelDavidCrawford on Tuesday June 09 2015, @07:18AM
he knows the odds because he studied graduate mathematics at the U of Nevada in Reno, then took a job designing gambling machines.
Go hang out in a big casino at ten o'clock on a monday morning; I did once, I wanted to vomit.
Yes I Have No Bananas. [gofundme.com]
(Score: 3, Informative) by Thexalon on Tuesday June 09 2015, @02:03PM
Also, casinos kick out those who they realize do understand probability, try to get everyone good and drunk so even if they understand probability they won't use their knowledge, and design their games so that even if you know what you're doing you'll still lose.
The only game commonly played in a casino that is possible to win (on average) is blackjack, and they'll kick you out if you engage in the strategies that allow you to win (it's not just card-counting).
"Think of how stupid the average person is. Then realize half of 'em are stupider than that." - George Carlin
(Score: 0) by Anonymous Coward on Tuesday June 09 2015, @05:20PM
The answer is that there is insufficient information for statistical analysis. Anything else is arrogant assuming.
(Score: -1, Troll) by Anonymous Coward on Tuesday June 09 2015, @06:12AM
Not only did eggheads game the system, which in itself is damning enough, but they took money from poor desperate stupid people who can barely afford to play the lottery. This story is why people hate nerds, and rightfully so.
So. When can we expect these MIT students to be thrown in prison forever for this scheme?
(Score: 4, Insightful) by kazzie on Tuesday June 09 2015, @06:48AM
Not only did eggheads game the system, which in itself is damning enough, but they took money from poor desperate stupid people who can barely afford to play the lottery.
No, they took the money from the lottery. It's the lottery that took money from the desperately stupid people.
(Score: -1, Flamebait) by Anonymous Coward on Tuesday June 09 2015, @06:54AM
Now remember, when someone pushes you in front of a bus, it will be the bus that will kill you, not the person who pushed you.
(Score: 1, Funny) by Anonymous Coward on Tuesday June 09 2015, @07:49AM
We have taxes on tobacco, alcohol, and masturbation, and we call these "sin taxes". A state sponsored lottery is a "stupid tax". Not as easy to justify. I think we should just have a "rich tax". (Oh, just joking about the jacking tax. Sorry if I scared anyone.)
(Score: 2) by c0lo on Tuesday June 09 2015, @08:01AM
Forgive my ignorance, but... really? I mean, literally?
https://www.youtube.com/@ProfSteveKeen https://soylentnews.org/~MichaelDavidCrawford
(Score: 0) by Anonymous Coward on Tuesday June 09 2015, @08:38AM
Scared ya! You past due liability is . . . . well, if we can't calculate it, we can't bill for it.
(Score: 0) by Anonymous Coward on Tuesday June 09 2015, @12:23PM
Some places have additional taxes on adult magazines. As for adult porn channels on television - while not an actual "tax" because the government is not collecting the money - you have to wonder why a single channel can cost almost the same as your monthly cable bill. And it's not because porn movies are especially difficult to make or the actors earn so much. It's gouging by middlemen because they know you'll pay it if you really want it, and you won't complain about it either because you know you are a "sinner".
(Score: 2) by c0lo on Tuesday June 09 2015, @12:45PM
I'm amoral, you insensitive clod (but still ethical from pragmatic reasons) - so no guilty feelings here.
Besides, there is so much free porn on internets, I don't see why would I want to pay for it.
https://www.youtube.com/@ProfSteveKeen https://soylentnews.org/~MichaelDavidCrawford
(Score: 1, Offtopic) by MichaelDavidCrawford on Tuesday June 09 2015, @07:15AM
I could easily get that kind of work as I have quite a lot of good experience, but for the specific reasons you state, I came to regard it as immoral.
For quite a long time, I've been debating this with kuro5hin's procrasti, who is a financial professional. Every time I come up with what I regard as a good reason for not being involved with the markets, he regards that as a positive trait.
For example other than the IPO I don't see how the stock market does any real good for society, nor for public companies. Consider that a trader could hold your stock for mere milliseconds, but if you don't kowtow to him during that brief instant, he could shitcan your company's board.
Yes I Have No Bananas. [gofundme.com]
(Score: 2, Insightful) by istartedi on Tuesday June 09 2015, @08:04AM
That's interesting. IPOs in their current form are probably one of the things I like least about markets. They're just exit strategies for the real winners, dumping crap on the public. I'd like to see rule changes that require them to IPO earlier. I'll give you this though--the reverse IPO is often worse. That's when private equity buys a public company and forces holders of common to accept a tender offer. A lot of times those shares are weak and won't come back for a long time; but still--you're being forced to realize a loss by PEs who circle like vultures. That's one reason to stick with large caps and indexes, although it's still possible for these things to dissolve and force you to take your cash back at inopportune times, it's far less likely than with individual small/mid cap stocks.
Appended to the end of comments you post. Max: 120 chars.
(Score: 5, Insightful) by jimshatt on Tuesday June 09 2015, @11:10AM
(Score: 0) by Anonymous Coward on Tuesday June 09 2015, @08:17PM
You're better than me, I've stopped reading his comments.
(Score: 0) by Anonymous Coward on Tuesday June 09 2015, @10:47PM
MDC is the single reason I wish for a soylent equivalent of the usenet killfile. Some posters anger me for their opinions, but his posts are just such an annoying combination of prolificity and narcissim that his actual opinions don't even matter. If it weren't for him I could start reading a post without having to think about checking the name of the author first, such a time-waster.
(Score: 0) by Anonymous Coward on Tuesday June 09 2015, @11:41PM
I inspired myself to fix the problem.
If anyone else would prefer an explicit warning of MDC content before reading it, here's a quick and dirty way to do it:
(1) Install FoxReplace [mozilla.org] add-on.
(2) Turn on Auto-replace on page load from the Tools->FoxReplace menu
(3) Add the following filter:
Name: MDC Remover
URL: *soylnetnews.org*
Substitution:
HTML: Input & Output
RE (regular expression)
Replace: (MichaelDavidCrawford \(2339\)[^]*?<div id="comment_body_\d+">)([^]*?)</div>
With: $1MDC Warning:<br><div style="background-color:white;color:white;">$2</div></div>
That will cause the text of his posts to be rendered as white on white - you can still read them if you highlight it with your mouse.
(Score: 0) by Anonymous Coward on Wednesday June 10 2015, @03:55AM
Add MDC to your Foes list. In your account preferences set the Foe mod to -6. Read at a threshold of 0 or higher. Voila, no more MDC comments!
(Score: 0) by Anonymous Coward on Wednesday June 10 2015, @04:04AM
I use the Foes list to keep track of people who I think are dumbasses that way I can judge what they write - if they should or should not get the benefit of the doubt when they post something that sounds kinda stupid. So I can't make it do double-duty as a killfile.
(Score: 3, Interesting) by MichaelDavidCrawford on Tuesday June 09 2015, @07:45AM
the reason that promotional drawings specifically say that one may enter only once per visit, is that some caltech students - in the early seventies IIRC - use a lineprinter to produce a few million "reasonable facsimiles" for a McDonaldss contest. The McDonalds people were quite unhappy about it but there was nothing they could do to stop it; I recall seeing a photo of a pissed-off restaurant manager being handed a large cardboard box full of these reasonable facsimiles.
However the institute got a lot of bad press over it. The students won most of the prizes but then donated them all to charity.
Yes I Have No Bananas. [gofundme.com]
(Score: 4, Touché) by khallow on Tuesday June 09 2015, @01:39PM
Not only did eggheads game the system, which in itself is damning enough, but they took money from poor desperate stupid people who can barely afford to play the lottery. This story is why people hate nerds, and rightfully so.
Yea, only the rich, politically connected elites should be able to rob poor, desperate people.
(Score: 3, Interesting) by Anonymous Coward on Tuesday June 09 2015, @06:17AM
Cracking the Scratch Lottery Code [wired.com]
(Score: 2) by Aichon on Tuesday June 09 2015, @06:40AM
I actually conflated this case with the one you just linked. That said, it's worth pointing out that this case is from 2012, so it's a few years old.
(Score: 2, Informative) by Anonymous Coward on Tuesday June 09 2015, @06:34AM
The title says "How" but neither the main article nor summary say how.
One of the links is better: https://www.boston.com/news/local/massachusetts/articles/2012/07/31/inspector_general_says_lottery_allowed_gambling_syndicates_to_take_over_winfall_game/?page=3 [boston.com]
(the ny daily news one is flamebait/libellous in saying the students scammed the lottery when they didn't).
(Score: 2, Interesting) by blackhawk on Tuesday June 09 2015, @06:53AM
This was done many times 30 years ago or more over here in Australia. Large syndicates full of wealthy people who didn't even need the money would wait for the jackpot to reach a given figure, and then they would cover enough numbers to ensure a win. Looks like history repeating itself.
(Score: 3, Informative) by Anonymous Coward on Tuesday June 09 2015, @06:59AM
And they did it deliberately to fuck over the poor, because all rich people are evil.
(Score: 0) by Anonymous Coward on Tuesday June 09 2015, @01:26PM
Well, yes, they are.
(Score: 1) by blackhawk on Wednesday June 10 2015, @03:03PM
Not really, they did it to make more money, and although that came at the expense of large amounts of poor people, I don't think they had evil intentions, only the intention to increase their wealth. They simply didn't consider how this action would affect other people. It's a form of ignorance rather than evil.
(Score: 2) by istartedi on Tuesday June 09 2015, @07:55AM
This sounds like arbitrage, or close to it. Enjoy it while you can, kids; because arbitrage is fleeting. It "closes" eventually.
I think the most famous case of people forgetting this was the Barings [wikipedia.org] failure.
When the arbitrage closed, that trader tried to extend the party with high risk trades.
Ponzi, yes, *that* Ponzi, also started out as a legitimate arbitrageur. When his arbitrage closed, his
method of prolonging the money train was to hatch his now infamous scheme.
They're bright boys. Hopefully they're aware of these examples.
Appended to the end of comments you post. Max: 120 chars.
(Score: 2) by aristarchus on Tuesday June 09 2015, @08:02AM
They're bright boys. Hopefully they're aware of these examples.
Smartest guys in the room, or in the prison cell, as the case may be.
(Score: 2) by FatPhil on Tuesday June 09 2015, @09:10AM
Great minds discuss ideas; average minds discuss events; small minds discuss people; the smallest discuss themselves
(Score: 1) by negrace on Tuesday June 09 2015, @03:24PM
It is a form of arbitrage called "statistical arbitrage".
One ticket might not win, but the expected value is greater than the price of the ticket, and by buying lots of them they virtually guarantee an overall win.
(Score: 2) by FatPhil on Tuesday June 09 2015, @10:19PM
If you can find a reference to that term which predates Nash, I'll take it seriously. Stop reinventing concepts and recycling words.
Great minds discuss ideas; average minds discuss events; small minds discuss people; the smallest discuss themselves
(Score: 2) by gallondr00nk on Tuesday June 09 2015, @01:56PM
There's quite a number of sites dedicated to sports betting in a similar fashion. Using different bookmakers worldwide, it's possible to hedge on both sides of a sports result and win money regardless.
(Score: 3, Insightful) by Anonymous Coward on Tuesday June 09 2015, @08:03AM
Am I the only person seeing that this article is from 2012?
(Score: 2, Informative) by negrace on Tuesday June 09 2015, @02:30PM
Come on, I heard this story like 3-4 years ago.
(Score: 0) by Anonymous Coward on Tuesday June 09 2015, @03:20PM
i foresee a future were multi-multi-belleonairs can only buy more lottery tickets ... and nothing else.
do you want some fermented tickets with that ticket stew?