Gaming Articles Kevin Strahm works in mortgage banking. He has dirty blonde hair, walks with the confidence of a former athlete, and lives in a beautiful Shawnee home with his wife and two daughters. Depending on how you calculate it, he lost $750,000 to $2.9 million gambling, most of it on sports. A former business is gone. His marriage was a close call. "For the longest time I thought, 'That can't be me,' " Strahm says. "I thought I could change and be like that guy." J.R. Miller is a retired TV writer -- remember "Hee Haw?" He has a thick goatee, is recovering from a heart attack he suffered last year, and likes the seclusion that his rural Tennessee house provides. He won't give exact dollar figures, but says he's made enough to own a second home in Las Vegas and pay the better part of 30 years' worth of bills betting on sports. He's made enough of a name for himself that he now runs a Web site where he gives advice to thousands drawn to the macho utopia of beating Vegas. And he makes it sound so damn easy. "I do it all the time," Miller says. "You flip a coin and you win 50 percent. All you have to do is make 53 percent to keep your money. You can win 55 out of 100, that's not a problem." Of course, if it really were that easy, Strahm wouldn't be one of the country's 3.5 million problem gamblers. Vegas wouldn't have all those presidential suites and neon lights and seafood buffets. The now-illegal offshore bookmakers wouldn't think it worth the effort to skirt American law enforcement. Estimates say as much as $400 billion -- roughly equivalent to car sales -- is bet on sports each year in America. Most of that is revenue for the house, and the biggest chunk is done illegally online. More than 100 million Americans place sports bets each year, ranging from entertainment to recreation to full-time. A small percentage of them live the dream of gamblers everywhere, from the recreational, $20-on-my-alma-mater guy to the compulsive, lost-my-house guy. You call it gambling, they call it investing. Some people play the stock market, they play the point spreads. Same theories, they say. Better chance of high returns, they insist. How they do it is a risky and harder-than-it-sounds story that some experts say is nothing more than a mirage that feeds the gambling machine. But as long as there are casinos taking bets, there will be millions of people trying for the dream life that only a few can realize. ** ** ** Miller is proud of his work on "Hee Haw," the old variety show full of country music and cheesy jokes set in a made-up place called Kornfield County. Among the perks: a seven-month work year that allowed him other endeavors. "My brother lived in Vegas," Miller says. "And, well, one thing led to another." Vegas led to blackjack, which led to sports bets, which led to a newsletter and Web site -- www.professionalgambler.com -- that now provide most of his income after decades of paying the bills on bets that he made either in Vegas or online when it was still legal. Tax-time is complicated enough already, which is why Miller won't say exactly how much he makes gambling. But he does offer a peek at how he does it. The most important thing is money management, and that means keeping bets steady and reasonable. Miller plays about 2,500 games a year. That's six or seven a day, 50 a week and 200 a month. It's a wearing-down process. The house's advantage comes in a small portion it takes from winning bets, known as the juice or vigorish, a margin that means the break-even point for bettors is 52.38 percent. Miller relies on his research and time for an advantage of around 2 percent that, when multiplied a couple of thousand times over, turns a profit that matches his neighbor's salary. He keeps his bets to a small fraction of the total bankroll, allowing him to withstand extended losing streaks -- like 0-13 during week 15 of the 1985 NFL season. "What will kill most people is greed, making their bets too big," Miller says. "It's all about money management. The stats and information, with the Internet, are there for anybody to see. My god, yeah, it can be done." Richard Abram, a retired lecturer from the University of Nevada-Reno's gambling department, says he's turned a profit on sports bets in 19 of the last 20 years. Not enough to make him rich, but vacation money some years. He says the key is betting what you know, and not what you love. He graduated from Wisconsin-Green Bay but likes to make his college basketball bets on the Southern Conference. He's from the south side of Chicago and won't allow himself to bet on the White Sox -- there are 2,000 other major-league games a year to make money on. Vegas puts a line on virtually every game out there. Abram takes his advantage in picking a select few wagers. "If you do your homework and you handle your money correctly," Abram says, "you may not win a lot, but I'd say you have a much better than 50-50 chance of turning a profit." ** ** ** Strahm's introduction to the sports gambling world came in 1992, a $50 bet with a friend on the Kansas-Kansas State football game. He won. "I remember that feeling," he says. "I was like, 'I can do this.' " Strahm is an athlete at heart. He chose being a student at K-State over playing basketball at a smaller school, but the competitiveness never left. He watched a lot of ESPN, surfed a lot of sports and gambling-oriented Web sites and felt like he knew more than most. He started betting for the money. He couldn't stop because of the rush. Typical day: arrive at work in the morning, see there was a game on at 2 that afternoon, spend four hours looking for an edge, place the bet, watch the game, and by the time it ended, the clock said 5 o'clock. Time to go home. "The preoccupation was just unimaginable," he says. "I'd be at home with my wife and daughter, and all I could think about was getting on the TV and watching a game I had money on." He had some huge wins -- $50,000 one time, $40,000 another and $80,000 in a span of 72 hours. It became an ego thing. He remembers buying his friends 50-yard-line tickets to a Chiefs game, $250 each. They asked where he got the money. Don't worry about it, he said. The beginning of the end came when he won the first eight games recommended by a service. He started dreaming about boats and vacations and gambled away his profits online before he could pay the service's 20 percent fee. Once, he took money from a friend that was meant to finance a business deal and lost it on games. Fourteen years after that first bet, his wife first discovered some debt in September 2006. She organized an intervention, and he agreed to get help. It worked fine for a few months, until last spring. Strahm says the first round of March Madness is "like giving a cocaine addict free cocaine for two days." He hid it from his family, all the way through summer, with a complicated web of lies, hidden bank accounts and secret post office box addresses. On Aug. 5, he put the last five grand that remained in the last of four offshore accounts on the Sunday night baseball game between the A's and Angels. Dan Haren started for the A's, which seemed like a good bet until the Angels' Casey Kotchman hit the game-winning single in the seventh. Strahm says that's the last time he's bet. The next day, he admitted himself to a gambling center in Minnesota. While in treatment, Strahm calculated his losses at $750,000 -- virtually all of which came in the last five years. When he figured in all the times he lost previous winnings, the number was $2.9 million. "On the list of priorities, the money was the last thing (my wife) cared about," Strahm says. "She realized how many times I actually stole from the family, how many times I committed fraud to obtain money in her name." One of the hardest things for Strahm to overcome was the thought that his guts, his competitiveness, his planning, all the things that made him successful as a business owner, were the same things that made him a gambling addict. "It's what got me so cocky," he says. "How I was in business and sports is exactly how I was as a gambler. That risk-taking, no-fear mentality. Ultimately, that planning and preoccupying took up all that time to eventually be detrimental to my business." ** ** ** They call it gambling if you bet on a horse, but investing if you own the horse. There is an old line that goes, "The only difference between betting on games and the stock market is with the games, you know if you won or lost in two hours." Yale economics professor Robert Shiller writes in the book Irrational Exuberance that an increase in acceptance of gambling over the last decade or so increased the willingness of average stock market investors to take risks. The Kelly Criterion, introduced in 1956 by John Larry Kelly Jr., can be used to calculate ideal bet amounts based on your odds and expectation of winning. The formula was proven to work in blackjack, the stock market and sports gambling by Edward O. Thorp, who claimed to make $80 billion over 30 years with it, mostly in hedge funds. "There's a lot of crossover between (sports gambling and the stock market) and the people who've done both will tell you there are similarities," says William Poundstone, author of Fortune's Formula: The Untold Story of the Scientific Betting System That Beat the Casinos and Wall Street. "I guess we have this idea that the financial investors are vital to our economy whereas we don't have the same idea about sports betting." Michael Konik, author of The Smart Money: How the World's Best Sports Bettors Beat the Bookies Out of Millions, says the only chance you have of winning sports bets is to approach it like you would the stock market. Successful sports gamblers are dispassionate, removed and emotionally uninvolved. Bets are expressions of mathematics and never to be taken personally. Trouble is, sports gambling often attracts the exact opposite kind of person. "You can't do it to be entertained," Konik says. "People who trade foreign currencies, it's not that entertaining, you know? It's not like, 'Wow, the drachma went up today.' It's just buy low, sell high." ** ** ** So why can't everybody do it? It's more than just the time commitment. After all, Strahm spent as much time tending to his bets as any of the successful gamblers interviewed for this story. And he even says he won many more bets than he lost, 65 percent at one point. "It's the competitiveness and the desperation," Strahm says. "It's the, 'They're not going to take me for that money.' I just couldn't handle it." Stan Bier is a psychologist who has treated gambling addicts in Missouri since the state, which does not take wagers on sports, first opened casinos in 1994. He says sports or otherwise, the losers usually follow a similar pattern. "Same as any other addiction," Bier says. "They have to increase the bet to get the same action. They might win a lot at the beginning. They go through a winning phase, and then a losing phase. And then the last phase is called desperation. "They do extremely well at times, and think they have more insight than most people. So they think they can beat the system." The ones who win don't come through Bier's office, and he's always skeptical of anyone who claims consistent profit from gambling. Konik guesses that 1,000 people in the world make $100,000 per year at it and fewer than 100 make millions. He says he used to be one of them, but only because of the financial and informational resources available to him with a large syndicate. He writes in his book of making $14,200 in his first weekend with the company. "It's quality of the information and analysis of the information," he says. "There's no secret fact that the syndicates have that everybody else doesn't have. It's what you do with the information. That's where computer analysis and proprietary simulations pay off. "That's stuff that your friend just doesn't have. It's not a fair fight." ** ** ** Strahm is approaching the one-year anniversary of the last time he failed to stop gambling. He's within a few weeks, in fact. "This," he says, "is the time of year I do get pretty vulnerable." He's cashed some big tickets in February and March, riding NCAA basketball upsets to five-figure paydays. When he got out of treatment, Strahm made a deal with his wife and counselor that he wouldn't watch anything sports-related for 60 days. The draw would be too much. He says that if he divided himself into 100 shares when he finished treatment, his addiction would've owned 99. He thinks now it's closer to 50-50. Not where he wants to be, and not where he believes he will be. But it's progress. It's enough that he can watch games on TV again. It's not in his DNA to be a successful or even recreational gambler. He used to be angry about that. He's starting to accept it. He has a new career now, and is living a different life, a better life, with the knowledge that even if all the stories of successful sports gamblers are true, there are a whole lot more guys like him than Miller or Abram or Konik. Who knows? Maybe by sharing his story, Strahm might help someone else realize their problem before it's too late. That's his hope, anyway. "Let's say best-case scenario I go out and win a bunch of money," he says. "I'm still gonna have to explain where it came from. I'm still gonna have to lie and manipulate, and the consequence is I lose my wife, I lose my kids, I lose the trust of my family. "No, I'm done. I've cashed out. I know that other life, gambling, it's just not for me." © Copyright 2006 OSGA, LLC |