Discipline: Part IX

This is the ninth of a series of columns on discipline, which is essential for anyone who wants to be a professional poker player. So far I have discussed avoiding tilt, finding good games, physical conditioning, and begun the discussion of mental conditioning. First, I looked at general mental conditioning—how to keep your mind sharp. Then I looked at poker specific conditioning—ways to study poker.

The last and in some ways the most important topic in this series is building and maintaining a bankroll.

Before starting in on such a complicated and important topic, I want to relate a little history. I was recently cleaning out a closet, and came across a stack of Card Player magazines from 2003 and 2004. I glanced through them and found that much of the advice, even mine, was sadly outdated — a nice way of saying dead wrong. In an issue from February 2004, I had written a column that looked at my past predictions of the future of online poker and then followed up with some current ones. This was my recap of a previous prediction:

Bad Prediction One (made approximately five years ago): If online gambling, including poker, casino, and sports, becomes big the US government will make a very strong effort to shut it down. This will include arresting and/or seizing the assets of the principals who are residents of this country and putting pressure on credit card companies, ISPs and phone companies to stop being facilitators.”

The original prediction had been made around the millennium. It was now 2004, and early in the Moneymaker era. Online poker was flourishing. The games were great, new sites opened all the time, competing for players with better software and bonuses. Pros, especially those with name recognition, were being recruited by the websites. They got all kinds or perks, bonuses, and sponsorships. Subsidiary industries were also booming—poker publishing, tracking software, coaching, payment processing, and so on. The combination of great games, some players owning pieces of websites, affiliate deals, and the sites throwing money at the pros producing a booming poker economy. Every casino wanted a poker room, and poker tournaments were proliferating. Entries to the World Series of Poker main event went from a few hundred to a few thousand.

This boom continued for more than six years. In fact, it grew, more sites, more players, bigger tournaments, and the like. There were a few signs of trouble with the Unlawful Internet Gaming Enforcement Act, causing some sites to give up US operations, but PokerStars and FullTilt, which both had the best software, became the market leaders. The owners were getting rich. The players were getting rich. Poker players, who once dined at ‘all you can eat’ sushi joints for twenty dollars, were going to Nobu and spending five thousand on a dinner for four. Crazy side bets and degenerate gambling was common. Going broke didn’t matter, since the ‘candy store was always open.’ You could play live or online and build a bankroll easily. As someone said, “You could turn a matchstick into a lumberyard” in a few months.

Then came Black Friday in April of 2011. This was a disaster on many levels. The government seized money. Even if your money wasn’t seized, money on the sites was tied up for months or even years. Not only that, but all the juicy action and bonuses were gone. Players with six or seven figure balances, suddenly found they didn’t have entry fee money for the WSOP. Taxes were owed on 2010 winnings, but the government had frozen or seized the money that was going to be used to pay them. Many in the poker community had taken on financial commitments—cars, houses, families, and so forth based on the good time continuing. I could go on with this litany of bad beats and misfortunes, but you get the idea.

The reason that I have taken the time to review all this painful history is that it serves as an excellent introduction to my topic—building and maintaining a bankroll. We live in an uncertain world. In theory, risky investments do better over long periods of time. They have bigger rewards. But in the short run, striving for high returns may produce misery. Even diversification doesn’t help when both real estate and stocks go into a sharp decline. (During the poker boom, there were players who invested in real estate, taking out big mortgages. In 2011 and 2012, when they needed to get their money back, many found they owed more on their homes than they could sell them for.)

In the next column, I’ll start to get into more specifics. Before then, try to think about your poker bankroll. Jot down your thoughts and assumptions about bankrolls, assuming you have any. Many people, not just poker players, spend more time planning their summer vacation than they do planning their financial future. ♠

Steve ‘Zee’ Zolotow, aka The Bald Eagle, is a successful gamesplayer. He has been a full-time gambler for over 35 years. With two WSOP bracelets and few million in tournament cashes, he is easing into retirement. He currently devotes most of his time to poker. He can be found at some major tournaments and playing in cash games in Vegas. When escaping from poker, he hangs out in his bars on Avenue A in New York City -The Library near Houston and Doc Holliday’s on 9th St. are his favorites.