• Half Och-Ziff's.


    Och-Ziff Turning Baby Pictures, Lack Of Things To Do In Oklahoma Into Big Returns

    The hedge fund is getting into the gambling biz.

    / Oct 1, 2015 at 3:49 PM
  • revel AC


    Monument To Morgan Stanley’s Two Billion Dollar Oopsie To Go Down For The Dirt Nap

    Revel, the Atlantic City Casino Morgan Stanley poured $1.2 billion into and then booked a […]

    / Aug 12, 2014 at 2:01 PM
  • Artist's rendering of the Revel on a Saturday night.

    Hedge Funds

    Hedge Fund Officially Allowed To Become Only Thing Gambling At Or On A.C. Casino

    Given everything else that’s gone wrong with Atlantic City’s flashy, unpopular new gambling paradise—and everything […]

    / Feb 13, 2014 at 1:25 PM
  • billgrosspimco


    Business Achievements Of “Indian Chief” Community Have Not Gone Unnoticed By Bill Gross

    My point about pigskin offense and defense is the perfect metaphor for the world of […]

    / Feb 28, 2012 at 12:05 PM
  • What does he have planned for that marker?


    Wynn Was Shocked, Shocked To Find Its Bribe-Loving Director Was Paying Bribes

    There’s a possibly true anecdote about Greek uncompetitiveness that goes like this: “An online store […]

    / Feb 24, 2012 at 3:01 PM
  • News

    Football? Yep. Oscars? OK. The VIX? Really?

    I was scoring up the Super Bowl (small loss) when Ocean called. Ocean is a good customer. He had a couple questions, and I told him fire away.

    First he wanted to know if we were doing the Oscars again this year. Of course we are. I’m not thrilled about it –I’m half paranoid about inside information bubbling on the Internet, but I’m learning to embrace the inside mis-information. Most importantly, we do it as a service, so the customers won’t start betting online with bookies in Costa Rica.

    Ocean was pleased. For what it’s worth, he likes The Artist at very short odds. He watches rom-coms. With his wife, he says. His favourite movie though is Love Story, and he cries shamelessly every time he watches it: he truly believes that love means never having to say you’re sorry. I’ve never figured that out. I’m forever apologizing to my wife for doing boneheaded things and saying stupid shit. And apologizing is a necessity But whatever. A happy customer is a beautiful thing. And I thought the phone call was over. And then Ocean said it.

    “What do you have on the VIX for this summer?”

    I asked him what the hell he was talking about because I didn’t compute what I was hearing. He then said how he had been watching CNBC. He went to his mutual fund guy determined to buy the VIX, and the salesman blew him off with “Oh, that’s just gambling”. So, hey, I must surely book the VIX, right, because I take bets from gamblers?

    Well I totally had my pants down and started mumbling about monthly contracts and the need to be a sophisticated investor and how there were a few products out there and…he cut me off. He understood how “the 1% were trying to make this complicated” and he just wanted a near-even-money type bet that the VIX would be over 30 at the end of June, as per the top of the screen on CNBC.

    I gave him the bet. 30’s a pretty big number, and I figure this’ll make me learn about trading the VIX instruments so I can lay it off if I want to. (I’ve never done anything more sophisticated than buy a put spread when I was afraid of a downturn. Go ahead, laugh.) 30’s a lot. So I let him have it at 6-to-5. He was only expecting even money or slightly worse, so he was pleased.

    Ten minutes later I was using this episode as an object lesson for my Faithful Assistant, a guy who is muddling through an MBA while living in his parents’ basement. Garage loft, I stand corrected. Anyway, good customers need to be kept happy, good customers lose, and happy customers pay. The Hollywood-movie days of kneecapping customers who stiff you were over before I was born, if they ever even existed, and—and the phone rang again.

    Ocean again, wanting an over/under number on where Apple would be in a couple months’ time. Oh, and Facebook. I told him I would have to call him back. I started throwing coffee cups and in between my screams my Faithful Assistant told me he’d just pretend I have Tourette’s. He’s cold. Then he asked me what was going on. And after I told him, he smiled, and tried to give his boss an object lesson of his own:

    “This is great. You trade the odd option. All my electives are Finance. We just set the over-under price, I mean you KNOW he’s going ‘over’, high enough that we can buy calls a couple strikes below that number. We use his bet to buy the calls, if he wins we clean up, and we’re covered.”

    And when I asked what would happen to Ocean’s bankroll over time, the answer came back that we would sodomize it.

    I just shook my head. My young friend may well end up in a business career where the necessary m.o. is to grab-it-all and grab-it-now, but that’s not how my business works.

    I actually want my customers to win 45-50% of their bets, lose fairly small amounts over time, and never lose so much in one fell swoop that they can’t pay or that they decide to stop playing. There’s a purpose behind all that languid ritual at the Baccarat table in the high-limit room at the casino: try to keep the House’s earn slow-and-steady. It makes the news when a whale beats Vegas for $10 million, or drops $10 million, but the casinos tolerate those lumpy earnings—aside from a little ink, they don’t really want them. The casinos want everybody playing dollar-slots, losing three cents a spin.

    His eyes kind of glazed over, so I thought, what would Suze Orman do to get her point across? I figured Suze, to make the young’uns understand, would probably Go Gangsta. So I said “Look, we make money by drawing blood from our customers.” His eyes lit up as I continued: “We’re blood collectors. We need a nice orderly blood bank. What you’re proposing, is a drive-by.”

    (Well, I actually said “drive-thru”, but we sorted it out after a little confusion.)

    So we’ve told Ocean that these bets are going to be for peanuts and we’re going to have fun with them. He’s on board, and he’s all excited. Faithful Assistant is going to make the numbers and I told Ocean to give us some requests for stocks he thought would go lower. “Oh you mean I could bet ‘under’ too? Not just ‘over’?” Yep, ‘under’ too.

    February’s a shit month in the bookie biz—the regulars are there, but football’s over and it’s a ways before March Madness. Ocean’s stockpicking is going to keep me interested.

    / Feb 16, 2012 at 4:25 PM
  • News

    Deutsche Bank Needs Less People Vomiting Outside Its Las Vegas Nightclub, More People Blowing Money In Its Casino

    As you may have heard, Deutsche Bank owns a casino (/hotel) in Vegas, called the […]

    / Apr 19, 2011 at 10:47 AM
  • News

    Has Deutsche Bank Made A Terrible Mistake?

    The bank claims it wants its new casino, The Cosmpolitan, to be a success and […]

    / Nov 17, 2010 at 11:39 AM
  • News

    What Does The Financial Reform Bill Mean For You? Kumar Patel Knows

    If you haven’t read the document yet (and only one person has so don’t feel […]

    / Jul 22, 2010 at 12:15 PM