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Five Things You Need to Know: Win the Battle, Lose the War


Just like gamblers, some traders and investors are addicted to losing.


Kevin Depew's Five Things You Need to Know to stay ahead of the pack on Wall Street:

Win the Battle, Lose the War... The Phenomenon of Stu Ungar... Addicted to Losing... The Numbness of Winning... Gods of Wealth

Win the Battle, Lose the War

This is the very essence of gambling; many battles won, tickets cashed, pots raked in, pockets stuffed full of bills, all the while running in place as you slip inexorably toward destitution. I would like to tell you that it's different, perhaps even as much as you might like to hear that it's different, that the war can be won, that not all gamblers die broke, that the battles fought between the first post and the last pot matter in the end. But it is what it is. The truth is harsh.

Stu Ungar met the truth in a Las Vegas motel room in 1998, so far near the end of the Vegas strip he was practically off it. He was found dead in his bed, alone, with about $800 cash. But this was no ordinary steady bad-lucker. This was Stu Ungar, or Stuey the Kid, who had won back-to-back World Series of Poker titles by the time he was 27. It is estimated that Ungar won and lost about $30 million before meeting his end in that hotel room at the age of 45.

The Phenomenon of Stu Ungar

The Sunday New York Times in June 2005 ran a feature on the phenomenon of Stu Ungar. It made the front page of the Sunday Styles section. The newspaper at the same time began began a new "educational" feature on poker playing, similar to the Chess features, or Bridge features, that have run in newspapers around the country for years. Remember, this was 2005. Risk appetites were hot. I suppose it was about time poker entered the mainstream.

The reason the Stu Ungar story caught my eye then, and the reason I was reminded of it this morning, is because the article was able to draw a thin line between risk and ruin and even shade the line between the two with a bit of gambler's wisdom. The thin line between risk and ruin is really just the faded, yellowed distinction between those who have already lost and those who still want to. According to the Times, "To his contemporaries, Ungar remains the ultimate gambler's cautionary tale, the embodiment of hazardous risk. But to a wonky new generation of players, decked out in Oakley snowboarder sunglasses and iPods, schooled on Internet poker and striving for corporate sponsorship, Ungar is a renegade genius..."

A symbol of wasted talent - and reckless disregard - to some, Ungar is also a symbol of romantic rebellion - and reckless disregard - to others. Which category you fall into - wasted talent or romantic rebel - probably also describes your relationship with risk in general.

Addicted to Losing

I'm no stranger to a romanticized view of gambling and a tilted relationship with risk. When I was a kid my first job was on a golf course. I took lessons from the local golf pro - not in golf, but in making odds lines, taking bets on everything from Churchill Downs to the Cincinnati Reds to the British Open, and occasionally running them to the local liquor store to hand over to the bookie.

Later, my first "real" job out of college was working for the Daily Racing Form. Over the years I've met, literally, hundreds and hundreds of "professional" gamblers. But I can count on one hand the ones who were verifiable winners. Most were addicted to losing. After all, that's the one addiction gambling feeds day in, day out - losing.

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