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Unexplainable
How to beat roulette
00:21:48
You’ll need your best friend, a computer in your shoe, and a working knowledge of physics.
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- [00:01]
Host
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- [00:26]
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- [01:00]
Host
All right, numbers are going up. Okay, we're recording.
- [01:02]
Doan Farmer
Good.
- [01:04]
Host
All right, so to kick things off, how did you first become a scientist?
- [01:09]
Doan Farmer
Well, you know, I dropped out of graduate school for a while to beat the game of roulette. And that's, that's how I became a scientist, I guess.
- [01:23]
Host
Wow. Today, Doan Farmer is a physicist, an economist. His work helped define the field of chaos theory. But before all that, nearly 50 years ago, he was gaming casinos. I gotta ask about the roulette. Whose idea was it to apply physics at the casino?
- [01:47]
Doan Farmer
It was my friend Norman Packard, who I'd known since we were about 9 years old.
- [01:52]
Host
Doan and Norman had been boy scouts together in southern New Mexico. Silver City is on the edge of millions of acres of national forest land. It's also a university town. And both boys self described science kids were inspired to go to grad school for physics. So by the summer of 75, Doane and Norman were very smart and very poor students.
- [02:19]
Doan Farmer
We were always trying to find a nice way to make money.
- [02:22]
Host
During our summers, Doan was making more money playing poker than at his summer job with the forest service in rural Montana. Reading the complete guide to winning at poker was enough to give him an edge and a taste for winning money. Norman, on the other hand, spent his summer in Vegas playing blackjack.
- [02:42]
Doan Farmer
But then while he was playing blackjack and stirring it roulette wheels, he got this idea that we were physicists. We should be able to beat roulette.
- [02:53]
Host
Roulette is a game that feels at home in James Bond Movies or Casablanca, where tuxes and ball gowns gather around the table to bet on the epitome of chance. As the spinning ball falls onto a spinning wheel, it can land on one of 38 numbers. You can bet on the ball falling on red or black, an even number or an odd one, or cryptic combinations of numbers. But ultimately, it's simple. Predict where the ball is going to land. And if you guess right, the payout can be as much as 35 to 1. Way higher returns than blackjack or even a really good hand of poker. The thing is, though, there's not really any strategy. There's no opponents to bluff, no cards to count, Just pure random chance. But Norman saw potential. What. What was his pitch like? Why. Why should physicists be able to beat roulette? I mean, wasn't there, like, an Einstein quote that no one could win at roulette unless you steal the money from the table?
- [04:03]
Doan Farmer
Yes, that's right. But there's something Einstein didn't think of, but he should have, actually, which is that roulette is a. It's just physics. There's nobody making any decisions. It's just physics.
- [04:17]
Host
The casino croupier, not a dealer, spins the wheel one way and then spins the ball the other way. And then it's a little more complicated, maybe, than playing catch in the yard. But Norman and Doan's reasoning was largely the same. If you know where the ball is, what direction it's going, how fast it's going, you can have a pretty good idea of where it'll end up. And yet roulette is this random number generator. Even Einstein supposedly didn't think there was any rhyme or reason to it.
- [04:49]
Doan Farmer
And that's because tiny differences in the way the ball is thrown can cause big differences in where it lands.
- [04:56]
Host
But there's an opening, because casinos keep the table open for bets after the croupier throws the ball, maybe 10, 15 seconds of golden opportunity, that sweet spot after the throw that makes the ball unpredictable. But before it's had a chance to land. Dohan and Norman had to figure out where the ball was going to land in those precious few seconds when roulette was. Was just a predictable physics problem. So how did you figure out how to beat roulette?
- [05:36]
Doan Farmer
Well, you know, we started by thinking, okay, it's a rolling ball on circular track, but it's slowing down. What causes it to slow down? We realized it's air resistance. So then we went to the library and looked up air resistance and thought about that. And so we wrote out an equation that described a rolling ball under circular track with air resistance and solved it.
- [06:00]
Host
Okay.
- [06:00]
Doan Farmer
And then we bought a roulette wheel, and we started doing experiments to see if.
- [06:05]
Host
Where'd you set up the roulette?
- [06:07]
Doan Farmer
Well, the roulette wheel was set up first in my dorm apartment. I was a graduate student advisor in the dorm. And then we would take it into the physics department in the middle of the night where, you know, I had a master key. And the janitor was in on it, so he didn't tell the faculty we were doing this in the middle of the night.
- [06:29]
Host
Doan and Norman spent their nights doing experiments on the roulette table and solving their equations on bulky 1970s computers. But they weren't going to make any money in an empty physics department at midnight. They needed to take their strategy to the casino, and they needed to bring their computers with them. So naturally, they built the first ever wearable, concealable digital computer. The idea of a personal computer, let alone one that you could carry around with you, was pretty out there at the time. Doan and Norman couldn't just order up parts and start tinkering. They had to set up a shell company to buy the components they needed. They used the same processor that went into their original Apple computer and even ran in the same circles as Steve Jobs and Steve Wozniak. Though Dolan and Norman couldn't quite imagine what regular people would do with personal computers, they were completely obsessed with roulette.
- [07:37]
Doan Farmer
Doing experiments, building computers, solving the equations, writing programs that would solve the equations on the computer we built.
- [07:47]
Host
The project, as they called it, grew from just Doan and Norman to about 30 people. They found that they could use their equations and computers to roughly predict where the ball was going to land. And, you know, even if the ball bounced around a little as it fell off the track, it wasn't going to bounce clear over to the other side of the wheel. They could narrow it down enough to cover the bets. They had it. The dream was to win enough money to fund a science commune where they could live and study and work together outside of the pressures of academia. But first, they had to hit the casino floor.
- [08:35]
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- [11:06]
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- [11:59]
Host
Do you wish to place another bet?
- [12:02]
Doan Farmer
No.
- [12:02]
Host
No, I guess not.
- [12:04]
Doan Farmer
Try 22 tonight.
- [12:07]
Host
So you had the strategy, you had the math. Walk me through. Through the heist. What was if I'm imagining, like an ocean's eleven theme. So what was the heist? That you guys.
- [12:18]
Doan Farmer
Yeah. So we'd start out by. In our apartment, we would suit up, which meant putting on the computer. All right, you know, the computer was strapped under one arm. There was a 12 AA batteries strapped under the other arm. Back in those days, took a lot of power to run a computer, and we could only run for about an hour and a half.
- [12:37]
Host
Okay.
- [12:38]
Doan Farmer
So you'd strap on the battery pack that was all sewn into this belt like weightlifters would use. And then we had switches in each of our shoes with wires running up.
- [12:51]
Host
Like, up your leg.
- [12:52]
Doan Farmer
Up our legs. And we had a kind of radio transmitter around our shoulders, and we had little buzzers. So the buzzers, they were like thumpers. So they give us a low frequency thump, Medium frequency thump, High frequency thump on your chest. Actually, the men typically put them kind of under their belts, and the women had them sewed into a bra so they would give them a vibration in their bra.
- [13:19]
Host
Okay.
- [13:20]
Doan Farmer
So we would suit up in the apartment, and suiting up already was kind of tricky because you had all these wires and things you had to plug together. And. And then we would get in our car, it was usually my 1966 Dodge van, and drive to the casino.
- [13:39]
Host
Doan and the team made 11 trips to Nevada in all. They'd spill out of Doan's van, Adjusting the wires in their belts and bras, and head into the casino.
- [13:51]
Doan Farmer
And then we would look around for roulette wheels with a little bit of tilt. Turns out, only a tiny bit of tilt Would make the dynamics much more predictable because it caused the ball to be more likely to land on one side than the other.
- [14:05]
Host
And then one of them, usually doin, approached the table. He'd act stupid and loud, Called himself Clem, and bet small stakes. But all the while, Doan was using his big toes to click the switches inside of his shoes to program the computer tucked into his weightlifting belt. Using all this, he'd measure the speed of the Ball and the rotor turning the wheel.
- [14:31]
Doan Farmer
Depending on the friction in the rotor, it might slow down faster, or the ball's a little more dense, or even if the barometric pressure has changed, the ball will accelerate faster, slower.
- [14:44]
Host
Once he had a feel for that particular tilted wheel with that specifically dense ball, On a fair weather desert night, Doan and his computer were ready.
- [14:56]
Doan Farmer
I would signal the other player, and I would just be betting red or black, and I'd say, switch to betting even, odd. So the other player would know, ah, now he's ready. And then the other player would take their place on the opposite side of the table. And my computer would relay to their computer, when the ball was about six seconds ahead of falling off, it would tell them what part of the roulette wheel was. Was the best part to bet on. And they would have memorized a pattern. So if they got a buzz that meant, say, seven, they'd know, okay, that's the seventh octan. And the numbers in there are 14, 32, and three. And they'd lay down bets on those numbers, which were all in about the same part of the wheel. And that's how it worked.
- [15:49]
Host
Yeah. And this is all on taps in the shoes and thumps under the belt or in the bra. And that's how you're communicating, Trying to stealthily do all these calculations.
- [16:00]
Doan Farmer
That's exactly right.
- [16:02]
Host
This system, it was complicated.
- [16:05]
Doan Farmer
We always had a lot of problems with hardware. For every hour we spent playing, we probably spent five hours fixing our equipment.
- [16:13]
Host
And it didn't always go as planned.
- [16:16]
Doan Farmer
It could drive you crazy because the ball would land just short, Just right next to the number you made your bet on. You could be making good predictions and still end up losing just from bad luck. Which is part of why we were always nervous about having a big enough bankroll to outlast the bad luck.
- [16:36]
Host
But trip after trip, it paid off.
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Doan Farmer
We make predictions, and they were far from perfect, but they were still good enough to give us about a 20% edge over the house. So, in other words, every time we laid down a dollar, on average, we got a $120 back.
- [16:51]
Host
Nice.
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Doan Farmer
That was pretty good. But we were always a little cowardly about scaling up to big, big stakes, because every time we started to do that, we'd fill a lot of casino heat.
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Host
Interesting. Feels like a lot of trouble to go through For a little extra pocket money, if you consider all the, like, man hours put in.
- [17:12]
Doan Farmer
It was. It was, but it was a lot of fun, I must say. It was a engineering project where we had to do the basic science, we had to do the math, we had to do experiments, we had to build a device, we had to get the device to work in the field. My thesis advisor said, actually, you could just write your thesis about this if you wanted to. And I decided not to. I didn't think that really would qualify me to do much else. But it did, actually, in the sense that it taught me a lot about predictions.
- [17:51]
Host
About a decade later, Norman Doan and some friends founded the prediction company in 1991. They kept up the grad school vibes, setting up their company in a barely furnished adobe house in Santa Fe and. And basically sharing one business suit between them to wear to meetings with investors. Just like their days playing roulette. Dohan and Norman harnessed the underlying science, invented the technology they needed, and profited by finding predictable patterns where others saw randomness.
- [18:26]
Doan Farmer
We knew a lot, we'd learned an awful lot from that first enterprise, and we put a lot of the things we'd learned into practice. Beating financial markets.
- [18:38]
Host
At a time when trading floors still ran on, brokers in colored blazers shouting out orders and throwing up hand signs. The prediction company used computers, mountains of data, and even some early machine learning to find these predictable patterns and automate.
- [18:56]
Doan Farmer
Trades in stock markets and bond markets and commodities markets, foreign exchange markets, basically.
- [19:04]
Host
They started one of the very first quantitative hedge funds.
- [19:09]
Doan Farmer
Exactly. That's. That's what we did. Inspired by, in many respects, by our time in the casino. And we did succeed in making a decent amount of money. We made a pretty good. We made quite a pretty good amount of money doing that.
- [19:30]
Host
If you want to hear more about Doan's work teasing out those patterns he keeps seeing in the economy, check out our episode, embracing economic chaos. This episode was produced by me, Meredith Hodnot. I also run the show. We had editing from Jorge, just sound design and mixing from Christian Ayala, music from Noam Hassenfeld, and fact checking from Melissa Hirsch. Julia Longoria's looking a little green. And Bird Pinkerton got to the airport. She waited till 12 and made her way outside. And at the far end of the abandoned Runway, she saw a pigeon. Ah, she thought that must be Aaron Bird. But next to him, she saw something else hiding in the tall grass. It couldn't be platypus. Thanks, as always to Brian Resnik. Hey, o' Brien, thank you so much for creating the show. And if you have thoughts about the show, you should send us an email. Brian, specifically, you should email us, but also any other listeners we're really excited to hear what you think about the Show. We're@ unexplainableox.com you can also leave us a review or a rating wherever you listen really helps bring new listeners into the fold. Tell the world about Unexplainable. It's going to be their new favorite podcast. They'll thank you for it. You can also support us and all of Vox's journalism by joining our membership program. You can go to vox.commembers to sign up, and if you do, you'll be helping make this place run. You also get unlimited access to all the phenomenal reporting on Vox.com you'll get exclusive newsletters, and you get all of our podcasts ad free. Unexplainable is a part of the Vox Media Podcast Network. We will see you next week.