Bernard Baruch's business logic links to great poker strategy

Jul 10, 2012 3:00 AM

Bernard Baruch (1870-1965), prominent financier, elder statesman, advisor to U.S. presidents, was also a gambler:

Baruch speculated in the stock market, and was extremely successful. Starting his career as an office boy in a linen business and later in Wall Street brokerage houses, he rose to great prominence and wealth. Baruch College is named in his honor.

A part of the City University of New York, it is located on One Bernard Way, and consists of The Zicklin School of Business, The School of Public Affairs, and The Weissman School of Arts and Sciences.

Highly regarded for his intellect, Baruch was often quoted. Many of his quotes can be examined as they relate to our beloved game of poker. The one I like most:

“Millions saw the apple fall, but Newton was the one who asked why.” And thereby Sir Isaac Newton was able to discover gravity. What would our world be like if we never understood why the apple falls to the ground – much less so as mankind moves out into space?

I have observed that when many poker experts share their wisdom (or secrets) for winning poker they tell us what to do, but rarely explain why. To gain a complete understanding of a strategy, for example, a winning poker player needs to understand the rationale that is involved.

The why.

Otherwise, he will soon forget that strategy. Even when able to recall it during the heat of battle at the poker table, he likely will not be able to adjust for various situations.

Illustration: You have been taught to raise preflop with pocket aces. You assume the reason is to build the pot you expect to win. After all, A-A is the very best starting hand possible. But that is not the reason. What’s more, there are some situations you would be wise not to raise.

We raise with A-A because the laws of probability tell us that hand will lose most of the time if there are more than four opponents staying to see the flop. That’s why! We raise to reduce the size of the playing field (RSPF).

Say, you are the Big Blind in a limit game, with A-A in the hole, and only two opponents have called to see the flop. There is no need to further reduce the playing field. In fact, a raise could do more harm than good.

Your two opponents likely will call your raise, thus you gain two small bets. But now they are leery. Their holecards were not strong enough to warrant a raise. If their hands do not improve on the flop, they will fold when you bet. On the other hand, had you not made that raise against two opponents, chances are you could have won a bigger pot.

With two opponents seeing the flop, chances are one will pair up. But his pair is second best to your pocket Aces. With top-pair-on-the-board, he calls you all the way to the river – only to lose at the showdown to your A-A. The additional wagering, especially with the bets doubled on the turn and river, far exceeds the extra two small bets you gained by raising preflop from the Big Blind position.

What if an Ace falls on the flop, giving you a set of Aces?! Because you raised preflop, your two opponents most likely would fold when you bet (with that Ace staring up from the board).

Here’s another Baruch quote:

“We can’t cross that bridge until we come to it, but I always like to lay down a pontoon ahead of time.”

What’s your take on this one as it applies to poker? The best response (e-mail [email protected]) wins a signed copy of the new (hot-off-the-press) Hold’em Algorithm book, including two new poker concepts that can save/make money for you.

“The Engineer,” is a noted author and teacher in the West Los Angeles area and a member of the Seniors Poker Hall of Fame.