Gambling & Journalism

I can see feeling this way. It's a bit convoluted. You can't actually have an effect on the outcome of a game if you are a journalist, but theroretically, at least, you can have an effect on a betting line with what you choose to report and how you present it.

 

Yeah, well, I think the notion that "insider trading" is something anyone can stop, or should want to, is silly. Life is about making informed choices using the information available to you. Information, by its very nature, is assymetric. Some people are in positions to know things that I can't possibly know. Just as in other areas, I am going to be more informed than some others by the nature of what I do with my time or where my interests lie.

Take all of that assymetry in the aggregate and you create the most efficient markets possible. They include all of the available information. The fact that one person knows more than another shouldn't be considered a source of "unfairness." That is how the world works -- naturally. To me, it's like saying that the sun setting every night is unfair.

If anything, smart people would be assuming that there are people who have "insider" information, and they would be trying determine who those people are, and then they'd be looking at the decisions those people make to inform their decisions. Which is exactly how things actually work -- have always worked.

The idea that we try to regulate "fairness," creates a convoluted environment in which you make things less efficient, and consequently end up hurting the people you were purporting to help, while penalizing behavior that is perfectly rational -- trying to capitalize on infomation for your own well being. You create sheep who put their well being in the hands of a regulatory authority that can not possibly truly regulate the thing they say they do. It contributes to making people complacent and less vigilant about looking after their own interests. Which actually makes the information others have more valuable, and increases the chances that it can be exploited (even if you have made that illegal, there will be a ton of people who see the value in evading your enforcement of it).

But I have always seen the free flow of information as a "freedom" thing as much as it is something that leads to the most efficient outcomes. The minute you try to regulate information with the stated goal of creating fairness, you might as well be limiting freedom.

 

I think this is a yes and no thing. Yes, the public heavily bet New England, and it was a game that attracted a lot of casual betting, which was what accounted for a New England bias. But the "sharp" money, as those sportsbooks watch it, was much more balanced. Several of the books went to -3.5 a day or two before the game, if I remember correctly, and a lot of professional gambling money pounced when that happened with big bets on Denver. The sportsbooks moved the line back to -3. The sportsbooks weren't so much making a bet on Denver as they were measuring what constituted a balanced line by where a certain portion (the smart money) of the betting money was coming from. I think they always do that, it's just that the divergence between that smart money and what the larger betting public was doing was so pronounced with that game.

 

It is amazing though how many journalism/writing opportunities have risen from the increased legalization of gambling. It's not unlike fantasy sports a generation ago, many people want to find some kind of informed opinion if they're going to dive in. And all the regulatory issues have created a need for reporting that wasn't necessary even five years ago.

 

Sportsbooks have gotten very sophisticated in terms of tracking the betting histories of their customers. They know the "sharps," or professionals by their volume and the size of their accounts, and they pay very close attention. What I am talking about isn't an amorphous group of people that may or may not exist. They do exist, and they are isolated out by the sportsbooks, and it's money that often has a higher than average winning percentage and no, it is not the majority of us who think we can spot the choice betting lines.

The sportsbooks move their lines to discourage bets on the same side as that sharp money. You said that they aren't actuaries, but they really are. They are using models that try to guarantee profits while limiting risks. And that sharp money plays a part.

In fact, it falls under what I was saying in an earlier post about insider trading, in that if you are going to bet without any assymetric information that gives you an edge, it would probably be smart to track lines and follow the money flows. Although by the time you react and can place those bets, you are likely not going to get the same line as the smart money that got there first. But it is money that often has assymetric information that gives it an edge. It's the same concept as following flows of institutional money in the stock market and piggybacking on what they do.

That is a bit simplistic, in that the sportsbooks don't tell everyone the reasons that a line moved, and their models weight other things, too. There is a lot more going into the models they use than just WHO has been placing bets and where, even if it is probably a big part of what they are following.