Investors Are All In With A Weak Hand

I could’ve been a contender. Forgive me my nostalgia but everybody who knows me hears this story at one point or another. For those of you who don’t know, I’m a professional caliber poker player with 15 years of experience. This March, right before everything shutdown due to COVID, I played in the $5250 Bay 101 Shooting Star Texas Hold ‘Em No Limit poker tournament in San Jose, CA. On Day 1, I played with well known pros like Loni Harwood and James Carroll.

The tournament drew about 300 players and I was sitting with a solid 50 BB stack in the BB with 39 players left in the middle of Day 2 when the well known professional Chino Rheem raised. Darren Elias, the former #1 player in the world according to the Global Poker Index (GPI), raised from the SB. I looked down at QQ.

Chino is hyper aggressive so Darren could very easily be raising lightly i.e. with a less than premium hand. Even if he wasn’t, there were many value hands in his range I could beat like 1010 JJ and AQ. It was a no brainer: Go All In. I shoved, Chino folded, Darren called with an equivalent stack and AK and there was monster pile of chips in the middle when an Ace came on the flop. My dream of winning my home tournament, the most prestigious in the Bay Area, would have to wait for another year. Fortunately, my friend Pat Lyons, WPT and WSOP Champion and Bay Area Poker Legend, was there to console me and confirm that I’d made the right play (For an excellent piece on Pat’s larger than life personality, see Jeff Walsh “From Banned to WSOP Bracelet: The Return of “World Famous” Pat Lyons”, July 24, 2020).

The stock market is euphoric right now. A lot of people are extrapolating fro the recent past and going, ‘Wow, the market’s gone up a lot and I think it’ll go up more.’ We’ve seen this play out before, and it doesn’t end well – James Angel, Professor of Finance, Georgetown University (quoted in “Margin Debt Reaches a Record”, Michael Wursthorn, WSJ C1, Monday December 28).

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