WEBVTT - Episode 6: VIP 0:00:15.356 --> 0:00:28.156 Pushkin. So, as I explained last episode, we've created this experiment. 0:00:29.036 --> 0:00:31.956 My producer Lydia Jean Kott has partnered up with one 0:00:31.956 --> 0:00:36.236 of the world's smartest sports gamblers, Rufus Peabody is his name. 0:00:37.316 --> 0:00:40.436 Over the past fifteen years, Rufus has made many millions 0:00:40.476 --> 0:00:44.516 of dollars betting on sports. He's had the occasional losing week, 0:00:44.916 --> 0:00:47.636 but never a losing month, much less a losing year. 0:00:48.956 --> 0:00:52.316 Unlike all but a handful of sports gamblers, Rufus Peabody 0:00:52.636 --> 0:00:57.076 has always had an edge. The deal was this, Rufus 0:00:57.116 --> 0:01:00.236 would turn LJ into one of his mules. He'd send 0:01:00.236 --> 0:01:02.476 her money and the bets he'd like to make, and 0:01:02.516 --> 0:01:05.956 she'd make them on sports that she knows nothing about, 0:01:06.596 --> 0:01:09.556 like golf. She just opened as many a counts with 0:01:09.596 --> 0:01:12.436 sports gambling companies as she could and get as much 0:01:12.436 --> 0:01:15.876 money down as they take. I didn't have the first 0:01:15.876 --> 0:01:18.356 clue how this would work out. I started to think 0:01:18.356 --> 0:01:21.156 it wouldn't work out at all, especially after DraftKings froze 0:01:21.196 --> 0:01:24.276 Lj's account after just two bets, and fan Duel came 0:01:24.316 --> 0:01:27.516 in right after and refused to accept anything but small bets. 0:01:29.476 --> 0:01:32.076 But there are right now dozens of these gambling apps, 0:01:32.516 --> 0:01:34.916 and three weeks into her new career as a pro gambler, 0:01:35.436 --> 0:01:39.316 lj's life is obviously still kind of nuts, so nuts 0:01:39.316 --> 0:01:41.276 that she's no longer keeping me up to date on it, 0:01:42.036 --> 0:01:44.796 but I can see it on my phone. There's this 0:01:44.916 --> 0:01:48.356 text thread that's the length of an epic poem. My 0:01:48.436 --> 0:01:52.956 producer has this whole other life after dark. I wake 0:01:53.036 --> 0:01:54.276 up in the morning and I find I have two 0:01:54.356 --> 0:01:57.236 hundred and seventy four new messages on Telegram, and I 0:01:57.276 --> 0:01:59.596 can't figure out. I mean, it's oh, it's just you 0:01:59.676 --> 0:02:02.756 and Rufus going back and forth. Well, what's going on? 0:02:03.236 --> 0:02:05.996 Okay? So I mean I placed a bunch of bets 0:02:05.996 --> 0:02:06.596 this weekend? 0:02:06.836 --> 0:02:07.556 How many bets? 0:02:08.076 --> 0:02:09.236 So many bets? 0:02:09.276 --> 0:02:10.796 Actually, how many bets? 0:02:11.076 --> 0:02:14.196 Okay, total, I've total. 0:02:14.316 --> 0:02:17.396 I've placed one hundred and ten thousand dollars since we started, 0:02:17.876 --> 0:02:18.716 which is pretty good. 0:02:18.716 --> 0:02:20.556 It's my salary. 0:02:20.716 --> 0:02:24.516 She's bet the equivalent of her annual salary. The sports 0:02:24.516 --> 0:02:26.996 bookies that will still take her big bets are the 0:02:27.036 --> 0:02:29.876 ones she's lost money to. These places seem to warn 0:02:29.876 --> 0:02:31.196 her business more than ever. 0:02:31.756 --> 0:02:34.996 Like every five seconds I get a bonus and they're 0:02:34.996 --> 0:02:38.116 always like, open your app now to get this, and 0:02:38.156 --> 0:02:39.316 I'm like, no. 0:02:40.796 --> 0:02:44.156 She's somehow gotten her debit card tied to her gambling accounts. 0:02:44.716 --> 0:02:46.756 She's been moving so much money around that her own 0:02:46.876 --> 0:02:48.316 bank is trying to shut her down. 0:02:49.116 --> 0:02:50.956 I've basically locked my debit card, which I didn't know 0:02:50.996 --> 0:02:52.236 is a thing. So then when I tried to buy 0:02:52.236 --> 0:02:55.836 a coffee, it got declined, which has never happened to me. 0:02:55.876 --> 0:02:57.076 How did you pay for your coffee? 0:02:58.316 --> 0:02:59.796 The barista covered me. 0:03:00.316 --> 0:03:03.036 Really yeah, he was like, I'm sorry, this seems like 0:03:03.036 --> 0:03:04.476 a bad situation for you. 0:03:08.596 --> 0:03:11.916 Not a bad situation because LJ is now that most 0:03:11.956 --> 0:03:17.236 coveted of things a sports betting VIP. A lady named 0:03:17.236 --> 0:03:21.396 Courtney at MGM texted her with the news, which is odd. 0:03:21.996 --> 0:03:24.716 Lj's only made like forty nine thousand dollars worth of 0:03:24.756 --> 0:03:28.156 bets at bet MGM and she's only lost like eight 0:03:28.236 --> 0:03:31.636 grand to them. But they've assigned her a personal concierge 0:03:31.676 --> 0:03:34.476 and invited her to see Charlie XCX at Madison Square 0:03:34.516 --> 0:03:37.956 Garden just handed her to tickets worth thousands of dollars. 0:03:39.076 --> 0:03:41.796 I actually have no idea who Charlie XCX is. To me, 0:03:41.876 --> 0:03:44.436 it sounds like a new model of Mountain Bike. But 0:03:44.676 --> 0:03:49.356 Lj's thrilled and also worried. What if these people discover 0:03:49.436 --> 0:03:52.836 who she really is? What if they realize she's their 0:03:52.876 --> 0:03:53.636 worst nightmare. 0:03:56.116 --> 0:04:00.796 It'll be just like going to any hosted VIP and 0:04:00.876 --> 0:04:02.116 then at Medicine's Gay God. 0:04:02.996 --> 0:04:04.196 Okay, like I've never done that. 0:04:08.436 --> 0:04:12.116 That's the altar voice if someone we're calling Beckett like 0:04:12.196 --> 0:04:15.836 Rufus Peabody, Beckett's a player with an edge. Unlike Rufus, 0:04:16.196 --> 0:04:19.716 Beckett has on several occasions managed to become a VIP. 0:04:21.276 --> 0:04:21.556 You know. 0:04:23.276 --> 0:04:26.836 Lvy boxes and suites, and you'll be told where to go, 0:04:26.956 --> 0:04:29.996 and you'll go up onto a special floor and ushered 0:04:30.036 --> 0:04:34.556 into a large room which has been reserved by that 0:04:34.756 --> 0:04:39.716 MGM for all of their corporate hospitality stuff, whether it 0:04:39.756 --> 0:04:43.316 be a sports event for a music event. There will 0:04:43.356 --> 0:04:46.756 be a few other people in the VIP provent there, 0:04:48.196 --> 0:04:50.516 and there will be a few other people that work 0:04:50.556 --> 0:04:53.396 for that MGM, and there will be free food and 0:04:53.436 --> 0:04:57.476 free booze and a great view of the band. 0:04:58.516 --> 0:05:02.716 Beckett gives LJ a goal fake being a degenerate gambler 0:05:02.796 --> 0:05:05.396 so well that they raise her betting limits from like 0:05:05.556 --> 0:05:09.356 five to fifty thousand dollars a pop, but La is 0:05:09.356 --> 0:05:11.396 still fixated on how to act like a VIP. 0:05:12.636 --> 0:05:14.436 I don't know, Like I guess, should I pretend to 0:05:14.436 --> 0:05:17.076 be someone other than myself? No? I feel like I 0:05:17.076 --> 0:05:19.756 could just be myself a podcast producer in New York 0:05:19.796 --> 0:05:22.676 who is just a little wealthier than I actually am 0:05:22.716 --> 0:05:24.916 in real life, and enjoys batting a little more than 0:05:24.956 --> 0:05:25.796 I do in real life. 0:05:25.836 --> 0:05:27.676 And we love golf. 0:05:27.836 --> 0:05:28.836 We love golf. 0:05:29.676 --> 0:05:33.596 That's Ariela Markowitz, another producer on our show, who's flying 0:05:33.636 --> 0:05:37.276 in from California to be lj's plus one at Charlie XCX, 0:05:38.036 --> 0:05:39.316 and who is so into it. 0:05:40.156 --> 0:05:43.836 How sophisticated should our golf vocabulary be? I feel like 0:05:44.036 --> 0:05:46.276 I should start reading more. 0:05:47.716 --> 0:05:50.036 I mean, you know, if you try and become convustant 0:05:50.036 --> 0:05:52.836 in it, I think that just leads to all risks, 0:05:52.836 --> 0:05:55.316 because if then something you know doesn't make sense, and 0:05:55.356 --> 0:05:58.036 then you're drawn into a deeper conversation about stuff that 0:05:58.116 --> 0:06:01.076 you you know you don't feel comfortable talking about. I 0:06:01.156 --> 0:06:02.476 just I just wanted. 0:06:02.436 --> 0:06:04.316 Okay, well peppered in if we need to. 0:06:04.836 --> 0:06:06.676 And we got some light peppering. 0:06:08.596 --> 0:06:10.756 Do you have any backstories for us? It's toll like, 0:06:10.756 --> 0:06:11.476 how we're wealthy. 0:06:13.676 --> 0:06:15.756 I would, I would keep it vague, but I would, 0:06:15.756 --> 0:06:19.956 you know, family wealth or you know, in saving fears, 0:06:20.156 --> 0:06:23.916 something like that. Maybe you'd been investing for a while 0:06:24.156 --> 0:06:25.636 and you got bought it, so you pulled your money 0:06:25.636 --> 0:06:27.916 out of the stock bucket and decided to gammel with 0:06:27.956 --> 0:06:28.436 it instead. 0:06:29.276 --> 0:06:31.116 Yeah, that seems like gonna be a really hard thing 0:06:31.156 --> 0:06:32.036 for me to pull off. 0:06:32.076 --> 0:06:34.036 Thing casually for me, I'm. 0:06:33.916 --> 0:06:38.756 Like a dead relative. They gave me money, I'm stupid, 0:06:39.356 --> 0:06:42.836 got a honor. May their memory be a blessing? 0:06:43.676 --> 0:06:44.876 Like is that what you do? 0:06:44.996 --> 0:06:47.436 You go and say stuff like that, like have you 0:06:47.516 --> 0:06:47.876 done that? 0:06:48.556 --> 0:06:50.636 Yeah? I mean I've I've set all kinds of things 0:06:50.676 --> 0:06:53.316 to all kinds of people. I don't want to give 0:06:53.356 --> 0:06:54.196 away too much. 0:06:56.796 --> 0:06:58.916 He really doesn't. He doesn't want us to use his 0:06:58.956 --> 0:07:01.356 real name or his real voice, and he's certainly not 0:07:01.356 --> 0:07:04.596 going to tell us all his secrets. But even he's interested. 0:07:05.156 --> 0:07:07.996 He's never seen anyone with no interest in sports or 0:07:08.076 --> 0:07:11.156 gambling try to fake being a degenerate sports gambler. 0:07:11.596 --> 0:07:14.556 I'm gonna I might try just the no Lie route. 0:07:15.556 --> 0:07:15.836 Bee. 0:07:16.236 --> 0:07:18.876 Yeah, I totally improve. I think that's the way it did. 0:07:18.956 --> 0:07:21.276 Beckett approved slowly if that could approved? 0:07:22.116 --> 0:07:34.476 Beckett approved, and I did too. I'm Michael Lewis, and 0:07:34.516 --> 0:07:38.596 this is against the rules. Can I just pause for 0:07:38.636 --> 0:07:43.436 a moment to ponder this strange situation? Just how weird? 0:07:43.556 --> 0:07:48.316 This new sports gambling market now is the biggest sports books, 0:07:48.796 --> 0:07:51.836 Fan Duels and DraftKings, the two companies that basically control 0:07:51.916 --> 0:07:55.676 this market, have gotten so expert at spotting smart gamblers 0:07:55.996 --> 0:07:59.316 and kicking them out that they've already mostly kicked out LJ, 0:08:00.556 --> 0:08:04.196 which of course is not exactly a human tragedy. But 0:08:04.276 --> 0:08:06.796 you might think that the sports gambling companies could also 0:08:06.956 --> 0:08:10.236 use their shrewd algorithms to identify people with gambling problems 0:08:10.996 --> 0:08:14.796 and kicked them out too. As it turns out, not 0:08:14.916 --> 0:08:15.396 so much. 0:08:25.156 --> 0:08:30.196 My name is Jeff. I'm from New Jersey. 0:08:30.236 --> 0:08:33.516 What else? Jeff Gordon is one of those people who 0:08:33.596 --> 0:08:36.516 no one bothered to identify, As he says, he grew 0:08:36.596 --> 0:08:39.276 up in New Jersey. He didn't play sports, but he 0:08:39.316 --> 0:08:42.356 was a sports fan as a kid. He prided himself 0:08:42.356 --> 0:08:46.076 on his sports knowledge, and in early twenty sixteen, he 0:08:46.116 --> 0:08:50.036 saw a billboard ad for a Draft Kings fantasy basketball tournament. 0:08:50.956 --> 0:08:54.036 He was twenty four years old. He paid thirty bucks 0:08:54.036 --> 0:08:56.756 to enter the tournament, and to his delight, he finished 0:08:56.756 --> 0:09:02.276 second overall out of fifty thousand players. This further convinced 0:09:02.316 --> 0:09:04.116 him that he could predict whatever would happen on a 0:09:04.156 --> 0:09:05.996 basketball court better than other fans. 0:09:06.876 --> 0:09:09.476 It was one hundred thousand dollars, which to me, it 0:09:09.596 --> 0:09:11.796 was a lot of money for a thirty dollars bet. 0:09:12.076 --> 0:09:13.916 It is a lot of money for a thirty dollars 0:09:13.956 --> 0:09:15.996 to everybody, it's a lot of money for a thirty 0:09:16.036 --> 0:09:17.956 dollars bet. I mean, that's incredible. 0:09:18.236 --> 0:09:21.316 Yeah, it kind of I have a concept of what 0:09:21.396 --> 0:09:23.596 money is, but at the time it was like water. 0:09:24.436 --> 0:09:28.716 You can go through that very quickly. I think I was. 0:09:28.956 --> 0:09:32.436 I think I bought myself a car and the rest 0:09:32.476 --> 0:09:35.036 of the money was gambled away with it, I want 0:09:35.076 --> 0:09:38.076 to say a couple months, not. 0:09:38.116 --> 0:09:40.396 Even gambled away in fantasy leagues. 0:09:40.436 --> 0:09:44.356 In fantasy leagues and the daily fantasy tournaments in sports betting. 0:09:44.676 --> 0:09:48.276 When was the first time you thought I have a problem. 0:09:48.516 --> 0:09:51.356 When I was watching the six figures turn to five figures, 0:09:51.396 --> 0:09:54.996 to four to three and it hit about four figures 0:09:54.996 --> 0:09:58.556 in my bank account, I said, this is bad. 0:09:59.956 --> 0:10:03.196 But Jeff didn't stop or even really slow down, just 0:10:03.236 --> 0:10:06.636 the reverse. Because the year after his big win, New 0:10:06.716 --> 0:10:11.756 Jersey legalized mobile sports gambling. By twenty nineteen, everyone in 0:10:11.796 --> 0:10:15.236 New Jersey now had a casino in their pockets, and 0:10:15.356 --> 0:10:17.596 Jeff had zero ability to ignore it. 0:10:18.476 --> 0:10:21.956 When you hear that these that you can bet on 0:10:22.036 --> 0:10:28.076 in game parlays, you can do in game betting, player 0:10:28.116 --> 0:10:33.436 bet like, it's just crazy. When that was introduced, I wasn't, 0:10:33.676 --> 0:10:36.396 as I didn't have as much money as I did 0:10:36.476 --> 0:10:39.836 when it was really daily fantasy, but I was still 0:10:40.196 --> 0:10:41.116 involved heavily. 0:10:42.196 --> 0:10:45.756 He started losing money that he didn't have. He scrounged 0:10:45.756 --> 0:10:49.436 for money wherever he could, took out loans, and he 0:10:49.516 --> 0:10:51.956 did stuff he never imagined himself capable of. 0:10:53.036 --> 0:10:55.836 My wife and I were saving for our wedding. We 0:10:55.876 --> 0:11:00.556 had an account, and I dipped from that account and 0:11:01.476 --> 0:11:06.796 that was pretty low, dipped into some other money that 0:11:06.836 --> 0:11:08.476 I shouldn't have gotten my hands on. 0:11:09.956 --> 0:11:11.596 What did it feel like when you were doing it? 0:11:13.436 --> 0:11:15.556 During the time, all I cared about was getting that 0:11:15.636 --> 0:11:18.196 next bet in. But once that that was in there, 0:11:18.236 --> 0:11:24.276 once I lost, I felt like such a slimy, nasty 0:11:25.156 --> 0:11:28.116 case of garbage because I soooped to such a low 0:11:28.236 --> 0:11:30.596 level to get a bet in. 0:11:33.276 --> 0:11:35.516 You didn't need an algorithm to see that Jeff had 0:11:35.556 --> 0:11:40.116 a problem. But an algorithm could easily have spotted it. 0:11:40.116 --> 0:11:42.916 It's all about the action for the convulsion. For me, 0:11:43.516 --> 0:11:45.916 I'll speak for myself, it's not about the money. 0:11:46.196 --> 0:11:48.556 Does everybody kind of agree? It's not about the money. 0:11:49.196 --> 0:11:52.676 Absolutely. One of my favorite sayings is, we could fill 0:11:52.716 --> 0:11:55.356 this room up with one hundred dollars bills and it 0:11:55.476 --> 0:11:57.476 still wouldn't be good enough for us. 0:11:58.236 --> 0:12:01.396 Jeff doesn't have a drinking problem. Jeff doesn't do drugs, 0:12:02.196 --> 0:12:05.196 Jeff doesn't feel the appeal of any other addictive behaviors. 0:12:05.836 --> 0:12:10.796 It's just sports gambling. But the pull is strong, so 0:12:10.836 --> 0:12:13.596 strong that even after his wife throws him out of 0:12:13.636 --> 0:12:16.596 their home, even after he's forced to move back in 0:12:16.676 --> 0:12:20.156 with his parents, even then, he still keeps on punching 0:12:20.156 --> 0:12:24.676 his bets into DraftKings and FanDuel. It made me what 0:12:24.756 --> 0:12:25.156 I feel. 0:12:25.196 --> 0:12:29.156 It was a monster, and it's hard to it's very 0:12:29.156 --> 0:12:34.036 hard for me to to to say, like to let myself, 0:12:34.556 --> 0:12:37.356 to forgive myself, so to speak, because of all the 0:12:37.396 --> 0:12:43.156 relationships I've strained, the money I've taken, and it's just 0:12:43.636 --> 0:12:47.036 it effect. It just made me an angry, angry person, 0:12:47.236 --> 0:12:53.516 very irritable, just like dope sick. Almost. I want to say, like, 0:12:53.716 --> 0:12:57.716 I've never been dope sick, but it was like, unless 0:12:57.716 --> 0:13:01.916 you're in action, you're not. Actually you don't feel human. 0:13:03.036 --> 0:13:08.436 The sports gambling companies have this phrase responsible gaming. The 0:13:08.476 --> 0:13:10.316 idea is to everyone else off of the hook of 0:13:10.356 --> 0:13:12.996 worrying too much about the Jeffs of the world, whose 0:13:13.036 --> 0:13:15.236 behavior is totally unaffected by the warnings. 0:13:15.876 --> 0:13:18.996 Gambling addiction can make change seem out of reach, but 0:13:19.076 --> 0:13:22.476 help is closer than you think. Ready for a fresh start, 0:13:22.796 --> 0:13:26.116 visit ny dot gov bard slash ny responsible gaming to 0:13:26.196 --> 0:13:26.676 learn more. 0:13:27.676 --> 0:13:30.796 These PSAs are a little like the safety talks on airplanes, 0:13:31.476 --> 0:13:36.356 blasted at everyone and listened to by no one anyway. 0:13:36.356 --> 0:13:39.196 At some point into a sports gambling life, Jeff began 0:13:39.316 --> 0:13:43.596 having suicidal thoughts. He'd made plenty of bets and lost 0:13:43.636 --> 0:13:46.836 piles of money, but no one from the sports betting 0:13:46.836 --> 0:13:50.316 company's picked up on it. No one called, no one 0:13:50.396 --> 0:13:54.156 suggested he take a break. Did you ever feel like 0:13:54.636 --> 0:13:57.316 they were trying to detect that you had a problem 0:13:57.396 --> 0:13:59.156 so they could get rid of you or get you 0:13:59.236 --> 0:13:59.556 to help. 0:14:01.276 --> 0:14:04.196 H I would not say that. No, no, they would 0:14:04.556 --> 0:14:06.636 the more money you spent, I feel like the more 0:14:06.876 --> 0:14:11.156 you get the emails, I know that they had those 0:14:11.316 --> 0:14:16.556 cool They have cool off periods, but it's very easy 0:14:16.596 --> 0:14:18.676 to turn off a cool off or it's very easy 0:14:18.676 --> 0:14:21.596 to use another account if you have if you truly 0:14:21.636 --> 0:14:23.916 want to, if you want to, if you want to gamble, 0:14:23.956 --> 0:14:25.996 you're going to find a way to sports bet. 0:14:27.396 --> 0:14:29.596 It actually didn't occur to Jeff that the new sports 0:14:29.636 --> 0:14:33.236 gambling industrial complex for any responsibility at all for what 0:14:33.276 --> 0:14:35.756 had happened to him, that he was at the mercy 0:14:35.796 --> 0:14:38.676 of these new commercial forces that in some earlier age 0:14:39.076 --> 0:14:44.116 he might never have encountered. He just blamed himself. Who 0:14:44.236 --> 0:14:47.276 wasn't until his wife persuaded him to join Gambler's anonymous 0:14:47.596 --> 0:14:50.236 that he saw just how toxic the environment was. 0:14:51.196 --> 0:14:56.676 I see people come in, young, young kids, and they're 0:14:56.716 --> 0:15:00.316 they're they're getting emails spammed to them from from FanDuel 0:15:00.356 --> 0:15:04.556 and DraftKings. They're they're just getting bombarded. It's it's so enticing, 0:15:04.796 --> 0:15:09.516 it's so enticing, and that's just the world that we 0:15:09.556 --> 0:15:09.836 live in. 0:15:10.036 --> 0:15:14.316 You have to adapt and defend yourself exactly. 0:15:14.516 --> 0:15:17.956 That's all I can do is keep going to the program, 0:15:18.116 --> 0:15:21.796 keep going to meetings, speak, be around like minded people 0:15:21.876 --> 0:15:23.996 who want to get better and want to do the 0:15:24.076 --> 0:15:26.796 right thing, Because I know if I go back down 0:15:26.876 --> 0:15:29.716 that road, I'm going to end up doing the shady 0:15:29.756 --> 0:15:33.996 stuff that got me to the point of nearly taking 0:15:34.036 --> 0:15:38.556 my life. I would go to sleep every night praying 0:15:38.716 --> 0:15:40.516 that I didn't I don't wake up. 0:15:44.396 --> 0:15:46.676 Just this one guy with a problem, who my producer 0:15:46.756 --> 0:15:49.396 sort of randomly found in an online chat room full 0:15:49.396 --> 0:15:52.636 of problem gamblers, and he was brave enough to talk 0:15:52.676 --> 0:15:56.116 with us. One guy with a problem you pick up 0:15:56.156 --> 0:15:59.396 in a chat room isn't exactly science or even social science, 0:16:00.556 --> 0:16:03.556 but this one guy happens to be almost perfectly representative 0:16:03.716 --> 0:16:21.716 of a very big social problem. 0:16:21.796 --> 0:16:25.556 What's really interesting about gambling in general and sports gambling 0:16:25.636 --> 0:16:27.956 is a subset of gambling. Gambling in general is the 0:16:27.996 --> 0:16:30.156 way in which is sort of the most efficient kind 0:16:30.196 --> 0:16:30.596 of addiction. 0:16:31.476 --> 0:16:35.516 Charles fan Lehman of the Manhattan Institute, which calls itself 0:16:35.516 --> 0:16:38.556 a right of center think tank. So I guess Charles 0:16:38.676 --> 0:16:40.676 is just done a right of center dive into a 0:16:40.676 --> 0:16:43.196 bunch of new academic research about sports gambling. 0:16:44.156 --> 0:16:48.116 I think about slot machines which are just like designed 0:16:48.156 --> 0:16:52.196 to slowly gently take you down to zero. It's like 0:16:52.436 --> 0:16:54.516 you're can have a complicated relationship with marijuana, you get 0:16:54.516 --> 0:16:57.636 a complicated relationship with heroin, as it turns out. But 0:16:57.756 --> 0:17:01.836 like gambling addiction, if you gamble compulsively, you just keep 0:17:01.876 --> 0:17:03.676 doing it until you have lost all of your money. 0:17:04.076 --> 0:17:05.996 It's very efficient, and so it's very informative. 0:17:06.636 --> 0:17:10.316 It's informative because its outcomes are so clean, but it's 0:17:10.316 --> 0:17:12.996 also informative because of the way sports gambling has rolled 0:17:12.996 --> 0:17:17.676 out over the past five years, state by state. If 0:17:17.676 --> 0:17:20.316 the states had legalized sports gambling all at once, its 0:17:20.316 --> 0:17:23.436 effects would be harder to study. But this is like 0:17:23.476 --> 0:17:27.116 a giant natural experiment. You have data being generated in 0:17:27.236 --> 0:17:30.396 states that have approved gambling side by side with states 0:17:30.396 --> 0:17:32.876 that have it. Walk me through some of the research 0:17:32.996 --> 0:17:34.956 that has sort of affected the way you think about it. 0:17:35.476 --> 0:17:39.916 The sort of bottom line is that economic outcomes get 0:17:40.036 --> 0:17:43.636 much worse, and more precisely, households on average become much 0:17:43.676 --> 0:17:47.276 more precarious, and in particular, the kinds of households that 0:17:47.316 --> 0:17:50.716 are already at risk of precarity become much more precarious. 0:17:50.756 --> 0:17:53.436 And what I mean by that is, their risks of 0:17:53.516 --> 0:17:56.636 defaulting on credit go up, their risk of going to 0:17:56.716 --> 0:17:59.396 delinquency goes up, their risk of bankruptcy goes up twenty 0:17:59.396 --> 0:18:01.156 five to thirty percent, which is a big jump from 0:18:01.196 --> 0:18:01.956 a low baseline. 0:18:03.156 --> 0:18:06.316 One jeff is disturbing. A million jeffs is a big 0:18:06.356 --> 0:18:09.196 social problem, and what the research is showing is that 0:18:09.316 --> 0:18:11.836 every day America has a lot more jefs. 0:18:12.316 --> 0:18:14.956 One of the sort of shocking numbers is for every 0:18:15.316 --> 0:18:18.916 dollars spent on sports gambling, two dollars of investment are 0:18:18.956 --> 0:18:22.396 foregone money transferred into your like Schwab account or whatever. 0:18:22.796 --> 0:18:26.076 People are spending it today rather than on tomorrow. And 0:18:26.116 --> 0:18:28.116 then the point about you know, the most precarious is 0:18:28.116 --> 0:18:30.436 that when you sort of dig down into who is 0:18:30.516 --> 0:18:35.676 most affected, it is generally a young men who across 0:18:35.716 --> 0:18:38.236 a variety of indicators, are prone to risky behaviors, self 0:18:38.236 --> 0:18:41.916 harming risky behaviors. And b it is often those households 0:18:41.916 --> 0:18:44.716 that already have problems with credit, already have some history 0:18:44.756 --> 0:18:48.516 of bankruptcy or delinquency. And so there's people who are 0:18:48.556 --> 0:18:53.116 sort of already primed to not make the most responsible decisions, 0:18:53.156 --> 0:18:54.956 have gas poort on the fire. 0:18:56.236 --> 0:18:58.956 Of course, a gambling problem first reveals itself as a 0:18:58.956 --> 0:19:02.476 money problem, But when a money problem is caused by 0:19:02.476 --> 0:19:05.276 a gambling problem, there are some shocking side effects. 0:19:05.956 --> 0:19:09.716 When the home team has an upset loss an fell game, 0:19:09.996 --> 0:19:14.756 there is a statistically significant increase in rates of into 0:19:14.796 --> 0:19:18.876 a partner of violence domestic violence. The increases even larger 0:19:19.156 --> 0:19:21.356 in states that have sports gambling. And the point is like, 0:19:21.756 --> 0:19:25.116 not only is sports gambling sort of leading people who 0:19:25.196 --> 0:19:28.236 might not have great judgment into really terrible situations for themselves, 0:19:28.556 --> 0:19:32.476 it is contributing to these terrible situations for the people 0:19:32.476 --> 0:19:35.076 who are They are surrounded with their loved ones, their partners, etc. 0:19:35.716 --> 0:19:37.236 It's amplifying fan emotion. 0:19:38.356 --> 0:19:41.756 Yes, if you know it feels bad to lose a 0:19:41.756 --> 0:19:44.676 big bet, it feels particularly bad if you have everything 0:19:44.716 --> 0:19:46.996 riding on it. And if you're the sort of person 0:19:47.036 --> 0:19:49.516 who has everything writing on it, maybe it's not great 0:19:49.596 --> 0:19:51.316 that you were able to place a big bet from 0:19:51.356 --> 0:19:52.556 your phone in the first place. 0:19:55.116 --> 0:19:58.076 The argument that people made back before sports gambling became 0:19:58.156 --> 0:20:02.756 legal is that Americans were already betting on sports. Legalize 0:20:02.796 --> 0:20:05.236 it and regulate it, and it'd be easier to identify 0:20:05.276 --> 0:20:07.596 people with gambling problems and help them to get help. 0:20:09.116 --> 0:20:11.596 What happened instead is that more people are developing gambling 0:20:11.636 --> 0:20:15.276 problems because more people are gambling. I mean, that's why 0:20:15.316 --> 0:20:18.916 in states that legalized sports gambling, the savings rate falls 0:20:18.956 --> 0:20:22.796 and the bankruptcy rate rises. So you've got to kind 0:20:22.796 --> 0:20:26.756 of ask why is this social experiment going so wrong? 0:20:27.956 --> 0:20:30.996 Ohio generally is the caboose when it comes to gambling, 0:20:32.156 --> 0:20:34.716 and that's not a bad place to be because you 0:20:34.996 --> 0:20:38.956 learn so much from all of the states that have 0:20:39.036 --> 0:20:39.676 come before. 0:20:41.196 --> 0:20:47.276 Meet Matt Schuler, Ohio's sports gambling regulator. Ohio only legalized 0:20:47.276 --> 0:20:50.436 sports betting last year, but it already allows seventeen different 0:20:50.476 --> 0:20:54.436 mobile sports gaming apps. Up till now, Matt's job has 0:20:54.436 --> 0:20:57.996 been to regulate casinos in the state. This new form 0:20:58.036 --> 0:21:01.236 of gambling, well, it's added a whole new wing to 0:21:01.276 --> 0:21:05.036 Matt's duties. Not all of the states that legalize sports 0:21:05.076 --> 0:21:07.436 gambling have someone like Matt, but most of them do 0:21:08.276 --> 0:21:11.556 someone who's never regulated sports gambling and is being asked 0:21:11.596 --> 0:21:15.956 to figure it out quickly. Most of these regulator types 0:21:16.076 --> 0:21:19.476 declined to come on podcasts, But since he's been in 0:21:19.516 --> 0:21:23.036 his new job, that's seen some stuff that he really 0:21:23.076 --> 0:21:24.436 feels the need to talk about. 0:21:25.716 --> 0:21:28.236 So here's an example of something I think is rather 0:21:28.396 --> 0:21:32.236 dastard One of the sports books in our state. If 0:21:32.276 --> 0:21:38.036 you place three straight wagers, whether it's on different teams 0:21:38.156 --> 0:21:40.876 or different aspects of a game with the same team, 0:21:41.636 --> 0:21:46.356 that app will automatically take your three separate straight bets 0:21:46.396 --> 0:21:49.836 and turn it into a parlay bet. In a parlay, 0:21:49.876 --> 0:21:53.356 you have to get all three of those right to win. Now, 0:21:53.396 --> 0:21:55.676 you might have won two out of three and actually 0:21:56.276 --> 0:22:00.476 you won something. But when you roll it into a 0:22:00.556 --> 0:22:05.036 parlay automatically, sometimes they don't even know that happened. 0:22:05.996 --> 0:22:07.916 The better doesn't even have to approve. 0:22:08.796 --> 0:22:12.196 No, that's bizarre. I think it's sinister. 0:22:14.756 --> 0:22:16.676 The apps all have a lot of these little nudges, 0:22:17.036 --> 0:22:19.556 not just to place bets, but to place certain kinds 0:22:19.556 --> 0:22:22.436 of bets. Parle bets tend to make more money for 0:22:22.476 --> 0:22:25.956 the sports betting companies because it's easier to trick people 0:22:25.956 --> 0:22:29.876 into taking bad odds on these bets. Parley bets are 0:22:29.916 --> 0:22:33.036 long shot bets, and the human mind is notoriously horrible 0:22:33.276 --> 0:22:36.676 at thinking about long shots. Offer most people fifty to 0:22:36.676 --> 0:22:39.516 one odds, and they get so excited that they don't 0:22:39.556 --> 0:22:42.396 notice that they should really be getting one hundred to one. 0:22:43.476 --> 0:22:45.996 What else needs to be done that isn't being done? 0:22:46.596 --> 0:22:48.116 Like where else do you? When you look out, you 0:22:48.156 --> 0:22:50.436 say like, I can't believe that's allowed. 0:22:52.316 --> 0:22:55.036 All operators are required at least here in Ohio, and 0:22:55.076 --> 0:22:58.156 I'm sure this is the case elsewhere to use the 0:22:58.276 --> 0:23:02.396 very kind of sophisticated data they collect on their customers 0:23:02.716 --> 0:23:07.476 to identify those that are engaging in problematic handling behavior, 0:23:08.196 --> 0:23:12.836