Not at all. In fact, I wrote this up because of a conversation I had a while back with a man buying a lottery ticket at the gas station. I was talking with him about how bad the odds were, and he fully admitted that he was getting terrible odds on that dollar.
But he figured that on the one in a million chance that he hit the jackpot, even if he only saw a quarter of that amount he could actually get out of debt and start making the power of compound interest work for him instead of against him, and after enough time with that money in the bank, the scales would tip in favor of spending the dollar on the lottery ticket.
Now, I don't think that argument really holds water, and I told him so (for several reasons, even apart from my skepticism that he'd actually put any cash he won into a properly managed account without spending a huge chunk of it first; the odds at the lottery are so hideous and the doubling time for a quarter million that you're also drawing money out of to live off of is very long, so it would be tough to make those numbers work out), but it got me started thinking about whether there might actually be situations where a losing gamble could be worthwhile, depending on the current situation of indebtedness.
I like to pickup lotto tickets occasionally; it's basically a small fee to spend the week daydreaming about what you'd do with a sudden influx of money you didn't have to do any work to get. If I win back the cost of the ticket on a minimal prize I consider myself to have won.
Gambling where you get the results quickly (pretty much anything at a casino) has no appeal for me though, I see that as simply destroying money.
This is exactly why the lottery is called a tax on the poor. For one, it's hard to think about expected value when you can't pay your bills.
Also people greatly overestimate their odds of winning big prizes like that. If the odds of winning the lottery were 1 in a million I'd be buying tickets by the truckload.
Fully in agreement here. And actually, I agree with the moral of what you've said almost elsewhere else on this thread; I meant this post to be a bit more tongue-in-cheek than I suspect it came across, I definitely should have made it more clear that I don't really think poor people should be heading to the casino every time they come up short when rent's due. :)
Not at all. In fact, I wrote this up because of a conversation I had a while back with a man buying a lottery ticket at the gas station. I was talking with him about how bad the odds were, and he fully admitted that he was getting terrible odds on that dollar.
But he figured that on the one in a million chance that he hit the jackpot, even if he only saw a quarter of that amount he could actually get out of debt and start making the power of compound interest work for him instead of against him, and after enough time with that money in the bank, the scales would tip in favor of spending the dollar on the lottery ticket.
Now, I don't think that argument really holds water, and I told him so (for several reasons, even apart from my skepticism that he'd actually put any cash he won into a properly managed account without spending a huge chunk of it first; the odds at the lottery are so hideous and the doubling time for a quarter million that you're also drawing money out of to live off of is very long, so it would be tough to make those numbers work out), but it got me started thinking about whether there might actually be situations where a losing gamble could be worthwhile, depending on the current situation of indebtedness.