Edward Oakley Thorp

(1932, Chicago. University of California, Massachusetts Institute of Technology) Edward O. Thorp is best known for writing the original card counting manual Beat the Dealer, which was first published in 1962, and for his research on probability theory applied to blackjack. He is the first person to have proven mathematically that it is possible to beat the dealer at blackjack by counting cards.

The First Signs of Success

Using J.L. Kelly Jr.’s 1956 formula for calculating the optimal size of series of bets, Thorp began analyzing the game of blackjack and its winning probabilities. He devised card-counting schemes using one of the first IBM computers to increase his odds and tested his system in Lake Tahoe, Reno, and Las Vegas. He carried out this fieldwork with professional gambler and underworld figure Emanuel “Manny” Kimmel, and gambling expert and sleight of hand artist Mickey MacDougall. In Las Vegas Thorp’s winning streak attracted the attention of casino security, and he began to be ejected from the premises. He took to using disguises such as hats, fake moustaches, beards, and glasses to avoid being recognized.

Publication

His exploits soon became well-known within the gambling community, and in response to the demand for information about his stategies, Thorp wrote his best-selling book Beat the Dealer: A Winning strategy for the Game of Twenty-One. The book was a great hit, especially considering that the subject matter is very specialized. Thorpe’s book also caused a lot of contorversy, especially by having angered established gambling expert John Scarne, who continually contested Thorpe’s claims. Thorpe’s system was the real thing though, but it was also very complicated and difficult to master. Despite the influx of players trying and failing to use the system properly, casinos felt threatened enough by those who could master it to adapt their rules. Thorpe then worked toghether with various other mathematicians on a blackjack panel to develop a more accurate and less cumbersome system that could handle the newly introduced multiple deck odds. He published these updated systems in the second edition of Beat the Dealer. This was also the book the MIT Blackjack Team thoroughly studied before rising to fame.

Further Exploits

Thorp enjoyed applying probability theory to gambling. He also set up a baccarat team, and together with Claude Shannon he also developed a wearable computer to predict the odds of roulette wheels, which they used to play together. He later took to applying his skills in probability and statistics to the stock market, made a fortune by exploiting pricing anomalies, and rode out the success of the “Beat the…” title with Beat the Market: A Scientific Stock Market System.

In 2003 Edward Thorp was elected one of the original seven Blackjack Hall of Fame inductees.