[ig1]

> When Las Vegas casinos come up with new ways to gamble is it called innovation?

Yes.

In my personal opinion the difference between gambling and investment isn't in terminology. It's about expect return. If your expected return is negative than it's gambling, if your expected return is positive it's investment.

[asmithmd1]

Gambling is when the economic activity is zero-sum -- there is a loser exactly equal to the winner. Investment puts money to work so the effect is their is more real wealth in the world. For example, a farmer buys an irrigation system with a small business loan -- now there is more food in the world. A homeowner uses a home equity loan to insulate his house -- now there is more energy in the world.

Contrast this with a casino developing super-slots with a $1 million payout. The casino might increase their take, but their is no increase of real wealth in the world.

[arethuza]

Well, if I go out and buy some stock in a publicly traded company post IPO the company won't see any of my money it will simply go to someone who purchase it from its current owner.

[yummyfajitas]

If there was no secondary market, the company would receive far less money at the IPO.

Liquidity is very valuable. Compare the more and less liquid shares in Chipotle - the only difference between CMG and CMG.B is that CMG.B has more voting rights, but less liquidity.

http://www.google.com/finance?chdnp=1&chdd=1&chds=1&...

[arethuza]

Sorry - I was really thinking about the definition of "gambling" and "investing" above. So perhaps using that terminology the original investors at an IPO are willing to do so expecting liquidity based on the willingness of others to gamble on the stock.

Or something like that :-).

[asmithmd1]

I agree, if you "invest" for a few months or days you are just gambling.

Check out this post on where to put your money now -- this is not a scam therefore it is not easy, or risk free:

http://scottlocklin.wordpress.com/2010/11/20/investments-for...

[pessimizer]

You're confining gambling only to casino games or games with vigs (http://en.wikipedia.org/wiki/Vigorish). Under your definition, when I play cards with my friends for money, I'm not gambling because my expected return is zero. Actually, judging by my known skills in any particular game vs. my partner's skills, what I'd be doing would be varying nightly.

What you're saying seems to be a useful distinction, though, but I'd say it's the difference between "risk entertainment" or something else and investment, rather than gambling and investment, because it's all gambling.

[arethuza]

I really don't think gamblers think that way - I know people who play poker fairly seriously (which is clearly gambling) and they play to win and generally they do pretty well - certainly well above break-even.

[ig1]

All gamblers play to win.

Think about it this way: if you buy a slot machine to put in your store/bar/etc, are you gambling or investing ? - it's clearly a game of chance, and you might lose money on it, however because the odds are set in your favour in the long term you'll make money. Hence it's an investment rather than gambling.

You do actually get angel investors who invest in poker players with solid track records.

[tkahn6]

I think serious poker is in a different category than slots or roulette.

You can call it gambling but there's a reason there exist top poker players who win with consistency. If it were really random chance, you wouldn't see players that make a living playing poker.