A central idea, the idée fixe of Bankers Anonymous, is that as a society we do a poor job of teaching about finance, a consequently poor job as individuals of learning about finance, and therefore we all suffer an inevitable tendency to make bad decisions, both personal and political, about finance.
Sometime this Spring I realized why: We played Monopoly all wrong as kids.
This explains everything that I’m trying to do with Bankers Anonymous.
1. Free Parking – We collected all taxes – luxury tax, income tax, and taxes accumulated from Chance and Community Chest cards – in the middle of the board. In addition, we frequently ‘seeded’ Free Parking with an orange $500 bill. When a player landed on Free Parking he collected all the accumulated taxes, plus the $500, in a lottery windfall. None of this exists in the real rules on Monopoly.
2. No Property Auctions – When we played, the player who landed on an available property got the exclusive option to purchase it, at the listed price only. In the real rules, if the initial player declines to pay the listed price, any player may bid on the property, at any price – starting if necessary at $1, with no upper limit to the final auction price.
These house rules turn an interesting game about capitalism into a boring monstrosity. A monstrosity responsible for societal poverty, government debt, runaway inflation and the Crisis of 2008.
Real rules Monopoly is so much better for society
Let me explain why real rules Monopoly is far better.
Free Parking – Free Parking is stupid. Growing up, my friend Brendan always, always, ALWAYS landed on Free Parking, collecting the taxes and the $500. How did he do that? I have no idea.
Although he may have always won the game, I can be smug in my knowledge that Brendan learned bad lessons from Free Parking. Free Parking never happens in real life. Nobody actually wins the lottery. Clearly, Free Parking is a gateway drug for kids to learn about lotteries, casinos, and all the other terrible ways in which poor people pay taxes.
Property Auctions – This would have been the ideal way to teach millions of children about valuable concepts like savings, real estate, competitive auctions, distressed investing and slum-lording. Information, in other words, we can all use.
Instead, by eliminating the auction, we learned in Monopoly house rules that there’s just one price for property, take it or leave it, and that chance – rather than skill – determines whether you accumulate valuable properties. But that’s never how it works in life.
In real life, sometimes you can nab the property nobody else wants on the cheap. In real life, sometimes you pay twice what the property is really worth and end up mortally wounded financially.
Bidding wars can break out in real rules Monopoly, which lead the ‘winner’ of the auction to actually be the ‘loser’ in the long run. This is a valuable financial lesson. It explains much of the real estate boom 2001 to 2007.
Monopoly isn’t a bad game, if played right
I was reminded of all this by a recent feature on Business Insider showing the odds-adjusted advantageous properties to buy.
According to the feature, to play the odds, in sum:
1. Buy the orange properties,
2. Build 3 houses per property at one time (i.e. 9 houses, for most colors) for the fastest return on investment,
3. Take into account the likely dice rolls of your opponents. (5, 6, 7, 8, and 9s happen more frequently, build accordingly), and
4. Note that “Jail” acts as a ‘sink,’ attracting more than your typical proportion of landings. Other properties also have higher probabilities as landing spots, so invest accordingly.
All sound advice.
My advice is to play by the real rules, which turns Monopoly from an endless bore of a game to an interesting lesson in real financial skills.
Epilogue – The bad news: I played real rules Monopoly for the first time in my life this Spring with Brendan, as well as with my 7 year-old.
My 7 year-old, with some coaching, won. At least Brendan didn’t win. I hate Monopoly.
 I’ve linked here to a site that explains the origin of the typical house rules for Monopoly. It turns out the rules were probably designed to keep kids from getting upset with Dad during the game. As a Dad, that makes sense. But as an ex-banker, I’m livid since this encapsulates everything that’s wrong with Western Civilization.
 In my 100% invented-out-of-whole-cloth fake poll, 93% of American households adopted these same house rules. I’ve rounded down to be conservative, because that’s just good science.
 When we played real rules Monopoly recently, Brendan and I cleverly avoided the railroads. Because: No houses! Meanwhile my 7 year-old picked them up on the cheap. Guess who won?
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