How to make $600/day the hard way

This Wired magazine article is not about investing, but some might find it as interesting as I did (I heard about it from bogleheads.org).

Mohan Srivastava, a geological statistician, found a statistical flaw in an Ontario lottery program, allowing him to predict winning tickets with 90% accuracy prior to purchasing them.  When he contacted the Ontario Lottery and Gaming Corporation,

he was referred to Rob Zufelt, a member of the lottery corporation’s security team. After failing to make contact for a few days, he began to get frustrated: Why wasn’t Zufelt taking his revelation more seriously?  “I really got the feeling that he was brushing me off,” Srivastava says.  “But then I realized that to him I must sound like a crazy person—like one of those people who claims that he can crack the lotto draw because last night’s number was his birthday spelled backward.  No wonder they didn’t want to talk to me.” Instead of trying to get Zufelt to return his calls, Srivastava decided to send him a package. He bought 20 tic-tac-toe tickets and sorted them, unscratched, into piles of winners and losers.  Then, he couriered the package to Zufelt along with the following note:

In the enclosed envelopes, I have sent you two groups of 10 TicTacToe tickets that I purchased from various outlets around Toronto in the past week… You go ahead and scratch off the cards. Maybe you can give one batch to your lottery ticket specialist. After you’ve scratched them off, you should have a pretty solid sense for whether or not there’s something fishy here.

The package was sent at 10 am. Two hours later, he received a call from Zufelt. Srivastava had correctly predicted 19 out of the 20 tickets. The next day, the tic-tac-toe game was pulled from stores.

The article also includes some troubling statistics.  Households earning less than $12,400 spend an average of 5% of their income on lottery tickets, whose expected value is 53% of the price you pay.  Thirty percent of people lacking a high school education said that playing the lottery is a wealth-building strategy.

Coincidentally, lottery tickets made an appearance in the Dilbert comic strip yesterday.