I have been reading Casino, and the whole gambling business is way over my head but I cant figure out what a layoff man is. It said if there were too many bets for one side, they would call the layoff man and he bet for the other side, so the bookies wouldnt get swamped with wins. Isnt that really unproductive, for both sides? The layoff man obviously gets his money, and more, back for his troubles, or else he wouldnt do it, but then the bookieowes the wins, plus the layoff man his original money, plus the extra for his trouble.This cant be profitable, so I must have missed something.

plawrence is the best source for a definitive answer. But, until he weighs in:
Horse and dog racing, and jai-alai, have pari-mutuel betting, in which the track or fronton protects itself by adjusting the odds according to how much money is bet on each horse, dog or player. If a lot of money goes down on a favorite, the track's computers adjust the payoff odds downward so that even if the favorite wins, the track will still make a profit on the race.
For example: Smarty Jones was such a heavy favorite at the Derby that the odds were 1-5. So, even if he'd won, Churchill Downs still would have made a profit on the race. Conversely, a longshot may have a big payoff--but the odds were calculated on how much was actually bet on that horse, so the payout won't result in a net loss.
But a bookie joint doesn't make the odds, nor calculate them based on money bet at the joint. A heavy bet on a favorite that wins, or a heavy bet on a longshot, can bust the book. That's why they lay off heavy action with others, who can balance their own books. In effect, it's a network that acts like a track, guaranteeing profits.

If I can add to what Turnbull said.

When you bet with a bookie it costs $11 to bet $10.

The one dollar is the "vig" or price of doing business.

So, if Charlie the bookie takes 10 $10 bets he really takes $110.00

If all the bets are for one team to win, say for the Reds to beat the Yankees. Charlie will then get in touch with someone who has 5 bets for the other team. So Charlie has 5 for one and 5 for the other. The wins cancell the losses and he makes $10. Multiply that by thousands, and factor in point spread and all that and you can see it adds up to some serious $$.

Hope this helps.

Mike's Bodyguard pretty much nailed it.

Think of the world of illegal sports bookmaking as a pyramid. A lot of small bookies on the bottom, a few larger ones above them, and so on up to the top.

Since bettors, when betting against a point spread, must always lay $11 to win $10 whichever side they choose, it's in the best interest of the bookie to always have an equal amount of action on each side.

Sometimes, though, his "books don't balance", so he "lays off"(bets) the excess with another, larger bookmaker, If this causes too much of an imbalance for the larger bookie, he lays off some of the action to someone larger than he is.

The higher you get up the pyramid, the less necessary it becomes for a bookies "book" to balance exactly , since he's handling so much action.

The 11-10 that the bettor must lay gives the bookie a built in 5% edge whichever team wins. He makes $1 on every $20 wagered if his books are in balance. But for a large bookie, a slight imbalance does not create a problem. All it does his decrease his edge from 5% to a lower percentage.

Every once in a while though, there's a "bad line", which causes the public to bet like crazy on only one of the two teams. Small bookies layoff their excess to bigger bookies, and the bigger bookies layoff to bigger bookies, and so on.

But in those rare occasions where there is a tremendous imbalance,thebookies can lose money if the team everyone bet on happens to win.

Of course, if that team happens to lose, then the bookiesmake a lot more than they normally would.

Some bookies don't layoff their excess action, and play for the big win, but in those cases they become nothing more than gamblers themselves.

Thanks a lot for the help. I still dont understand the whole thing real well, but give me some time to think about it...