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Suppose these are the players on a table on which a game has just finished.

A1 B2 C3 D4 [E5] F6 

[E5] was the dealer. But now [D4] [E5] [F6] left, and [G7] [H8] joined.

A1 B2 C3 __ [__] __ {G7} {H8}

Now who gets to be the dealer?

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This is a really good question, many experienced players get it wrong when playing live :) . – Radu Murzea Apr 17 '14 at 13:37
Is there any particular reason you declined to accept my answer when it said exactly the same thing as Xaruth's, just in different words? I'd like to know for next time. – Brent Morrow Apr 19 '14 at 2:36
@BrentMorrow Your answer was lacking detail earlier. And I may not have read it again (my bad) when I accepted Xaruth's answer, but their detailed explanation made the concept clear to me instantly. – laggingreflex Apr 19 '14 at 12:21
up vote 1 down vote accepted

On the first hand, F6 is SB and A1 is BB.

Don't look where button go but look where BB go on new hand (rule of the dead button). Second hand, B2 is BB, A1 is SB.

Button is theoricaly at F6 (empty seat) and no player can enter betwwen button and SB, so Button stay in a empty seat and new players (G7 and H8) can't play this hand (no deal and no ante for them)

Next hand, if no one leaves, C3 will be BB, B2 will be SB, A1 will be the Button, and everyone will play.

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A1 is the small blind and B2 is the big blind. The F6 seat is the button, even though it's empty, as it would have been the button had the players stayed — it's a dead button. We can't skip having A1 as the small blind — that would just be giving him a discount. G7 and H8 can't come into a game in the middle of the blinds so they'll have to wait to play until the next hand when A1 is the button.

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Notice that under the Moving Button rule A1 will post SB and becomes button, while both B2 and C3 will post BB! After that hand B2 becomes button and both B2 and C3 will post SB, G7 posts BB. Next hand brings sanity: C3 - button, G7 - SB, H8 - BB.

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