I was actually the BB in this hand.
And I agree the guy needed to raise those 7s preflop.
I am shocked that anybody can put the BB (me) on AJ here. Who checks TPTK on the flop out of position then flat calls a bet and a raise ... and then thinks he's good catching a miracle two pair? I would never ever play it that way. Would you?
Similarly Ax of hearts or a combo draw of some sort ... that would be a really dumb way to play it. You want to be betting/raising on the flop, not the turn. The CO's line just screamed set. Trying to push people off sets when you have only 1 street to catch up ... no thank you.
Anyway, the guy with 77 had been playing very LAG preflop, mostly following up his preflop raises with full pot bets whether he hit or missed. This smallish flop raise, then the big turn bet, made it clear he had a set. I was pretty clear he had the set on the flop, actually. So I thought this was the best way to play the flopped straight. Let your opponents make the biggest mistake you think they will make (quoting TUP from another hand where I flopped the nut straight) -- and calling a push on the turn is way worse for a set than calling it on the flop. If the board had paired on the turn I'm pretty sure I could have gotten away from this. If the board had 3-flushed I don't get his stack, but I do get a pretty good amount: I can bet it for an amount that I think he can call to chase his boat outs.
Apparently hard2tel thinks I'm not a half decent player based on this hand... guess I have a lot to learn.
But thanks for all the replies. I was pretty sure he couldn't get away from his hand once he had committed so much, but he did think for an awful long time before he called. Board didn't pair on the river.