else think its very interesting that the top part of this Keenland yearling sale is so strong with very very little participation from Sheik Mo?
There\'s some new blood buying at the top end which is great to see.
As I posted last week, there are clearly things that need to be fixed in the game (like many other games) but there are also some reasons to be optimistic and the top end of this sale being so strong without Sheik Mo playing is one of them.
You have got to be kidding...... Let me explain, first they the front-loaded the sale and there is nothing to compare it too and furthermore the absence of Sheik Mo is a\"long term disaster\".
Watch what happens after Book 3, the sale will collapse. This reminds me of Charlie Haywood crowing that the Saratoga meet was a big success. All \"spin\" but no pocketbook!
High Roller,
The sale is \"front loaded\" every year. They take the best horses with the best pedigrees every year for book 1. Been that way forever. Not sure what you are talking about.
First, here are some numbers. The averages and median\'s were up more than 30% from book 1 last year. Those are just numbers, not spin. The $4.2mn horse was the highest price paid for a yearling since 2006, another number, not opinion. The guy who sold the $1mn smart strike ridgling today had a $179,000 reserve on the horse. He had no idea the bidding would go up to $1mn. Another fact.
Second, I know alot of people at the sale, including the agent consigning the horse than I am selling there and another agent who is working on the buyside for me and its a strong consensus by alot people on the ground that the sale is stronger than expected. Its not the go go 2007 sale by any stretch but it\'s better than it was last year.
Of course books 4, 5 and 6 will be weak, the median price in those sessions is typically about 1/10th of the book 1 every year so your view that the \"sale will fall apart after book 3\" is just like your comment that they \"front-loaded the sale,\" It happens that way every year.
Do you have any numbers to back up your view that I \"have got to be kidding\" or were you just mouthing off?
Covel...
I\'m also surprised it\'s so strong. I\'m just amazed at you guys who play at the top of the market. How many of these scores of $400,000+ yearlings make a profit for the buyers? I mean you really have to be a Grade 1 winner to make that pay off especially as there are very few going for the real big money as stallions these days. Is it just a numbers game where you buy a batch of them and hope one breaks through that\'s worth $10 million? I\'m not sure I could play that game even if I was a billionaire. That phone call from the trainer that a $2 million unraced horse got hurt down must be brutal. What is interesting to me now is the proliferation of the evermore lucrative state bred programs where you can have a horse and training paid for with one restricted state bred maiden win these days. Are you buying any of that stock in addition to your bigger stakes horses?
Covel,
While it\'s too early to say definetively what the final outcome is, the early numbers speak for themselves. I\'m not sure how anyone could put a negative spin on the facts you cite.....
The Sheik may have been playing with \"borrowed\" money for a lot of thsoe years. (Sovereign wealth Funds) Maybe there are more Big Players at the table figuring they don\'t have to do battle with his \"blank check\".
I would be the first to admit I\'m not greatly informed here like others but maybe people want a \"real race horse\" for once. There hasn\'t been any rush to retire and syndicate deals. Japan isn\'t gobbling things up much anymore. Storm Cat is about pensioned so Mike Tabor doesn\'t have much to do.
Besides the Big Studs, AP Indy, Smart Strike, Unbridled Song, there are some \"really good\" young Stallions out there for people to bid on.
Why don\'t we just wait and see the numbers for the whole sale and see if it\'s up or down from last year, CARE TO WAGER???
I have also talked to many consignors at the sale (as I am a buyer). There is less traffic at the sale and more importantly many horses going through with no reserve as they are captives of bank liens. There are also scores of farms and and sellers on the verge of bankruptcy.
P.S. I feel sorry for you as you are a \"confirmed kool-aid drinker\" who feels the need that every horse needs weeks and weeks of rest between every start.
I don\'t doubt for a minute the \"farms facing bank leins\" aspect. There had to be way too much free credit floating around at previous sales. Or just a lot of shaky collateral.
This is good for respectible prices being paid. Maybe the days of free credit \"so people can fleece the geese\" are over.....
High Roller,
Let me recap this thread:
Covil makes a post expressing optimism that the ealry results of the sale look promising.
You respond by saying he\'s an idiot for thinking such a thing.
He responds by posting facts - not opinions - on the results of the sale to date and asks you to state facts to the contrary.
You respond by asking him to wager on the outcome, basically changing the subject, and still haven\'t provided any facts. To top it off you then go totally off topic and attack his handicapping approach with the ridiculous Kool-Aid drinking bit. Still no facts...
Does that about summarize it?
Check out the OBS yearling sale, which was a terrific improvement by all metrics over recent sales...it\'s not Keeneland, but it\'s indicative of a comeback. Of course, there are fewer horses being bred, which is good and that has to have an effect on the overall value of each individual.
Regardless of how one reads and deciphers it, good horses are selling for more than they did last year, they are racing for better purses overall and the business-sport will be around longer than the critics who don\'t begin to understand it.
Hey Martoon,
Thanks so much for the message.
One thing up front, I am far far far from a big player at these things. I will take a leg or a third of a big one once in awhile but I don\'t want to give anyone the impression that I am some big spender because I am not. I wish I could be and I hope to be some day but I am not there yet. By the way, it really really sucks when the trainer calls you about one of the expensive ones going down (even if you only own a leg).
Its a really really interesting question that you ask about the state bred programs. Some of my partners and I are focusing on the PA Bred program.
Check out the card on Sat at Philly Park (I guess now Parx Racing).
The are calling it owners appreciation day and I sure do appreciate it.
We are running one of our homebreds in a MSW for 2 year old fillies where the purse is 90k. It\'s an open company race (i.e. not restricted to PA state breds) but first preference for starters was given to horses that had raced before at Philly Park and then second preference given to horses that had workouts at philly park. This was a creative approach by the Parx racing secretary. We ran our filly in her second race at Philly specifically with the idea of this race in mind in case we didn\'t break our maiden in that race (we finished 3rd but ran a 13 and change on the sheets which should be good enough to win this if we can pair). Since we are PA Bred, even though the purse of that open company race was 45k, we ran for 63k because PA breds run for a 40% bonus against open company if you finish 1st, 2nd or 3rd.
If we win this race on Sat. with the 90k purse (we are one of the favorites but who ever knows with these young ones), it would pay for the entire cost of the mare we bought out of the sale a few years ago, the stud fee and all of the costs of getting this one to the races and we would still have some left over. Her name is Mean Reversion (I am the Scout Stable part of the ownership group that\'s listed)
The PA Bred program is terrific. The idea is clearly catching on which we can measure by the number of PA breds that are entered this year in the mid-atlantic yearling sale in a few weeks.
PA clearly has the right idea, others need to start following their lead.
Alm,
Good post, totally agree.
Are there things we can do better and fix as an industry? Absolutely yes but we are making some progress (breeding fewer and not just to pinhook, less buying on credit, better drug testing, far from perfect of course) and I think we will get there. See my post back to Martoon on the PA Bred program. You can actually make the economics work with PA Breds.
We have a long way to go but we are making some progress.
The Kee sale is not even close to a reflection of the big racing picture which is as close to a disaster as possible.Consignors were paranoid pre sale, every one spoken to, shaky at best. I\'m sure they are somewhat relieved by the early results but it\'s probably temporary.
A new sucker or two at the sale is no more than a temporary bright spot, the absence of Sheik Mo a disaster.The new suckers will probably go broke like most of big multi million that cash in their \"core\" businesses and try to \"conquer\" racing. I could list a dozen or so recently, one I\'am personal friends with(stuck $50 million), but we\'ll just look at the all time sucker Sheik Mo, stuck about $500 million on racing stock(last rough count)
There is no question that there are bargain hunters at Kee who are aware that several\"nice\" consignments are being handled on behalf banks who are liquidating stock of owners who have defaulted on loans. These consignments have no RNA and guys that know are sharp-shooting trying to steal one for maybe half of what they are reallly worth.
The lack of bank credit alone has farms, pin hookers,breeders on their knees with no real end in sight.Many large claiming outfits in NY and Cali gone and some perennial players that wager big money are slowly backing up or disappearing.CALI increasing the takeout on certain exotics is bound to stop borderline rebaters a little, as a couple of points is huge on the handle of a whale.
Horseman\'s bookkeepers across the country have never had so many outfits \"not in good standing\"(owners not paying bills). Trainers in New York are putting horses on trucks and returning them to their owners for non payment of day rates.Top NY claiming outfit owes their trainer over $350k for almost one year.
The final shoe may be about to drop. The recent recommendation of the committee that reviewed racing in New Jersey is the first sign of the politicians wavering on supporting/subsidizing the game. Once the politicians figure out that there may be an extra buck \"in letting racing go private\",it will truly become a boutique meet type game.The argument about racings job creation and economic contribution is way overstated when picked apart by the bean counters.Statebred programs will be slaughtered when/if the politicians stop forcing racino\'s to contribute big money to pump up losing live race meets.
The most lucrative racing franchise in the US,New York, was \"passed on\" by some very sharp business people because EVERY feasibility study performed by the consultants showed racing to be an albatross on the gaming/slot revenue, now and in the future.A foreign non racing outfit,Genting the only real bidder now owns the Aqueduct slots.
Bright spots?,It must be my sunglasses blocking them.Having said that, I\'ll be one of the last suckers looking to make a pick six play or buy one or sell one or whatever.
Mike
Mike
Read \"Supercycles\" by Arun Motiani...a book about the macro economic issues that shape the micro issues...the world economy is in a massive paradigm shift that makes things look and feel dire for some, but absolutely limitless for others.
Racing is a business-sport that surfs waves like the one he describes. It\'s going to look awful for some and very promising for others. IMO a combination of internet and cross border betting will combine with a smaller thoroughbred population to result eventually in a smoothing of this downturn.
It will never look great in the US again, for sure. I agree with you about that. But it will look a lot better to the bettor at some point...betting on better stock in boutique meets and foreign tracks. It\'s coming.
Shocker that Miff takes a negative contrarian view to one of my posts, haven\'t seen that before.
I am pretty sure that if I posted that the sky was blue, Miff would find a way to vehemently negatively disagree with that. I get it Miff, you think I am an idiot. It\'s a long line that you have ahead of you to express that view. The line starts with my wife, you will have to wait for awhile in the line while she goes through her list of issues.
Good thing is that if Miff is right, it\'s only a matter of days before the racing industry disappears alltogether and so we won\'t have to worry about any of this stuff anymore.
Cov,
Never said you were an idiot,never implied it and racing not going away tomorrow but is continuing to slide downwards.New York guys don\'t hide behind screen names, if I had something to say to you I would,I don\'t.
Racings only hope would be if 30 state racing venues\"partnered\" and that will never happen.To understand racing in this country, you have to understand the financial side. During the bidding process for the NYRA franchise I was involved with one of the consulting firms and saw unbiased financial projections re New York Racing(Nyra and OTB). They were disastrous to say the least and hence no serious bidders for a captive NY multi billion dollar business.
The entrepreneurs walked, the fortune 500 never even considered it, brokesters and political charlatins made up most of the bidders that showed up.I believe you may be New York Wall Street(I was for 30 years) so just stand back and think about the whys.
With politically appointed stooges and clueless racing execs calling the shots, along with the old fools in their Jockey Club fiefdoms, racing is terminal, boutique meets at best as AL said.If you can bet on what I just said do it, I\'d \"short\" racing for all I have if the same people stay in control.
Voiceless players tired, stalwart bettors that I know in NY, CALI, KY and Fl for years and years are wavering.
Thats my side, you obviously know another side which I am not familiar with.In any event very good luck to you.
Mike
Some interesting posts on this string, notably from Jim and Mike. But here\'s the question-- how is a \"good sale\" (prices for horses going up) good for the industry in general?
I know it\'s life or death for many in Kentucky, I know some of them and feel for them. But the breeding industry is NOT part of the racing industry, it\'s a separate industry that supplies product to it. The more it costs to buy horses, the tougher it is for owners in OUR industry to survive. It\'s simple math-- a zero sum game.
Purses in North America are around $1 billion annually, expenses twice that-- without counting the cost of the horses themselves. That means owners as a group are losing far more than 100% of their investment.
Betting on racing is the original derivative-- we are not involved in the event, but our outcome is dependent on the outcome of the event. Our betting pays for purses and everything else, including in the end the cost of the horses (no purses, no point in owning one). It\'s a gambling industry, not a sport. In order for this industry to get back on a firm footing the Kentucky breeders-- who sit on every damn board and have tremendous influence-- have to get out of the way or get ousted. They know nothing about our business, and have run it into the ground, As long as they are calling the shots we are screwed.
JB
I am not taking issue with your core argument...you know darn well what you are commenting about.
However:
1. There has never been a period in which purses equalled the expenses of getting horses to the races, so what?
2. Purses have generally improved over the years, but the number of horses pursuing purses has declined and isn\'t likely to grow again, so the situation has improved overall if you are an owner. No?
3. I\'m not sure what you mean when you say the breeding industry is not part of the racing industry. It may have its own financial dynamics, but are you exempting breeder-owners from the equation? I\'ve bred most of the horses I have raced, not all, and consider my outcome pretty important...to myself.
You are probably right that big, commercial breeders ought to keep their noses out of the gambling side of the industry, but isn\'t the fact that we have a federal system as big a deterrant to building a rational system for the country as any idiocy the breeders bring to the equation?
JB...
I love that \"original derivitive\" line. That\'s classic and true. I\'d say MOST of the race horse owners i know are not expert betters at all and in it not even realizing the industry (gambling) they are in. But while that\'s true you could also say NFL football, College football and certainly the NCAA basketball tournament are more than ever dominated by gambling but they have still retained their identity as major Sporting events. In fact they are much bigger gambling enterprises than horse racing but they are smart enough to exploit gambling to grow their sporting brands enormously. The only differences really are organization. The only part of horse racing that actually looks organized is the triple crown and most would agree that for those couple months and 3 races Horse Racing actually resonates as a sport to the public at large. You\'re also right that the breeders are killing the game. Once the industry flipped to breed to sell, it was all downhill. How can you trust an industry where the creators of the product (the breeders) don\'t even trust their product enough to keep and race them in the industry for which they were intended??!!
The betting industry side of racing could survive and maybe thrive on 1 race card a day. That\'s all you need when you can bet from anywhere. Other than the state bred programs, that\'s kind of where it\'s heading...
Alm--
1-- The \"so what\" is that anything that reduces the cost for owners helps the game.
2-- Expenses have gone up at least as fast as purses, and the cost of horses (taking a long term view) has as well.
3-- If you are breeding to race you are indeed part of the industry. I\'m talking about commercial breeders (and the percentage of homebreds vs. those bought to race has gone way down over the years).
4-- Leaving politics aside, this is actaully a case where Federal intervention COULD (not would) be a plus. Right now there is no governing body, and nobody with power ever wants to give it up, so there are dozens of roadblocks to progress. If anything positive is ever going to happen someone is going to have to take charge and crack a few skulls.
Jim.. Good luck at Philly! i really think the state breds are the only way to go for new owners to the game. Running in restricted races against some \"slow rats\" is much preferable to open company. Plus state bred stakes races, breeders awards if you breed, and if you have a good one the condition books are stacked in your favor for the open races. For example in most places you can win an unlimited number of state bred races and still enter the horse in open NWX1 and start your conditions all over again. I kind of hate the state breds for betting as much as most on this board, but as an owner I think it\'s the only way to make financial sense of ownership. And you still have to be lucky to make it work... A ton of fun but a very tough biz or hobby.
Martoon-- the difference is that the NCAA and NFL don\'t get their revenue directly from gambling, racing does-- it\'s virtually the only source.
I\'ve said this before, but it\'s f--king astounding that considering the above bettors are not even consulted about things like takeout raises, track surface changes, etc. Can anyone think of any other large industry that does not do market analysis or focus groups? The industry going in the crapper is not just some event happening on its own due to outside world forces-- it\'s the direct result of the actions and inactions of those in power.
Jerry, the horse owners need to organize their own racing series. The tracks are bad partners for the locals because they make more from 365 day simulcast than their own race cards so they and the ADW\'s don;t want to give up those fees where they are raping the industry. Racing could generate Sports league type money but the owners can\'t get control. Now more than ever is the time since racing is now a tv studio-computer screen type sport (and betting medium) instead of a spectator sport. And all the great parts of racing gets crapped out by the clutter. When Mountaineer is racing 52 weeks a year that is just a make work job for a few horsemen to survive. Nobody is making any money at these small handle small purse tracks.
The bettors need a much better paradigm, but their objectives and needs are much different than the horse owners. There is plenty enough to go around but the bet takers are stealing it all... The owners and bettors don\'t have any problems with each other I don\'t think...
Jim & Mike, One other point on these state breds. I bred a few in New Jersey last couple years even though I\'m closer to PA. NJ had a bigger purses for state breds even before the elite (sic) meet. And would you believe they only dropped 400 foals there last couple years where PA and NY had in the thousands. So not nearly as much competition even for a state bred slow rat. You\'re only competing with roughly a total pool of 200 of each sex! Throw out the really slow ones and the hurt ones etc.. and not much left. If you can\'t win a piece there your horse definitely does not deserve it. That all sounded good until the governor threw NJ racing under the bus. And he had the audacity to announce he was trashing racing in the middle of the successful elite meet and before the Haskell! Thanks for the help Gov!
Anybody want to buy a nicely bred NJ bred?
Martoon,
If the NJ governor throws racing under the bus after the successful Monmouth meet, then NJ racing is RIP on many levels. In spite of what the various Horsemen groups are saying,without State backing and casino money there is no business model that works in the current racing environment.
In NY, the once enormously powerful friend of racing in Albany,former State Senator Joe Bruno is in the slammer for 2 years on federal charges. Would not be breeding too many crooked legged NY bred slow rat mares in my upstate back yard.
Mike