Very Important...

[Michael D.]

silver,
one of us will be right, and one of us will be wrong. let\'s address the issue when GP is built and the magna tracks have slots. sure, magna has tough times ahead, but i hope you realize that when we have this discussion next year, when we are having a drink at the bar at the new GP, watching the best racing in the US, you are going to have to admit you were wrong.

Personally, I\'ve never understood the economics of horseracing. An extremely high percentage of all the participants lose money or can\'t make a decent living regardless of what segment of the industry they are in.

I\'ll especially never understand why the prices of horses are so high given that most owners are getting buried.

I thought that by now the prices of horses would reflect the risks of ownership closely enough that most competent owners would be able to get a reasonable return on their money (at least in aggregate if not individually).

I thought that with all the high tech ways of betting these days that many weak racetracks would be closed down.

I thought track takes would reflect the modern competition for the gambling dollar.

Horseracing has to be one of the few industries where almost everyone is losing money and few adjustments are made by the market place in terms of sound economic and business practices.



Post Edited (02-26-05 14:13)

I think slots will help for awhile for some tracks, but at a certain point there\'s going to be a top. There are only so many gambling dollars out there. The solution to every state tax and horseracing revenue problem can\'t be more casinos and slots. That pie will eventually be sliced too thin. We are a nation of degenerate gamblers, but the top is coming.

[Chuckles_the_Clown2]

The buying and racing yearling game is a confirmed loser. Anyone paying more than about 200K for a yearling is making a bad investment with big dreams.

Magna is losing and Silver Charm has voiced his concern about the long term prognosis for some time.

Those playing at the high end are losing money, guys like Mattress Mac and Sanish Satan. Eugene Klein\'s operation was a reported money pit, despite his success with D.Wayne. Bob and Bev Lewis have had a couple lucrative syndication deals so they may in the Black. The Japanese owner of FuPig may be in the Black but if so that one Syndication got him there.

The breeders can make money. The Pinhookers are making money.

[Silver Charm]

A vote of confidence from someone named Chuckles the Clown. I\'ll take whatever I can get. (lol)

I had some experience with TVG but was unable to get a DISH because of geographic issues. This is where the future is, if racing is to have a future. There doesn\'t have to be a Disney World in every town or a MGM Grand for that matter. But people will travel to the good places for the experience.

Getting the Product to those who can\'t get to it is the way to go.

Michael D. I hope Magna comes thru, I really do. And I will gladly buy you that drink. I also hope that JDSU, EMC, SUN, CISCO and Co. go back to all-time highs. I\'m just not going to put my money on it.

[Michael D.]

ctc,
with the GP renovation and the delayed implementation of slots in maryland, it is safe to say that everybody knew magna would have short term cash flow problems. long term prospects are still up in the air. it\'s interesting that magna\'s stock has been up 10% to 20% since we started discussing those long term prospects (up 6% yesterday alone).

[Silver Charm]

Your are correct Michael D. I noticed that yesterday that even with the bad news the stock remained at $6.00. The investment is strictly an Asset Play and they do have good ones. Even the Slot Licenses are worth something and those aren\'t even on the Books but are in the price of the Stock.

But Michael D. I\'m going to ask you the same question again that you didn\'t answer before. Would you put a significant infusion of liquidity into an investment where Frank Stronach has Total Control??

[Michael D.]

silver,
 i look at palm meadows, i look the the horses stronach breeds, i look at the new tracks at GP and lrl, and most of all, i look at the quality of racing now at GP, and i come to the conclusion that the guy understands horse racing. looking at a five year horizon, if i had invest in the track operator side of the business, i would go with magna. now am i saying that racing will be a lucritave business going forward? no, i am not. i really don\'t know. i do think, however, that stronach will do as well as anyone. i think things will start to turn around next winter, and within two or three years, magna will be doing as well as anybody in the business.