Dan over at Thorotrends has a neat piece up today. In it he looks at not only his family history, but a little bit about the history of bookmaking on horse racing.
In bygone times, Dan writes:
- One estimate I read suggested a betting volume seven times that bet legally at the racetrack. Today, when we read statistics that say 90% of handle is wagered off-track, maybe our reaction should be "Sure, but it has always been that way."
I sent a link to the piece to a professional gambler friend of mine. He is into the history of betting. He sent me the following back this evening.
"I've got the 1948 edition of Win, Place, and Show by Robert Dowst.
"...in 1947 over $1,500,000,000 were poured through the mutuel windows in straight, place, show or daily double betting on thousands of horses in thousands of races. A reader of course should understand that for every dollar wagered legally in the machines at the tracks possibly $5 or $10 are wagered on the same horse with illegal handbooks away from the tracks. If the ratio of illegal off-course to legal on-course betting is 5/1 to 10/1, it follows that approximately $5,000,000,000 to $10,000,000,000 are wagered each year in the United States on horses. No on conversant with the general facts will dispute the figure, and it is sufficiently romantic and impressive even in this era."
In the book, he generally assumes takeout to be 10%."
I think that's true, don't you?
If they were betting $10B in 1947, in today's dollars that's over $100B of horse racing handle, or about ten times bigger than we are. Of course, now that we charge 22% takeout instead of 10% the handle would be a lot lower than that, all things considered. Regardless, some food for thought.
Conversely, here is how we've done since 2000 in harness and thoroughbreds, with GDP attached.