Purses n' Purses and Wednesday Notes

Good day everyone!

I took a glance at the chatter regarding Yonkers adding two $250,000 invites to their International Trot card in October, on twitter, facebook and elsewhere. One point made by many, had to do with $ generated per $1 of purse spend.

Yonkers, as you know, has soft handle (about $420,000 on Monday), so some were questioning using $250,000 for a race like that, where the handle drawn from it will not be very high.

Rob Key, the man who had to argue vociferously for that very $250,000 number for his digital marketing and promo campaign for a whole year, responded on Facebook.

You can sense the frustration in Rob's words.

No matter how you feel about promoting harness racing, seeing $250,000 of purse money doled out like it is, versus how hard it is to get $250,000 for other things, certainly doesn't sit well with most. $250,000 out of the $420 million in purses is 0.05% of revenue. Companies can spend upwards of 10% of revenue for such things.

Coincidentally, I received an email this morning from Bob Marks, which showed the following stats for a Yonkers card in 1964.

That's a handle of $2.56 million, which in today's dollars is over $19 million.

On that same 1964 card, an invite was $8,000. In today's dollars that's about $60,000.

Yonkers opens go for about $40,000, or 67% of what they went for (standardized then).

Yonkers draws about $420,000 in handle today, or about 2% of what it did then.

Purses have not suffered much, but handle sure has.

That's the disconnect people complain about, and they have a point. Purses (the input factor of supply) have barely changed in real terms, while handle (the output factor measuring demand) has been absolutely decimated. This is the purses up, handle down phenomenon everyone speaks of, on crystal meth.


Tonight the Big M turf meet starts with 15% across the board takeout. Emily and John at Optix have offered out free analysis for the card.

For those betting the election, this feels like a pivotal week to me. After the debate on Monday ("the worst debate I've ever seen" according to one on my texter machine right after it happened), where, by most counts HC killed the Donald, we would expect a stout bump in the polls for her - maybe up to 5% or 6% in the next 7 days. In my view, if that happens, we might be at a Gladwell tipping point moment where 1.35 is solid value for Mrs. Clinton. If it doesn't happen and we see her leading by 2% or 3%, she is, I think, in deep trouble, and fading her at 1.35 is a gift. I will be watching this and likely taking a position this week, or early next. I currently have no long position on either candidate, but have traded it since May.

I saw the Parx card this weekend had some nice numbers (about $9.6M, which is good for Parx) with the presence of Derby winner Nyquist and Songbird. It made me think once again, however, just how popular Chrome is, and was. The handle for his PA Derby, with a short field was over $10M. A Derby winner, the most popular filly in racing, along with minus pools, could not touch the big horse. Chrome solidified himself as a generationally popular horse that day at Parx, in my mind, and he's done nothing since then to make me change that view. He drives handle. He's special.

Have a nice Wednesday everyone.


Anonymous said...

Last year The Yonkers International trot was conducted on October 10. Total purses on the 13 race program was $1,407,000. Total handle on the 13 races was $538,933.

Average purse 108,230
Handle per race 41,456

Simply speaking, for every dollar in purses on the October 10 program, Yonkers generated 38 cents in handle.

JLB said...

Yonkers should take $ 250,000, and offer 25 $ 10,000 rewards for confidential information leading to the arrest and conviction of those violating racing statutes. The $ 100,000 recently spent at Harrah's Philadelphia on a worthless drivers' contest, could have been utilized in the same fashion. While there has always been a code of silence, rewards of this magnitude could be icebreakers.


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