Churchill Downs Inc Denies Local Nun Derby Access

Just when you thought it could not get any worse.

"I don't know what happened," says Sister Martha, of St. Patrick's Church in west Louisville. "They just called and said I would not be able to attend the Derby this year."

Sister Martha, as most know, shows up at the Derby each year, selling roses on behalf of the under-privileged children of Greater Louisville. Although she usually raised only $20 or $30, this tradition dates back over 70 years.

Sister Martha and her flowers, in happier times

"I've been doing this since I was 25. I never had a problem before," she said. "I saw that nice Secretariat man got in trouble that one year, and I saw the news on the Brad Cummings Report that the lovely young and talented Caton Bredar had her credentials revoked, but I didn't think it could happen to me."

Sister Martha says she feels most upset for the children.

"They've done nothing wrong. It's sad," she said.

A Churchill spokesman, on condition of anonymity said although he feels bad for her, it was time to pay the piper.

Churchill spokesman (artist likeness)

"A few years ago we increased takeout on unsuspecting horseplayers. In Sister Martha's case she was selling flowers tax free. We simply asked her to give us 22% of the proceeds, and I don't think she liked that. Something about the "children," he said.

"This was just about leveling the playing field. It's nothing personal."

When asked what the proceeds of charging the children would've went for, the Churchill spokesman said they would still go to a needy cause. "The markets have not been as kind this year as in past years. We have to get our bonuses from somewhere," he said.

Reaction from the industry was mixed.

"When I was a young boy I sold flowers in Austria, so I have a soft spot, not only for the children, but for flowers" noted Magna head Frank Stronach.

"No comment," said a Keeneland spokesman.

Some in the industry have rallied around Sister Martha.

Mattress Mack has started a Gofundme. Toby Keith has begun to organize a free concert. Bobby Flay said he'll make a new drink for the Derby (with simple syrup) and all proceeds will go to Sister Martha. Todd Pletcher has donated locks of his hair to be sold on Derby Day.

Others tried and are there in spirit.

University of Kentucky coach John Calipari said he'd do something, but he's on day 3 of a 364 day recruiting trip and unavailable. Rick Pitino said he'd give a free talk, but no one seems to like him anymore. Ron Turcotte said he'd sign autographs for free, but he can't find a parking spot.

It appears that once again, Churchill has galvanized the great industry of horse racing, although perhaps for the wrong reasons.

That's all the fake news that's fit to print. We'll keep an eye on this developing story.

Racing's Power Brokers & the Uncanny Valley

The "Uncanny Valley" was a concept first coined in the early 1970's by a Japanese robot maker.

He noticed that when robots are clearly robots, they're embraced by the public, as cute or neat, or interesting. As the robot becomes closer and closer to lifelike, however, it reaches a point where it becomes repulsive.

This reaction was noticed (and talked about in Newton's Football) when the producers of Shrek focused group different types of animation to children. While the kids laughed happily while shown type after type of animation, one iteration caused them to instantly change the smiles to literal screams. That iteration was so lifelike it was considered so creepy it scared them. The producers immediately scrapped that version, went to the older one, never wavered by pushing the envelope too far, and made a pile of money.

This uncanny valley - the point where we become too uncomfortable with something - is seen in other mediums as well.

Back in 1905, Teddy Roosevelt, a lover of football, realized that sport was on the precipice. People enjoyed the game and it was growing, but it was way too dangerous. 18 players had died the previous year, and the uncanny valley for fans was palpable. The excitement for Shrek was fine when people knew it was a game, but when the real Shrek showed up, people were horrified.

Roosevelt called together all the football powers, and rules changes - like not allowing mass blocking with certain formations, a line of scrimmage and downs - were made. Many of these changes are in use today.

Horse racing has its own uncanny valleys, and you and I live with them each day - horses perishing on the racetrack. Your uncanny valley might be the Grand National, or a cheaper racetrack with higher than average breakdown rates. For casual fans, they dance around the uncanny valley often, exemplified when we hear "I love the sport, but that part of the sport makes me question myself."

Ten years or so ago it looked like the sport was smack dab in the uncanny valley; polytrack and other surfaces were being tested, safety measures were in their formative stages. But I am not sure it was.

I don't want to belittle the safety measures because they have done a world of good, but when a place like Keeneland reverses on poly so quickly for business decisions, it makes me wonder. I simply don't think the sport was as close to the uncanny valley as we thought they might be.

Perhaps that should be expected. 113 years ago when Roosevelt spearheaded changes, it was in response to people dying, and those people were sons of the upper class in football playing colleges like Harvard and Yale.

In 2018, although the public's attitude shift towards animals has changed measurably, it's not quite about that. They're still animals, and revenue keeps chugging. Maybe they aren't wrong.

I suspect racing's uncanny valley moment will come, however. There will be a day - maybe a generation hence - where if a track reverses course on a horse safety measure there will be dire consequences; where a politician forces change; where a city bans a racetrack, like many have banned a circus. But that day is not today.

Are Judges & Stews Biased For the Big Barns & the Chalk?

Good morning everyone.

Tobias Moskowitz is a Yale professor, and he's looked at some interesting data about bias in pro sports officiating.

In general, he's concluded that there is a bias towards primarily the home team, but also for other teams when they're the team that's expected to win, or a subtle bias for a team that a league might want to win a game.

One famous way this was illustrated was in major league baseball. Historically, for the home team, strikes and balls were called differently at crunch time. The home team had an edge, both hitting and pitching, and this subtle difference resulted in an extra 7.3 runs per season. This might not sound like much, but home teams outscore visitors by about 10.5 runs per season. In effect, he concludes about 70% of the home field advantage can be explained by the home plate umpire's bias.

Technology changed a lot of this of course, although it proved a supposition at the same time. Questec - the ball and strike technology used that we see on television now - was used quietly and behind the scenes for a period at some ballparks for some games. Umpires who knew the technology was being used cleaned up their bias; the next game, in a different park, the bias was back.

When we saw the Patriots get flagged for only one nondescript penalty against the Jaguars while the Jags got penalized six times (one of them a less than clear cut game changer PI), we saw twitter light up like a Christmas tree. It's easy to be conspiracy minded, because, well, the data shows that game would likely be officiated with bias - Super Bowl ratings could be down with an underdog Jags win (the officials don't want to rock that boat) and it's the home team (the Jags themselves get this bias at home, so why not the Pats?).

I'm sure by now you think I have a tin foil hat on my head, but despite me egging on @gregreinhart on the twitter about his beloved Penguins, I never really remotely believed this stuff. I encourage you to read Moskowitz's work. He covers all major sports, and in all major sports he sees the exact same thing, and he provides a compelling case.

Switching over to racing, I can honestly say I have not seen a bias. I see people on twitter grumbling about the chalk being left up because taking him down would cause a riot, and the stews would be disappointing a lot of people. I see others grumble about horses from big barns being left up, because, well, they're from big barns.

But maybe I'm wrong. Maybe we need to get the tin foil hat out.

If the Sword Dancer debacle a couple of years ago was a team-up, rabbit barn job by a 4% trainer with an owner like me or you, and not a high percentage trainer with stock from a massive breeder, do we get in trouble?

If mine or your Chuck Simon trained gelding wins a grade one race, and perhaps caused a foul, is he more likely pitched than a blue blooded stud for a big barn, where a grade one win can be worth an extra couple of million dollars at stud?

Is pitching a 90-1 shot because people have not bet much on him easier than a chalk?

With the absence of data (there should be data on this really, when we think of it) we'll never know. But from reading Moskowitz's conclusions across all other sports, human nature is human nature. It would not surprise me one bit if that's happening.  Maybe the yellers and screamers at simo centers and on social media have been right all along.

Have a great day everyone.

Give Bettors the Goods, Monday Notes

Good day everyone!

"Walk a mile in someone's shoes." It's sound advice. When you do, you have a respect for what they do, how they think, and your understanding about an assorted issue tends to grow.

In race 7 tonight at Woodbine/Mohawk, there's a horse with a 5-2 morning line that looks pretty good. But he's been off since March 8th.

Unlike the thoroughbreds, where a six week break is modelable and a horse may have listed workouts to make an informed opinion, in harness you're completely in the dark.

Because these horses need to race frequently to stay in form, this horse is a total coin flip. He could be 50-1 fair odds, or he could be 5-2. There's no trainer data. No one publicly knows. Even the track handicapper said "It's a guess."

This is the last leg of a pick 4, which will garner about $50 of $60,000 of handle. Casual players might say they'll spread to be safe, but at 25% juice they're getting their heads handed to them. Sharp players who know the trainer will feast on them like chum. Any player worth their salt will not bet this pick 4.

"Walk a mile in their shoes". Understand that you're whacking your customers in the teeth. You need to stop doing this stuff.

Why not field test some marketing and bettor outreach? I get the status quo is a safe port in a storm, and by trying something that could potentially fail is very hard for the business to get its head around. But as Jeff Bezos said once - "Companies overemphasize how expensive failure is going to be. Failure is not that expensive. The big cost that most companies incur is harder to notice and those are errors of omission."

I'm very interested to see how Kentucky Derby betting goes this year. I'm super impressed over the years how the brand has grown, along with the work CDI has put into it. I'm also wondering about the tax changes and how it increases churn during the day, with the simple fact that racing's "big days" are growing almost each and every event. With all things equal, I guess we should expect a nice bump. But we'll see.

I'll just leave this out there.

pic.twitter.com/A3VBNVcusM

— Jim Halpert (@Larkinsomnia) April 21, 2018

Have a nice Monday everyone.

No Matter What You Hear, or What the Sports Leagues Profess - Gambling Has Always Been Perfectly Acceptable

I think, with lotteries, slots, and Vegas, we can concede gambling is pretty mainstream. But for some reason when we talk about sports betting it is anything but. There's still - even though it will likely be legalized soon - a stigma that surrounds it. Hell, if you listen to some of the sports leagues, it's like the world will end.

That, in my view, simply is not reality, and never has been reality.

Let me share a little story.

Back in the 70's, my cousin Doug couldn't find work in Southern Ontario where he lived, so he came up north and landed a job at the mines. Needing a place to stay, he lived with us.

Doug worked in the ball mill and it was not exactly mentally stimulating, so he had a lot of time to think. He had bet some sports with a bookie in his town, and decided he should try something along those same lines to try and make a little scratch.

Doug thought that rather than offering single games with large bet sizes where he'd be chasing people all day to pay or collect, he'd create parlay cards with low denominations. Hockey season was around the corner and all he'd need to do was get the cards typed and copied, and sell them. For that he'd need a little help, by the way of my dad, because he had access to the tools needed to make the cards, at work.

"I'm wondering if you'd lend a hand," he asked him. My father, doing the dutiful uncle thing said no, that's gambling and it's bad, sure he would help out.

Then away Doug went.

He made the puck line cards for the big Saturday slate ("Vegas odds", said Doug, because "if people don't win something they won't come back") and began to sell them.

At the mine these cards went like hotcakes, both on surface and with the underground guys that he'd catch at shift change (and get double the business).

Doug would spend time at the old Empire Hotel on weekends. The Empire - built in I think the 1920's - was a rather bizarre place; maybe not so weird if you grew up where I did, but it was odd to any reasonable person. It was the biggest hotel in the region, and visitors would stay there, but it, well, had a disco bar on one side of the main floor, with a strip joint on the other. Doug became a regular (I think on the disco side) and if you wanted a parlay card, he was there around 6, right near the bar, sipping on a bottle of Molson Export.

Doug also had some family connections. One of our cousins was a sergeant on the local police force and he told Doug it was illegal and he'd put him in jail if he caught him selling parlay cards he'd sell some to the cops at work for him. The town's police force bought a pile of them each week.

After the bar on Saturdays, Doug would sit at the AM radio trying to catch a signal that gave scores so he could tally how the house did. Most weekends he would do pretty well. In fact, I don't think he ever had a losing weekend.

On Monday, he'd head out to work, pay out to a few boys at lunch and the ones who didn't win would talk about a late goal, or how they got greedy and chose too many games. I'm sure it was not too much different than a bad beat chat on twitter - except with people actually talking face to face.

The following weekend he'd settle up with the folks at the Empire, and with the cops. And everyone would do it all over again.

This was good education for a little six or seven year old kid. A year or two later it came in handy.

In January we were let out for recess, in the usual minus 30 temps, by teachers telling us to stay  warm, and to not lick any poles. I heard someone talking about the Super Bowl, which was rare - no one really watched or knew much about the Super Bowl in these parts. It was Paul, and he was holding court.

"The Cowboys are going to win! I'll bet anyone five dollars right now" he exclaimed, to a throng of shivering kids.

I shuffled over and said I'd take that bet. He accepted with a "you better be good for it", which was kind of frightening because I didn't have five bucks, and Paul was a tough fella. He'd have to go to other schools to find kids to fight, because there was no one left who he didn't already beat up at our school.

Fortunately I had Doug, and math. A few days earlier, my cousin told me the spread was the Steelers by seven. Paul didn't mention a point spread, so I was getting +100 on a big chalk. Pure freaking gold.

The Steelers won by four or five, I got my $5, and Paul didn't have to beat me up. Sadly, this represented a high water mark for me as a sports bettor.

Back to the present day, when you and me, who do gamble, see people like @dinkinc or @robpizzola or @insidethepylons on twitter, we think nothing of it. But, to many others, it's like they're doing something they're not supposed to be doing.

They're not. They're doing what the cops, and drinkers, and mine workers, and school children at recess were doing four decades ago. They're gambling on sports. It was a perfectly acceptable behavior then, just as it is now. The only difference is that in 2018, it will probably soon be easier to get a legal bet down.

Have a nice Monday everyone.

Derby Prep Mental Gymnastics, Driving to Win, Handle Questions

Good Monday everyone.

Two Derby preps were run this weekend, the biggest one of the bunch in terms of interest, at Santa Anita, with buzz horse Justify proving his mettle in California, beating the very talented Bolt d'Oro quite handily.

I was most interested to note that when Bolt was asked, he couldn't even get to the Justify tail. I really think he didn't want much to do with that horse.

It was an interesting race to analyze, and twitterites seemed to be going through the usual machinations that surround each and every Derby prep.

Was the final number good? It appears to be. 

Was Bolt d'Oro bouncing some off his last taxing effort, where the trainer noted he was dead tired, and he didn't show his best fastball? Maybe.

Was the margin back to third and fourth enough to say those two, who are considered Derby major Derby contenders, ran a formful race? Probably, although maybe you could reasonably think they should have opened a bit more daylight.

I think it's reasonable to conclude that both look like serious racehorses; with the winner, no matter how you slice it and dice it, emphatically answering a lot of questions.

Dougie Sal, emerging from a snowbound Erie PA hibernation, had his internet turned on as of a few weeks ago and provides some solid analysis of the major races on the YouTube, including the SA Derby and Blue Grass. I'll watch that later today to see if my analysis is wet, or all wet according to Doug.

Trying to win? A common complaint in all types of racing here in North America. At Woodbine, a driver buried a short shot recently, to much consternation, and the judges stepped up to give him a fine and days. You can see the race here.

After a chat on twitter there was a drop mic moment, in my view, about how and when it could be determined if a driver tried with a very low odds horse.

Do you think if I told Roy before that race I'd give him 10k cash if he won the race that he would've driven the horse the same way?

— Jimmy V (@trackingwinners) April 9, 2018

Of course the driver would've pulled the right line, and that's the problem. With the ten K prize from Jimmy V, he makes the ten K for himself, so off he goes in search of a win. Well, he's driving for $200K of the bettor's money in that race  - he needs to treat that money like it's his own.

Keeneland racing returned with lower takeout rates from last fall, when they were off pretty miserably, but still higher takeout than last spring. Their first weekend, according to @o_crunk, was a little ho hum, at up 1% per entry. The weather probably played a part.

Over at Santa Anita, which frankly has a less than interesting product, and a much less interesting product than Keeneland, handle was up 2.6% per interest.

Stronach tracks versus the non-Stronach tracks have been smoking lately and it's more than an aberration, it's a trend.

It's like they're selling crack.

One wonders, what's the recent handle total increase made of, tax changes versus handle from only Frank tracks?

Without a deep dive and a lot of data we won't know. I am still of the belief that this TDN piece looking at bettor bankrolls explains the tax changes, but since about September of last year (before the tax changes) handle was starting to move, primarily at Frank tracks. Mental gymnastics aren't just for Derby preps.

This month's issue - speaking of Frank tracks - of the Horseplayer Monthly is out and it's free. It has a look at bet downs at Gulfstream, and if they've gotten worse over the last few seasons.

Cheers and have a really nice Monday everyone.

Notes, Usability & Access (of Derby Pools) & Pari-Mutuel Reality

Good day everyone.

There's been a lot of chatter about sports betting of late. The if's, how's and why's of it in terms of horse racing were waxed upon here.

Knowing that horse racing (any gambling game) has two or more sets of customers, the article looks at how the seasoned professional types (like Charlie) will respond to sports betting at racetracks, or ADW's. For the more casual but extremely dedicated player, a snapshot of a poll on Paceadvantage.com provided a look into that side of the game.

While larger players like Charlie could massively pivot into legal sports wagering, smaller players who love racing tend to be more mixed (50% won't play sports, 50% will play at least some). I think this confirms what most of us would believe.

As always, it depends on the juice, availability etc, and from what we've seen from governments in North America in the past with gambling, a positive business environment for customers is in no way assured. It remains a salient point, in my view - Charlie and others won't pivot for 15% takeout parlay cards.

The Masters is upon us, and it struck me how different I play it today. I have more information, faster internet connections, and I love the event as much as ever. But, because of usability and access to betting pools, my betting handle is in the crapper. At this point I have wagered about $80.

Ten years ago, through the betting exchange I'd have wagered 400% or more. After each event, when one of my targets would have a less than stellar week, I'd wager them on the drift, and come the start of the event I'd have my full book. At that point, my handle would surge as I would trade it until the final putt would drop. The lack of an exchange kills my handle.

In terms of Derby betting, CDI has invested hard in the future pools. But those are the same for me. I bet nothing, because I don't want to wager and be locked into a bet (especially at the rake). For sports bettors an exchange for the Derby would open up a whole new market, and possibly - within say ten years - it could be massive if done right. Would that help TV viewership, event attendance, branding of the event, and the overall bottom line? I think it would. It would for me, and I think others like Charlie. Most of us follow the Derby when, well, the PP's come out.

Regardless, exchanges are a non-starter for Derby wagering. CDI owns the Derby, TVG owns the exchange. Welcome to horse racing.

What has plagued the game, in my view, is being married to the system and the past. Access is important, and new tools should always be explored.

Speaking of that, one new tool that takes a lot of flack - and this was a discussion yesterday on the twitter - was computer assisted wagering. This type of wagering gets blamed for late odds drops, rebating, and the "killing of the game". I'm not going to get into a circular argument about what it does, or doesn't do (and the assorted hyperbole), but I think what people fail to understand is that it's a symptom of a game that is not modernized.

Pari-mutuel pricing is a mess. This is why rebates exist. Every time a takeout rate goes up, rebating gets more of a foothold, and round and round we go.

It frustrates me that some people lose their minds at rebaters, and at the same time make excuses when Keeneland raises the juice; or even worse, they try and sabotage a betting boycott. If you're carrying water for places like Keeneland and Churchill when they raise takeout, you're throwing your support behind computer batch betting and rebating. So, either climb aboard or don't bitch about it.

Late odds drops are a scourge of the pari-mutuel system, and it makes the game look mickey mouse, but they are reality. If a horse is 5-2 fair and is 5-1 with two minutes to go, money will come in to make the horse 5-2.  Bettors didn't get 5-1 because they were never going to get 5-1. 

That's how the system - in fact, the betting world - works. Money will come in to set a market. With 90% of the money coming in off track, and late, the market will be set late.

With a true system of fixed odds, or exchanges, horse racing would never have these issues. But, above.

Racing is stuck in a bog and we're not telling tales out of school. It's slow moving, it's high priced, it rarely explore new systems, or invests in them. When you're in a 1920's system, you get inefficiencies. That's a tough reality for some to come to grips with, but it's the reality we live in.