A new way of wagering!?!?

[tanda]

I am looking for feedback.

Imagine:

1) Off-shore pari-mutual pool,

2) 5% takeout,

3) Payout rounded to nearest nickel on the dollar odds (no breakage),

4) Money on deposit with an established off-shore bank which accepts transfers to and from US banks,

5) Wagers are instantly debited from account and winnings returned to account (wagering pool company only holds amount of bet, remainder of bankroll on deposit with bank),

6) Pools closes 1 minute before post-time (to avoid questions of irregularities) and final odds are known before running of race,

7) Initially offer win betting only on a major circuit,

8) As handles grows, add exacta and maybe a few other wagers to track and add additional tracks, but only as handle allows (important to keep pools fairly large in size),

9) Takeout would drop to lower level if handle increases,

10) When pool opens on race, company would fund pool so that first bettor would not be betting into zero pool, as bets are made company's money would be withdrawn from pool so that no company money is in pool at close of pool (mechanics of this would be fully disclosed),

11) Wagering would be on-line.

Any interest?

[hurrikane]

interesting but

1. by banks do you mean US banking instutions...no way they will do this. First..too much traffic on accounts...second...they don't like gambling.

2. I see no advantage to closing 1 min before post..what about late scratches...if the betting closes and odd recalc and my bet drops through the bottom...I can't get my ticket back..just as it is now

[tanda]

The banks would be located off-shore in the host country. Those would be the accounts that handle the betting traffic.

However, the off-shore bank will have the ability to transfer your money to and from US banks. The US banks would not be involved accept for transfers to and from the foreign bank. A person would not be making frequent use of the US banks, only for account withdrawals and deposits. The day to day/ bet to bet transactions would be made with the foreign bank. The goal is that the wagering company would not hold your money (except for the actual amount bet on a race until that race is official). An established, creditable bank would. Obviously, an agreement would have to be reached with this bank for the type of transfers discussed. I have some ideas on which banks and on what terms (the company would bear the expense of compensating the bank, all customers would use the same bank) this could be arranged. This alleviates some of the concern with depositing money off-shore.

The purpose of the one-minute rule is so that there is no questions that the pool closed before gates opened. Thus, it removes the appearance of impropriety (such as company employee making bets after the gates open). The goal is that final odds would be listed on-line before the gates open.

As to late scratches, there would be a full refund.

As to odds dropping, the odds cannot drop after the pool closes. The odds in the off-shore pool may differ from track odds. You would not be paid at track odds. You are paid at the odds of the off-shore pari-mutual pool. Of course you may bet with seconds remaining before close of the pool and, because many others were waiting to do the same, the odds may change in the last few seconds. But that occurs no matter when you choose to close the pool.

The odds would update as fast as the software can handle (hopefully instantaneously). Also, a clock would notify you of how much time is left to wager (in seconds for the last two minutes).

Besides the low take, the company would be founded on the idea of full disclosure and unquestioned integrity. All of the guidelines above are designed for that purpose.

For example, initially the pools would be small. I have an idea/mechanism to allow the company to fund the pools early in the betting, in other words "create a market". Then, that money would be gradually withdrawn as bets are made. The company would disclose in full the procedure. If the company is successful, I imagine this procedure will be less needed as handle increases.

[smf]

Sounds like the horsemen (remember them?) get nothing out of this.

My feedback is "no thanks".

[Figman]

Two Questions:
1.) Under this scenario, how is the purse money generated?
2.) If there is a betmaker-bettaker dispute, how does it get settled?

[tanda]

smf,

Unfortunately, the horseman care nothing for the bettor. When was the last time a horseman argued for a lower take, even though all evidence indicates that a lower take would increase revenue to horseman while returning more to the bettor (i.e. Hawthorne, Saratoga and Gulfstream a few years ago). How many of them have ever protested the outrageous NYC OTB surcharge (and supplementary surcharge!)? Or mentioned that if the tracks are concerned with paying off in pennies, they could instead round to the nickel (NYRA does, as does Woodbine and other Canadian tracks, so it must be possible) and they don't have to round up. How about natural rounding? How many ever have given an informative interview that helps the bettor?

Most have limited intelligence when it comes to financial and business matters. How else can you explain all the screwy business decisions made by the establishment? Why won't CDSN allow me to bet on-line on their races? I would love to give them the take from my action. Same with NYRA. But they refuse my business. There are a lot of bad businessmen in this industry.

The horseman do deserve to make a profit. However, if they and the establishment do little to cater to the bettor, competition should arise to give them the incentive to do so.

Actually, I realize that the success of this type of company could hurt the game I love. I know that the success of this company would be tied to the health of the sport. So I have ideas on that issue. For example, after start-up and solvency, the company would consider plowing back some of the take to the host tracks. I have some ideas on how this could be done. Of course, by being off-shore, the government would be cut out. As they deserve to be, since they tax winnings after have reduced winnings already by their share of the take. I hope you have no complaints about that.

[tanda]

Figman,

I am not sure what you mean by purse money. This is a non-comingled pool with no contributions to the track or purses. In the future, there may be contributions in the interest of the health of the sport.

Disputes would be settled by the terms of the account agreement. With choice of law provisions directing the factfinder to apply US contract law. Probably the agreement would include both parties agreeing to binding arbitration. Obviously, I envision no need for such measures, but they would be available.

Again, since the company only holds the wager amount, your loss through company action would be limited to your last wager. But there would be a wager receipt similar to tother on-line services for all wagers.

For everybody, the main question I have is:

If you had adequate assurances as to the safety of your money off-shore (my biggest concern), would you be willing to wager in a non-comingled pool (with the understanding that eventually the pools would be fairly large) with a low takeout?

Is there interest or a market for such a service?

[smf]

Tanda,

First, you asked for feedback. I gave mine.

Second, you're correct about cdsn, nyra. They don't care about the bettor. Still, I don't want to throw out the baby w/ the bathwater. I want to support the horsemen (not necessarily track mgmnt). Besides, the horsemen/ women's "job" isn't related to looking out for the bettor. It's to earn money for the owners and pay the minimal salaries of backstretch workers.

Finally, I have no quarrel w/ paying taxes on gains at the windows.

Respectfully,
smf

[Topcat]

Tanda,

You would get a lot of interest on this from bettors
but you would have to get by the credibility problem.

It may be a matter of buidl it and they will come.

As for the horesemen and tracks-You're right they don't care about the bettors.

I once interviewed with the leading track in the country for a marketing position and they were concerned about any candidates who actually bet the races-said they didn't want a potential employee who would want to bet on the races-as if it were repugnate to them. They didn't make the connection that that is why fans come out to the "park" as they called it. That is why most track promotions have nothing to do with betting.

Say If you wanted you could make it 6% take and donate the 1% to a horse/jockey fund.

[tanda]

smf,

I have no quarrel with taxes on gambling income, except general opposition to all taxes, but I do have opposition to the state's pre-tax cut from the take and then later taxing winnings. This practice only occurs in the gaming industry. Probably due to anti-gaming/gambling bias.

Obviously, if this idea was ever successful and siphoned significant money from the horsemen, that problem would need to be resolved. Again, I know that horsemen MUST make a living and good horsemen deserve a good living or better. Initially, the question is insignificant because of the small amounts involved.

Also, you are right that the horsemen's job is not to look out for the bettor (even though if they did by advocating a lower take, they would probably benefit as well). But that is a two way street. It is not my job as a bettor to look out for the horsemen. However, as this post and previous indicate, I realize that are interests are intertwined and know that helping the horsemen may help me indirectly. Of course, the vice versa is true as well, but horsemen do not seem to realize it.

The entire industry would be better off if it realized that a lower take benefits not just bettors, but horsemen and management. Or that simulcasting benefits all tracks in the long run. Or that exclusive deals with wagering outlets are counter-productive. Everybody seems to think it is a zero sum game. If Magna prospers, then CDSN must suffer. I think the best businessmen realize that good deals often benefit both sides.

[hurrikane]

well...not to beat a dead horse..(sorry)...anything setup off shore would come under the laws that govern that country..which ususally means F*** Americans they have too much money anyway.....no thanks.

[tanda]

So ... it seems that there is concern with sending money back to the track. I believe that a company could be profitable with less than a 5% take and suggested, after start-up and repayment of venture capital, a reduction in the take.

Is the consensus that we would prefer to not reduce the take and instead send money back to the tracks (of course they may not accept it for a variety of reasons)?

For marketing purposes does a 3% take with no money going to tracks or a 5% take with 2% of that going to the tracks appeal more to you?

Seems like there are some of us who realize that some money should go to horsemen.

SMF, would you join (if credibility concerns were also addressed) if money was sent to horsemen?

[karlskorner]

Tanda:

IT AIN'T BROKEN, why are you trying to fix it? Agreed it has some rough edges that could be rounded off, but how long would the tracks last when everybody runs to the 5% takeout? 95% of nothing is nothing. Or are you of the belief that only a portion will take advantage of the lower takeout and the balance will continue on paying the high tariff ?

Your statement in your 3rd post "horemen care nothing for the bettor". I am going to assume that you have very little contact with owners and/or trainers, but believe me, they are well aware of who fills their "rice bowl". When you see that first flash on the tote board drive a 5/1 down to 3/5 you had better believe it is some owner or trainer, trying to hide his wager early. As a group they are probably some of the largest bettors at the track and paying the same takeout as you and I. The purses and "dailys" can't keep most trainers going.

To quote another statement of yours "actually I realzie that this type of Company could hurt the game love" , I can't add to that.

In my mind the "takeout" is your contribution to keep this business alive, no more than your federal/state/local taxes, or the profits by every major manufacturer in this country. To those who continually complain to me about the "takeout", my reply is "improve your handicapping" and you will never notice the difference.

Karl

[tanda]

Hurrikane,

There are many countries that are friendly to foreign investments. In fact, many give tax breaks to Americans for investing in their country. I do not perceive this as a problem.

[Tim]

Originally posted by tanda
There are many countries that are friendly to foreign investments. In fact, many give tax breaks to Americans for investing in their country. I do not perceive this as a problem.
tanda,

A few comments

Thats usually the investment position countries take just prior to the nationalization of foreign owned businesses.

The reason horsemen are perceived to be adverse to lower takeouts is that the states always want the cut to come from the horsemen/track part of the takeout and not the state tax part.

As a serious longterm player (35 years) I believe that the rules and regulations of the horseracing market in America benefit both the bettor and the industry. All in all it's a well balanced honest game.

When you bitch about paying taxes (we all do) just remember that it beats bitching about not making any money. When you're making money you can afford to bitch about the taxes over a nice dinner.

If you can be as confident betting a $50 exacta box offshore as betting it into a $300,000 exacta pool at Saratoga then my hat's off to you. If that exacta comes in and pays $120 I would like to listen in on the conversation where you ask the offshore people about your $3,000. I know Autotote would hit my account less that 30 seconds after the race is official.

[Dave Schwartz]

IMHO...

Personally, I would not be against playing in such a pool... But, as pool size is a consideration today I question that anyone off shore could build a pool sufficient to sustain a significant wager size without making the pool go on tilt whenever someone bet a couple of hundred bucks on anybody but the favorite.

Recall the stories of Conn. OTB's pools on week nights... A $20 bet on ANY horse sometimes made him the automatic favorite.

Nevertheless, get the pools to a significant size and I'll play.

As for management subsidizing the pools, the only way that would work would be if (say) they put some significant money into each pool wagered according to morning line and left it there so that the final pool minimum was guaranteed to be at least (say) $100k. They could well lose money on that deal.

For management to seed the pool at startup and then remove the money serves zero purpose as I can see.

Finally, the horsemen. While I recognize that the horsemen must be considered long term, I am not concerned about the lack of money going towards purses. Why? Because if this idea flies and makes an impact on the money going to the track, the tracks will be forced to make THEIR product more competitive, something they are not subject to do at all now (as evidenced by the marked absence of change in the industry).

To refuse to spend money where the horsemen and track do not benefit would be (to me) like refusing to buy an imported product even though it was better and/or cheaper.


Regards,
Dave Schwartz

[Tom]

Great thread. My concern would be how secure is my money. I am leary of well known placce right here in this country, so I am not about to cross boarders too quickly.
But as far as the idea, hey, that is the American way. Big business builds plants in other countries, totally ignores common decency and pollutes their environment,
exploits their citizens, then brings their products back home to sell for full price. In Mexico, the US auto companies are no better than an invading army-they pay commuting Americans more than Mexican locals working side-by-side at the same jobs a heck of a lot more. So if it is good for them to do, then it is good for us to do as we see fit. Screw the taxes. You and I pay taxes so gfat-cat morons can waste our money and get rich themselves. It is everyone for themselves. And I love your point about the horsemen-we are already footing the bill for thier welfare and if they don't like us betting elsewhere, to damn bad.
(OK, now duck....get ready for the sob stories).
Tom

[karlskorner]

Topcat:

Regarding your applying for a marketing position with a leading track and they were not interested if you were a betting person.

For ages tracks have had a problem with mostly tellers and others, who borrowed from the 'box" during the day and at days end came up short. A good tip here and a tout there, if your short borrow from the "box" you'll make it up when you win. Couple years back a teller friend was short over $4000.00. Of course they fired him, I met him a couple weeks later, he truly believed he was going to win and the track would never know the difference.

Karl

[tanda]

karlskorner,

1) The take that goes to state and local governments does NOTHING to support the game, so I do have a problem with that aspect. If horsemen lose revenue because bettors want to escape the government's "vig", that is the government's fault.

2) The take that is necessary to pay the inefficient tracks' overhead (to the extent it is higher than necessary) is also unnecessary. The tracks deserve compensation for staging the races and overhead. However, some of that overhead is due to poor management.

3) Saratoga has proven that a 10% take can work. If NYRA did not have to pay the state "vig", it could have a 10% take and profit. Thus, I submit that any track taking more than 10% is taking more than is necessary for the health of the game.

4) You are wrong that the take is not an important issue. Breakage is included when I use the word take. First, you have written that if the take was lower, the same people would lose, only slower. That is completely false. The amount of winners is closely tied to take. For example, if the take is 100%, nobody wins. Thus, somewhere between the current take and 100%, winners stop winning. Your position that the take does not change who wins is wrong by this example. Do you really believe you could win with a 40% take on win wagers? Maybe, if your edge on the crowd exceeds 40%. But even if you could, the number of winners would decline. Your R.O.I. is your edge on the crowd less the take. Thus, if I have a 40% edge on the crowd but the tracks takes 17%, I win at a 23% R.O.I.. If the tracks raises the take to 20%, my R.O.I. must decline. It does not change that I am a winner but it does change the amount I win. Also, if a player has a 2% R.O.I. and the take goes up, that player moves into the losing column. A take increase changes those on the margin from winners to losers.

Somewhere between the current take and 100% take, EVERYBODY must become a loser. Where that point is varies according to each player's edge on the crowd. As you move the take, players move from one column to the other. But to take the position that there are the same winners now as there would be with a 10% or 5% take can be proven as mathematically false.

And you cannot guard against it. For example, if you have a spot play method that turns a 20% profit on plays at 4:1 or better, you may think that you can maintain your R.O.I. by being more disciplined and waiting at a high take track. Initially, you make fewer plays and every winner returns less that it otherwise would. Your R.O.I. will decline. Let's say you win 25 of 100 at 5:1. With a lower take you would win the same amount but the average odds would be higher, thus, a higher R.O.I. Eventually, as the R.O.I. erodes with higher take, you must at some point move into the loss column.

Also, a track that has a 17% take with dime breakage would round a 3.55:1 winner to 3.50. That same winner would pay 4.20:1 with 5% take. Are you really suggesting that is not significant? I recently tested a spot play method that threw a 12+% profit at 3.50:1 odds. That same system would throw a 30% profit with 5% take. The additional take cuts my R.O.I. on this test to less than 1/2.

You may be able to win at a 20% take, but at some point the take would have to grind you down if it kept climbing. But you seem to be of the mind that when it does climb to 30% or whatever it takes to move you into negative R.O.I., then it is your responsibility to deal with it and become a better handicapper. At some point, that is no longer possible.

[tanda]

Tim,

I agree with the credibility problems. That is why I do not bet off-shore. That is also why I suggest the guidelines above to improve those matters.

Remember: the company would be a stakeholder, not a bookie. Thus, they make money no matter who wins. A bookie may not pay up because he may lose if he pays.

Although, I am not that concerned with nationalization. Many countries have welcomed American capital and ex-patriates with no problems.

Also, I am not grateful that I have money. I earned it. I deserve it. I have nobody to thank, but myself, for it. I got it by exchanging my goods and services with other people and providing them with value, just as they do with me. Paying taxes has nothing to do with the fact that I am successful. Thus, my dissatisfaction with taxes is in no way mitigated by the fact that I have a fairly affluent life. One has nothing to do with the other. Your thinking indicates that the productive should just feel grateful that they are so productive and rejoice in the fact that they money to tax. The productive are productive through their own efforts, not luck. Yes, my life could be worse. But if it was, it would be because of choices I made. Not anything anyone else did, so I owe nobody and nobody owes me.

Yes, things could be worse. We still have a generally wonderful country compared to others and historically. Yet, a person can still strive for more.

[tanda]

Dave,

The suggestion on the seeding of the pool and withdrawing money would be so that the company does not take losses. Also, it would be better if the company had no stake in the outcome. I think it improves credibility. The withdrawing would occur as money is bet, so that the pool does not shrink. There would be full disclosure on the site as to the algorithm used. The seeding could occur based on the morning line, maybe in conjunction with the opening pool at the host track.

There would probably have to be a wager limit early on. Maybe as a percentage of the pool.

Yet, even with an initial pool of $10,000 dollars, a $100 bet on a 3.75:1 shot only moves the odds to 3.55:1. Tolerable by far. So, maybe a 2% of the pool limit. Maybe higher. That allows at least $200 wagers with an initial pool of $10,000.

The pools would be helped by the availability of only a win pool at start-up followed by an exacta and trifecta if the handle could support it.

Many tracks have fairly small pools, so any five digit pool would be serviceable. The goal would be six digits.

[Dave Schwartz]

Tanda,

Let me guess... You are a liberal right? <G> Just kidding.

Could not agree with your statements more.

As our global community gets smaller and smaller, (which translates into "even outside the US you can get in trouble for absconding with my cash") it could become a possibility.

Imagine if you were to be permitted to open such a facility in Nevada. People would flock to you... (or would they?) They certainly would not flock AWAY from you out of fear for their money.

I think you face two problems:
1. Getting people over their fear of sending money off shore.
2. Getting enough money into the pools to make it work.


And, by the way, even 8% would be a great take. Or 10% with level-based rebates.

And don't round payoffs. Pay them to the lower penny. What's wrong with $8.23?


I truly wish you well in this venture.


Regards,
Dave Schwartz

[NNMan]

Sounds to me like Tanda IS a liberal. A liberal thinker on ways to revamp an industry
that is screaming for change. Every paragraph I read from Tanda's posts appeared
to be lucent, well thought out and made perfect sense. Granted, there is going to be
a challenge with the offshore aspect, but if the pools are large enough, count me in.
Every 1% reduction in the take translates into a 6% raise for me. I'll take it and not
feel guilty for the horseman, the tracks, or anyone else that is standing in the way of
a revitalization of the sport. I stand for the conservative traditional principles of free
enterprise and competition. And those principles are as healthy for horse racing as
they are for any other business in this great country of ours. Its time for a change...

[andicap]

As a real "liberal" (well, moderate liberal actually), I was AT FIRST appalled by Tanda's proposal that would rip the heart out of the state's share of the take ... money that goes for roads, schools, health services etc. (yes, I know much of it is pissed away by gov't bureaucracy. Big business is just as bad, believe me.)

Anyway, subsequent posts caused me to reconsider: Competition is good (I'm no socialist) and the track and state's neglect and incredibly belligerant attitude toward horesplayers needs to be brought to task. If off-shore books take money away from racing, the gov't will at first (it has already begun this) try to shut them down or prevent us from using them by outlawing their use. This is government by intrusion -- not liberal, but overbearing and authoritarian. It would, in fact, be a socialist act since under Communism the state runs everything. In this case the racetracks, OTBs, etc. are the government's proxy and tax collector.

I'm all for the state getting a FAIR SHARE of racetrack money, but greediness, incompetency and neglect should never be rewarded.
Racing is the Sport of Kings. If fans vote with their wallets, the governments and tracks would have to take notice and treat us like the kings we all are.

In the final analysis, Tanda's act of rebellion is a full-scale consumer revolt -- extremely Naderesque. (the good Nader not the evil one who elected Bush.)

Tanda, you're a liberal after all!

[Aussieplayer]

Guys,

You may want to check out:

http://www.betfair.com

and

http://www.flutter.com

....for what is becoming HUGE in Britain - and is being debate here.

Betting exchanges - the way of the future??????

Apparently one of them (think it was flutter) is "researching" there chances of coming to America!

Cheers
Aussieplayer

[smf]

tanda,

I'm not trying to stray from your topic but this kind of gives a view from a responsible, sharp track owner (Bryan Krantz of FG). I found it interesting. I found his comments about "international interests" of particular interest. It looks like something you're talking about c/b in the works.

This (partially clipped) text is from the FG BBS and he posted this on 8/2 concerning account wagering and the possible changes on the horizon .....


We are very close to deals with UK and Austrailian interest to add product to our system in La. and add FG races to much broader distribution. The TVG situation will be much clearer this coming year. Watch what happens in California with great interest. It's TVG's last hope of survival. Watch for TRN to be reformed into a new entity. The Magna group may now be coming to life and be as ugly as TVG in its own way after the NY City OTB contract going to them. My thought is there are big international players who are just getting started in this game. Churchill and Magna could be swallowed by larger fish in the not to distant future.

This next 10 years are going to be constant change. A track like FG is somewhat insulated because of the diversity we have been able to establish. Jazz Fest, Video Poker, OTB, Account wagering but we need slots to insure the true independence necessary for the future. With the purse $ and bottom line revenue from slots neither Magna or CD could freeze us out of markets. This will also insure for racing fans a broad base offering of all tracks/product in all otb's and account betting. Our presentation has always been to give as much choice and information to our customers as possible. Please compare what we do to what is done in other regions of this country (especially pricing). We want to take the FG brand of this type of response to our customers and create a national account wagering business with the same reputation. The other guys want to package and upsell. Raise prices where ever possible to enhance bottom line revenue so they can cover their debt service. It started last year when CD raised their rates on host track fee charges to the tracks/otb's showing their races. TVG is all about the larger tracks attempting to monopolize account wagering and what tracks get bet on through their tellevision presentation. It's a bad deal for the non "founder" TVG tracks and the customers who bet on all races. If they are successful regional tracks will lose market power in their own home markets.

[andicap]

I've actually met Bryan Krantz. He is a down-to-earth, sharp executive who does care about the fans -- and is a truly nice guy. FG is a great racetrack to visit and has one of the best racing surfaces.

[ceejay]

Originally posted by tanda
When was the last time a horseman argued for a lower take....
Sunday.

[Topcat]

Originally posted by karlskorner
Topcat:

Regarding your applying for a marketing position with a leading track and they were not interested if you were a betting person.

For ages tracks have had a problem with mostly tellers and others, who borrowed from the 'box" during the day and at days end came up short. A good tip here and a tout there, if your short borrow from the "box" you'll make it up when you win. Couple years back a teller friend was short over $4000.00. Of course they fired him, I met him a couple weeks later, he truly believed he was going to win and the track would never know the difference.

Karl


Karl,

You bring up a good point and it may explain a bit of their attitude. However, the position I was interviewing for was not a teller position or one that would have ready access to the windows. It was a management position. Their attitude was such that after interviewing with them I had no longer had any interest in the position.

What was clear was to me was that they had a condescending attitude towards bettors. They saw themeselves and the state as partners but not the bettors. If they staffed their executuve postions accordingly it is no wonder that the "take" is what it is.

At any other corporation executives understand what their product is and are firm believers and or users in the product. But track management ,or at least at this leading track, they see their product as some sort of equistrian olympic event rather than what it is: horse racing with betting.

TC

[karlskorner]

Topcat;

You will note that I carefully included "tellers and others" he was only responsible for about $1000., the balance belonged to 3 people in (guess where ?). He got fired and they denied, denied, denied.

I guess that is another use for the word "takeout"

Karl

[andicap]

I wonder if the tracks don't want to hire "betting people" for the same reason any other business may not want to -- for fear that they will spend their working hours gambling instead of doing their jobs. I can't blame them. But you guys make a good point that in ignoring bettors, tracks are hiring people who don't understand their market.

It's a real conumdrum for the tracks, no doubt about it.

[Dave Schwartz]

I recently spoke with someone that is interested in coming to work for us... He told the same story. Once interviewed for a job and was strongly advised to never admit to being a horse player.


Regards,
Dave Schwartz

[Tom]

Horse players have a social stigma, no doubt about it. Personally, I think the wackos are the ones in the stock market and mutual funds.
Recently, a co-worker asked me with some obvious disdain if I was going to the track that weekend.
I told him no, I played at home on my computer.
He looked disgusted and made a comment about throwing money away. My reply to him was, "By the way, how did your 401K do last year?"
Tom

[tanda]

The stock market does have certain advantages ... 1) It can handle large capital and 2) it has a long-term positive expectation, even adjusted for inflation, but horse playing has advantages as well ... primarily the ability to churn capital repeatedly in one year.

It is interesting that many (players and non-players) look with disdain at a person who buys tipsheets, etc. If you told a non-player that you did that (and I know that none of us do), they would look at you as even more of a degenerate. Yet, these same people sit at home and watch CNBC and buy stocks on advice of touts (most of whom are part of the "crowd" while most great investors (all?) are contrarians and most TV stock pickers (all?) have another agenda).

Anybody know the difference between a track tipster and a stock picker?

Or between the people who listen to each of them?

There is no difference.

Then, they bitch when the advice is wrong.

Do they really think that some true genius is going to appear on CNBC daily and give them brilliant contrarian advice for free? And do they really think that contrarians would last long at the big houses? Yep, they do. Actually no, since they do not understand contrarian thinking. They are lemmings.

Of course, even if a true genius appeared and gave advice, they would ignore it because the best advice (advice that beats the crowd) most be contrarian and most people have no confidence/self-esteem to part from the crowd. So they all buy Amazon because USA Today says tech stocks are hot.

Next time a person asks you about horse racing, ask them why they bought their last stock (including what they thought it was worth at the time and how their valuation methodology and investment philosophy works). Also, remind them that buying a stock because somebody told you to is never a good reason.

Then, explain your investment philosophy at the track (how you value wagers and why you make certain wagers and the empirical evidence you have to support your plays).

Then ask them which is investment and which is speculation.

Oh ... they still will not get the point. After all, they will always be part of the "crowd" and accept the crowd's thinking which is that we are 1) sick, 2) weird, 3) degenerates (pick one or more, or add your own).

My father once told me that the worst thing you can be is common.

I am proud to be looked at with contempt by the "crowd".

[takeout]

Originally posted by tanda
Obviously, if this idea was ever successful and siphoned significant money from the horsemen, that problem would need to be resolved.
I was under the impression, perhaps wrongly so, that a rather large amount of money was already going to offshore books that don't commingle and that is the reason for some of these reduced takeouts that we're seeing now. My theory may have holes in it but one thing's for sure. Tracks don't do things like lower takeouts unless their backs are to the wall.