Archives for October 2019

The U. S. Bureau of Labor Statistics reported that the unemployment rate for September 2019 was 3.5%, which is the best performance in half a century.  Moreover, the unemployment rates for women and minorities are at historic lows and real wages continue to rise for the broad swath of people in the workforce. Adding to this economic brew are low inflation and record high net worth.

What effect does employment/unemployment have on pari-mutuel handle?  Presumably, lower unemployment should have a salutary effect on spending on leisure activities and entertainment such as betting on horse racing.

One would expect an inverse relationship between pari-mutuel wagering and the unemployment rate:  the lower the unemployment rate the higher the pari-mutuel handle.  Stated differently, the correlation should be negative.

To test the correlation between the average annual unemployment rate and annual (non-inflation-adjusted) U.S. pari-mutuel handle, I ran a simple correlation analysis for the years 2000-2018.  The correlation, as supposed, was negative: -0.2522.  However, this is not the best measure because the handle dollars were not adjusted for inflation. 

To illustrate, in 2000 U. S. pari-mutuel handle was just over $14.3 billion and in 2018 it was slightly over $11.3 billion, for a decrease of 21.3%.  But in inflation-adjusted dollars, pari-mutuel handle actually declined from $14.3 billion in 2000 to $7.7 billion in 2018, or by 46.3%.

When I used “real” dollars to calculate the correlation coefficient, the result was -0.2095.

Both -0.2522 and -0.2095 are mild correlations, where the coefficient can range from plus 1 to minus 1. While correlation does not prove causality, one can infer with a high degree of confidence that the U. S. unemployment rate has had only a minor effect on U. S. pari-mutuel handle between 2000 and 2018.

Why so?  The hypothesis (educated guess) here is that the small percentage of professional-like horseplayers who account for the vast majority of pari-mutuel handle are not as affected as the proverbial $2 bettor by prevailing economic conditions.

Copyright © 2019 Horse Racing Business

Australia’s Melbourne Cup is held at the Flemington Racecourse in Victoria.  The race was first run in 1861 and became so popular that its raceday has been a public holiday in Victoria since 1877.  The Melbourne Cup is always run on the first Tuesday in November, on the 5th this year, and is the showcase of the Melbourne Cup Carnival.  The Carnival is a combination of racing, fashion, entertainment, and food that begins in 2019 on November 2 and ends on November 9.

The Melbourne Cup is Australia’s premier horse race and the nation’s biggest betting spectacle.  Ever since Vivienne McCredie in 1986 wrote a poem about the Australian people’s fascination with the Melbourne Cup–titled “the Race That Stops a Nation”–the race has been billed as such.  Indeed, when the race’s 3 p.m. post time approaches, much of the population in Australia (as well as New Zealand) stops to watch the race on television, to bet on a favorite or longshot in a large field, or to see how they fared with $2 office sweepstakes tickets on randomly-selected horses. On a per-capita basis, Australians are the world’s most prolific gamblers on sports, horse racing, and various casino games. Melbourne Cup Betting Offers provides attractive choices and convenience.

Flemington Racecourse can accommodate 122,000 spectators.  On-track attendance for Melbourne Cup day in this century has ranged from a low of 83,471 to a record high of 122,736.

The purse for the Melbourne Cup, a handicap, is $8 million, making it the second richest race in Australia, with $4.4 million going to the winner.  (Australia’s most lucrative race is the Everest, worth $14 million and run at Randwick Racecourse in mid-October at 1,200 meters.)

The field for the 3,200m (2 miles) Melbourne Cup is determined by how well horses have done in Group races worldwide of distances of at least 2,400m (1.5 miles).  Twenty-four entrants are selected from hundreds of nominations.  Even now, only weeks before the race, over 60 horses remain in contention to start.

The international character of the Melbourne Cup is demonstrated by past winners, who, in addition to entries from Australia, have come from France, Germany, Japan, and Great Britain.  Last year’s winner, Cross Counter, will return in an attempt to put together back-to-back wins.  The 4-year-old gelding is owned by Sheikh Mohammed of Dubai, racing under the prestigious stable name Godolphin, and is conditioned by Charlie Appleby.  Cross Counter is the first British-trained winner. 

Current betting odds show that the top challengers to Cross Counter are two horses from Great Britain, Marmelo and Mustajeer, and one from Japan, Lys Gracieux.

While the Melbourne Cup is the featured event of the eight-day Carnival, it is by no means the only top-flight race.  To illustrate, the $1 million Group I Kennedy Oaks for 3-year-old fillies on November 7 will attract a talented field competing at 2,500m.

A feat that is unlikely to ever be equaled was achieved by the late trainer Bart Cummings.  Remarkably, his horses won the Melbourne Cup twelve times, with Cumming’s first winner coming in 1965 and his last in 2008.

Copyright © 2019 Horse Racing Business

SeaWorld opened a theme park in the Cleveland, Ohio-area suburb of Aurora in 1970 and permanently closed it in 2000.  The land on which the park was located was dormant until now, when it is about to be developed for residential and commercial use. 

People for the Ethical Treatment of Animals recently sent a letter to Aurora City Council asking for permission to erect a memorial on the site to 10 dolphins that PETA alleges died prematurely at SeaWorld Ohio due to a variety of causes, such as systemic infection, lung disease, and gastrointestinal disease. (The city replied that it does not own the property.) PETA’s principal assertion is that dolphins were and still are mistreated.  Its letter read, in part: 

“While dolphins are no longer held captive at this location, at other SeaWorld parks across the country, 140 of them are squeezed into just seven small tanks, where they can’t escape attacks from other frustrated, aggressive dolphins.  They’re forcibly bred—sometimes after being drugged—and they’re used in cruel circus-style shows in which ‘trainers’ stand on their faces and ride on their backs like surfboards.”

A PETA spokeswoman referred to the former Ohio SeaWorld facility as an “abusement park.”  SeaWorld answered by labeling the quest for a memorial a “publicity stunt.”

Whenever a person resorts to an inflammatory term like “abusement park,” it immediately signals that having a rational conversation with the individual is unlikely, at least as the conversation pertains to a memorial to deceased dolphins or to animal-use ethics in civilized society.

The PETA website unambiguously reflects the creed underlying the PETA spokeswoman’s coarse choice of words:

“Animals are not ours to experiment on, eat, wear, use for entertainment, or abuse in any other way.” 

Captured in this single sentence is PETA’s ambition to eliminate animal use for virtually any purpose, including, for example, livestock farming/ranching, feeding people, all forms of horse sports (hunting/jumping, dressage, racing, showing, etc.), crafting leather-made products like shoes, and advancing medical science.

Some of the most generous benefactors to equine and animal welfare organizations and efforts are deeply involved in horse sports, encompassing people who make monetary donations as well as caregivers.  Yet from reading the aforementioned PETA doctrine, the only logical conclusion can be that, in PETA’s interpretation, these folks are wittingly or unwittingly engaging in animal cruelty.  This is an extreme position and a highly inaccurate and insulting portrayal of many kind animal owners, trainers, and caretakers.

The vast majority of owners and trainers in horse racing (and other horse sports) acknowledge that substantive reforms are necessary to ensure better safety for human and equine athletes; incidents like the recent horse fatalities at Santa Anita are unacceptable. And the racing cohort has taken remedial actions, as acknowledged on PETA’s own website, and is pursuing others.

But, if you take PETA at its written word–that animal entertainment is in and of itself abusive–no amount of reform will suffice.  PETA’s desired end-result is the abolishment of all horse sports, of which racing is the most visible genre.

By contrast, the Humane Society of the United States works with equine participants to derive and implement humane initiatives.

Copyright © 2019 Horse Racing Business