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I'm just back from Keeneland, where I spent too many days looking at way too many horses at the annual yearling sale. A couple of stories coming out of the sale sparked my lawyerly interest in those obscure terms called "Conditions of Sale" that govern the relationships among the auction houses, consignors, agents the people who actually buy and sell horses. The first story was the embarrassment of  Keeneland's selling a horse  for $1.1 million to someone who apparently didn't have the money to pay for it. The successful, if underfunded, bidder, Karen Sanderson, a dentist from London , outlasted Sheikh Mohammed's agent John Ferguson to get the Medaglia d'Oro filly out of Amizette (Hip No. 1084) on the first Saturday of the marathon sale. Then, after the auctioneer’s hammer fell, Keeneland discovered – surprise – that Dr. Sanderson didn’t exactly have approved credit.  Embarrassed Keeneland officials scrambled to clean up the mess.   First, after Ferguso...

OK, we finally had a weekend with good weather both days, good crowds at the track, great racing, especially on Saturday, and the usual Sunday giveaway mob scene. But a closer look at the numbers suggests that perhaps those giveaways -- by now a Saratoga tradition -- really don't contribute much of anything to NYRA and its horsemen. It's safe to assume that NYRA doesn't actually make any money on the giveaway items themselves. Even if made by near-slave labor in China, those long-sleeved t-shirts (today's giveaway item) probably cost NYRA a couple of dollars each. Add in the need to pay a few people to hand the shirts out to the oncoming hordes, and add in the over-ordering that's a necessary part of running the giveaway program, and it seems unreasonable that NYRA could realize a profit on the $3 general admission charge. I don't know how much of the giveaway items' cost is picked up by corporate sponsors (today's shirt was credited to the Adirondack...

This is a diversion from the usual fare, which deals with racing economics and the big players in the game. But we (Castle Village Farm) will be running our first-ever stakes race at Saratoga tomorrow, and I couldn't not mention it. Our four-year-old filly Just Zip It will run in Monday's $80,000-added Union Avenue Stakes, for NY-bred fillies and mares on the dirt at six furlongs. Just Zip It sailed through her NY-bred conditions earlier this year: lifetime she's 3-3-2 from eight races, and has never been worse than second at six furlongs. Her Beyer numbers aren't as flashy as some of the other entrants', but she has a great competitive spirit. Dick Dutrow has what will certainly be an odds-on favorite in By the Light, but we're hoping to be able to run with the rest of the field. Actually, we're happy just to be here, with a filly that legitimately deserves a shot at this level. Our horses have won stakes before (Maryland Million Distaff at Laurel and t...

Many observers tend to conceive any changes in media businesses as trends that are irreversible or to combine them with other changes to make sweeping generalizations about industry conditions. The results are often wrong and distract observers from asking deeper more appropriate questions about longer-term developments and how media companies use the resources they have. To understand changes one needs to consider developments separately to determine their origin and expected duration. This allows one to determine what are the result of external trends and what are the result of company choices. Only then can one begin combining them with other observations. Thus, one needs to consider whether the ratings increase for AMC is due to people spending more watching cable channels or an effect of the AMC's investments in quality programming and the popularity of programs such as Mad Men? If it is the former, one can enjoy benefits with little effort or extra investment; if it is the la...

Magna Entertainment scrambled and managed to negotiate a one-month extension of the loans that were due this month, according to a report in the Daily Racing Form . In addition to intra-company loans within Frank Stronach's Magna empire, MECA also got an extension from the Bank of Montreal, which was due to have some of its $40 million paid back by yesterday. The bank's estimate of Magna's creditworthiness is illustrated by the 16.2% interest rate that it's charging on the loan. Not exactly prime-rate territory. I'm not sure what good this doies in the long run, since it's unlikely that Magna can raise significant revenue by the new due date, September 15th, but perhaps it gives Frank Stronach time to decide if he wants to put his own, personal money into the company, rather than continuing with plans to use funds from other Magna companies that have those pesky minority shareholders.

One of the fringe benefits of being a recovering (i.e., retired) lawyer is that you know how to read financial statements, but you only have to read the ones that interest you, and not, as in the old days when one was still working at a law firm, the incredibly boring ones of your clients or their takeover targets. So, when Frank Stronach's Magna Entertainment Corp. filed its quarterly financial report with the Securities and Exchange Commission last Friday, I decided it was time to put some of those old skills to use. For what can be more entertaining than deconstructing what was certain to be bad news? And if the report provided some ammunition for criticizing Stronach, so much the better; after all, his "vision" single-handedly destroyed the perfect winter race track that was the old Gulfstream. And bad news it surely is. At least for Frank Stronach and for those who, quite frankly, are unlucky enough to still own Magna stock. (Full disclosure: I bought a little bit ...

In my last post, I mentioned a few things the industry itself could do to put the steroids issue behind us and eliminate at least this one piece of the all-racing-is-drugged-and-crooked perception. It looks like I'm either fairly prescient or, mirabile dictu , some folks with power in the game actually read these blogs. On Friday, the American Graded Stakes Committee, an offshoot of the Thoroughbred Owners and Breeders Association (TOBA), adopted a rule, to take effect January 1, 2009, that would strip graded-stakes status from any race where the state regulatory authorities or, if those bodies haven't acted, the race tracks themselves, have not adopted the Association of Racing Commissioners International (RCI) Model Rule on anabolic androgenic steroids. Under the model rule, the four naturally occurring substances, boldenone, nandrolone, stanozolol, and testosterone are only allowed at trace levels, and all other anabolic steroids are banned completely. The effect of the...