They are creating a bubble economy Scav. The yearlings are selling for a million dollars to a lot of people hoping to be able to sell them to Shiekh Mo for $10 million off a maiden win. They aren't worth that million without the possibility of selling them to Shiekh Mo. A lot of people think that Shiekh Mo stopping spending money in America would be a disaster because the bubble would pop. And yeah, a lot of people in the industry that are thriving off that bubble would take a hit. In the long run though it might be the best thing for the sport for that breeding bubble to burst.

I couldn't agree with you more. But it is NO DIFFERENT then something like the housing economy in the US.

The big difference is that the entire bubble is being created in large part by one person.

Money eventually runs out, it always does, you can NEVER have enough of it, even this guy.

It is no different then say the Beer Industry. Right now in one of my final classes, we have to do a strategic audit on a company, the teacher picked the beer industry. The industry as a whole has 4 major players, and then a bunch of fringe players. It is exactly what is going on here. You have 4 major owners, some people that are trying to get to that level, and then you have the fringe players, that take what they can get.

There are 4 people creating that bubble.

I don't want it to look like I am defending this guy, because personally, I can care less what goes on over there, although it does look like a cool place to visit.

I just think that people are missing the big picture, what the industry as a whole is doing.

Take the one with the limitless resources out of the picture and the spending by the other three drops dramatically. I think you are underestimating just how much money this guy has and how much the economy of Dubai is making him each year. The money won't run out, he gets virtually none of it from oil anymore so won't even be impacted if we somehow reduced our dependance on oil.

Those three players could easily get together and say you know what ENOUGH IS ENOUGH, but they won't do it because they also have 'a war chest'.

Money is no object to these people, and those people eventually get smoked. And trust me, when you are losing 200 million a year on bad investments, while a drop in the bucket for some, you still don't have 200 million, even if it is just a bathroom to these people...

Sheikh Mo's net worth is $14 billion. He spends $50 million on a horse and it is the equivalent of someone with a net worth of $100,000 spending $357 on a horse. So Shiekh Mo can buy a $50 million stallion easier than I can buy a share in Sumwonlovesyou.

You're right...I understand Scav's analogy, and Team Valor may equal Bud, etc, but Sheik Mo is on an entirely different level than ANY of the other players. He is DRIVEN by his thinking that his people are the rightful heirs and owners of thoroughbreds in general and horse racing in particular. He can rationalize anything by this philosophy. He isn't driven to win this race, or own that horse, he wants to bring the breed and the sport back to where he feels it rightfully belongs. It's almost religous in nature and common sense can't compete with that. Sure, there are some ancillary "good" things and charitable things along the way, and Eurpopean racing benefits as does American on a certain scale. But to say he's just a rich dude buying horses underestimates his end game, IMO.

I agree with this. But the point to made that the BREEDING INDUSTRY has caused this. Not just these four jerkoffs

You have a 50k stallion making TWENTY MILLION DOLLARS A YEAR(400 mares) if he is going to the south hemisphere, how can ANYONE pass that opportunity up with any horse they have. you aint making 20 million with a horse on the race track. ****, a 10k stallion is making TWO MILLION DOLLARS in a year....

UNTIL the economies of scale EVEN OUT between racing/breeding, this **** aint gonna change people

As much as we'd like to believe that there will be some magical source of money that comes in and boosts the purses it just isn't going to happen. The only way the racing/breeding scale evens out is if the breeding bubble bursts. That won't happen until Shiekh Mo decides to stop spending money in the US. He has the finances to singlehandedly keep the bubble afloat and is getting some help from the previously mentioned other three groups.

I would really have to study the industry to come up with some ideas, but I can tell you right now, one of them would be to continue the consolidation from all sides. Just by looking at it, this industry wastes SO MUCH MONEY. Look at the ADW landscape, at the most, you need 2 of them, so there isn't a monopoly, but you have 4 majors, plus some fringe. These companies run at RAZOR thin margins, now if they consolidated, to two companies, maybe Twin Spires and TVG, margins would increase, thus you can be more competitive.

Look at these BS tracks that are closing and how tracks have to be pulled out by slots. Magna/Churchill really have the RIGHT IDEA in having all these tracks under an organization but the problem is that Magna has a bunch of buffoons in the organization and they get rid of people that demand they are heard.

There are too many tenacles to this industry, and tenacles don't usually live long.

Well if you wanted to make me the czar of racing I'd just limit the stallion books by age. If you stood a 3yo his book would be limited to 20 mares. If you stood a 4yo his book would be limited to 60 mares. A 5yo could cover 100 and then 6yos and up would be unlimited. Would provide less incentive to retire a sound horse early.

Which is incredibly frustrating when I have one that I'm pretty sure could win it.

a great idea, but will never happen, until horse racing is run like the NFL, and the breeding industry is run like college football.

These morons can't even get medication rules to be the same

I understand where you're going with this, and it was brought up prior, but the top four major players in the beer market don't have unlimited pockets, or charge ridiculously low prices, to eliminte the others. They still, by large, keep the market competitive.

They constantly buy up smaller breweries, or they essentially force them into a distributation agreement (such as a company like RedHook, which is who I am doing the audit on)

It has been either merge upon merge or just getting consolidated into one of the largers.

I don't have their 10k's handy, and with it being a highly regulated industry, their piss away alot of money on regulators and **** like that, but they aint struggling, their pockets/power, is pretty large

But that still isn't comparable to Godolphin and racing. Miller and Bud battle for exclusivity at sporting events. You think if Sheik Mo wanted his beer ( I know..bad analogy) at the UC, he wouldn't just quadruple the highest offer from Miller or Bud and we'll all be drinking Mo's Brew? No one else is capable of that in the beer industry, let alone the horse biz. I don't think you have an appreciation for exactly how much money he does have.