Which (if any) 3-yr-olds will run next year?

[Danzig]

well, there's another scenario that could happen...
let's say you have a buyer. he contacts an agent to do his buying for him. let's say the agent id's a horse. let's say he knows his buyer will pay X for a horse. let's say that maybe he finds someone to buy said horse privately (perhaps he provides the money to buy it?), and then he will bid up the next day, in the neighborhood of X. then could he and the private buyer (who no one knew about at the time) possibly benefit??

wonder if that has ever happened? goodness knows that all kinds of funny business could go on. just like the cases where someone bid and then a commission was split between the agent and the seller. who is taking care of the buyer? how many naive owners get taken? how many leave a game they would love to be in because they get taken by an unscrupulous agent?

[Danzig]

Originally Posted by Cannon Shell

Though it is easy for us to throw numbers around the amounts of money being paid for stallion prospects is staggering. 25 to 50 million dollars is real money even to rich people. Dont forget that alot of these rich owners believe that the sport is who makes the most money like in their other businesses. I am not saying it is wrong or right but it is how they think.

i think the competition has veered from who can breed the best horse to who can get the best bottom line. a shame too.

[Dunbar]

Originally Posted by GenuineRisk

I agree, owners could opt to sit out a year; in that case they'd be gambling on the industry's memory of a good season vs. a 4-year-old campaign. And yes, I agree they risk a stallion's "value" dropping after a bad year, but I think that's part of the problem- the stallions are overvalued to begin with- the insurance companies price the top ones with the idea that they'll all turn out to be AP Indy at stud.

I pulled this quote out of your post because I thought it was an extremely good point. Cannon Shell's response that the market sets the value, not the insurance company, is 100% correct, but it doesn't change your conclusion. Namely, that the preceived risk proves that stallions are overvalued to begin with.

There's no other rational conclusion that could be drawn. If the average value of a stallion prospect would drop markedly after a 4-yr-old campaign, then people are paying too much for 3-yr-old stallions. (yes, there should naturally be a small drop attributed to the loss of one breeding season, but we're not talking about that kind of price difference.)

The initial market price for breeding is based on a combination of the stallion's lineage and what it accomplished on the track. If the average market price would suffer from another year of racing, then clearly people have been over-paying for what a horse accomplishes on the track up to the point of its 3-yr-old year.

Maybe it already seemed obvious to some that breeding prices are inflated. But the argument could always be made that the market establishes a fair price. However, that argument would be negated by the fact, if it's true, that on average, a horse's value would go down decidedly by simply racing another year.

--Dunbar