Archives for November 2018

The recent murder of dissident journalist Jamal Ahmad Khashogghi by Saudi Arabian operatives presents a moral challenge for many businesses, including prominent horse-racing enterprises who have customers from the Saudi royal family.

Currently, the United States and other nations are being urged by citizens and elected officials of all political stripes to severely sanction Saudi Arabia over the killing of Mr. Khashoggi at the Saudi Arabian consulate in Istanbul. Though Saudi Arabia has denied that Crown Prince Mohammed bin Salman ordered the assassination, the Kingdom does not dispute that Mr. Khashoggi was murdered by Saudis with connections to the House of Saud.

Sanctions create a practical dilemma in that Saudi Arabia can drive up the world price of oil and is a major customer of multinational companies and an important source of funds for Silicon Valley high-tech startups.  In addition, Saudi Arabia could adversely affect prices on equity and bond markets if it were to sell its vast holdings in anticipation of or retaliation for economic sanctions.

So firms dependent on Saudi Arabian business face a dichotomy of fact and value.  On the one hand, a Saudi boycott would cost them plenty monetarily.  Yet, one may be uncomfortable doing business with a nation that has an indisputable record of human rights violations, including repression of women, and, moreover, was a breeding ground for fifteen of the nineteen perpetrators of the September 11, 2001 attacks in the United States as well as the mastermind.

Over the years, prominent members of the House of Saud have been deeply involved with horse breeding and racing.  They have spent millions of dollars at horse sales, owning farms across the world, employing thousands, and thereby providing economic fuel for the global Thoroughbred industry.  While it can be argued that Saudi racehorse owners may be upstanding individuals with no direct involvement in atrocities and repression, the fact remains that most of them are members by blood of the ruling House of Saud and therefore are at the very least accessories.

Horse trainers, auction company executives, and others with a vested interest turn a blind eye to Saudi human-rights violations because they won’t alienate deep-pocketed patrons.  Their posture is similar to corporate giants like Boeing and Raytheon and numerous California startups that depend on Saudi Arabia for investment, or even to consumers who enjoy low gas prices at the pump.

Businesspeople, including those in horse-racing, can rationalize commercial ties to customers and employers who may be complicit in crimes against humanity: “Keep business separate from politics” or “They are no worse than Russian oligarchs.”

Democratic governments and basically good individuals have a long history of conducting business with bad actors.  Yet, rationalizations aside, doing so may, or should, trouble one’s conscience…at least a little bit.

Copyright © 2018 Horse Racing Business

When voters cast their ballots for the Eclipse Award for 2018 American Horse of the Year, the choice will come down to 5-year-old Accelerate and 3-year-old Justify.  My analysis of which horse will win the award follows a brief summary of the achievements of each horse.

Accelerate Credentials

His first race in the 2018 season was on February 3rd and his last race was on November 3rd in the Breeders’ Cup Classic.  Accelerate won six of seven races with one second-place finish.  He achieved a feat that only three racehorses (Affirmed, Alysheba, and Cigar) have accomplished–winning four Grade 1 races, in a single year, on dirt at 1 ¼ miles (Alysheba holds the record with five).

Justify Credentials

The colt broke his maiden on February 18, 2018 and was retired undefeated after the Belmont Stakes on June 9th.  His seven career starts included four Grade 1 races–the Santa Anita Derby, the Kentucky Derby, the Preakness, and the Belmont.  Justify was the 13th American Triple Crown winner and the only undefeated one at career end.

Analysis

A reasonable case for Horse of the Year can be made for either Accelerate or Justify.  Accelerate competed for virtually the entire 2018 year, whereas Justify ran for less than four months.  Additionally, Accelerate capped off his 2018 campaign by convincingly winning the Breeders’ Cup Classic.  By contrast, Justify became only the 13th 3-year-old in American racing history to win the coveted Triple Crown, though some observers have questioned the quality of the competition he engaged…and he never raced against older horses.  He won the Belmont at 1 ½ miles, a distance never attempted by Accelerate.

The view here is that the prestige associated with a colt winning the Triple Crown will be decisive and therefore Justify will prevail in Horse of the Year voting, even though statistically a Triple Crown does not qualify as being unique, which is defined as “sole” or “unequaled.”  A better descriptor would be rare, defined as infrequent.  In the one hundred years of Triple Crown history, the first champion being Sir Barton in 1919, the Triple Crown has been won 13 percent of the time, which equates to about 1 in 7.6.  This metric is unusual but certainly is not unique.  What is inarguably “unique” is that Justify is the “sole” Triple Crown winner who was never bested in an official race.

No doubt Accelerate will be preferred by some voters, but more voters will find Justify’s undefeated Triple Crown season compellingly distinctive.  The reasoning will be that a Triple Crown champion, and an undefeated one at that, must almost automatically be Horse of the Year.  The Triple Crown is the ultimate prize in American horse racing and winning it conveys an aura to a champion.

When Justify is eligible for induction into the National Museum of Racing and Hall of Fame in five years, debate will focus on his very brief racing career and the fact that he did not compete against older horses.  Nonetheless, Justify will join his Triple Crown peers in the Hall of Fame.

Copyright © 2018 Horse Racing Business

For horse racing fans domiciled outside of the United Kingdom and Ireland, it can be difficult to appreciate how the focus of British racing flips in autumn.  Gone are the long, intoxicating summer days at Ascot and Epsom.  Memories of the Derby and the Oaks slip away, and familiar names like O’Brien, Godolphin, and Coolmore are not heard as often.

Attention turns to the much different ambiance of the National Hunt season; cold, windy nights in December with sodden, muddy tracks.  It’s a world away from the pomp and ceremony of the summer.  But many fans wouldn’t have it any other way.

There is no official date for the start of the National Hunt season, usually having some cross-over with the flat season in October, then building up steam until the Cheltenham Festival and Grand National in mid-spring.  The latter event is, of course, one of the world’s great handicap races, steeped in history and prestige.  However, it is the Cheltenham Festival that fans tend to focus on at this stage of the year, and National Hunt trainers and jockeys prepare for the Festival as if it were their Super Bowl.

Bettors, of course, are among those making plans for the Festival and, even at this early stage, they can get their hands on the Cheltenham 2019 best betting offers, such as free bets and other promos, as bookmakers look to drum up some early interest. Markets are available for all 28 races, and plenty of ante-post bets are made to potentially get some extra value early in the season.

What horses, then, are looking like they offer some decent value for a long-term bet?  Already, there is some sentiment for Malone Road–a horse trained by Gordon Elliot–who was impressive in his debut at Down Royal last week.  He is being pointed toward the Supreme Novices’ Hurdle (the opening race of the Festival) with tempting odds of 20/1.

Elsewhere, the brilliant Kalashnikov is seen as a big hope for the Arkle Chase.  Currently given odds of 7/1 from Betfair, the runner up of last year’s Supreme Novices’ Hurdle might be better suited to chasing. Those odds will likely tumble if he picks up a couple of wins over the coming months.

The most prestigious race, the Cheltenham Gold Cup, has several candidates right at the top of the odds. Might Bite is tied with Presenting Percy at 6/1, with last year’s winner, Native River, just behind at 7/1.  A favorite may emerge as the season develops and more past-performance data become available.

While there are advantages of making a long-term bet, there are also downsides.  Some of the early favorites for the big races, Buveur D’Air (3/1, Champions Hurdle), Altior (7/4, Champion Chase), and the almost-legendary Faugheen (6/1, World Hurdle), are all much too short with five months between now and the Festival.  Moreover, bookmakers are sometimes slow to remove horses from the market that are unlikely to run at the Festival.  For example, Douvan, seems to be out for the season but is still priced as the 12/1 third favorite for the Champion Chase.

Yet if some of those favorites should be avoided, the opposite is true for a number of the outsiders:  Al Boum Photo (33/1, Gold Cup), Meep Meep (20/1 Mares’ Novice Hurdle), Limini (20/1 World Hurdle) and God’s Own (50/1, Champion Chase) could all look like great value a few months from now.  A bettor should always make sure the betting company will return the wager (NRNB) if the horse does not line up for the race.