The “short squeeze” in harness racing

For those of you not quite familiar with stock exchanges—taking ownership in shares of publicly held companies traded throughout the world—the participants in harness racing take ownership in a different type of stock—the standardbred horse.

Both types of markets offer risk and, if lucky, rewards beyond one’s wildest dreams.

The stock market offers an array of “prop” bets, one of which is the short sale.

Short selling involves “borrowing” shares and selling them promptly hoping that the stock’s price will go down and enable the borrower to buy the stock back at a lower price, if the company does poorly in earnings or other circumstances.

Well, those short sellers took a bath as buyers began gobbling up shares in Game Stop “squeezing” the short sellers to buy back their borrowed stock at much higher prices, “squeezing” them to a point of suffering huge financial losses.

Game Stop was valued at around $17.25 at the beginning of January 2021 and the squeeze was worse than a pythons as the price skyrocketed to around $500 a share.

One day, the frenzy was so violent that the price of the stock doubled in a period of around an hour-and-a-half and short sellers lost fortunes.

Game Stop was not the only company “squeezed” as there were other companies where short sellers were hoping the price would deflate and the stock of those company’s also went much higher squeezing those short sellers.

So, what does this have to do with your trotter or pacer worth $100,000 or more?

Plenty…just maybe not quite in the same way.

Yes, there seems to be some squeezing in our own industry…and it affects the small owner, you know, the ones with just a few horses in the barn trying to make a living in a sport they love.

A hint of the squeezing came in the recent Oak Grove meeting and what is going on in Kentucky.

“It’s almost like ants at a picnic.” said one owner. “Put a little sugar on the table and they’ll all come up looking for a piece of the sugar. Put a lot of sugar on the table and the whole ant colony will come visiting.”

In the recently concluded Oak Grove meeting, purses were outrageously great with some claimers making as much or more during the short meeting as they did all of last season.

That’s great!

But instead of the huge money going to those that have patronized Kentucky standardbred racing for years and years, new colonies of “ants” in the form of larger, richer stables, saw the sugar on the table and invaded the picnic.

The Erv Miller Stable won over 30% of their 135 starts there and took almost $600,000 home.

Tony Alagna did even better than that taking $709,470 out of the purse pool…in just 85 starts!!

You can’t knock these trainers and their stables for grabbing as much sugar as they can. It’s a dog-eat-dog business, harness racing is…and racing secretaries all over North America want the best product they can put up on the track.

But, in doing this, they’ve put a short “squeeze” on the smaller stable…not only in talent with the larger stable’s expensive “stock,” but there is also a “squeeze” on availability of stall space.

It’s been heard that many larger stables have already contacted the folk at Oak Grove trying to reserve stall space for next season.

Several others have bought—or about to buy—farms and land which puts a further squeeze on the small stable owner and trainer.

It’s hard to refuse a Miller or Burke or Alagna or any other “big name” stable that will ensure the highest quality of racing…but where does that leave the Brinson’s and Mike Murphys of the world with their smaller stables.

How about James Stiltner, John Hughes, Donnie Brock and the many others that have helped fill cards in the Bluegrass State for years and years?

What about the Mississippi guys and gals that have crossed the border to race in Kentucky for the past 10 to 15 years?

“Murph” had a couple stakes horses and an open trotter…and a 13-year-old war horse…at Oak Grove and worked as hard as everyone else but was lucky to cross the $32,000 threshold in purse money during the meet.

Just For Trix—a TROTTER—is Murph’s first 1:50 performer in his career spanning almost a half century.

He’s got $30,000 on his card this year and the week after his 1:50 performance, his race DID NOT FILL!

Last season was Murph’s best season in purses with $181,533—47 years of blood, sweat and tears showing $2,5 million in purse money.

Some of the “big stables” make in a month what it took Murph to win in 47 years!

Trainer Donnie Brock, who has been on the track since 1991, went over $100,000 last season for the first time. In fact, we went over $200,000! It’s August, and he’s at $37,322.

Kentucky is a thriving State that cares deeply about horses but not everyone is enjoying the ride on the fast pace to success, that’s for sure.

This is a very tough situation for which to find a solution that will satisfy owners that might have solid performers…but not quite enough to reach the top rung.

Years ago, a 2:00 mile was “king” or, for a filly or mare, “queen.”

Heck, when Adios Butler broke the 1:55 barrier at Lexington’s Red Mile back in 1960, the sport went “ga-ga!”

Today 2:00 will assuredly earn you z-e-r-o…and we’ve all seen horses’ pace in 1:48 or or 1:49—60 lengths faster than the coveted 2:00 mile—and earn 1% of the purse in some stakes events after the winner’s share…OR NOTHING AT ALL in overnight events.

It’s not just Kentucky, folks, it’s just about everywhere where the purse money from State legislatures and casino entities are thriving and the vast majority of owners aren’t on board.

Illinois owners are hurting…California owners are hurting…In Maine, they’re doing the best that they can. Some tracks in New York are doing well…but some are having a tough go filling programs.

There are only so many owners enjoying the riches as members of the Burke, Svanstedt, Engblom, Alagna, Cullipher, Alexander, Bongiorno or Takter Stables.

Add Melander, the aforementioned Erv MIller, Virgil Morgan, Linda Toscano and Richard Moreau and you’ve got your baker’s dozen that have close $50 million in purse money this year.

That’s about 18% of the total purses distributed so far this year with a huge chunk of stakes event yet to go to the post.

As one owner noticed, “Take last week for example at The Red Mile. They had 46 races over the Sunday-Monday-Tuesday cards….46 races in all.

“Only 16 of those were overnight races and that’s exactly what I own, overnight stock. I, simply, can’t go head-to-head in a slugfest with the top stables.

“By the way, the Stakes races went for between $15,000 and $80,000 and only one of our overnight races went for as much as $8,200.

“While they are eating ‘steaks’ from these Stakes, we’re getting hamburgers!”

Betting $2 on a 20 to 1 shot here and there might be interesting…but, when one thinks about the “odds against” when becoming a small owner getting into the “ring” with the big boys and girls…well, that’s another story!

by John Berry, for Harnesslink