Halftime adjustments

Halftime adjustments

November 27, 2021

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by Trey Nosrac

I began with a proclamation, “Like the Swallows of Capistrano, most participants in the yearling ownership game follow the same pattern each season. We study catalogs during the fall months, raise our hands at auctions, dream big, and then we see if our dreams have come true in eight or nine months. For people unfamiliar with our game, the empty wasteland between the excitement of a yearling sale and any racing action is long and tedious.”

My pal shrugged. “That seems to be the basic model in your sport. Nothing much will happen for eight or nine months, and, oh yeah, they will need to pay staking fees and a hefty bill every month. That said, I’m sure there are reasons for the timing of yearling sales.”

“Whatever the reasons for the schedule, the long void does not appeal to new owners. People today get impatient when their iPhone freezes. We need some models where time is not our enemy. I think I will take a whirl at creating one.”

“A time machine?”

“Sort of — did you ever hear the term pinhooking?” I asked.

“Yes, reselling a product later in the process. Strange term. Is it one word or two?”

He pulled out his phone and asked, “Hey Google, Where did the term pinhooking originate?” Then he tapped a link and read from his screen:

“From tobacco trading. Aaron H. Washington, the son of John Bratton, founded a community in Flat Lick Creek, Kentucky, one mile from Licking’s North Fork to serve his local store, mill, and tobacco house. Washington established the Bratton’s Mill post office on January 25, 1865. The community was known as Pinhook. The office closed in August 1875 but was re-established on May 10, 1882, simply as Bratton. What remains of Bratton is still locally referred to as Pinhook. Whence Pinhook? An early resident named Alta Mae Walton recalled the story of the boy who would fish in nearby Flat Lick Creek using a bent pin for a hook. She and others believe that it was at this place that the term pinhooking originated because, in the early days, shady tobacco dealers and brokers operated in this area.”

He slipped his phone into his jacket pocket. “So, is that Trey’s new adventure, Pinhooking harness horses?”

“A version I’m making up on the fly. These days a person buying or selling a pinhooked horse has new tools with the Internet. Customers can take out an ad on a website, or participants can buy or sell a horse online or Ongait any time in the process.”

He thought for a second and said, “The obvious problem is that nobody sells promising 2-year-olds well into training. Young horses like that are too hard to find. Buyers will always be ultra-wary, and in the back of their mind is the question, ‘Why would anyone sell this potentially Sires Stakes quality horse?’”

“That’s where my version enters the picture. Pinhooking seems to take place late in the process. Everyone knows that a 2-year-old that easily trains in single digits with a flawless gait in June and then wins a qualifier by open lengths in a jaw-dropping time has an excellent chance of evolving into an excellent racehorse. At this point, the horse has great value.”

He took the contrary position, “And everyone knows that a horse that can barely break three minutes in June is of minimum value. So, what’s your point? What’s your angle?”

“A middle ground determined by the time of the stopwatch.”

“Do tell,” he said.

“This fall, my friend and I bought three yearlings at various sales. Like a lot of people, we probably over-shopped. Still, we left each sale knowing that each yearling we purchased was ‘the one.’”

He chuckled, “Your theory of ‘the one’ will not hold up under statistical analysis but continue.”

“We all delude ourselves into thinking that the trifling stops between fame and riches; breaking, staking, training in 3 under minutes, training in 2:50, 2:40, 2:30, 2:20, 2:10, and then in the single digits and winning races is going to happen.”

He said, “And you delude yourself with the best of them.”

“Thank you. I’m telling you right now that when the horses train down to 2:35, there will be a sale. A complete accounting of the original sales price, training bills, and payments for stakes programs and races will be available. The horse can be examined and viewed. There will be a reserve price. Should one of the 2-year-olds sell, that’s fine. If they do not sell, the horses will continue training.”

“How much do you, or anyone, really know about a racehorse at this point?” he asked.

“Honestly, I’m not sure. However, everyone knows a hell of a lot more about a two-year-old training at 2:35 than they did last October when the horse was a bug-eyed yearling with a HIP number glued to their flank.”

He paused, then said, “If your 2-year-olds in training don’t sell, the commissions for repurchasing them, videotaping, and advertising costs will add up.”

“True, and I spend more. When, and if, any of this trio are training at 2:15, the horses may go to market again.”

“Where your price will go up.”

“Or down. Who knows?”

He shook his head. “Would you have the emotional strength to sell a very promising 2-year-old at that point? Come on, Trey, I don’t think you could do it.”

“That statement indicates you have never lived paycheck to paycheck. Look, would selling hurt? Sure. Could the sale come back and bite us? Sure. At this point, the money would need to make sense to us. We can bake a solid profit margin into the asking price. At 2:35, the buyer and seller have more information and time to consider relative value. Wheeling and dealing can be fun. Horse trading is a big part of the attraction to this game.”

He seemed to be softening his view, “Marketing a horse in 2022 is easier than ever.”

I nodded, “The idea is simple. Potential buyers are closer to the finish line than they were at the sales. For several cold months, we have taken risks, paid bills, and paid the stakes. These two-year-old racehorses are much more finished products. How that affects the price is up to the marketplace.”

He said, “I still don’t think this unorthodox sales schedule will find buyers.”

“You may be correct, but so what? And getting back to the start of this conversation, this project could be great for new owners who might join a partnership with seasoned partners. The newbie could pay their money and then in a month or two, turn the keys and go for a ride.”

He smiled. “So you are working on another crazy experiment.”

“It’s what I do. See you around 2:35.”

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