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Originally Posted by usedtolovetvg
One of my flaws is that when I don't understand something I say so. I really don't follow you. There was $8.5 million more withheld than should have been. 26% was withheld rather than 25% over the time period. The money that was, not ultimately, returned to the winning bettors was kept by someone and I believe NYRA got the unclaimed winnings. Chickenhead clearly explained that no law was broken outside of NY. I'm sorry but I don't follow you.
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The only way this "extra money" existed is if betting behavior was unchanged by the change in takeout rate. This means that players would have had to bet the same amount at 26% as they did at 25%. When the refund was calculated, it made this assumption. However, this assumption is wholly incorrect if we are to believe the common stance put forth by HANA among many others that take is too high and both tracks and players would benefit by lowering take. I assume you believe this stance to be true.
Takeout is simply the price of a wager. There is a level of takeout that will optimize the profits of the track, ie max profits. If you raise take above that level, then profits fall. If you lower it below that level, profits fall. Therefore, if we believe that take was already too high at 25%, raising it to 26% causes profits to fall. This is because players react to the higher price and decrease the amount wagered by a greater percentage than the increase in price. But if profits fell, there was no "extra money" kept by anyone. That money never existed because it was never wagered due to the higher price of wagering.
The point is, we can't at the same time believe take is too high for both player and industry and claim NYRA made all this extra money. These two statements are contradictory.
