Presidential Bet To Beget A $24,000 Tab for Two
To the victor belong the spoils, F. Scott Fitzgerald wrote in a 1922 novel, "The Beautiful and Damned."
In a more modern day Wall Street example, to the victor belongs the dinner, or, in this case, a dining extravaganza for two — it's one of those "Ripley's Believe It or Not" Wall Street bets between two well known New York money managers, this time on the outcome of next year's presidential election. The dining tab will run the loser at least $24,000, or maybe as much as $30,000.
The wager, made last Saturday, was confirmed to me by one of the bettors, a retired hedge fund manager who has given a good portion of his wealth to other funds to manage.
The even-up bet is confined solely to who will be the next occupant of the White House. One of the managers picked Senator Clinton, although he also rates a former Tennessee senator and "Law & Order" star, Fred Thompson, as a serious contender; the other manager chose Mayor Giuliani.
If neither of the two wins the presidency, the bet is null and void. Since it is unlawful in America to place a bet on a political election, the wager is illegal.
Our two bettors, each of whom frequently dines at the city's finest restaurants, consider themselves wine connoisseurs. What makes their political wager so expensive is that the loser will be required to provide four richly priced French wines and spirits. Their drinking delights — and the retail prices for them — are estimated by the city's two leading wine merchants, Morrell and Sherry-Lehmann, as follows:
• A 1961 Chateau Petrus, a Pomerol from one of the greatest years ever in Bordeaux, about $10,000.
• A 1947 Chateau D'Yquem, one of this premier dessert wine's finest years, about $5,000–$7,000.
• A bottle of Hardy's Perfection, a blend of reserve cognacs dating from the 1870s, before the phylloxera plague destroyed all the region's original vines, about $6,500.
• A bottle of 1985 Krug Clos Du Mesnil champagne, around $1,000.
The restaurant for this dining extravaganza has yet to be determined, but at the moment the focus seems to be on the Four Seasons, Le Bernardin or Sparks Steak House. The estimated $24,000 tab does not include the price of the food, tip, or corkage, so the bill for the loser, one bettor said, could easily run to around $30,000.
An auction house, Christie's, suggests it could be even more. Given the rarity of the wines, one of its wine experts tells me, the eventual buyer could wind up paying an additional 10% to 20% if he waits until next year to make his purchases.
The treasurer of real estate giant Tishman Construction, Larry Scharzwalder, who is also a certified public accountant, reckons the bet will produce at least two losers — the fund manager whose choice doesn't make it to the White House and the Internal Revenue Service. Mr. Scharzwalder figures, based on a $24,000 price tag for the dinner, that the IRS will miss out on a tax bite of about 43% on the winnings, or about $10,000.
Meanwhile, speaking of the presidential election, betting on President Bush's successor at Britain's largest bookmaker, London-based William Hill, shows the most money to date, $160,000, has been wagered on Mrs. Clinton. She is the overwhelming favorite to snare the presidency, currently at odds of 11–10. In other words, you put up $11 to win $10, for a total return of $21.
Senator Obama is the runnerup in fetching betting bucks at $40,000, although a William Hill public relations spokesman, Rupert Adams, says wagers on the Illinois Democrat have leveled off sharply in recent weeks after an initial surge. In the odds, though, Mr. Obama is now in third place at 5–1. Mr. Giuliani is in second place in the betting odds, at 4.5–1, but is in third place in the amount of money wagered, with $30,000.
Right behind the trio, William Hill's latest odds show a former vice presidential candidate and senator, John Edwards, at 9–1, followed by a three-way tie consisting of a former Massachusetts governor, Mitt Romney, Senator McCain of Arizona, and Vice President Gore. Mr. Thompson is next at 12–1. Interestingly, in a recent Wall Street bet, a hedge fund manager in the city wagered $20,000 with an official of a New York buyout firm at odds of 6–1 that Mr. Thompson would be our next president.
While press speculation about a presidential run by Mayor Bloomberg refuses to quit, despite his repeated denial that he's in the race, apparently a lot of bettors and the oddsmakers at William Hill are starting to take his "no" seriously — he's slipped in the betting odds to 50–1 from 34–1.
