Nice one ! In fact the eddy currents (generated in the conducting, but not magnetic, spool) create a weak magnetic field which is in opposition to the one that the fixed magnets set up.I'll try and drag up some of distant memories of A Level Physics for this one. Any conductor moving through a non-uniform magnetic field will generate an electric force. The magnetic field is disturbed and creates eddy currents, the generation of the electric force causes drag on the spool slowing it down. The amount of braking imposed is directly proportional to the speed the conductor passes the magnet, therefore the faster the spool spins, the more braking effect there is.
I'm sure somebody will give a better answer than that but I think that's roughly the best way to describe it, if you want formulas and stuff then find somebody far more intelligent that me!
One thing that has always puzzled me, why do we never manage to zap ourselves with a few hundred volts during a cast if they generate electricity?
This is the principle used in most power generation, like wind turbines etc.