Neilds
Assistant Pro
But the assets owned by the club aren't worth £4 billion, ie the players and the ground so how do they come up with these figures?
Neilds
Assistant Pro
Surely this analogy only works if you sell for more than you buy (after wages) but what club manages to do that consistently?
Swango1980
Well-known member
I'm not sure what the arguments are for now.
On one hand I'm hearing some suggest that Owners with mega riches should be able to spend what they like, as long as the money is put up front.
And almost at the complete other end of the scale, I'm hearing a suggestion of some sort of football communism, where clubs can only spend the same amount as the poorest club!?
Maybe the true reality is that fans will always moan about something? You let owners spend what they want, every single fan whinges except for those fans of the club with the wealthy owner (i.e. when Abramovich took over Chelsea). Whereas if you put very severe spending restrictions on the already successful, wealthy clubs, let us wait and see how the hundreds of millions of fans of those clubs react to that? More complaining I guess?
In fairness, as a Man Utd fan I would probably be absolutely delighted if spending restrictions were lifted completely. Yes, a club that gets a mega wealthy owner may be able to climb the ranks, although probably not to the extend Chelsea did when Abramovich took over, as there are a lot more mega wealthy clubs to compete with now. But, generally, I suspect the clubs with most money would grow that gap between everyone else.
On one hand I'm hearing some suggest that Owners with mega riches should be able to spend what they like, as long as the money is put up front.
And almost at the complete other end of the scale, I'm hearing a suggestion of some sort of football communism, where clubs can only spend the same amount as the poorest club!?
Maybe the true reality is that fans will always moan about something? You let owners spend what they want, every single fan whinges except for those fans of the club with the wealthy owner (i.e. when Abramovich took over Chelsea). Whereas if you put very severe spending restrictions on the already successful, wealthy clubs, let us wait and see how the hundreds of millions of fans of those clubs react to that? More complaining I guess?
In fairness, as a Man Utd fan I would probably be absolutely delighted if spending restrictions were lifted completely. Yes, a club that gets a mega wealthy owner may be able to climb the ranks, although probably not to the extend Chelsea did when Abramovich took over, as there are a lot more mega wealthy clubs to compete with now. But, generally, I suspect the clubs with most money would grow that gap between everyone else.
Swango1980
Well-known member
What about the money that Liverpool brings in through broadcasting, sponsorship and fans?
GB72
Money List Winner
I think it depends on what you want at the end. At the moment, football, as with a number of other sports, is a financial competition as opposed to being a fully sporting one. In a massive generalisation, the spoils go to those with the biggest wallets and by winning things, those wallets just get bigger.
The other end is to bring the sport back to being just that, a sporting challenge, by leveling the budgets and seeing who can compete when the resources are level. To me, a far more interesting prospect but sport is all now about winning no matter the cost and so those who just like to see trophies at the end of the season will not be happy with that.
I have argued for both as I think both are preferable to a situation where some can spend more than others even if others have the resources to spend and thus maintaining a status quo
That’s when a business has a credit line, a permitted overdraft. It’s juggling with dynamite for you and I but that is how businesses run. To operate outside of profits, i.e. run an overdraft will be covered by the value of the business. If a club defaulted, as we’ve some do, might see the bank foreclose.
Arthur Wedge
Well-known member
think that’s what we are looking work towards , trying to balance the books to ensure the profits and losses balance out over a 5 year period
Think last accounts we made a loss of £9mil , previous accounting year it was an £8 mil profit etc
The thing that I’m always confused about is that ffp or sustainable laws etc where not supposed to include infrastructure or anything to do with stadium costs etc
But Everton went over the profit and sustainability because of the stadium
so why were they punished
PaulMdj
Well-known member
No idea, it was all in a financial report.
@Lord Tyrion maybe able to explain Business’s being in debt as a norm, I’m sure he posted something on the subject a while back.
Cash flow. A business is worth more than its assets. It’s assets + what money comes through the door from various revenue streams. Ticket sales, player sales, TV money, sponsorship, catering all have a value if it came to selling a club.
think that’s what we are looking work towards , trying to balance the books to ensure the profits and losses balance out over a 5 year period
Think last accounts we made a loss of £9mil , previous accounting year it was an £8 mil profit etc
The thing that I’m always confused about is that ffp or sustainable laws etc where not supposed to include infrastructure or anything to do with stadium costs etc
But Everton went over the profit and sustainability because of the stadium
Modern budgeting is done on a 5 year rolling budget, not an isolated one year picture.
PaulMdj
Well-known member
Moshiri lied about payments/interest against the stadium that weren’t and was caught out.think that’s what we are looking work towards , trying to balance the books to ensure the profits and losses balance out over a 5 year period
Think last accounts we made a loss of £9mil , previous accounting year it was an £8 mil profit etc
The thing that I’m always confused about is that ffp or sustainable laws etc where not supposed to include infrastructure or anything to do with stadium costs etc
But Everton went over the profit and sustainability because of the stadium
Tashyboy
Please don’t ask to see my tatts 👍
Blocked.
As long as you can keep servicing the debt, you can keep on borrowing. Oddly enough, if you are a plc and in the black the city like you to borrow in order to keep growing. The fact that you may overextend yourself or it may go wrong doesn't come into their thinking. There is an obsession of always keep moving. What's wrong with just making a decent profit? Anyway, I digress.
If the lenders believe that the PL cash cow will keep on giving, tv rights can be extended and increased, then they will keep giving you money. If the deals start to contract then I suspect the foundations of a lot of clubs are built on sand and it could get scary, but so far there is no sign of this. So yes, some businesses exist quite happily in debt, with bosses taking out huge salaries and bonuses. It's capitalism at its best / worse depending on your view point.
Arthur Wedge
Well-known member
The scary thing is the deals just seem to be getting bigger
The new telly deal will be bigger than before
The CL money will increase
The sponsership and shirt deals getting bigger
unfortunately that cost will filter down - shirts more expensive, the telly will be on 3 different PPV channels and all becoming more expensive
The golden goose is getting fatter
Will add though that the goose no longer relies on match going fans
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GB72
Money List Winner
Sadly, in the current market, the deals will not contract. Football is the ultimate way of selling a subscription service. Without it, Sky revenue would plummet and so they have to keep going big. Trouble is there are several interested parties at each renewal and so they keep bidding each other up.
The bubble will only burst if the public interest in football dwindles and I cannot see that happening
And this is why investment banks, US billionaires etc are buying clubs over here. Buy a modest sized club PL club, keep it for a few years, sell it on to the next person / group. Whilst they are built on debt, they oddly make money as an investment. (unless of course they get relegated and don't come back up sharpish
)Tashyboy
Please don’t ask to see my tatts 👍
You would be surprised at how many are turning off football. Especially match going fans. But and this is a massive but. The general feeling at City supporters groups is that the club wants to screw as much as they can out of fans, to an extent that season ticket holders they don’t care if they renew. They get far more income from 1 day tourist fans than a season ticket holder game after game.
PaulMdj
Well-known member
Oops 
Swango1980
Well-known member
So much for Gary Neville singing the praises of Martinez pre match
