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01-15-2004, 10:45 AM
Join Date: Jan 2004
Originally Posted by
While we're talking about the business side of hockey, I'm going to go off on a side note, cause it's obvious to everyone besides this suped guy that Boivon doing a good job.
Remember a year or two ago when the "Canadian team crisis" was in full swing, and we all heard about how the low value of the Canadian dollar was killing the Canadian teams and that for every cent it lost against the US was an extra loss of a mil or two (I can't remember the exact numbers) Well now the Canadian dollar is doing awesome and has risen at least 20% since then, but where's the story about this? Shouldn't we have a ton of extra money to spend on payroll considering it has essentially "dropped" because of the exchange rate?
Actually, this is not exactly how things work. The Montreal Canadiens, in the beginning of their financial year, makes a deal with a bank of some sort (ok, the details are confused, but the importance is not there) to purchase the value of the payroll in American money. They both set an estimated value for the Canadian $ VS the US $ at the start of that year, and they then have a fixed value for the rest of the year. Henceforth, they are not affected by the CAN dollar losses or gains VS the US$. Now, it's true that the CAN$ have more value now, but it won't reflect on the team's business up until they make a new deal of that kind. Or choose not to, if they are overly optimistic.
I know that they've been using that system for at least the last two years, and that they managed to save money when the dollar was down.
So, basically, we'll have to wait for next year until we see the difference in the Canadiens finances.
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