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Datsyuk, Franzen and Zetterberg's contract relative values into the future:

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Old
07-15-2009, 05:39 PM
  #51
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Benefit of owning a franchise: Don't forget all of the side deals that come into play. Arena deals. Taxpayer gifts. Political favors, etc. etc etc.

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07-15-2009, 06:29 PM
  #52
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Quote:
Originally Posted by Captain Bob View Post
1. Pro sports are not recession-proof.
2. We already saw signs of the recession in crowds at the Joe this year. Including the playoffs.
3. Revenues will continue to slide, quite likely, as the recession continues.
4. Prospects for rapid growth in the economy, after we bottom out, may be slim, as, hopefully, consumers are smart enough not to overextend themselves again. Hopefully, the credit-card era is coming to an end. If so, that means, even when the economy turns around, we might not see the wild spending we saw in the 90s. That could damper revenue growth when the NHL turns around.
5. Unrelated, but as a result of the massive government spending, their could be crazy inflation and dollar with less power, which would mean the cap rises ...
6. Who knows?
1) Pro sports are almost as recession proof as alchohol...
2) Crowds were still at close to 100% capacity
3) We'll see, and I'll be shocked if it slides more than one year
4) A long period of prosperity follow every single recession
5) Inflation will definitely be going up
6) I agree!

HockeyinHD: Looks like you are puling back on the "We won't see an $80m cap in our lifetime" -- good move.

For the past 15 years the NHL has averaged annual revenues growth of over 10% -- and there were TWO lockouts during that period -- an entire 1 1/2 seasons completely lost.

When Bettman started as commish (can it really be over 16 years???), league revenues were right at $400 million -- to now at $2.6 billion. Franchise values have grown a similar amount in that time, from $50m to $280m -- and we were arguing whether franchise values were tied to revenues or not??

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Old
07-16-2009, 09:04 AM
  #53
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Quote:
Originally Posted by RabbinsDuck View Post
HockeyinHD: Looks like you are puling back on the "We won't see an $80m cap in our lifetime" -- good move.
Learn how to quote, Duck:

"There won't be an 80 million dollar cap. Certianly not in the lifetime of any currently signed contract, and probably not in the lifetime of any currently living fan."

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Old
07-16-2009, 09:19 AM
  #54
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Originally Posted by solo16 View Post
We meant the same. 1/3 of the teams were profitable. 2/3 lost money or had trivial profits. That is all I was saying. 2/3 doesn't equal 3/3 hence it was a generalization.
And like I was saying, oh good grief.

Solo, if you think any person wealthy enough to be able to drop 150+ mil on an investment looking primarily at making money from it would be happy with the returns the VAST MAJORITY of sports franchises make, not just the NHL but sports franchises in general, I just do not know what to tell you.

The rate of return even successful franchises are able to achieve in year to year profits can usually be beaten by a halfways decent analyst from Dean Whitter... and those Forbes numbers are pre-Financial Fubar.

Sports teams are going to take a savage beating from the shifting economy, which is going to kick most long term projections and forecasts based on anything pre-Financial Fubar right in the package.

Speaking to the other issue, if you think a comment that refers to 75-80% of a league is a 'gross overgeneralization'... again, I don't know what to tell you. It's almost impossible to make any substantive statement which is going to be universally accurate when you're talking about any sports league. Based on those standards of conversation, it's a gross overgeneralization for you to say the NHL is growing. I'm absolutely positive that 20-25% of the teams in the NHL are not growing, so... there you go.

See how hard it is to hit that target?

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07-16-2009, 10:07 AM
  #55
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Quote:
Originally Posted by HockeyinHD View Post
And like I was saying, oh good grief.

Solo, if you think any person wealthy enough to be able to drop 150+ mil on an investment looking primarily at making money from it would be happy with the returns the VAST MAJORITY of sports franchises make, not just the NHL but sports franchises in general, I just do not know what to tell you.

The rate of return even successful franchises are able to achieve in year to year profits can usually be beaten by a halfways decent analyst from Dean Whitter... and those Forbes numbers are pre-Financial Fubar.

Sports teams are going to take a savage beating from the shifting economy, which is going to kick most long term projections and forecasts based on anything pre-Financial Fubar right in the package.

Speaking to the other issue, if you think a comment that refers to 75-80% of a league is a 'gross overgeneralization'... again, I don't know what to tell you. It's almost impossible to make any substantive statement which is going to be universally accurate when you're talking about any sports league. Based on those standards of conversation, it's a gross overgeneralization for you to say the NHL is growing. I'm absolutely positive that 20-25% of the teams in the NHL are not growing, so... there you go.

See how hard it is to hit that target?
Meh meh meh. It was only a over generalization when directed directly at I believe Darkreign's quote. On its own it is a fair assessment. He said people buy for profit you said they dont. We are arguing semantics but "most do not buy for profit would be correct."

I wasnt going to mention this but you keep bringing up this hypothetical investor. Most hypothetical people with the money to buy a team aren't all that worried about the tax write off, because most get a fair portion of their income from dividends/capital gains. Those are subject to 15% tax rather than the 45% tax on ordinary income. 15% tax to write off is still substantial but nothing compared to a 45%. In order to capture that an individual would have to be taking a salary in the Gary Bettman world. And frankly not many people making 10M a year have accumulated wealth close to a billion needed to be a potential bidder.

Also there are collectives of people who collectively invest in teams. They may not buy the stock purely for an investment but interestingly enough the Oilers were one of the more profitable teams on that list.

In the end people buy teams for different reasons. The Oilers are a more profitable franchise than the New York Yankees if we look at purely profit. Thats all you need to look at to recognize both sides correct.

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Old
07-16-2009, 11:20 AM
  #56
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Forget the year to year profits from the Wings.
How much does Illitch get from his side deals? How much did Illitch's success with the Wings, and then Tigers, allow him to get one of the casinos?
How much money are taxpayers going to spend to fund his next arena?

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07-16-2009, 12:22 PM
  #57
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ever since I saw the long term contract dipietro got, like 15 years, i thought it was bad for him, exacly due to inflation. he will end up getting peanuts in his 15th year (ok maybe not) but still the 4 mil now is nowhere as low as it will be in 10 years when is contract will be over.

However he has the certainty to win a more than decen amount of money for the rest of his career

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Old
07-16-2009, 12:41 PM
  #58
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Quote:
Originally Posted by Captain Bob View Post
How much money are taxpayers going to spend to fund his next arena?
Have you been to Detroit lately?

(I was being sarcastic, the rest of this post isnt directed at you, Bob)

Not a frickin chance in hell, not now, not ever, never again. If Illitch expects help from Detroit's taxpayers, the Wings are moving to the 'burbs a la the Pistons. Book it.

...money from the taxpayers. Riiiight. Is this the same city that is about to go into receivership and have its public schools taken over by the state if Bobb doesnt balance the budget by August?

Detroit is ****ed. Its dead, its over....10 years from now, it will lose even more population to the suburbs and other states entirely and be ranked right up there with other major metropolitan areas like Pittsburgh and Columbus. Are any of us going to move into city limits? Not without me being forcibly relocated would I ever even consider the prospect.

Detroit is gone. If Illitch doesnt know it, his kids do. He isnt going to be around forever.

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Old
07-16-2009, 12:41 PM
  #59
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Quote:
Originally Posted by solo16 View Post
Not to discredit you FF but few comments.

Failed bond as in this year? If so its really not a big deal. US debt is still low relative to our GDP. We can make up the money by taxing the citizens pants off. The fact our government has paid off larger debts reliably has to give a bit more leeway to us. One would think at least... or hope. Who knows.
Larger debts? Are you joking? We currently have the largest debt in history of any country and it's increasing at a faster rate each year. When have we ever paid off trillions of dollars in debt to anyone?

Also don't be so quick to dismiss a failed bond offering. That's a huge impact to a country and it's economic stability. Did you know that the great majority of our bonds are bought by China? Really the Chinese are the ones giving us the money to keep us solvent right now without leveling unbearable tax burdens. They do this because right now they feel their economy is dependent on imports from the US so they need us around buying. The problem is they are developing rapidly and will eventually reach a level where they don't need us to drive their economy. That's when the money train stops and we run into very deep financial trouble. I'm not sure how much you've studied the financial markets, if at all, but it's a far larger issue that you seem to realize. How does the country pay for anything is they essentially have no more credit? That's basically what a failed bond offering is - a declaration that the countries credit is bunk.

Also, with the recent court rulings on the Crysler bankruptcy the bond market is no longer as secure as it once was. Bonds were viewed as low-yield, low-risk investments because the rights of the bond holder were protected above all others as stipulated in the Constitution so they would get paid off first. The Crysler rulings flipped the script and actually put the union contracts (previously least important) and stock holders (middling) above bond holders. It's a large concern for any investor right now and one of the reasons the bond market has slowed down recently.

In case you aren't familiar with the UK offering here's a small article on it from Bloomberg. U.K. Bond Auction Fails for First Time Since 2002. Notice the key words there are "The auction failure comes as the Bank of England uses newly printed money to purchase government and corporate debt in an attempt to drive down borrowing costs." Sound familiar to anything going on over here?

Quote:
Originally Posted by solo16 View Post
China can talk all it wants but I dont see how a Currency that is linked via a market basket approach (heavily weighted in U.S. dollars) could replace a pure U.S. Dollar currency. The Chinese money supposedly is a floating money that is linked to if i recall 7 other national currencies. Seems odd to have a currency referencing other currencies as a world stable. I say supposedly because there is some debate if the Chinese government actually lets it float and how strict it regulates it. In many ways its kept artificially stable by the Chinese government. This hush hush secret approach to monetary policy is why it wont become the national currency in my opinion.
I doubt that China would become the new standard but the point is there are talks out there about changing. A strong, stable US Dollar would never have countries even considering a change. The prospect of a rapid inflation of the US Dollar in the not-to-distant future is a problem for a global economy based on it, and the more we continue to increase our deficit spending and pay for it with bond sales (ie printing more money) the worse the inflation becomes. Here's an article on some of China's ideas, which are backed by Russia as well. China Takes Aim at Dollar

Quote:
Originally Posted by solo16 View Post
The Rome analogy is always interesting. The whole idea that one country can rule the world and that that country would eventually be spread to thin in many ways is contradicted by Globalization. Granted the Romans had one of the first waves of globalization during their empire. The Roman empire made the world a smaller place yet even still it proved unsustainable. Maybe the flaw lies in that Rome made the rest of the world stronger via globalization so that they no longer needed Rome. In essence they fed the lion that eventually ate them. In many ways the U.S. via its globalist agenda has fed india, china and the developing world to the point they may no longer need us. In the end those kitten's may or already have become Lion's comparable to the Roman states. Though wasn't rome destroyed from within? Maybe a reference to the English empire would be more fitting. Each colony eventually became strong and rebelled.
Rome did not fall from provinces rebelling or because they modernized their enemies. Rome began to rot from the inside. Increasing corruption led to a disconnect between the people and the leaders. You can read many old surviving works that make lots of mention to an apatheic populace who felt that it didn't matter what they did or who they supported. The government lost the trust of the people, much as ours is doing now. Along with the corruption came decadence. Under the emporers there would be lavish arena games costing tons of money, some of which endured up to 3 months. It was their way to placate the unrest. The problem was it never fundamentally fixed any of the problems and the increased spending always was followed by increased taxes. Rome's decadence also was on display in their erosion of self-reliance. They become less of a center of production and more of an importer from the provinces. They became reliant on outside production for the majority of their good, much as our economy has seen production slashed and importing rise with the globalization movement. Of course, there was the moral decay as well but that's very well documented. The people became more amoral, more selfish, and especially the leadership led the way there. I'll not pass judgement on the current standard of ethics and morals in this country but I've heard arguments that there has been a decline is social awareness in general so at least some feel it is happening. The Huns, Gauls, Visigoths, and Vandals were not the downfall of Rome. They were simply the end result of a long and steady decline.

Your example of England is off because we have never controlled the countries that have become powers now. Yes we may have shaped them in some way or tried to influence them but we never subjugated them. Plus the problem is that your example seems to brush off that our country is not being destroyed from within, but rather from without. China, Russia, Europe.....they are not what is causing our problems. They are not the reason we are in trouble. We've done this to ourselves and the rest of the world suffers as a result because they became too reliant on us to stabilize their own currencies and economies. The only hope we have for reversing this is to stop deficit spending and pay off our debt. The problem is as a country we've become too reliant on the government for too many things to make this a reality without taxing the citizens into the ground. I'm not even going to get into the domestic unrest, which is just another clear sign we are walking down the Roman path.

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Old
07-16-2009, 12:58 PM
  #60
solo16
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Originally Posted by FissionFire View Post
Larger debts? Are you joking? We currently have the largest debt in history of any country and it's increasing at a faster rate each year. When have we ever paid off trillions of dollars in debt to anyone?

Also don't be so quick to dismiss a failed bond offering. That's a huge impact to a country and it's economic stability. Did you know that the great majority of our bonds are bought by China? Really the Chinese are the ones giving us the money to keep us solvent right now without leveling unbearable tax burdens. They do this because right now they feel their economy is dependent on imports from the US so they need us around buying. The problem is they are developing rapidly and will eventually reach a level where they don't need us to drive their economy. That's when the money train stops and we run into very deep financial trouble. I'm not sure how much you've studied the financial markets, if at all, but it's a far larger issue that you seem to realize. How does the country pay for anything is they essentially have no more credit? That's basically what a failed bond offering is - a declaration that the countries credit is bunk.

Also, with the recent court rulings on the Crysler bankruptcy the bond market is no longer as secure as it once was. Bonds were viewed as low-yield, low-risk investments because the rights of the bond holder were protected above all others as stipulated in the Constitution so they would get paid off first. The Crysler rulings flipped the script and actually put the union contracts (previously least important) and stock holders (middling) above bond holders. It's a large concern for any investor right now and one of the reasons the bond market has slowed down recently.

In case you aren't familiar with the UK offering here's a small article on it from Bloomberg. U.K. Bond Auction Fails for First Time Since 2002. Notice the key words there are "The auction failure comes as the Bank of England uses newly printed money to purchase government and corporate debt in an attempt to drive down borrowing costs." Sound familiar to anything going on over here?



I doubt that China would become the new standard but the point is there are talks out there about changing. A strong, stable US Dollar would never have countries even considering a change. The prospect of a rapid inflation of the US Dollar in the not-to-distant future is a problem for a global economy based on it, and the more we continue to increase our deficit spending and pay for it with bond sales (ie printing more money) the worse the inflation becomes. Here's an article on some of China's ideas, which are backed by Russia as well. China Takes Aim at Dollar



Rome did not fall from provinces rebelling or because they modernized their enemies. Rome began to rot from the inside. Increasing corruption led to a disconnect between the people and the leaders. You can read many old surviving works that make lots of mention to an apatheic populace who felt that it didn't matter what they did or who they supported. The government lost the trust of the people, much as ours is doing now. Along with the corruption came decadence. Under the emporers there would be lavish arena games costing tons of money, some of which endured up to 3 months. It was their way to placate the unrest. The problem was it never fundamentally fixed any of the problems and the increased spending always was followed by increased taxes. Rome's decadence also was on display in their erosion of self-reliance. They become less of a center of production and more of an importer from the provinces. They became reliant on outside production for the majority of their good, much as our economy has seen production slashed and importing rise with the globalization movement. Of course, there was the moral decay as well but that's very well documented. The people became more amoral, more selfish, and especially the leadership led the way there. I'll not pass judgement on the current standard of ethics and morals in this country but I've heard arguments that there has been a decline is social awareness in general so at least some feel it is happening. The Huns, Gauls, Visigoths, and Vandals were not the downfall of Rome. They were simply the end result of a long and steady decline.

Your example of England is off because we have never controlled the countries that have become powers now. Yes we may have shaped them in some way or tried to influence them but we never subjugated them. Plus the problem is that your example seems to brush off that our country is not being destroyed from within, but rather from without. China, Russia, Europe.....they are not what is causing our problems. They are not the reason we are in trouble. We've done this to ourselves and the rest of the world suffers as a result because they became too reliant on us to stabilize their own currencies and economies. The only hope we have for reversing this is to stop deficit spending and pay off our debt. The problem is as a country we've become too reliant on the government for too many things to make this a reality without taxing the citizens into the ground. I'm not even going to get into the domestic unrest, which is just another clear sign we are walking down the Roman path.
Interesting post. I disagree with most. Not going to get into a lengthy debate on it but.

1. Obviously debt is largest ever that is a factor of inflation. Also our debt is relative to our Gross Domestic Product. Historically our debt has been a higher % of our GDP and we still paid it off.

2. The bond issue is a concern. I am not dismissing it just I dont think it will happen to us. Certainly could but I dont see it.

3. China has been saying that for quite some time. Its just puffery and frankly should be ignored.

4. I like my England reference. I see your point but those who study the English empire know it wasn't so much about territorial control but social control. For quite a long time one little island was able to exert its social influence on the entire world. Some remnants still extend today. In many ways the US's influence today is an extension of the English beliefs. But in other considerations England sorta made us and we eclipsed them during WWII as the shining center of the Globalist world. One could argue that we were involved in brining capitalism to china(despite our repeated failures at this) and obviously japan. There is also a fairly large conspiracy theory that the Japenese vowed to get revenge on the US via economic dominance after WWII. Interesting that they are currently one of our closest allies and control majority of the US national debt. You can look at that in several ways but I always remember that in the back of my mind. Japan has a globalist agenda and it is only currently inline with ours. What if...

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