I think we're looking at different aspects
by SixShutouts66 (2022-06-01 22:24:15)
Edited on 2022-06-02 17:38:43

In reply to: Only if you're going to sell the players, right?  posted by ChicagoWave03

Post Reply Return to Clark's Pitch

Your point and the OP are correct that a large debt and the ability to service it are key financial considerations. A negative cash flow will cause teams to sell off assets or enter receivership. I've included a link of the number of UK soccer teams that went into this condition (shocking and includes some relatively big clubs).

The other side of the equation, as any homeowner can relate to, is that financial debt doesn't tell the whole story when there are non-liquid assets (here players value and perhaps stadium ownership). Some of these high-debt clubs could vastly reduce the size of their debt by selling off some/all players (i.e. the value of the franchise - its debt > 0)

It's like the two problems a homeowner faces: do I have the cash flow to make the monthly mortgage (your point) and is the value of the house more than the house still greater than the mortgage or not (mine). Both are valid



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