Football Finances
After the explosive 606 podcast yesterday, MUR and I thought it might be a good idea to start a thread about football and finances. It's a huge day tomorrow for Liverpool F.C. but all clubs (with the exceptions of Chelski, Citeh and QPR) are facing the same pressures. So how do you feel about the state of your club in this current state of affairs? What can those who run football do to ensure the continued health of our clubs? Do you support salary caps? Limits on foreign investment? Caps on foreign players? I'll look forward to your comments.
posted by The Blue Devil @ 8:22 PM
6 Comments:
The Guardian have a live blog on the Liverpool F.C. hearing today. Check it out here:
http://www.guardian.co.uk/football/blog/2010/oct/12/liverpool-fc-rbs-hicks-gillett-john-w-henry
The Liverpool F.C. hearing is winding down today with no resolution in sight. Indeed the judge has commented that it's unlikely that the issue will be settled even by the Friday deadline!
Alrighty, then. I'll chip in on the situation at Leeds. I'm actually relatively pleased with the current situation at Elland Road, but of course we've been buffeted about by the winds of change in English football.
As you'll all know, we were bitten by the ambition to be a competitive Champions League club in the early years of the millennium and under Peter Ridsdale's dubious leadership we overspent on literally dozens of strikers. As a result of those years, we no longer own our hallowed ground but are forced to rent Elland Road.
That said, I think we're building on a solid foundation at this point. I'm not a huge fan of Ken Bates but even I have to admit that Capn Birdseye has done a nice job bringing us back into the black. I'm satisfied with us as a mid-table Championship side with a fiercely loyal following and a side that plays decent football on the ground.
How about the rest of you?
After listening to the 606 podcast I finally realized how much English football has changed over the years. I have followed English football since 1977. Those were simpler times. When I was a middle school/high school student English football was a game. Now it is a major business grossing more income than most countries. I was thinking about this while listening to the podcast.
I realized that with the exception of Chelski,Citeh,and QPR that no club can take anything for granted. When Simon Jordan was talking on BBC Radio Five I realized that just about every club is a"house of cards". They are literally just steps away from administration and following a similar direction to that of Leeds United. With the exception of the three clubs mentioned, any club could be in League One in the near future, including Liverpool and Manchester United. Gillette and Hicks sure do remind me of Peter Ridsdale and some of the diabolical decisions he made.BD mentioned some of the poor decisions including signing too many strikers. That sounds a lot like Liverpool.However, I do not expect them to go into administration. I have a sneaky feeling that some sort of solution will be reached. Liverpool sure do have a lot of " dead weight."
While listening to the podcast, I thought that it would be fantastic to see our hated rivals go into administration and be deducted nine points. My thinking was that relegation would now be more realistic. However, I thought about Portsmouth and that whatever happens to Liverpool will have ramifications for the future of the Premiership. We have to be careful as to what we wish for. Once it becomes Liverpool then it becomes someone else. Who would be next? Could it be Manchester United? We are one of the richest clubs in the world,but we are just two or three decisions away from becoming the next Charlton,Southampton,or Leeds? We carry a massive debt. According to Simon Jordan, who despite his sickening arrogance, did his job on the podcast of speaking from an owner's point of view. he stated that it is also a matter of "managing your debt." United are currently doing that. So far so god. What happens if they cannot pay their debt? Then what happens?
I liken the situation to the mortgage crisis. For example, I carry a debt because I am paying a mortgage on my house(it is really a bank loan) That is why banks are in business. BTW.If I miss several mortgage payments then my house forecloses. In football, my understanding is that a club enters administration for a similar situation. I believe Liverpool are incredibly close to this situation. In my opinion the English game will suffer because EPL clubs would no longer be able to sign the quality players they are currently signing. If that is the case then the EPL would no longer be the best league or in the world or Europe. As much as I despise Liverpool, it would be best for the English game if Liverpool can sort out this situation. Simon Jordan stated that Hicks and Gillette will do what they can to recover as much of their investment as possible. That could be a huge obstacle for Liverpool.We do not want any more EPL clubs going into administration. Any thoughts gentlemen?
Thanks for the comment, MUR. I agree - every club, save the ones owned by investors or investment companies that treat football clubs as a plaything, are vulnerable in this climate. That said, I think Newcastle is a better model for what can happen to top clubs like Liverpool or United. What happened to LUFC in 2001/2 was a "perfect storm" of conditions, including financial mismanagement, poor acquisitions and the Majestik scandal that implicated three starting XI players (Bowyer, Woodgate and Duberry) in a GBH charge against a person from an ethnic minority group. All three elements came together to send us plummeting to the Championship. Ridsdale then compounded the issue by hiring mercenaries such as El Tel and Dennis Wise who came and went pocketing huge parachute payments.
That said, I could certainly see Liverpool dropping into the Championship for a season or two and permanently dropping out of the "Big Four" category.
And speaking of Liverpool, as of 5 pm GMT, they have new owners. After a week of courtroom blather, NESV is the new ownership at Anfield. Just in time for the Merseyside Derby on Sunday. Wow - can't wait!
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