Losing Money

Losing Money

Post by Jim Risi » Fri, 02 Mar 1990 23:08:16


There are a lot of creative ways that ML clubs can lose money.  E.g.,
the owners & directors pay themselves huge salaries..but the club shows
a loss on paper.  I don't know how many times that that is the case
in ML baseball, but I bet it's common.
--
Name:     Jim Rising
Mail:     Dept. Zoology, Univ. Toronto, Toronto, Ontario, Canada    M5S 1A1
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Losing Money

Post by mist.. » Sat, 03 Mar 1990 03:39:06

Quote:

>There are a lot of creative ways that ML clubs can lose money.  E.g.,
>the owners & directors pay themselves huge salaries..but the club shows
>a loss on paper.  I don't know how many times that that is the case
>in ML baseball, but I bet it's common.

Yes..I'm under the distinct impression that MLB teams, like other teams, serve
as huge tax shelters for many owners.  Especially if it loses money.  
Seems to me that's why so many owners (like George and Ted) get involved in the
affairs of the team -- it's not like they're going to ever make money, so they
can do whatever they please with their team and not worry about turning a
profit.

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Losing Money

Post by Paul_Andres » Sun, 04 Mar 1990 03:52:23



Quote:
>Yes..I'm under the distinct impression that MLB teams, like other teams, serve
>as huge tax shelters for many owners.  Especially if it loses money.  

An excellent book on this matter is *The Business of Major League Baeball*
by Gerald Scully. The book is hardly perfect...his means of assessing player
performance are a bit suspect for instance, but the tricks of the trade in
ownership are quite enlightening. Most teams are just another arm of some
congolomerate (Turner owning the Braves, The Chicago Tribune owning the
Cubs, for instance).

As an example of creative accounting, the Braves sell their TV rights to WTBS
for an amount vastly under the real market value for such rights. The result
is that the Braves bottom line looks weaker than it really is. Overall,
Turner is making the same amount of bucks, so what does he care.

I have never given the owners' bleatings much credibility, and after reading  
this book, I give them even less. Scully makes a pretty good case that the
star players bring even more revenue to a team than their salaries, so they
are hardly underpaid.

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Losing Money

Post by Scott Barm » Wed, 07 Mar 1990 01:57:26

Quote:

>There are a lot of creative ways that ML clubs can lose money.  E.g.,
>the owners & directors pay themselves huge salaries..but the club shows
>a loss on paper.  I don't know how many times that that is the case
>in ML baseball, but I bet it's common.

Like the brewery owner of a baseball team who doesn't charge the brewery
the same rates as others for advertising (see the Jays, Brewers, Cards, ...)

Like the owner of a "super station" that pays a lower broadcasting rights fee
to the team the corporation owns (see the Braves and Cubs).

These things happen all the time!  Only the above examples are blatant.
Other teams do it more subtly!  Like the Mets who said once (then shut up
about it because people found out how obsurd it is) that the decline in
attendance last year (as in not over 3 million) puts additional financial
burden on the team.  What they forget to tell ya is that they sold 3.6
million tix, the most in club history.  But the NL counts "fannies in the
seats" and they can get away with calling it an attendence decline!

Neat stuff like that!
--
scott barman

uucp:     {philabs, ge-dab, crdgw1}!nbc1!scott