Barcelonas economy

[Idris]

thanks for making it clear

[Dino]

The guy on this interview says we have practically the same amount of debth as with Gaspart, just a different kind:
http://www.sport.es/default.asp?idpubli ... cio_PK=803

The kind of debt does matter, bank debt has been significantly reduced and bank debt is the most the most expensive as you have to pay compound interest.

Thanx for illuminating me. I never been to a bank.
Sure we have to pay less interest but the debt is still there. Fact is things aren`t so rosy as the board made us believe.

[ronstyler7]

When talking about debt, you talk about the amount of debt relative to the size of the organization. Now Barca has grown is size on the back of global stars like Messi, so even if the amount of debt is the same under Gaspart, in accounting terms the debt ratio is less.

Also remember debt is a good thing if well managed, it is by taking on debt that enables any organisation to grow. You will struggle to find any organisation that has zero debt. In fact having a capital structure of zero debt is not an economically-wise thing to do. As a matter of fact the United States government is approximately $US 10 trillion (10,000,000,000,000) in debt, and the US isn't in catastrophic economic melt-down.

Debt is only a problem when you are struggling to meet your debt payments. and the creditors (people you owe money to), takes legal action to get their money back. This is similar to want to Lavente, when the club didn't pay it's debt owed to players in the form of wages, and the players threatened to go on strike.

So if an organisation is able to meet its debt payments on a regular basis, debt isn't a problem. In fact as a company is constantly taking on debt and paying off debt, you would expect debt to remain constant relative to the size of the oraganisation, unless there is a major overhaul of the company's financial structure.

[venomsnake]

. As a matter of fact the United States government is approximately $US 10 trillion (10,000,000,000,000) in debt, and the US isn't in catastrophic economic melt-down.
[b]

Only a matter of time when things go wrong in the US.
The whole money system (dollar) is based on debt/credit.

If (now cheap) energy becomes more expensive by time (and it will), then the US is in real trouble.

But i'm going WAY offtopic.

[Dino]

Ron,

Your post is made up of so many half-truths and contradictions.

First of all, let me tell you one thing: debt is not a good thing. FACT.
Now loans could be a good thing. (and I cannot stress enough the word could). And that`s if and only if, you use that money to grow assets :business development or something that will generate profit.
And thats where people get "debt is a good thing". Why banks promote that paradigm on the whole and what`s in it for them I think it`s pretty obvious
As your US comparison.. that can only work in the favour of my argument.

[ronstyler7]

Ron,

Your post is made up of so many half-truths and contradictions.

First of all, let me tell you one thing: debt is not a good thing. FACT.
Now loans could be a good thing.

Well a loan is a form of debt. So by saying debt is bad and loans are good if used wisely you are in fact contradicting yourself. When I said "debt is a good thing" I am talking about the use of debt instruments (i.e loans) to finance the purchase of assets.

To be honest I don't know what exactly is your point, you make it sound that Barca is in financial ruin going to become bankrupt because of it's 300 million euro debt (as you say). Well Man Utd and Chelsea have debts of about 800 million euros, and they aren't certainly going bankrupt. Real Madrid are said to have huge debt too, according to reports they took out a loan to cover it's daily operating expenses. As a mater of fact according to the Deloitte football rich list despite their debt, Barca, Man Utd, Madrid and Chelsea are among the 10 richest football clubs in the world. Why?, because of the massive amount of revenue they generate, which can cover their debt payments many times over.

You allege that debt is not in order, but if debt was indeed spiraling out of control how come creditors aren't knocking on Barca's door demanding their money back? It's the amount of debt relative to the company's value that matters, and the ability to meet debt payments that matter. As FCB grows it can sustain more debt. Remember the situation Lavente and Leeds United (5 years ago), that's what you'll get you are unable to meet your debt payments as they fall.

[Dino]

Where do you get all that? And where the feck did I say we are in financial ruin?!
Thanx for enlighting me regarding that list. If you were here longer you`d probably have know that I was the first who actually posted revenue and income lists on fcbes. We are still behind both ManUtd, and whats more important, Real Madrid. And in both revenue and operating income. As a matter a fact Madrid even made more money than us 2 years ago when we took La Liga and they won zilch.
And that we do have a larger stadium and had better players aka shirt sales superstars. So that leaves us with single conclusion. Madrid are better in marketing than us. Period.
Please read my posts carefuly next time. Financial ruin, gimme a break. World isn`t black and white you know

[ronstyler7]

Where do you get all that? And where the feck did I say we are in financial ruin?!
Thanx for enlighting me regarding that list. If you were here longer you`d probably have know that I was the first who actually posted revenue and income lists on fcbes. We are still behind both ManUtd, and whats more important, Real Madrid. And in both revenue and operating income. As a matter a fact Madrid even made more money than us 2 years ago when we took La Liga and they won zilch.
And that we do have a larger stadium and had better players aka shirt sales superstars. So that leaves us with single conclusion. Madrid are better in marketing than us. Period.
Please read my posts carefuly next time. Financial ruin, gimme a break. World isn`t black and white you know

Sorry for the misunderstanding Sir.

But does it really matter that Barca isn't as rich as Man Utd and Real Madrid. I think what matters in success on the pitch, yes the past two season have been miserable and I hope Pep can motivate the squad and that the boys will give a good account of themselves. What's important now is that everyone gets behind the squad.

As for Man Utd, no doubt there the best at marketing, their brand all over the world is just massive, especially in Asia. They were really the first club to penetrate the massive Asian market, using Beckham as their "poster boy". No doubt the marketing power of the EPL does give English clubs a huge advantage over the Spanish and Italian counterparts. For me la liga has the best quality football, but the Spanish federation manages it incredibly poorly, with last minute changes of venues and all that. With better management no doubt the league will become "richer" as a whole. So Barca and Madrid have done really well to compete for the football money with the English clubs.

As for Madrid being the richest club in the world (according the rich list), this was down to the shrewdness of Florentino Perez, the sale of Madrid's old training-ground was a master-stroke financially wise and more significantly the purchase of David Beckham, one of the most famous people (let alone footballers) on the planet. Beckham made Madrid millions upon millions and significantly increased their marketing power. As for Barca, well Ronaldinho made us millions too and now Messi is seen as the "global star" to get the club's image out there. But neither has the marketing power of Beckham. I mean thousands flock (many of them young teenage girls who have no interest in the sport of football whatsoever) to shopping mall just to see Beckham launch some sort of fragrance.

[Dino]

Yes, and... ? I agree with majority of the post, in fact posted Becks, Asia, EPL exposure and other variables many times before

[FCBFan]

Maybe you can be the club's Financial and Economic manager. Screw Ferran Soriano, he does'nt know what the feck he's doing

[Dino]

I`m sure that anyone who can articulate his opinion and has any economic knowledge is a rocket scientist for you

[FCBFan]

Yup, especially since I'm only 19 and I have a Bacelors Degree in Finance and Banking, and I'm doing my masters degree in 2 years time. Other than Finance and Economics was my major since school. But who the feck am I to know anything? We got you !!

[Dino]

I`m sure you have Bacelors degree and that it is possible to get it at your teens in Bahrain. Probably whoever knows how to write gets a PHD automatically.

We are yet to see anything from you on this subject. So please refrain from the personal remarks in the future if you don`t, or can`t write anything meaningful.

[FCBFan]

Whoa, I spelled Bachelors wrong .. Thus I know nothing . . . Like you never make any spelling mistakes
Plus I worked hard to get a degree, I joined Uni at 17, each year has 3 semesters, and I talk 5-6 subjects per semester, and I finished in 3 years time. I don't know what you guys do in Croatia, maybe 1 subject per year?

Oh about the subject .. As long as our profits are increasing each year, (refer to the economic statement on the official site) and our club is one of the richest then Im ok with it. Unlike you I don't bitch about everything, Barca are doing a great job in this area

[Dino]

Erm... No we have Bahrains as slaves here. They get PHD at 17 and work for us.

Still, nothing on the subject from you