14th? Pfft, we'll never be top 13 with Casey at the helm.
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Forbes: Raptors Worth $920M; 14th in the League
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raptors999 wrote: View PostYou have to make loan payments. Being in the red operationally and then taking a loan is a recipe for insolvency. Its what caused the housing crisis in the US - cash crunch.
Also, you don't need to own a team very long to more than double your money. Just look at Brooklyn. Prokhorov bought 80% of the team in 2010 for $375M, and now his share is worth $750M.
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Primer wrote: View PostHousing prices got way too high and people built too much housing and then it crashed back to reality. Considering there is only 30 NBA teams on planet earth, I don't see the happening with an NBA franchise.
Also, you don't need to own a team very long to more than double your money. Just look at Brooklyn. Prokhorov bought 80% of the team in 2010 for $375M, and now his share is worth $750M.
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raptors999 wrote: View PostYou have to pay salaries until the sale. That includes everybody not just players. The housing problem was caused by flippers who assumed prices would rise, banker who bet on that premise and people who couldn't meet loan obligations. If any franchise sells below expected value the system collapses.
As far as an NBA team selling below expected value, I'm basically saying that will never happen because there is only 30 NBA teams. The housing bubble had quite a bit more going on than just the stuff you listed. If housing was in extremely limited quantity, instead of way oversaturated, then prices never would have fallen, but there also wouldn't have been houses to give loans on that people couldn't afford, etc. etc. etc.... When you have a very large supply of overpriced goods, the price will fall until the supply meets the demand. The demand for NBA teams will always way outpace the supply, even at a billion plus per franchise.
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Primer wrote: View PostFirst off, no NBA team makes so little that they can't pay their salaries. Teams like Philly get enough just from revenue sharing to afford their roster. Add in their ticket sales, tv deals, sponsorships, etc... I'd be shocked if an NBA team is actually losing money.
As far as an NBA team selling below expected value, I'm basically saying that will never happen because there is only 30 NBA teams. The housing bubble had quite a bit more going on than just the stuff you listed. If housing was in extremely limited quantity, instead of way oversaturated, then prices never would have fallen, but there also wouldn't have been houses to give loans on that people couldn't afford, etc. etc. etc.... When you have a very large supply of overpriced goods, the price will fall until the supply meets the demand. The demand for NBA teams will always way outpace the supply, even at a billion plus per franchise.
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Mostly in agreement with Primer, that the fact that there's a limited supply should insulate NBA franchises from having a bubble burst.
HOWEVER, a big part of a franchises worth comes from TV deals, and those are linked to popularity. Yes the new TV deal is going to be huge, but's it's unclear what the TV deal after the next one will be like. The amount of money you get in a content deal is going to be based on how popular the sport is. IF basketball isn't as popular, then content providers won't pay as much for a deal, and therefore your franchise will lose value.
The second way a team could lose value is through expansion. Adding teams increases supply, therefore lowering the amount of money people are theoretically going to offer for any one franchise.
Before any one play's devil's advocate, I think that Basketball will gain ground against MLB and NFL, in terms of popularity (especially worldwide). And the chances of the NBA over-expanding are slim to none. I was just pointing out ways in which it could lose ground.
I do think that you were much better off buying a team pre-ballmer, as Ballmer paid above market for the franchise based on expected future performance, and bidders for current teams on sale would be doing similar. I don't see an NBA team losing money, BUT it's a looooong term investment. I think you'd want to hold it for at least 10 years.
Lastly, I don't see the Rogers/Bell relationship lasting more than 5 years... SO let's start pooling our money now!"They're going to have to rename the whole conference after us: Toronto Raptors 2014-2015 Northern Conference Champions" ~ ezzbee Dec. 2014
"I guess I got a little carried away there" ~ ezzbee Apr. 2015
"We only have one rule on this team. What is that rule? E.L.E. That's right's, E.L.E, and what does E.L.E. stand for? EVERYBODY LOVE EVERYBODY. Right there up on the wall, because this isn't just a basketball team, this is a lifestyle. ~ Jackie Moon
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