Is Debt really that bad?

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Originally Posted by Boss

Not all debt is bad though.

Show me a good form of cancer, on the other hand... :coffee:

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Hand cancer :unsure:

ive always said the board and management have completely underestimated the value of debt and potential revenue through trophies; you spend £15m on a defender which of course is an initial outlay, a sunk cost, but the opportunity cost of that could be minimal in terms of merchandise sales or potential revenue from winning trophies/cups. winning the champions league or premier league opens the door for major revenue and adds to a growing brand for the club; new fans appear, many of whom buy shirts, dvd's, mugs etc, which help build the club foundations and add to our overall value. on top of that, you have an upperhand on tv companies and sponsors so the club negotiates better deals in the future, all of which help pay off our stadium debt sooner. nonetheless, we decided to take the safe option and inflicted the rise in cost onto fans through higher ticket prices. unforgivable you may say, but whilst the board milk their millions, who are we peasants to question their authority?

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Originally Posted by ItsMe

Some would say you have to speculate to accumulate, you can play it safe as we always seem to do and stay where you are and never really grow, or you can invest a bit to increase your chances of winning, which could increase you marketability all over the world.

The long term gains of investment can be massive, there's a risk of course but we're not talking astronomical amounts we couldn't claw back eventually anyway.

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I don't think moving stadium was playing it safe...

I do think we're too cautious now but we're in a different football world. Teams like City aren't speculating, they're just spending, spending, spending till sheer weight of it brings them success. And there's no consequence or risk because their owners can bail them out. They spent 117% of their income just on wages last year :doh: It's completely ludicrous that a club is allowed to operate like that. Hopefully FFP will help but I'm sceptical.

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Originally Posted by Letters

I don't think moving stadium was playing it safe...

I do think we're too cautious now but we're in a different football world. Teams like City aren't speculating, they're just spending, spending, spending till sheer weight of it brings them success. And there's no consequence or risk because their owners can bail them out. They spent 117% of their income just on wages last year :doh: It's completely ludicrous that a club is allowed to operate like that. Hopefully FFP will help but I'm sceptical.

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It's a relatively safe bet, reason being that we had a long waiting list so we knew we could sell out the stadium, there's an element of risk in any investment of course but noone is going to lend you that kind of money without a pretty solid business plan which almost guarantees a return of the capital. Spending money on players is no doubt viewed as riskier as there's much oless guarantees there, if a player fails to perform his value plummets and you lose your money, that's not going to happen to land or a stadium.

They can only have a squad of a certain, they can spend whatever they like but it doesn't stop us doing our own thing and signing quality ourselves at the end of the day.

Yeah the FFP, can't see it myself.