Ted Hughes wrote:Socrates wrote:Ted Hughes wrote:Socrates wrote:Very interesting stuff. The debt into equity might not mean what we would like it to mean though, it may mean that it is acceptable to eliminate debt interest from the equation by capitalising accumulated debt but NOT that you can spend more than you actually earn going forwards. Would allow any club to spend up to their turnover rather than up to their turnover less debt interest repayment by eliminating that debt interest element. Still does not mean you can use equity to spend more than you earn.
whatever they finally decide, this bit sounds promising - the phasing-in time schedule could be effectively extended (from 2015 to 2018).
That buys us more than enough time to be very confident that we can raise our turnover to a competitive level in time so very hopeful.
How would they stop us from having an enormous loan paid back at a ridiculously low rate?
Nothing, but if we use it to spend more than we have EARNED then we won't meet the UEFA criteria so there would be no point doing it!
Is that not in effect what the Glazers are doing but they're choosing to spend the money on buying themselves the club & giving themselves pocket money rather than spending it on on players?
No. Doesn't change the formula they plan to use anyway. (3 years spending + 3 years debt interest) <= 3 years turnover
Don't meet that formula you don't play. Eliminating the debt interest by eliminating the debt in favour of equity capitilisation helps the Scum as they currently have debt. Doesn't help us. The extra time they have negotiated does help us though.