Can you all help me out here?

[Florida Blue]

Ok, so I have one Rag mate, not the ones over here that are glory hunters, that only know the big names, but someone actually raised a Red. I gave him some stick this morning about how quiet he has been this season, and his only response was enjoy it now while you can, the new economic metrics will take care of any chances you will ever have.

Since I am lucky to see SSN once or twice a week at most, and since I spend most of my time reading financial reports (and the thought of trying to read up on this one makes me want to vomit), I am asking some input from you all.

So the questions are:

What exactly is the downside of this to us (worst case scenario)?

Are we going to be allowed to give away players (for example sell RSC to a team in Vanatuu and pay a portion of his wages)? Or just dump a player, pay his wages to go away?

Is there any impact of the Rags because of all their debt or is just expense/revenue ratio that matters, not the fact you are in huge debt?


Is there anything I am not getting?


Thanks for any help. I know we have touched upon this in older threads, but I am hoping to be a bit more concise here.

[ronk]

For the rags it's about the serviceability of those debts. When debt exceeds 100% of revenue they'll have to give additional information to show that they're able to pay it. They should be okay with that so long as overall debt is falling and they can show that it will remain that way.

This will greatly affect their ability to borrow money to go on a spending spree, even if they have the money and even if it's a good long term investment. Unless they can do something about the PIK debt, they'll eventually run into some form of trouble with UEFA but there are enough provisions that they can probably continue as normal.

We will have a considerably more challenging task in respect of the UEFA regulations at first, but there are provisions that will almost certainly grant us a temporary exception so long as we're making a genuine effort.

[quote=from the very last section of the regulations]2. For the purpose of the first two monitoring periods, i.e. monitoring periods
assessed in the seasons 2013/14 and 2014/15, the following additional
transitional factor is to be considered by the Club Financial Control Panel:
Players under contract before 1 June 2010
If a licensee reports an aggregate break-even deficit that exceeds the
acceptable deviation and it fulfils both conditions described below then this
would be taken into account in a favourable way.
i) It reports a positive trend in the annual break-even results (proving it has
implemented a concrete strategy for future compliance); and
ii) It proves that the aggregate break-even deficit is only due to the annual
break-even deficit of the reporting period ending in 2012 which in turn is
due to contracts with players undertaken prior to 1 June 2010 (for the
avoidance of doubt, all renegotiations on contracts undertaken after such
date would not be taken into account).
This means that a licensee that reports an aggregate break-even deficit that
exceeds the acceptable deviation but that satisfies both conditions described
under i) and ii) above should in principle not be sanctioned.
[/quote]

This will buy us 2 years if we need it.

[DoomMerchant]

For the rags it's about the serviceability of those debts. When debt exceeds 100% of revenue they'll have to give additional information to show that they're able to pay it. They should be okay with that so long as overall debt is falling and they can show that it will remain that way.

This will greatly affect their ability to borrow money to go on a spending spree, even if they have the money and even if it's a good long term investment. Unless they can do something about the PIK debt, they'll eventually run into some form of trouble with UEFA but there are enough provisions that they can probably continue as normal.

We will have a considerably more challenging task in respect of the UEFA regulations at first, but there are provisions that will almost certainly grant us a temporary exception so long as we're making a genuine effort.

[quote=from the very last section of the regulations]2. For the purpose of the first two monitoring periods, i.e. monitoring periods
assessed in the seasons 2013/14 and 2014/15, the following additional
transitional factor is to be considered by the Club Financial Control Panel:
Players under contract before 1 June 2010
If a licensee reports an aggregate break-even deficit that exceeds the
acceptable deviation and it fulfils both conditions described below then this
would be taken into account in a favourable way.
i) It reports a positive trend in the annual break-even results (proving it has
implemented a concrete strategy for future compliance); and
ii) It proves that the aggregate break-even deficit is only due to the annual
break-even deficit of the reporting period ending in 2012 which in turn is
due to contracts with players undertaken prior to 1 June 2010 (for the
avoidance of doubt, all renegotiations on contracts undertaken after such
date would not be taken into account).
This means that a licensee that reports an aggregate break-even deficit that
exceeds the acceptable deviation but that satisfies both conditions described
under i) and ii) above should in principle not be sanctioned.

This will buy us 2 years if we need it.[/quote]

Interesting, if we consider how much then we could/have to write off based on that...the most expensive players from the last 18 months before this last transfer window, would be:

Adebayor, Tevez, Toure, Given, RSC, Jo, Lescott, NDJ, Vinnie, SWP, Robinho (he's just on loan with an option to buy, right?), Bellers, Barry

So, i would assume this to mean we NEED to keep Ade, RSC and Jo around to use as chips in this deal or else we could be well and truly fucked. Make sense?

cheers

[Beefymcfc]

Eh??? I'm a sort of accountant but still don't understand it, luckily the Sheihk's corporate ones will.

[Ted Hughes]

The only way we'll get around this is by hugely increasing our turnover or taking legal proceedings if we're barred. Imo we won't need to take legal proceedings because the club will have a way of bringing in huge investment which passes the test & makes it impossible for Platini & Co to kick us out whilst allowing others to do the same & participate which would be obviously corrupt (hence legal proceedings).

Cook has already alluded to 'new/deeper streams of revenue' which in his estimation puts our turnover in the £300m bracket. That means we've found a loophole imo & investment will continue. At the same time, the rules allow us to spend whatever we want on the academy & the stadium etc. So we will do & we will try to hoover up all the best prospects to save us money in the future.

The rags will be able to stay afloat as things stand but they will have very little left to invest in anything so may well be left behind by our academy etc.

However smug they think they'll be, I bet we come out of this a lot better than they do & it wouldn't surprise me to see them & their ilk kicking out Platini & changing the rules back in a couple of years or contesting it in court if they fall foul of it themselves.

[john68]

I am confident that our owners have this under control. It was made clear that the subject was discussed at every board meeting, so the club will be well aware of what needs to be done and will take appropriate action. With Mancini stating at the forum that we were ready to go for Dzeko as well as 2 more players, it seems that there is some slack in the schedule that they feel they can play with.

Looking at the rags, they could be in a bigger mess than they realise if things don't go right. Financially, they may be able to comply with the UeFA rules regarding servicing their debt as it now stands but that could change dramatically very soon. They have promised Shrek a bag full of new cash and have to find the funds to replace Giggs, VdS, Neville and Scholes...replacements won't come cheap if they wish to stay competetive with the top CL clubs. That investment would only have them standing still, they need to push on and that will inevitably cost them more money that they haven't got.

With Chelsea, Arsenal, City and Spurs all capable of taking top 4 slots, for the 1st time in many years, it is now conceivable that they may even fail to qualify for the CL. If that were to happen, they could financially implode.

I know there's abit of wishful thinking there but I'm sure Ronk can add a few figures to the point I'm making.

[john68]

Dealing with the same issue but from a slightly different angle, Most rags I speak with, even the more intelligent ones, seem to be placing a lot of trust in the attitude that:
"The rags are an institution and won't be allowed to die"
"They have been in trouble before but Taggart always turns up trumps"
"They are the biggest club in the World"
"They have their kids coming through"
"It won't happen just because it's them"

Maybe they have had it so good, been spoonfed so much nonsense that they can't see straight. The history of football is littered with great, rich and big clubs falling by the wayside.

Rag fans seem quite adept at burying their heads in the sand and not facing some of the starker realities of their situation.

[the_georgian_genius]

Dealing with the same issue but from a slightly different angle, Most rags I speak with, even the more intelligent ones, seem to be placing a lot of trust in the attitude that:
"The rags are an institution and won't be allowed to die"
"They have their kids coming through"

You could say that these two are true, they will never die as they are too big too ever die, it's like the Yankee's dieing, would never happen, they would get bailed out quickly enough as they are a worldwide money spinning brand that will always make money. The success might not be there but the club will.
The second one they have a few decent players coming through from what i have heard, especially this ravel morrison bloke who i have been told not just by those connected with the rags that he is a future world star in the making, the only thing that will stop him is his attitude and who he hangs around with.

All we have to worry about in the future will be bad decisions on the pitch and lack of luck, apart from that we are set for life.

[kinkylola]

we should be careful not to fall into the same shit attitude that the rag fans have though. Yes we are lucky and we may very well be "set" for life ... but we need to constantly evolve and look for ways to better our club.

[john@staustell]

Dealing with the same issue but from a slightly different angle, Most rags I speak with, even the more intelligent ones, seem to be placing a lot of trust in the attitude that:
"The rags are an institution and won't be allowed to die"
"They have been in trouble before but Taggart always turns up trumps"
"They are the biggest club in the World"
"They have their kids coming through"
"It won't happen just because it's them"

Maybe they have had it so good, been spoonfed so much nonsense that they can't see straight. The history of football is littered with great, rich and big clubs falling by the wayside.

Rag fans seem quite adept at burying their heads in the sand and not facing some of the starker realities of their situation.

Also most of 'em seem to think football began with that Mark Robins goal (at Oxford was it, or Forest?), or at least there was a 25-yr gap between titles which is a great forgotten black hole. During this time the 'great club' of the euro cup went bust and got relegated.

The Death Star will crash and burn.

[King Kev]

Eh??? I'm a sort of accountant but still don't understand it, luckily the Sheihk's corporate ones will.

Is that what you have on your business cards??

[Ted Hughes]

Dealing with the same issue but from a slightly different angle, Most rags I speak with, even the more intelligent ones, seem to be placing a lot of trust in the attitude that:
"The rags are an institution and won't be allowed to die"
"They have their kids coming through"

You could say that these two are true, they will never die as they are too big too ever die, it's like the Yankee's dieing, would never happen, they would get bailed out quickly enough as they are a worldwide money spinning brand that will always make money. The success might not be there but the club will.
The second one they have a few decent players coming through from what i have heard, especially this ravel morrison bloke who i have been told not just by those connected with the rags that he is a future world star in the making, the only thing that will stop him is his attitude and who he hangs around with.

All we have to worry about in the future will be bad decisions on the pitch and lack of luck, apart from that we are set for life.

I've heard good things about Morrison but unless you're Lionel Messi (& Morrison isn't) you can't guarantee anything at all about a player's future at that age. SWP was fucking fantastic as were Lee Croft (have a look at his scoring record as a kid) & David Bentley, Francis Jeffers etc, the lower leagues are full of 30 year old 'future world stars' . They were saying the same thing about Fabien Brandy but that seems to have gone quiet (greedy ponce) or years ago Russell Beardsmore (the new George Best) Mark Robbins (Rummenigge), etc etc.

From the admitteldly limited amount I've seen of the rags' youngsters they're no better than anyone elses & I don't expect them to produce any more Prem players than they have been doing in the last decade, ie one or two. I'd back our academy to produce signinficantly more than Utd's in the coming years, even BEFORE the new changes/expansion fully kicks in.

Where the rags do excel, imo, is the coaching of winning tricks/habits. Their players always seem to have a cross or a free kick in them, even when they're shit, & understand the team strucure & how to apply pressure as a team or nick a goal & are better prepared for 1st team football. Ours always seem to lack those things & hugely talented players like Stephen Ireland struggle. Marwood will fix it though imo. Changed my mind about him.

[john68]

1...There is no such thing as they will survive because they are big...Abject nonsense. If the Glazers lead 'em down the financial garden path, they will fail and fall. Just like all the othe massive and successful clubs throughout the history of football.

2...Since the explosion of youth they had all those years ago, they have produced absolutely nothing that has taken the World by storm and I have no thoughts of them doing it now just because they are failing.

The whole thing that they cannot fail because they are big or some sort of national treasure is garbage. There are always reasons for success and failure.

[Beefymcfc]

Eh??? I'm a sort of accountant but still don't understand it, luckily the Sheihk's corporate ones will.

Is that what you have on your business cards??

Ha ha ha, if I needed a business card I'm sure that's what it'd say.

[ronk]

1...There is no such thing as they will survive because they are big...Abject nonsense. If the Glazers lead 'em down the financial garden path, they will fail and fall. Just like all the othe massive and successful clubs throughout the history of football.

2...Since the explosion of youth they had all those years ago, they have produced absolutely nothing that has taken the World by storm and I have no thoughts of them doing it now just because they are failing.

The whole thing that they cannot fail because they are big or some sort of national treasure is garbage. There are always reasons for success and failure.

Yes and no. Their fundamentals are great, they have a low wage structure and have been constantly growing revenues. If it wasn't for the leveraged buyout debt being sour they'd be in a very strong position.

They've been able to ride out lean periods before when they tightened the purse-strings (Chelsea's initial surge), this time might be different but despite tightening everything, they still have the emergency funding in place when they need to dip into it. But they don't have a lot of margin for error.

Instead of being the rich misers they were, they're going to be a lot more like Arsenal, picking their moments in the market and taking in players who mightn't make the huge initial impacts but will be amazing, and selling a certain proportion to help ends meet. Arsenal are selling better than ever despite not really being in the title race for ages. The Glazers already cashed in on the waiting list by seeing who'd blink when prices shot up, this means they'll have a hell of a lot less room to ride out tough times. But rags aren't showing many signs of getting smarter and realising that scarves at the match don't hurt the bottom line. Loads of the thick rag fuckers I know wouldn't believe me when I said they finished 3rd a few times when Chelsea were winning. There's mileage in that for them, but when it starts to go it might never come back.

Scum would lose too much through not being in the CL that they'd always find the cash to give themselves a performance boost. Shrek just proved it by claiming a wedge of it. But that's normal for them, they responded to Chelsea by buying Shrek when injured rather than squeezing Everton and they responded to our takeover by suddenly finding a few extra million to give Spurs for Berbatov.

I'm not getting my hopes up that they'll get relegated. They have the muscle to hold onto 3rd place and be there if someone slips up and for the CL where getting out of the group puts them in the mix. They'll be able to drift along like that for a while depending on how well they can hold together/rebuild their squad.

The Glazers still have the escape route of selling equity and putting that all into debt. Much rougher on their long term chances of making money, but much stronger for the company.

[john68]

Cheers Ronk, I knew you put detail on that for me...taking you for granted, soz Mate.

I wasn't looking at them being relegated at this stage. maybe (hopefully) sometime further down the line. What I did consider was that this is the 1st time since taggart that they have been in the position where they have had this situation. Initially just them and Arsenal, then Chelsea and L'Pool joined them, now City and Spurs are in the hunt.
In the past they have always had the resources to deal with any upsurge in the market and the ability to spend whenever they needed to. I see a lot less breathing room for them now.
With regard to income streams, they have always increased but IMO that's because they have usually been successful and were always on the World stage. There is a distinct danger that this may change. Failure to qualify for the CL will hit them hard and I wonder if they will have the financial clout to buy their way back in. Should they slip sufficiently, their marketting with the glory seekers over in Asia could be very badly hit and prove disastrous for them. We are already seeing a reaction from their hardcore support who attend games.

I JUST LOVE PLAYING THIS GAME....HAHAHA

[john68]

Anyway Flozza....back to the point of this thread...arguing and convincing a rags that they are shit.

Keep it simple...(Being a septic, you'll cope with that)...remember rags can't do complicated either.
1..Keep to the script
2..Don't allow him to ask questions.
3..If your not sure of the facts, no worries, he won't know the facts either, so say whatever enhances your argument.
4..Whatever you say (shit or otherwise) say it convincingly and with confidence. He won't know enough to contradict.
5..If he doubts your word, Tell him it's not your responsibiltiy to educate him and to go check for hmself.
5..If all else fails...punch him.

THE SCRIPT
Yer shit, historically you've always bin shit. If it hadn't bin for City on numerous occasions, your shite club wouldn't even exist. If it hadn't have been for City, you'd be a Blue...(perish the thought). You didn't invent football in the 1990s, it had been going for over 100 years before that and your club was just a nomark club. Usually skint and on the verge of going out of business. The Glazers are only returning you to your natural heritage....Get used to it...your dad did.
Your club has only had 2 periods of success...a bit in the 60s, which we sorted out for you when we put your club out of it's misery and relegated you...(Denis Law backheel)....and don't forget that your club only afforded to rebuild after the War (2nd) out of City's generosity, allowing you to use our ground, giving you access to our fans and letting you earn more profit that you had ever earned before.
...and before you go on about the Arabs and their money buying success, what about fuclin Gibson whose money saved you from extinction. You rags greedily took that without any complaints...double standards, or what....and ain't it funny that we don't hear any of you rags bragging about the G14 and the part your shit played in coercing UeFA in getting the finance rules changed to suit all the rich clubs at the expense of everone else...money and resources diverted from grass roots football to fill your coffers.
...and even now your shit club tried to get City to bail them out by selling us Shrek at an inflated price, to help pay off your debts.

(If that has him rocking a bit...finish him off with.....)
...and the manner in which your arrogant club treated it's own after Munich was despicable and deplorable...Chucking players out of their homes. making returning players pay their own taxi fares when they retuned from hospital. Having a testimonial for the Munich families...40 fuclin years AFTER the event...(nowt at the time)...then giving the money to fuclin Eric Cuntona. Your shite even had to have the 50th anniverary sponsored by AIG, depite protests from your own fans....

Should do the trick...
PS...You'll need to sort out when and where to breathe on your own Mate...:-)
GLAD TO BE OF SERVICE FLOZZA!!!

[Blue in the face]

Eh??? I'm a sort of accountant but still don't understand it, luckily the Sheihk's corporate ones will.

Is that what you have on your business cards??

Ha ha ha, if I needed a business card I'm sure that's what it'd say.

As well as tree climber?

[Florida Blue]

Dealing with the same issue but from a slightly different angle, Most rags I speak with, even the more intelligent ones, seem to be placing a lot of trust in the attitude that:
"The rags are an institution and won't be allowed to die"
"They have their kids coming through"

You could say that these two are true, they will never die as they are too big too ever die, it's like the Yankee's dieing, would never happen, they would get bailed out quickly enough as they are a worldwide money spinning brand that will always make money. The success might not be there but the club will.
The second one they have a few decent players coming through from what i have heard, especially this ravel morrison bloke who i have been told not just by those connected with the rags that he is a future world star in the making, the only thing that will stop him is his attitude and who he hangs around with.

All we have to worry about in the future will be bad decisions on the pitch and lack of luck, apart from that we are set for life.

Just like Bear Stearns??

[Florida Blue]

Anyway Flozza....back to the point of this thread...arguing and convincing a rags that they are shit.

Keep it simple...(Being a septic, you'll cope with that)...remember rags can't do complicated either.
1..Keep to the script
2..Don't allow him to ask questions.
3..If your not sure of the facts, no worries, he won't know the facts either, so say whatever enhances your argument.
4..Whatever you say (shit or otherwise) say it convincingly and with confidence. He won't know enough to contradict.
5..If he doubts your word, Tell him it's not your responsibiltiy to educate him and to go check for hmself.
5..If all else fails...punch him.

THE SCRIPT
Yer shit, historically you've always bin shit. If it hadn't bin for City on numerous occasions, your shite club wouldn't even exist. If it hadn't have been for City, you'd be a Blue...(perish the thought). You didn't invent football in the 1990s, it had been going for over 100 years before that and your club was just a nomark club. Usually skint and on the verge of going out of business. The Glazers are only returning you to your natural heritage....Get used to it...your dad did.
Your club has only had 2 periods of success...a bit in the 60s, which we sorted out for you when we put your club out of it's misery and relegated you...(Denis Law backheel)....and don't forget that your club only afforded to rebuild after the War (2nd) out of City's generosity, allowing you to use our ground, giving you access to our fans and letting you earn more profit that you had ever earned before.
...and before you go on about the Arabs and their money buying success, what about fuclin Gibson whose money saved you from extinction. You rags greedily took that without any complaints...double standards, or what....and ain't it funny that we don't hear any of you rags bragging about the G14 and the part your shit played in coercing UeFA in getting the finance rules changed to suit all the rich clubs at the expense of everone else...money and resources diverted from grass roots football to fill your coffers.
...and even now your shit club tried to get City to bail them out by selling us Shrek at an inflated price, to help pay off your debts.

(If that has him rocking a bit...finish him off with.....)
...and the manner in which your arrogant club treated it's own after Munich was despicable and deplorable...Chucking players out of their homes. making returning players pay their own taxi fares when they retuned from hospital. Having a testimonial for the Munich families...40 fuclin years AFTER the event...(nowt at the time)...then giving the money to fuclin Eric Cuntona. Your shite even had to have the 50th anniverary sponsored by AIG, depite protests from your own fans....

Should do the trick...
PS...You'll need to sort out when and where to breathe on your own Mate...:-)
GLAD TO BE OF SERVICE FLOZZA!!!

This will only work if y'all can teach me to speak in a Manc accent!! Well worded John.