Michael Jackson’s death has reverberated across the world, having untold and unexpected effects across the nation. For example, his death might be the best child support he could have ever offered as the children will “earn a tremendous amount of money over the next 12 to 18 months given the outpouring (of support through album purchases), and he won’t be spending.”
Even though Jackson once held the honorary chairmanship of an English soccer team, it’s unlikely David Beckham could have ever predicted that the passing of the King of Pop could likely mark the end of the ill-fated attempt by the Beckhams to take over America and raise the level of popularity of the sport on this side of the Atlantic.
One of the storylines that emerged from the 2008 presidential election was that Barack Obama would be the first “basketball” president. That seemed like a largely meaningless distinction; yes, he played b-ball while growing up instead of hitting the gridiron like Gerald Ford and George H.W. Bush, but unless you care who the President puts in his NCAA bracket (and why would you? Do we ask Joe Lunardi about politics?), who cares, right?
(Remember this guy?)
Oddly enough, though, it may be the shenanigans of an Obama-backing former basketball player (and, as it were, the owner of several pro sports franchises) that may, if not derail the entire Obama presidency, at the very least give the opposition a legitimate salvo to fire for the 2010 election cycle.
Suppose you’ve got a product that exists in a relatively finite market. Its value is directly related to the amount of money it can generate, whether by its own sale or by the sales it can generate while in your possession. Suppose that you, as an owner, enter into obligations based on that projected value or the projected sale. Then, this being America in 2009, the bottom completely drops out of that market, and you’re left in a financially untenable situation with an “asset” that suddenly isn’t worth nearly what you expected. So, are we talking about home owners, banks, and mortgages… or the professional sports landscape?
(Look behind Derrick Rose. You see a fellow Bull, three Charlotte Bobcats, and about six of their fans.)
Bill Simmons recently released an impressive column detailing the woeful state of affairs in the NBA from a balance sheet perspective (seriously, it’s a must-read). Obviously, nobody’s going to give him hard numbers; if even 20% of Simmons’ anecdotes and predictions are true, it would be an open call for investors and partners of franchises to flee in terror. But Simmons has enough to forecast a coming dark era for the league, and probably the rest of American sports as well. The, ahem, money quote* is after the jump. Read more…