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Thread: NBA Lockout: NBPA Rejects Deal, Announces It Will File For Decertification

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    Re: NBA Lockout: NBPA Rejects Deal, Announces It Will File For Decertification

    Quote Originally Posted by justabubba View Post
    i did notice - but was not surprised - that you were unable to answer the question
    maybe twenty years of managing a business has been inadequate
    And I'm not surprised that you only see this through the eyes of an employee. Selling a business and running a business are two entirely different things. You are entirely basing your argument on selling an NBA team - which is an extremely rare commodity - and you are ignoring basic business fundamentals.

    Last year, 22 of the 30 owners lost money from operations of their teams. That's why they feel no need to play. They're better off not playing than losing another gob of money by beating their head against the same wall. Player salaries are not commensurate with cash flow. Simple as that.

    Companies make operational cost decisions all the time. That's what the owners are doing. The players have no power in this, other than to play elsewhere. And guess what, elsewhere isn't going to pay them nearly what these owners will unless their name is Kobe or Lebron, and probably not even then.

    Meanwhile, Mark Cuban owns the rights to High Definition technology and runs a dozen other companies. He's OK. Where's the income coming from for the backup point guard for the Pistons? Nada.

    The owners need only wait, and they can get their cash flow for THIS business in order before play resumes.
    Last edited by Erod; 11-16-11 at 01:40 PM.

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    Re: NBA Lockout: NBPA Rejects Deal, Announces It Will File For Decertification

    Quote Originally Posted by Erod View Post
    And I'm not surprised that you only see this through the eyes of an employee. Selling a business and running a business are two entirely different things. You are entirely basing your argument on selling an NBA team - which is an extremely rare commodity - and you are ignoring basic business fundamentals.

    Last year, 22 of the 30 owners lost money from operations of their teams. That's why they feel no need to play. They're better off not playing than losing another gob of money by beating their head against the same wall. Player salaries are not commensurate with cash flow. Simple as that.

    Companies make operational cost decisions all the time. That's what the owners are doing. The players have no power in this, other than to play elsewhere. And guess what, elsewhere isn't going to pay them nearly what these owners will unless their name is Kobe or Lebron, and probably not even then.

    Meanwhile, Mark Cuban owns the rights to High Definition technology and runs a dozen other companies. He's OK. Where's the income coming from for the backup point guard for the Pistons? Nada.

    The owners need only wait, and they can get their cash flow for THIS business in order before play resumes.
    and still, with twenty years business management experience, unable to answer the question
    we are negotiating about dividing a pizza and in the meantime israel is eating it
    once you're over the hill you begin to pick up speed

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    Re: NBA Lockout: NBPA Rejects Deal, Announces It Will File For Decertification

    Quote Originally Posted by justabubba View Post
    anyone out there able to translate the post immediately above
    not me - I speak regular english.
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    Re: NBA Lockout: NBPA Rejects Deal, Announces It Will File For Decertification

    Quote Originally Posted by haymarket View Post
    not me - I speak regular english.
    I understood what he was saying, but it was poorly worded.
    Nobody who wins a war indulges in a bifurcated definition of victory. War is a political act; victory and defeat have meaning only in political terms. A country incapable of achieving its political objectives at an acceptable cost is losing the war, regardless of battlefield events.

    Bifurcating victory (e.g. winning militarily, losing politically) is a useful salve for defeated armies. The "stab in the back" narrative helped take the sting out of failure for German generals after WWI and their American counterparts after Vietnam.

    All the same, it's nonsense. To paraphrase Vince Lombardi, show me a political loser, and I'll show you a loser.
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    Re: NBA Lockout: NBPA Rejects Deal, Announces It Will File For Decertification

    Quote Originally Posted by justabubba View Post
    and still, with twenty years business management experience, unable to answer the question
    Answered it for you twice, but you still don't grasp the difference between operation fundamentals and value of a business entity.

    But OK, here you go. The owner you referred to sold the team for a hefty profit for a multiple of reasons: the increased value of the league, the exclusivity of being the only team in that market, perhaps a new facility that was built that was part of the deal, existing broadcasting contracts that were in place of value, existing advertising agreements that were established, the marketing and branding that had been put in place, the general inflationary aspect of the economy over time, the establishment of numerous outlets to sell paraphrenalia, etc, etc, etc.

    Those things weren't necessarily in place when the guy bought the rights to put a team in that market.
    And NONE of them have to do with whether or not the team is cash flowing enough as a day-to-day business.

    The street value of a company has nothing directly to do with the compensation level of an employee. Players do have a very direct impact on the marketing of a team, which is why they make millions while Susie in accounting makes $40K.

    I can no longer believe I'm explaining this.

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    Re: NBA Lockout: NBPA Rejects Deal, Announces It Will File For Decertification

    They should disband the NBA it sucks

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    Re: NBA Lockout: NBPA Rejects Deal, Announces It Will File For Decertification

    Quote Originally Posted by Erod View Post
    Answered it for you twice, but you still don't grasp the difference between operation fundamentals and value of a business entity.

    But OK, here you go. The owner you referred to sold the team for a hefty profit for a multiple of reasons: the increased value of the league, the exclusivity of being the only team in that market, perhaps a new facility that was built that was part of the deal, existing broadcasting contracts that were in place of value, existing advertising agreements that were established, the marketing and branding that had been put in place, the general inflationary aspect of the economy over time, the establishment of numerous outlets to sell paraphrenalia, etc, etc, etc.

    Those things weren't necessarily in place when the guy bought the rights to put a team in that market.
    And NONE of them have to do with whether or not the team is cash flowing enough as a day-to-day business.

    The street value of a company has nothing directly to do with the compensation level of an employee. Players do have a very direct impact on the marketing of a team, which is why they make millions while Susie in accounting makes $40K.

    I can no longer believe I'm explaining this.
    and you still haven't
    you have been unable to explain why a team purchased for $32.5 million is sold for $300 million (possibly discounted from $350 million because it is located in an inferior market) when the team was operating at a financial loss
    tell us why it makes economic sense for a team to have appreciated in value that drastically while the team is showing an operating loss
    we are negotiating about dividing a pizza and in the meantime israel is eating it
    once you're over the hill you begin to pick up speed

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    Re: NBA Lockout: NBPA Rejects Deal, Announces It Will File For Decertification

    Quote Originally Posted by lpast View Post
    They should disband the NBA it sucks
    I suspect the NBA would do very well and be very profitable with half the teams it currently has. It would do even better if they could turn back the clock to the late 70's and 80's and recapture that era on the court.

    And for heavens sake, putting your hand on the lower half of the ball when you dribble is carrying the ball and a traveling violation. Watching nearly every guard in the league do that simple drives me to distraction.
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    Re: NBA Lockout: NBPA Rejects Deal, Announces It Will File For Decertification

    Quote Originally Posted by justabubba View Post
    and you still haven't
    you have been unable to explain why a team purchased for $32.5 million is sold for $300 million (possibly discounted from $350 million because it is located in an inferior market) when the team was operating at a financial loss
    tell us why it makes economic sense for a team to have appreciated in value that drastically while the team is showing an operating loss
    I explained it, but you don't get it. Value and cash flow aren't directly related at all.

    Let's say you have a one-of-a-kind BMW worth $100K (the Hornets). If you can't afford to put gas in it (no cash flow), what's its practical worth to you? Nothing, unless you sell it.

    The next buyer pays a premium because it's the only BMW like that in town (there are no more NBA teams in New Orleans, so there's TREMENDOUS bidding competition). And if he buys it, and he can get gas prices down by 10 percent (player salaries), he might be able to get it to cash flow properly, and he'll have an asset that can appreciate and not drain his personal finances.

    People pay good money for businesses all the time that aren't cash flowing. Then, they restructure them, get rid of all the high-earners who's roles can be duplicated by existing personnel, and re-brand the company.

    Besides that, you're talking about a guy who purchased the team in the 80s and sold it 10 years ago. Do you really think this is the same economic climate today? The NBA couldn't get its Finals games on live television until around 1980.

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    Re: NBA Lockout: NBPA Rejects Deal, Announces It Will File For Decertification

    Quote Originally Posted by Erod View Post
    And I'm not surprised that you only see this through the eyes of an employee. Selling a business and running a business are two entirely different things. You are entirely basing your argument on selling an NBA team - which is an extremely rare commodity - and you are ignoring basic business fundamentals.

    Last year, 22 of the 30 owners lost money from operations of their teams. That's why they feel no need to play. They're better off not playing than losing another gob of money by beating their head against the same wall. Player salaries are not commensurate with cash flow. Simple as that.
    Not true. First off, the NBA claims that 22 teams are losing money, that doesn't mean the owners are losing money. Cash to cover net losses could come from the owners, they could come from outside investors. We don't know, but what we do know is that the league claims that teams wound up collectively in the hole a little over 300 million dollars. The player's association who has seen the figures and how they add up claims that figure is grossly overstated due to technicalities and accounting practices. They claim the correct figure is just over 100 million dollars.

    Meanwhile, a 1% difference in the CBA adds up to 38 million dollars. Owners are asking for another 7 or 8% of the CBA, which obviously adds up to about 300 million dollars, which is (depending on who you believe) more than enough for teams to resume making money.

    Incidentally, if the owners are worried about losing money, they can always sell their team for a profit.

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