Quarterly Quarrel: Financial Discussion Part 4

Discussion in 'Manchester United' started by JamesA, Feb 23, 2012.

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  1. JamesA

    JamesA Member+

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    [​IMG]

    Carry on lads..


  2. Motterman

    Motterman Member

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  3. The Jitty Slitter

    The Jitty Slitter Moderator Staff Member

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    According to Pay as You Play these are the top 10 Utd Transfers - corrected for inflation


    1. Rooney 49.1m
    2. Rio 48.4
    3. Veron 36.8m
    4. Carrick 32.3m
    5. Yorke 30.8m
    6. Cole 26.5m
    7. Saha 26.0m
    8. Stam 25.7m
    9. RVN 24.9m
    10. Ronaldo 24.7m

    So is that only Carrick from the Glazers then?

    / cat in to pigeons :D
  4. JamesA

    JamesA Member+

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    That's an excellent return. The only questionable purchase on that list is Veron and Saha (for different reasons). I would consider the rest successful and value for money.
    HarveyDent repped this.


  5. cr7torossi

    cr7torossi Member+

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    Definitely incorrect those numbers jitty.

    UK isn't in deflation and Berba is missing.

    <grenade thrown right back ;)>
  6. The Jitty Slitter

    The Jitty Slitter Moderator Staff Member

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    It corrected for transfer inflation as at 2010

    So for instance, Shevchenko is 53m in 2010 money, Essien 47.4m, Drogba 43.6m because back then 25-30m bought far more than it gets you in 2010.

    berba was bought at the peak of the bubble so he is number 11 of your list - in other words his number moves in the opposite direction

    I don't know if they have updated this for 2011

    Of course it is only a model - but nevertheless interesting.

    Berbatov 23.8m
    Keane 22.3m
    Anderson 20.3m
    Hargreaves 19.1m
    Nani 19.1m

    What is quite interesting (even though this is only a model) is that the purchase of Anderson, Hargreaves and Nani at once was an enormous splurge for squad players
  7. benni...

    benni... scream @ me.

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    huh?:confused::confused::confused:
  8. cr7torossi

    cr7torossi Member+

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    So transfer inflation and not real inflation was used?
  9. The Jitty Slitter

    The Jitty Slitter Moderator Staff Member

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    Think of it this way

    100k per week in wages used to pay Roy Kean - but now it pays less than half a Rooney. Yet Rooney is not twice as valuable

    To compare players from the different eras, you need a way to correct for the fact that each £ buys less.

    You do that by weighting the market as a whole.

    But there is not always inflation - since 2008 - the majority of clubs have far less money available than they used to.
  10. MtP07

    MtP07 BigSoccer Supporter

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    JittySlitter's posts make my brain hurt sometimes.
  11. The Jitty Slitter

    The Jitty Slitter Moderator Staff Member

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  12. benni...

    benni... scream @ me.

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    Okay, thats a little better.
  13. JamesA

    JamesA Member+

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    You've said that before, but each was certainly a long term prospect at the time, especially in the case of Ando/Nani.

    I don't think they were quite viewed as squad players.
  14. cr7torossi

    cr7torossi Member+

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    They very conveniently point towards their book for how they calculate football inflation so I can't comment on it.

    I do see what they are trying to do though and it is interesting as a comparison tool of how much each million is worth at different periods.

    However, it is not really relevant as a comparison tool of how one club has spent across different seasons since a club's spending power grows at footballing revenue inflationary rates.
  15. The Jitty Slitter

    The Jitty Slitter Moderator Staff Member

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    No but it was a huge outlay to buy players ranking 13, 14 and 15 at the same time
  16. The Jitty Slitter

    The Jitty Slitter Moderator Staff Member

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    Sorry mate - here is the intro

    http://transferpriceindex.com/2010/11/pay-as-you-play-introduction-chapter-one/

    I do agree the results don't have to be construed negatively - in fact my own view is that the arrival of the glazers and a smarter transfer approach saved Ferguson's career when you look at some of his poor decision making in the first half of the 00s
  17. JamesA

    JamesA Member+

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    It was indeed. But I also don't think we quite expected to get the imlage out of Giggs and Scholes that we have since that point. I really just think we were preparing for the transition.

    At the time, we also knew Tevez was only temporary and I suspect we had question marks around Ronaldo as well.

    And, Chelsea forced our hand. They turned it into another level of squad game the years prior, so we tried to keep pace.
  18. comme

    comme Moderator Staff Member

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    Just got the book and am about 35% of the way through it (into the section about individual clubs).

    I think it is a good concept but it has quite a few issues to it.

    1. It only looks at transfers, and doesn't include wages. For instance IIRC Sam Allardyce comes out as the manager who achieved the most points for the least outlay. That fails to take into account the wages that he was paying out to players, which in many cases was significant.

    2. It only looks at gross spending. By failing to consider the actual profits made in selling players it doesn't adequately capture the nature of transfers.

    3. The idea of inflation it includes is fundamentally flawed. By applying inflation specifically to football transfer prices it distorts some very good pieces of business, because it doesn't accurately reflect the time value of money. If I borrow £10m at 5% interest and in the next 12 months transfer inflation runs at 10%, I have effectively saved money on what the player would have cost me.

    I must confess I was expecting a bit more from it.
  19. The Jitty Slitter

    The Jitty Slitter Moderator Staff Member

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    Wages have already been correlated to league position and there is lots of data for it (20 teams x big squads year on year) so this was not really a problem that needed solving

    Well it is only a model to compare different eras

    If you want to look at individual transfers then you have the issue that they are full of corruption/distortion etc

    Transfers are not exactly an efficient market.

    Look at the Samba transaction just last week.
  20. comme

    comme Moderator Staff Member

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    I just think it's something that would have been useful to factor in.

    Someone like Ryan Giggs may have cost nothing in transfers, but he's probably had c. £100m of wages, based on the index they use. Obviously still great value, but helps put it all in context.

    It's very rare to find an efficient market in things which aren't homogenous, and in which there are very thin volumes of trading.

    I do think the concept is interesting, I just expected a few more thing to surprise me.

    Don't
  21. Republic of Mancunia

    Republic of Mancunia Member+

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  22. comme

    comme Moderator Staff Member

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    It's because the inflation is calculated on the average transfer price in the season, rather than the highest price.
  23. Republic of Mancunia

    Republic of Mancunia Member+

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    Thanks.

    Weird how the Cole transfer felt like a much bigger deal at the time (and still does) when not using that measure. Suppose part of it was also down to the nature of the transfer itself and the shock-waves it caused. Also for a few other reasons, not least that the tv deal and revenue of clubs was much less then.

    For those that have read the book, does it mention the influence of the Bosman ruling on average transfer fees? Did it take a hit for a while?

    How about squad sizes and the possible need to spread money more thinly over a larger number of players if you're buying them in from other clubs? With the number of subs allowed to sit on the bench ever increasing during the Premiership era, I imagine that might've had an affect at certain times too.
  24. comme

    comme Moderator Staff Member

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    Agreed. The Cole transfer felt huge at the time. I mean it was 40% higher than the previous British record fee.

    Carrick in contrast didn't seem that large.

    My guess as to why that might be is that the Carrick amount might have been larger than the average due to a large number of low value transfers in the year. That might in turn link in to your next point.

    In short, no. It doesn't really touch on what impact Bosman had.

    It tends to look at the cost of the first XI, but does also look at squad costs. Much of what it finds in terms of squads is that where teams often perform badly it is because they have too much spent on their squad rather than the first XI.

    That in turn tends to be the result of bad luck as much as anything (such as if your star striker gets injured for the year he will not make the starting XI very often and so drive up the cost of the squad rather than the first team).
  25. sdotsom

    sdotsom Member+

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    So Al-Jazeera is apparently going to bid against Sky for the EPL broadcast rights from 2013-2016. They won CL rights and Ligue 1 already, and their bidding war could help drive up the revenue of the rights we get. More in the Guardian.
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