Swiss Rambler's latest on Real Madrid and Barca debt

http://swissramble.blogspot.com/2012/04/truth-about-debt-at-barcelona-and-real.html

I haven't read it yet, but I'm always better informed after I read the Swiss Rambler than before.

In conclusion, while there are some very real debt problems
in Spanish football, the situation is not quite so dramatic at Barcelona and
Real Madrid as some would have people believe. It would obviously be better for
their balance sheets if the debt was lower, but their ability to generate
revenue is unsurpassed, admittedly partly due to the current unfair TV deal,
but also their high gate receipts and awesome commercial strength. These
operations continue to grow, as seen by Barcelona’s record-breaking shirt
sponsorship deal with the Qatar Foundation and Real Madrid’s plans to build a
$1 billion holiday resort in the United Arab Emirates.

"Put your shirt on it"

Of course, the two Spanish giants may still come under
pressure from their creditors at some stage, especially if they embark on a
summer spending spree following the disappointing Champions League semi-final
exits. Nor should the impact of Spain’s faltering economy be trivialised, but
the fact is that right here, right now, the important debt (bank loans,
transfers and tax liabilities) is relatively low, at least for clubs of this
size.




When reading reports on how much Barcelona and Real Madrid
owe, it’s not quite a case of “don’t believe what you read”, but you do need to
understand what any analysis is actually referring to, because, as we have seen,
debt has many different definitions.




Caveat
emptor – or something like that.

Most companies in the world are in debt, doesn't mean they are in an unhealthy financial situation though. It just means they have to repay the bank loans they have taken. To be fair though, the whole of Spain is in debt, even their banks and the economy is going to crash like Greece did soon.

Also the whole deal with TV rights in Spain is ridiculous. While in England the ratio of top to bottom-earning club is 1.54, it is 12.5 in Spain! This is really why La Liga has become a two-horse race and it is getting worse every year.

This has caused smaller teams to lose even their local supporters. Most people in Spain nowadays support either of the big two, even when you go to places like Valencia and ask people who they support they say, "Valencia and Madrid/Barça".

It is a shame because La Liga has always been a fun league to watch but it is not a competitive league any more. And there is nothing happening to suggest it won't be staying like this for the foreseeable future.

The Spanish league will crumble soon if nothing is done about the tv revenue distribution. When are Barca and Madrid going to finally realize that without competition from their counterparts, their future too, is doomed? Most people nowadays do not give a fuarkk about La Liga, except when Madrid/Barca are playing...

PS. The Spanish league does itself no favors as well by choosing to market its football in the Spanish language, instead of English. Nobody understands Spanish except for Spain and the Latin American countries..that's hardly 30% of the world. They could learn a thing or two from the EPL.

danyjr wrote:Most companies in the world are in debt, doesn't mean they are in an unhealthy financial situation though. It just means they have to repay the bank loans they have taken. To be fair though, the whole of Spain is in debt, even their banks and the economy is going to crash like Greece did soon.

Also the whole deal with TV rights in Spain is ridiculous. While in England the ratio of top to bottom-earning club is 1.54, it is 12.5 in Spain! This is really why La Liga has become a two-horse race and it is getting worse every year.

This has caused smaller teams to lose even their local supporters. Most people in Spain nowadays support either of the big two, even when you go to places like Valencia and ask people who they support they say, "Valencia and Madrid/Barça".

It is a shame because La Liga has always been a fun league to watch but it is not a competitive league any more. And there is nothing happening to suggest it won't be staying like this for the foreseeable future.

I dont think its because of that, I mean just look at the PL. The PL is competitive because of oil money and not because of the tv rights. Chelsea got where they got thanks to abrahamovic, while man city are going to win the league this year because of the sheik. If it wasnt for those 2 teams, man utd would be crown the PL champions every january..