When you are dealing with a building, depreciation is typically aggressive. MACRS is used as the rule rather than the exception. What discount rate are they using and how does it differ from the discount rate in such transactions at large? It seems to me that this is a simple cash vs. accrual issue. Either way, it is all recognized within the same time period (a season). What is their inventory, and how does it relate to the stadium? Is it tickets? Hot dogs? What is their inventory? After you answer that, they must conform to one of the inventory methods approved by FASB, typically LIFO or FIFO. Either way, it is all straightened out and (generally) the same by season's end.
Here's the silly part of the accounting argument, Drayton doesn't open the Astros books. So we don't know if he has created paper losses or not. He could claim a loss even if his books said he was ahead $50 million, and we'd be none the wiser. Personally, I'll take Forbes' estimates to be fairly close to reality: http://www.forbes.com/forbes/2003/0428/mlb_11.html
1) New building, probable new ownership soon = aggressive depreciation. More than normal if you think you are going to sell. I am suggesting something other than LIFO or FIFO. That is possibe, right? 2) Discount rate is referring to valuation of cash flows. When you hear Drayton say we are losing money, what exactly is he talking about? He has never answered any types of questions related to this subject matter. I believe he is referring to present value calculations using a high discount rate. He could be really talking about a number of things, not net income. (i.e. IRR, Risk Adjusted Returns, ROI... $/k-g) How do we know what he is talking about when he does not elaborate? The point is............ I do not believe he is losing money. He is better off financially owning the Astros. Nobody in their right mind would argue against that. Even if he lost money this year, he benefits from collateral business (vertical and horizontal integration of his other businesses) because he owns the Astros.
http://www.nypost.com/sports/yankees/42259.htm Great...Looks like he may have the same thoughts as Wagner, if he does sign, the Astros won't do much else to be a contender.
There's absolutely no way the Stros are losing money over the past 4 seasons. He did (and nobody argues this) lose his ass the last 4 seasons in the Dome, especially '98-99.
and what i'm saying is that if there were a better deal to be had, i think the astros would have made it. that's how much faith i have in gerry.
Exactly. The Stros have a handfull of guys in the front office & scouting dept. who have forgotten more about baseball & evaluating talent than everyone on this board combined has ever known. By all accounts: 1. Myers, Floyd, Padilla and Hamels were untouchable; 2. Bucholtz is a better prospect than any pitcher in the Red Sox system; 3. The market for closers making $9M is miniscule, look around the league, only 3-4 teams need + can afford a guy like Wags. The more I think about it, the more I like this trade. Still would have liked Jason Michaels to be in the deal, though.
I agree. Folks have to remember that Wagner has an 8 million dollar salary so he is not easy to move. The list of teams for him to go to are few and far between. Free agency also starts in about a week and there are a number of decent relievers out on the market including Guardado and Hawkins of the Twins, Foulke, Urbina, Worrell, potentially Nen, and a few others. Granted, none of them are of Wagner's caliber, but they could cause a team to reconsider acquiring a high priced reliever. Wagner would essentially be a free agent after 2004 unless his team picks up a 9 million dollar option. Since the Astros are generally contenders, it would be difficult to move him during the season and imagine the outcry if they let him leave for nothing in return. In addition, this is a move which will allow other moves including the signing of Miller and/or Oswalt to a longer term deal or more easily handling their arbitration cases if it comes to that. The Astros seem to be between a rock and a hard place with their fans. When they lock up players to long term deals they get criticized (e.g. Biggio, Bagwell). Fans also complained about Wagner's deal. Then, when they elect to trade players or lose players to free agency rather than lock them up to long term deals they get criticized (Hampton, Kile, Johnson). The Astros still have a solid core of good players that play hard and rarely cause trouble off the field. Barring injuries, they should continue to compete for the division title. Keep in mind that there was an extremely limited market for Wagner, probably only Boston, the Cubs and Philadelphia and Boston's attempt to unload Ramirez may have been their effort to try and get in on the deal.
Great point, bobrek...I remember a thread of posts criticizing the Astros for signing Wagner to this high-priced deal just a couple of years back...now everyone's lamenting his loss as they approach a year where he's to be paid $9 million.
It sure would be interesting to see the budget and the financial statements over a series of years. Even if he was losing money, I think the point made earlier is likely correct, the Astros probably cause revenue streams in several other programs and budgets. It's ok to have a program that loses money as long as it generates revenue on the whole ( or generate a social value). But after the books get manipulated like play-doe, who really knows what the bottom line is. The big guy knows what he wants to hear and then the accountants make it happen. Pawns.
So the Astros save $8 million by trading Wagner. Technically true, although the saves that Dotel gets in 2004 will push his next contract higher. And I'll even buy that a great closer isn't worth as much as a great starter. But what are the odds that the Stros will get a great starter with the cash they're saving? Pettite? He's overrated. High era, tons of run support. Not an elite pitcher, although he'll probably produce a decent 4 era and 13-15 wins. Resign Oswalt and Miller? Miller was very mediocre last season. He's got a career era close to 4, and there's a real chance that he never develops into a great pitcher. Oswalt's a consistantly great pitcher, when he's healthy. Which seems to be a question mark every season. I wouldn't sign either one of those guys to a huge contract.
So Sammy... would you say this trade elicited a "HFS!!!" from you? You should see the awful things Manny's done to the Cubbies... I don't think this trade can be fully evaluated until Buchholz goes boom or bust. He's supposed to be a good one, friends.
Holy ****ing ****! The baseball sim is still going on? And a further holy ****ing ****! You let Manny run my Cubbies? Please tell me he didn't trade Prior and Wood to the BoSox for ManRam. Maybe I'll have to come back and redeem that poor, shattered franchise. I agree with you about Buchholz. If he develops into his potential, he could be an excellent #2 pitcher in the Stros rotation. I'll still never forgive haven for "accidentally" freezing up that LCS game and forcing a rematch.
i love dratons gay ass i stand lookin at him it makes me soo This post was edited for content. Please be careful how you phrase things. They could come back to haunt you
Bah! Troy Glaus made a bunch of Allstar teams for me and hit 40 homers every season. I think it took Prior quite some time to develop for your mediocre Rockies.
this trade has really made me want to buy a billy wagner jersey...i cant even find one anywhere! the astros shop has jerseys for all the players plus some former players like ZAUN, but NO WAGNER
