Economic Carnage and what it entails for Rangers

[Gonzo79 13,596]

Most footballers and their agents will be fully aware that the whole of Europe is affected, so pissing off a current employer probably won't bode well when looking for a new one.  

 

"You're skint so I'm leaving!  Oh, everyone else is skint too.".

[der Berliner 3,245]

13 minutes ago, Gonzo79 said:

Most footballers and their agents will be fully aware that the whole of Europe is affected, so pissing off a current employer probably won't bode well when looking for a new one.  

 

"You're skint so I'm leaving!  Oh, everyone else is skint too.".

... and those least skint are probably the footballers themselves.

[craig 5,195]

10 hours ago, buster. said:

Newcastle Utd fans have had to relatively suffer the reign of Mr.MASH for a number of years.

 

Suddenly it seems as if a takeover will lead to another rich bastard (Saudi oil money) in the door but one that is more likely to splash the cash. The Geordies have a way of attracting bad luck as well as cnut investors or now murdering bastards and at the same time, the oil price hits zero. That will obviously change but there is something poetic in the symmetrical about that.

 

Regards big clubs, it´ll be about to what levels they will need to downsize, how long will it take to recover and managing the process. My off the cuff guess is that Bayern Munich may come out of this on top of the pile.

The Spaniards will, once again, find a way of assisting Barcelona and Real Madrid.... but it wont be through state aid of course

[craig 5,195]

10 hours ago, Gaffer said:

I'm not sure what these investment managers are using to track previous trends but we have seen this before and it's quite common.  Unfortunately, too many use modern portfolio theory as the basis for their models but it's deeply flawed and omits all of the major dips throughout history.  Funnily enough the dip in 2008 is nowhere near the worst we've had in the last 60 years.

 

As for a 2nd or 3rd wave ... of what?  It's the lockdown that's causing this, not the threat of the virus.  The government can halt it by removing this mass lockdown.

 

We will all have our opinions based on what our experts are telling us.  I think what we can agree on is that tough times are ahead and Rangers must protect every penny it has.  We are going to need it to ride this out.

We haven't seen an global economic complete shutdown lasting for multiple weeks before.  We also haven't seen stimulus packages of the quantum or needs as this one.  That is their point, they can't use previous trends because this is unchartered territory.  I contend that it isn't common and hasn't really happened before either - even in the Great Depression, economies were still working.  This one, globally, has ground to a halt.  I am perhaps an optimist but I am with Bill in that I suspect that once things open up again I think that industries and jobless numbers will drastically reduce.  My fear, though, would be a 2nd or 3rd wave - not so much as it could result in another lockdown but that the markets will react very unfavorably to that instance - I personally don't think a 2nd or 3rd wave, and how they are handled, has been priced into the markets yet.

 

The lockdown is causing the economic carnage but it certainy isn't causing the wider health issue - unless you consider economics to be the only issue.....  If governments don't get the "r" below 1 (average rate of contamination) then you have an expanding virus.  Timing will be everything with this - herd immunity is not only a foregone conclusion but also essential to build immunity and build people to be asymptomatic.  However, you and I both know that the markets don't work on common sense all the time.  If, for example, the UK says in 6 months time that there is an increase in CV cases again you can guarantee that the markets will go into a frenzy, not matter whether it is short term or not.  No matter whether a 2nd wave is a large, or small, issue.

 

It is all very well to say stop the lockdown and get back to work, but that runs the risk of infections rapidly increasing again and even greater pressure on the healthcare systems around the world.  As I said, timing is everything.

 

Back on topic, yes Rangers must now tighten the belts - what will be interesting to see is what happens across the city - as I said earlier, everything is relative in Scotland, how we do is relative to Celtic - but their wage bill is significantly greater than ours and is largely dependent upon making the CL.  Will they ultimately have to sell assets to a) cover wages b) get some wages off the books to lower costs and c) ultimately balance the books.  This could hurt them financially far more than it hurts us, which brings them closer to us financially, which then MIGHT allow us a chance to challenge, even without the need to have a "war chest".

[craig 5,195]

6 hours ago, Tannochsidebear said:

Barca have said they would give the proceeds from this to corona-virus charities, not for their own coffers.

Thanks TB, I had only read the headline

[Bill 13,717]

2 minutes ago, craig said:

I personally don't think a 2nd or 3rd wave, and how they are handled, has been priced into the markets yet.

That is a very good question and I suspect you are right.

 

There's a growing bandwagon to curtail social distancing measures and I'm unclear whether it's the usual sheep syndrome or just a reflection of the lack of stamina for anything in current society. I'm fairly clear about one thing though - if we lift restrictions to soon and too quickly, the repercussions will be a damn sight worse than persevering until infection rates are much lover than they are today. People need to show some bottle and get through this, not f*ck it up at the half way stage.

[compo 6,129]

Over 700 deaths today and as long as we have people dying then there should be no sporting events were you have mass gathering of people I think we're about to see the grasping side of football soon were administrators will want to play behind closed doors just to get the sponsors money and keep their television deals they used to call it the people's game well you cant ha e a people's game with no fans .

If need be I would scrap all football until January then reassess the situation. 

 

[MacK1950 2,231]

7 minutes ago, compo said:

Over 700 deaths today and as long as we have people dying then there should be no sporting events were you have mass gathering of people I think we're about to see the grasping side of football soon were administrators will want to play behind closed doors just to get the sponsors money and keep their television deals they used to call it the people's game well you cant ha e a people's game with no fans .

If need be I would scrap all football until January then reassess the situation. 

 

IMO no sport that relies on mass spectators should be allowed until scientifically proved to be safe to do so.The importance to health totally needs to be foremost.

[RANGERRAB 3,256]

3 hours ago, craig said:

We haven't seen an global economic complete shutdown lasting for multiple weeks before.  We also haven't seen stimulus packages of the quantum or needs as this one.  That is their point, they can't use previous trends because this is unchartered territory.  I contend that it isn't common and hasn't really happened before either - even in the Great Depression, economies were still working.  This one, globally, has ground to a halt.  I am perhaps an optimist but I am with Bill in that I suspect that once things open up again I think that industries and jobless numbers will drastically reduce.  My fear, though, would be a 2nd or 3rd wave - not so much as it could result in another lockdown but that the markets will react very unfavorably to that instance - I personally don't think a 2nd or 3rd wave, and how they are handled, has been priced into the markets yet.

 

The lockdown is causing the economic carnage but it certainy isn't causing the wider health issue - unless you consider economics to be the only issue.....  If governments don't get the "r" below 1 (average rate of contamination) then you have an expanding virus.  Timing will be everything with this - herd immunity is not only a foregone conclusion but also essential to build immunity and build people to be asymptomatic.  However, you and I both know that the markets don't work on common sense all the time.  If, for example, the UK says in 6 months time that there is an increase in CV cases again you can guarantee that the markets will go into a frenzy, not matter whether it is short term or not.  No matter whether a 2nd wave is a large, or small, issue.

 

It is all very well to say stop the lockdown and get back to work, but that runs the risk of infections rapidly increasing again and even greater pressure on the healthcare systems around the world.  As I said, timing is everything.

 

Back on topic, yes Rangers must now tighten the belts - what will be interesting to see is what happens across the city - as I said earlier, everything is relative in Scotland, how we do is relative to Celtic - but their wage bill is significantly greater than ours and is largely dependent upon making the CL.  Will they ultimately have to sell assets to a) cover wages b) get some wages off the books to lower costs and c) ultimately balance the books.  This could hurt them financially far more than it hurts us, which brings them closer to us financially, which then MIGHT allow us a chance to challenge, even without the need to have a "war chest".

Did Ra Shellik not have annual operating costs of over £80m in recent accounts??

If so I’d think they’d much more to worry about...

[Gaffer 1,665]

4 hours ago, craig said:

We haven't seen an global economic complete shutdown lasting for multiple weeks before.  We also haven't seen stimulus packages of the quantum or needs as this one.  That is their point, they can't use previous trends because this is unchartered territory.  I contend that it isn't common and hasn't really happened before either - even in the Great Depression, economies were still working.  This one, globally, has ground to a halt.  I am perhaps an optimist but I am with Bill in that I suspect that once things open up again I think that industries and jobless numbers will drastically reduce.  My fear, though, would be a 2nd or 3rd wave - not so much as it could result in another lockdown but that the markets will react very unfavorably to that instance - I personally don't think a 2nd or 3rd wave, and how they are handled, has been priced into the markets yet.

 

The lockdown is causing the economic carnage but it certainy isn't causing the wider health issue - unless you consider economics to be the only issue.....  If governments don't get the "r" below 1 (average rate of contamination) then you have an expanding virus.  Timing will be everything with this - herd immunity is not only a foregone conclusion but also essential to build immunity and build people to be asymptomatic.  However, you and I both know that the markets don't work on common sense all the time.  If, for example, the UK says in 6 months time that there is an increase in CV cases again you can guarantee that the markets will go into a frenzy, not matter whether it is short term or not.  No matter whether a 2nd wave is a large, or small, issue.

 

It is all very well to say stop the lockdown and get back to work, but that runs the risk of infections rapidly increasing again and even greater pressure on the healthcare systems around the world.  As I said, timing is everything.

 

Back on topic, yes Rangers must now tighten the belts - what will be interesting to see is what happens across the city - as I said earlier, everything is relative in Scotland, how we do is relative to Celtic - but their wage bill is significantly greater than ours and is largely dependent upon making the CL.  Will they ultimately have to sell assets to a) cover wages b) get some wages off the books to lower costs and c) ultimately balance the books.  This could hurt them financially far more than it hurts us, which brings them closer to us financially, which then MIGHT allow us a chance to challenge, even without the need to have a "war chest".

The cause of this impact on the economy is certainly new, but there have been 7 instances in the last 60 years which have caused similar impacts.  The cause is not important, it's the impact that is, and that can be modelled fairly accurately.  Also, your point about second and third waves isn't really that important.  The markets don't care if there's a 4th, 5th, or 20th wave.  All the markets are interested in is if the government is likely to pursue the lockdown approach.  The lockdown is the problem, not the disease (for the markets anyway).  At the moment the markets reflect the belief that the government will have to drop this ridiculous approach and take a different approach.  However I do agree that there will be further hits on investments if the lockdown is the ongoing preferred route.  That will spell disaster.

 

The numbers are completely misleading in terms of deaths.  Many people are dying with corona virus but very few die from it.  There is very little evidence to suggest this is much different from the corona viruses we've suffered in previous years.

 

As for our club, I'm all for being optimistic, but that means hoping for the best but preparing for the worst.  I realise competing with that other lot is always on our minds but I'm hoping desperately that we have a plan B if this lockdown continues.  If the government really is committed to this approach, I really can't see how many if any supporters will be attending matches for the next 18 months at least.  If our season ticket money is reduced or eliminated, we need to find a way to survive.  It would be great not to have to break the emergency glass but let's at least have the action plan ready.  That's all I'm saying.

 

I do also agree with you that Celtic have a much bigger problem looming.  If we can navigate this smartly we may accelerate how quickly we catch them (and possibly overtake them) financially.  I hope we do.

Edited April 22, 2020 by Gaffer