Baseball has largely been recession-proof, but you have to wonder whether it will feel any sort of dent from the events of the past week. Specifically, will the trouble plaguing the likes of Lehman Brothers and Merrill Lynch impact future team sales? Will it decrease either the sales price or the suitors for the Cubs?Seriously. Especially considering how much debt has been said to factor into the bids for the Cubs. If the term "credit crunch" means anything, doesn't it mean that giving somebody close to a billion bucks for a baseball team is going to be a tall order these days?
"If one is thinking of the sale of the Cubs, there are one of two ways in which this could be seen," said Andrew Zimbalist, a sports economist at Smith College. "One would involve evaluating the portfolios of the major bidders at this point. Certainly the Ricketts family, which seems to be the front-runner by a good margin at this point, their fortune is in private equity investments. One would think that they have been hit significantly by this, and that might influence their wherewithal.
But perhaps the biggest impact will be on the day-to-day bottom line:
"But also the baseball model, and the model of all sports since about 1990, has been to cater to the more rapidly growing income groups. The corporate executives, the top people in the financial sector, to make money off corporate suites and club suites. These are the population sectors that are getting hit hard right now. It seems to me logical that the sports model is going to be taking a little bit of a hit. I do think that team revenue growth, 11 percent a year, that's not going to continue. It's even more likely you'll see diminution of revenue in the next year or two."I can't help but wonder how many Met and Yankee season ticket holders worked for the Lehmans and Bear Stearns of the world.