Wednesday, March 31, 2010

How's Goldman Sachs Going To Exploit This?

Certain individuals, particularly centered on those with a gambling problem, have been known to "bet the house", from time-to-time.

Now, thanks to some new "innovative financing", they can also "bet the stadium" (perhaps, along with the house).

Colleges offering ‘sports mortgages’

Now, combine that frustration with cash-strapped college athletics departments, struggling to upgrade aging stadiums, and you’ve got the latest innovation in marketing for big-time athletics — the sports mortgage.

At Kansas, Jayhawk fans who sign up to pay up to $105,000 over 10 years will earn the right to buy guaranteed top seats for football over the next three decades. In return, the seats themselves will stay locked in at 2010 prices.


The new pricing plans are known as “equity seat rights,’’ and are being pitched as a win-win for fans and teams. Diehard fans can be certain of what they’ll pay to see their favorite team well into the future — and can always sell tickets in the secondary market while taking a tax write-off for donating to a school. Teams can bank on extra revenue and avoid borrowing.

Stadium Capital Financing Group, the Chicago company behind the change, says it has the potential to transform how both college and pro teams court their most loyal fans. They’re confident sports mortgages will overtake the personal seat license, which doesn’t necessarily lock in ticket prices.

Okay, we're coloring outside the lines here, putting the ol' thinkin' caps on.

But what happens if the mortgage company, perhaps due to other investments, tanks?

How's Goldman Sachs going to exploit this?

Does, say, Goldman Sachs raise there hand, purchase the company, chop up the companies debt, and start selling "Stadium Derivatives", essentially just repackaging their programs that helped tank the world's economy?

Sports Mortgages?

Sounds like "three-yards-and-a-cloud-of-a-financial-mess" getting ready to come out of the locker room.

Bonus Goldman Sucks Riffs

Matt Taibbi: The Great American Bubble Machine

Paul Krugman: The Joy of Sachs

John Cook: Congrats Goldman Sachs! You're the New Symbol of Banker Greed

Survey Shows Name Should Be "Goldman Sucks"

Yet More Reasons The Survey Says Goldman Sucks!

Today's Ignorant Dolt - Brian Griffiths, of Goldman Sachs

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