RealGM

Queue the Doctor Evil pinky. Surprised this is not on here. It’s a transaction so what are everyone’s thoughts on this?

Wonder if it will be like Cuban and Dallas eventually.

Kind of a shocker they've owned it for so long.

AingesBurner wrote:Queue the Doctor Evil pinky. Surprised this is not on here. It’s a transaction so what are everyone’s thoughts on this?

Aside from political thoughts about how much society-corrupting money a few people have-

It won't change anything for this offseason - this will take some time and Buss will be in charge until it's finished (and perhaps a bit longer). Down the road it will make the Lakers more willing to pay higher luxury taxes, but 2nd apron limits how much that helps. It's easier to buy an elite team in MLB than the NBA.

Lakers will be more of a threat in the coming years with competent ownership and deeper pockets. The biggest impact in the near-term will be upgrading things like analytics, facilities, and training staff which the Lakers have cheaped out on for years.

Lakers future FRPs just devalued

Not the game breaker this is in the MLB (where there is no salary cap or restriction on deferred money).

But yeah. It might impact some things.

Snakebites wrote:Not the game breaker this is in the MLB (where there is no salary cap or restriction on deferred money).

But yeah. It might impact some things.

Lakers let Causo go tonsave money, there was no limitations that prevented signing him excely money saving.
They are a cost conscious org.

Mavrelous wrote:

Snakebites wrote:Not the game breaker this is in the MLB (where there is no salary cap or restriction on deferred money).

But yeah. It might impact some things.

Lakers let Causo go tonsave money, there was no limitations that prevented signing him excely money saving.
They are a cost conscious org.

It’s far more impactful than one single free agent signing. The dodgers are top of the league in spending for medical teams, analysts, physios, scouts and player development staff. Pretty much every corner that the Buss family has cut. If you think those investments result in success, it’s understated how important it could be for the lakers to add that on top of their inherent advantages.

I don't have the purchase price as justifiable tbh.

jbk1234 wrote:I don't have the purchase price as justifiable tbh.

Have you looked at the P/E ratio of NASDAQ top companies? Everyone said price wasn't justified in 2020, now the 2020 price is a bargain...
In this fiscal and monetary environment, no one can pretend to know, but Mark Walter can pretend better than Mavrelous and jbk...

Do they change management now?

sweetheart trade right before the biggest sale in league history to float the valuation, every single owner probably made at least a billion on paper with this sale locked in. the team that sacrificed is immediately rewarded with an improbable young replacement star by the league

crazy how conveniently perfect it went for everyone involved. guess the owners are just really lucky

Mavrelous wrote:

jbk1234 wrote:I don't have the purchase price as justifiable tbh.

Have you looked at the P/E ratio of NASDAQ top companies? Everyone said price wasn't justified in 2020, now the 2020 price is a bargain...
In this fiscal and monetary environment, no one can pretend to know, but Mark Walter can pretend better than Mavrelous and jbk...

How many of those companies have ever paid a dividend? Infinite growth is not a sustainable business model. Tesla currently has a P/E of 177 and only turned a profit due to the transferable tax credits the administration is getting ready to kill. Amazon has a market cap of $2.2T, a P/E of 34, and has never paid a dividend!

Now, you can stll make money by selling the stock for more than you bought it, but that entire business model is premised on the idea that you know when to sell and buy, and for that, you have to know how much more *growth* is likely, or even possible, and people don't genuinely calculate that anymore.

jbk1234 wrote:

Mavrelous wrote:

jbk1234 wrote:I don't have the purchase price as justifiable tbh.

Have you looked at the P/E ratio of NASDAQ top companies? Everyone said price wasn't justified in 2020, now the 2020 price is a bargain...
In this fiscal and monetary environment, no one can pretend to know, but Mark Walter can pretend better than Mavrelous and jbk...

How many of those companies have ever paid a dividend? Infinite growth is not a sustainable business model. Tesla currently has a P/E of 177 and only turned a profit due to the transferable tax credits the administration is getting ready to kill. Amazon has a market cap of $2.2T, a P/E of 34, and has never paid a dividend!

Now, you can stll make money by selling the stock for more than bought it, but that entire business model is premised on the idea that you know when to sell and buy, and for that, you have to know how much more *growth* is likely, or even possible, and people don't genuinely calculate that anymore.

I undetstand that, but if every speculative asset is "overpriced", then nothing is overpriced, if NVDA and TSLA are being traded at insane multiples, it makes sense that Celtics and Lakers follow suite.
TSLA may be a bubble, I personally strongly agree there is no justification for this insane valuation, but many real productive companies, some are divedend yielding, some have great technologies and real world advantages, that are being traded at insane P/E, long tradition sport franchises, in loyal and paying markets are the same.
Infinite growth isn't sustainable, but we're all looking at inflationary pressure mounting, if you and I see this, business people have long planned for it.

Mavrelous wrote:

jbk1234 wrote:

Mavrelous wrote:Have you looked at the P/E ratio of NASDAQ top companies? Everyone said price wasn't justified in 2020, now the 2020 price is a bargain...
In this fiscal and monetary environment, no one can pretend to know, but Mark Walter can pretend better than Mavrelous and jbk...

How many of those companies have ever paid a dividend? Infinite growth is not a sustainable business model. Tesla currently has a P/E of 177 and only turned a profit due to the transferable tax credits the administration is getting ready to kill. Amazon has a market cap of $2.2T, a P/E of 34, and has never paid a dividend!

Now, you can stll make money by selling the stock for more than bought it, but that entire business model is premised on the idea that you know when to sell and buy, and for that, you have to know how much more *growth* is likely, or even possible, and people don't genuinely calculate that anymore.

I undetstand that, but if every speculative asset is "overpriced", then nothing is overpriced, if NVDA and TSLA are being traded at insane multiples, it makes sense that Celtics and Lakers follow suite.
TSLA may be a bubble, I personally strongly agree there is no justification for this insane valuation, but many real productive companies, some are divedend yielding, some have great technologies and real world advantages, that are being traded at insane P/E, long tradition sport franchises, in loyal and paying markets are the same.
Infinite growth isn't sustainable, but we're all looking at inflationary pressure mounting, if you and I see this, business people have long planned for it.

My pet peeve is corporate America successfully convincing investors they have no right to expect a company to mature to the point where it should pay a dividend. Amazon went public in 97. In order to justify its current price it would have to increase earnings 300%? Show me the business plan that gets them there.

This is how bubbles form. Mature companies hang onto the *growth stock* label for a decade longer than they have any right to, the corporate officers are compensated based on stock performance, and investors risk their gains every year until the correction comes and the capital gain is the only return they're likely to see.

The NBA is even more structured in that the players are guaranteed to get 50% of BRI and the salary floor is 90% of the cap (not that the Lakers would get away with being a salary floor team). After Dr. Buss passed, it certainly did not seem as though the Lakers were awash with cash. They low balled coaches and let key role players walk rather than go deeper into the tax. I'd be shocked if their books justified this evaluation. If you want to say there will be a bigger fool who will pay $20B a decade from now, okay, but banking on the bigger fool is not sound business.

I don't disagree with any of this, but NBA franchise pricing is in line with the stock market pricing, so the valuation makes sense, what's good fir Amazon is good for the Lakers.
I pray for the day we have sound monetary policy and responsible fiscal policy, until that happens, I trust the market pricing more than common sense, I learned that the hard way in the post 2008 financial world.

jbk1234 wrote:

Mavrelous wrote:

jbk1234 wrote:I don't have the purchase price as justifiable tbh.

Have you looked at the P/E ratio of NASDAQ top companies? Everyone said price wasn't justified in 2020, now the 2020 price is a bargain...
In this fiscal and monetary environment, no one can pretend to know, but Mark Walter can pretend better than Mavrelous and jbk...

How many of those companies have ever paid a dividend? Infinite growth is not a sustainable business model. Tesla currently has a P/E of 177 and only turned a profit due to the transferable tax credits the administration is getting ready to kill. Amazon has a market cap of $2.2T, a P/E of 34, and has never paid a dividend!

Now, you can stll make money by selling the stock for more than you bought it, but that entire business model is premised on the idea that you know when to sell and buy, and for that, you have to know how much more *growth* is likely, or even possible, and people don't genuinely calculate that anymore.

Well, this isn't exactly about turning a profit off of the Lakers, and sports franchise ownership isn't about profiting off the team. (I mean, yes, you profit off the team if you can. The Busses have done this for years. But that's secondary to the people buying teams now.)

First, you profit off of local TV. This is better in some markets than others, but LA is the prime TV market for basketball. The new ownership is primed to start their own broadcast distribution network exclusively broadcasting the Lakers and Dodgers and making a killing off of it. Own enough sports teams locally and globally and you effectively add more teams for "free".

Next, you profit off of real estate. You need to have enough spare money and expertise in the market to also own and develop real estate around the sports venues. This is why Cuban ostensibly sold his ownership stake in the Mavs-- he observed that the way to make the most money from the team is to let real estate players leverage the team relationships with the local landowners and governments to make massive profits. See Dan Gilbert getting a casino built in downtown Cleveland. Brooklyn, Golden State, and other teams have delivered massive profits from building up adjacent areas to their arenas. Southern California's real estate is particularly valuable for this kind of play.

Of course, while Cuban ostensibly sold his team because the new owners were in real estate, the new owners were also into gambling, and they're now using leverage of the team to make their own casino plays statewide in Texas.

Sports team ownership is no longer about just owning the team. It's about taking the team and reaping all the economic benefits that can be associated with it. Why enrich a whole community or city center around you when you can instead buy a community close to the city center, build a new city center, own the new city center, and reap the profits for yourself? Why not vertically integrate the team, the broadcast, the gambling sponsors of the broadcast, and the gambling itself into a mega-entity?

Mavrelous wrote:I don't disagree with any of this, but NBA franchise pricing is in line with the stock market pricing, so the valuation makes sense, what's good fir Amazon is good for the Lakers.
I pray for the day we have sound monetary policy and responsible fiscal policy, until that happens, I trust the market pricing more than common sense, I learned that the hard way in the post 2008 financial world.

The lesson of 08 is that markets are entirely capable of mispricing assets in catastrophic fashion.

I wonder how much having Luka on the roster boosted their sale value?
And I wonder why Dallas would have traded Luka to the Lakers at such a low cost?

And in a totally unrelated observation, the Mavericks had a 0.5% chance at winning the lottery.