FTK Blog: Arsenal would be mad to sell Fabregas

The Spanish football team take to the field tonight in a World Cup semi-final which will provide some much needed cheer to the Spanish nation who are facing troubles with the economy at home. On the 8th of June in my blog which welcomed football’s financial Armageddon I reasoned that even the Spanish Clubs would not be protected from the world recession by saying “ The Spanish economic crisis is growing and soon as part of austerity measures, the reversal of tax breaks to high earning footballers will make the Bernabeu much less appealing in future. Spanish banks will be forced to reign in financing the stratospheric loans which enable the two giants to try and row against the rising economic  tide of debt.”
Now in major announcements intended to stave off the prospect of economic collapse similar to that suffered in Greece the Spanish government have announced that 14.6 Billion Euros is the deficit figure which needs to be managed from the introduction of a major austerity package. In order to reduce this debt which constitutes  11% of its gross domestic product . It intends to make cuts totalling 5% of its GDP reducing to to 1% over the next two years.  In a similar manner to the United Kingdom, there will be an increase in the pension age from 65yrs to 67yrs with the pensions link to inflation frozen with immediate effect.
The efforts to control the massive deficit which is the third largest in the Eurozone is intended to bolster the markets and ensure that the Spanish Banking sector retains its credit ratings and  prevent the country being declared bankrupt which would trigger a collapse of its national currency. With 20% unemployment  the Spanish Government voted narrowly to introduce a package of austerity measure which included the Prime Minister taking a 15% pay cut, the public sector wage bill is being cut by 5% and as a consequence there is rising public anxiety with widespread threats of a general strike by the Unions. The International Monetary Fund gave Spain its blessing in reaction to the proposed measures. Further measures on the level of taxation are also planned.
Within days of these public announcements The newly installed Barcelona FC President Sandro Rosell who managed to sweep into office by winning 61% of the 35,000 votes cast from its 156,000 membership, has announced that the club will have to make serious efforts to control its rising debts in the wake of difficulties in trying to secure an increase in revenue from its broadcasting deal.  Mediapro its previous TV rights holder has now gone into receivership, and in the light of the national economic crisis, new suitors are not stepping up to the plate with offers that would replace that previously received from Mediapro.
With 25% of Spanish people  said to support the Catalans and given that the club recently announced a 10% increase in its turnover to 445 million Euros one could be persuaded to think that all was well at the famous club, but a massive dose of reality is being forced upon the new President with news that analysis of the expenses has revealed that the sums paid out in wages  to players and the recent transfer costs for Ibrahimovich now totals some 305 million Euros,  giving the club a wages to turnover ratio of a staggering  68% way above the desirable 50% figure.  With debts totalling around 490 million euros.  Rosell was forced to admit on Catalan radio that “The transfer of Cesc is becoming more complicated because there are a lot of expectations on the side of the sellers and that is not good news for Barcelona,”
Manchester City came to Rosell’s aid by paying 23 million euros for Yaya Toure, but this will not be enough to fund a realistic bid for Cesc Fabregas. Rosell has reassured fans on its website by declaring that the club isn’t bankrupt (yet!), he went on to state
“This week we’ll have everything in place to impose a policy of austerity to be able to make savings in unnecessary areas and meet very important commitments such as paying the wages of our players, coaches and employees.”
So my interpretation is these events mean that Arsenal cannot now sell Fabregas to Barcelona unless someone at the club is seriously deluded!

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