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Speaker 1: This is Bloomberg Business of Sports talk about some of

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Speaker 1: the more interesting aspects of business of sports. So there's

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Speaker 1: all kinds of cool questions. So this is a fun

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Speaker 1: topic to the country is finally getting the memo about

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Speaker 1: how amazing the sport is. I think the sky's a

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Speaker 1: limit for MLS. We're spending more and more of our

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Speaker 1: time in a digital world, and it's also becoming a

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Speaker 1: really powerful place for commerce. It is so nice to

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Speaker 1: be back and to be able to have fans back

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Speaker 1: in the building. So despite the chaotic schedule, and this

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Speaker 1: is why we do what we do when you get

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Speaker 1: into the playoffs, so there's nothing better at the player

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Speaker 1: for the excitement and it's also for the organization sponsors involved.

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Speaker 1: Bloomberg Business of Sports from Bloomberg Radio. This is the

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Speaker 1: Bloomberg Business of Sports show, but we explore the big

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Speaker 1: old money issues and world sports. I don't like block

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Speaker 1: I'm Scarlett, you know. Mike Lynch coming up on the show.

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Speaker 1: The MLB lockout continues. We get the latest on CBA

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Speaker 1: negotiations with the ob networks John morros plus catch up

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Speaker 1: with No Montagne for offensive alignment for the Cleveland Browns

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Speaker 1: and director of the pro team at Fordense Capital Advisors.

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Speaker 1: We get his take on a big story at the

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Speaker 1: intersection of professional sports and wealth management. That's straight ahead

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Speaker 1: on the Bloomberg Business of Sports show. But first let's

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Speaker 1: look at some of the other topics of the week.

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Speaker 1: And there's a lot to talk about, involving Russia, involving

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Speaker 1: coming into Ukraine, and it obviously the human aspect of that,

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Speaker 1: we cannot even compare that with sports. But we are

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Speaker 1: the business of sports and there are a lot of things,

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Speaker 1: a lot of sports issues that came out of that.

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Speaker 1: One involved very rich man. Yeah, you're talking about Russian

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Speaker 1: billinaire Roman Abramovich, who is selling the Chelsea Football Club. Um.

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Speaker 1: It's interesting because he was previously looking to transfer the

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Speaker 1: stewardship in care of the club to members of his

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Speaker 1: charitable foundation, and it's not clear how that was going

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Speaker 1: to happen. Um, he had not mentioned any about giving

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Speaker 1: up ownership, but now that's changed. And of course the

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Speaker 1: backdrop to all this is the UK has proposed these

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Speaker 1: new laws that would target wealthy Russians which would include

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Speaker 1: a wrong which uh and some of these laws would

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Speaker 1: might might include freezing their assets. So now he's announced

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Speaker 1: that he's going to sell the club outright and saying

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Speaker 1: it's a painful and personal sacrifice. He's specifically saying he's

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Speaker 1: not asking for any loans to be repaid. We know

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Speaker 1: he's invested about two billion dollars of his personal fortune

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Speaker 1: in the club over twenty years, and he's doing it

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Speaker 1: with a very urgent timeline. Lynchie. It feels like he

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Speaker 1: needed to get the sun yesterday. Well, of course, because

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Speaker 1: I thought that they as we mentioned earlier, that they

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Speaker 1: may freeze the assets, especially in the United Kingdom. Um.

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Speaker 1: The good news out of this is that the proceeds

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Speaker 1: from the sale that Chelsea Football Club are going to

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Speaker 1: be used to helped in aid the victims of Ukraine,

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Speaker 1: those who are injured, those who are ill, and those

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Speaker 1: who are just scrambling out of the country finding a

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Speaker 1: place to live. Now, with the soccer story the Olympics,

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Speaker 1: they have said that Russia and Belarus you cannot play

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Speaker 1: in the games. It's a reversal from what they said earlier.

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Speaker 1: But then so many other athletes said, you know what,

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Speaker 1: if they're in, I'm out. I'm sure nobody's happy that

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Speaker 1: these athletes. Now, you know, it's not the greatest decision

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Speaker 1: in the world. But for what the Games are saying,

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Speaker 1: this is best for the Paralympic Games. I think you

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Speaker 1: nailed that. Nobody is happy with any of this. Ordinary Russians,

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Speaker 1: Russian athletes are are being punished, and they're not the

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Speaker 1: ones who are directing what's happening when it comes to Ukraine.

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Speaker 1: So it's unfortunate for everyone involved. But there's this sense

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Speaker 1: in the US and Europe that we have to use

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Speaker 1: soft power to get put in to understand what's happening here.

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Speaker 1: This salt was precipitated by the curlers from Latvia who

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Speaker 1: refused to compete against Russia, and the people who run

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Speaker 1: the Paralympics were really surprised about this, so they're expelling

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Speaker 1: the athletes. So there are seventy one of them from

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Speaker 1: Russia and a doze of them from Belarus who have

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Speaker 1: been expelled from the Games. Otherwise there'll be no games.

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Speaker 1: That all nobody want to compete. And again, athletes to

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Speaker 1: the trained for years and years and years to get

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Speaker 1: over to Beijing. They're going now through March thirteenth, but

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Speaker 1: they're gonna proceed from this point forward without Russian and

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Speaker 1: Belaruth para athletes. I also want to mention other sports

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Speaker 1: that are cutting ties or suspending their relationships with Russian

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Speaker 1: business partners. And I bring up hockey because obviously I'm

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Speaker 1: a hockey fan, but five percent of the NHL's players

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Speaker 1: are Russians, so this is kind of a big deal

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Speaker 1: for the NHL to suspend its relationships. They're pausing Russian

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Speaker 1: language social and digital media sites, really putting aside any

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Speaker 1: consideration of Russia as a location for any future NHL competition.

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Speaker 1: You wonder what kind of pressure this puts on the players.

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Speaker 1: And I'm thinking of alex of Kin of the Washington Capitals,

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Speaker 1: for instance, who has posted with Putting on his Instagram account,

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Speaker 1: or r Temmi Panarin, who had to take a leave

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Speaker 1: of absence from the Rangers for a while because he

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Speaker 1: had criticized Putting in the past and there were threats made.

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Speaker 1: The players are really in across hairs right now. That

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Speaker 1: was talking at some point about revoking visas of of

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Speaker 1: Russian hockey players in the National Hockey I don't think

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Speaker 1: that's going to happen. I don't think it's it's for

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Speaker 1: the greater good of the league. But to be a

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Speaker 1: Russian dissident is a very difficult position to be in.

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Speaker 1: We've seen it over the years and it's very very

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Speaker 1: hard for these hockey players, I think, to take a

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Speaker 1: political stance. Yeah, there is another story Tiger Woods. He

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Speaker 1: didn't play a single official p g A Tour event

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Speaker 1: last year, but the golf organization still designating him as

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Speaker 1: the face of the sport. Tiger Woods he won an

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Speaker 1: eight million dollar p g A prize just for being Tiger.

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Speaker 1: Phil Mickelson came in second six million dollars, and then

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Speaker 1: Phil Mickelson he tweeted out, hey, thank you all for

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Speaker 1: giving me the top prize, and then Tiger responded back, whoops.

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Speaker 1: You know, it says something that Tiger Woods is still

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Speaker 1: the face of golf. It's called the Player Impact Program,

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Speaker 1: and they measure a bunch of different things, none of

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Speaker 1: which involved, like you said, actually what happened on the green. Um.

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Speaker 1: The metrics that were used to determine that Tiger one

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Speaker 1: five criteria, Nielsen ratings, Google searches, MVP index, meltwater mentions,

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Speaker 1: I don't know what that is, and Q rating, which

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Speaker 1: is based on a player's appeal and popularity on social media.

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Speaker 1: By the way, to wrap it up Tiger Woods number one,

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Speaker 1: Phil Nicholson to Rory McElroy third, Jordan's Speeds, fourth, Bryce

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Speaker 1: and the Shambo fifth, Justin Thomas sixth, Justin, Dustin Johnson, seventh,

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Speaker 1: Brooks Skeptica eight, John Rome ninth and Bubba Watson finished.

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Speaker 1: Tim Coming up next on the show, we speak with

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Speaker 1: Noel La Montaigne, former NFL offensive lineman and director of

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Speaker 1: the pro team at Prudents Capital Advisor. Straight Ahead on

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Speaker 1: Bloomberg Business of Sports on Michael Bar. You can follow

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Speaker 1: me on Twitter and Big Bar Sports. I'm Scarlet Food.

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Speaker 1: I'm on Twitter at Scarlett Food. One team that Mike

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Speaker 1: Lynch on Twitter at Lynch w CDD. And don't forget

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Speaker 1: to catch our podcast that's Monday's, Wednesdays and Thursdays on

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Speaker 1: all your podcast platforms and right here on Bloomberg Business

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Speaker 1: of Sports from Bloomberg Radio. This is Bloomberg Business of

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Speaker 1: Sports with Michael Bart, Scarlett Foo and Mike Lynch from

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Speaker 1: Bloomberg Radio. This is the Bloomberg Business of Sports show

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Speaker 1: where we explore the big money issues in the world sports.

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Speaker 1: I'm Michael Laugh, I'm Scarlett Fou, and I'm Mike Lynch.

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Speaker 1: Coming up on the show opening day delay on. Now

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Speaker 1: we'll get the latest on CBA negotiations with MLB Networks

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Speaker 1: John Morossi. But first, let's talk wealth management for professional athletes.

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Speaker 1: I need to call this guy to According to a

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Speaker 1: report from the New York Times, Milwaukee Bucks point guard

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Speaker 1: Drew Holiday and his wife, former pro soccer player and

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Speaker 1: Olympic gold medalist Lauren Holiday, they have joined two NBA

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Speaker 1: players in a lawsuit against the organ Stanley and a

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Speaker 1: former broker, alleging inappropriate distribution of money. Holiday's alleged that

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Speaker 1: the ex Morgan Stanley broker was entrusted to make basic

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Speaker 1: long term investments, but stare millions of dollars to dubious individuals,

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Speaker 1: losing most of it in the process. So let's talk

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Speaker 1: more about all of this with Noel la Montaigne. He

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Speaker 1: is the director of the pro team at Verden's Capital

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Speaker 1: Advisors and a former offensive lineman for the Cleveland Brown.

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Speaker 1: See that's where I know that name. No Welcome to

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Speaker 1: the show, sir, Thanks for having me. I really I

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Speaker 1: really appreciate you all having me on. Well, let's let's

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Speaker 1: start with that, because we we did the set up

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Speaker 1: there about some of the players. They're saying, Hey, we

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Speaker 1: were scammed. My question to you is, if this is true,

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Speaker 1: is this something that's normal that happens in the business. Unfortunately,

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Speaker 1: the more that we have helped provide the types of

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Speaker 1: services that we do for ultra high worth individuals into

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Speaker 1: the athlete entertainer space, the more we're seeing a lot

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Speaker 1: of questionable things being done with the assets of these

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Speaker 1: types of individuals. And I think it boils down to

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Speaker 1: there's a lot of athletes and entertainers who have so

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Speaker 1: many other things going on in their lives that there's

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Speaker 1: sleep at the wheel when it comes to their finances

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Speaker 1: and whether something nefarious or just something maybe unknown agreed

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Speaker 1: upon but not a percent aware of what was actually

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Speaker 1: happening here. I can tell you that we're just seeing

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Speaker 1: too much of this. There's too much of a lack

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Speaker 1: of awareness in this space with these types of clients.

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Speaker 1: They're not paying enough attention to what their advisors are

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Speaker 1: doing with their money, why they're doing it, how the

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Speaker 1: mechanisms actually work. Um, they're giving up control in ways

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Speaker 1: that they shouldn't be giving up control. And you know,

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Speaker 1: in the good old days, people just wanted to stuff

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Speaker 1: all their cash into mattresses. Unfortunately, that would actually be

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Speaker 1: a better outcome than what a lot of these people

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Speaker 1: are doing trying to get in with these fancy boutique

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Speaker 1: groups and individual those who really just aren't looking out

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Speaker 1: for their best interests. Well, professional athletes are definitely more

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Speaker 1: vulnerable than a lot of ordinary investors. There was an

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Speaker 1: Ernst and Young report last year quoted in The Times

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Speaker 1: that said professional athletes reported almost six million dollars in

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Speaker 1: fraud related losses from two thousand four to nineteen. So

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Speaker 1: certainly there's a trend there, and it's it's troubling. But

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Speaker 1: the folks who say they got scammed here, they did

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Speaker 1: what a lot of ordinary investors do and what they

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Speaker 1: should do, right. They relied on a big name brokerage,

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Speaker 1: Morgan Stanley. And it's not like they went and found

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Speaker 1: someone dodgy. They found someone that is attached to a

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Speaker 1: firm that has a reputation for doing things properly. I mean,

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Speaker 1: how could they have gotten around this? You actually just

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Speaker 1: hit a really key point in my mind. This is

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Speaker 1: that that study that reveals those statistics that you know,

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Speaker 1: individuals like athletes are entertainers are more susceptible. Everybody is

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Speaker 1: exactly equally susceptible. There's nobody that's any less susceptible than

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Speaker 1: anybody else. What it boils down to, and it's something

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Speaker 1: that we preach. Were extremely proactive when it comes to

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Speaker 1: the transparency side of things, and I think in the

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Speaker 1: athlete entertainer space, you really have to be proactively transparent.

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Speaker 1: You have to sit some of these individuals down, you

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Speaker 1: have to show them exactly what you're doing, you have

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Speaker 1: to show them why you're doing it, You have to

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Speaker 1: meet with them more often, you have to educate them

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Speaker 1: because if you don't. The psychology I think of a

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Speaker 1: lot of these alpha individuals is to just not want

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Speaker 1: to be perceived in any way, shape or form is

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Speaker 1: weak or not intellectually on par or not understanding something.

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Speaker 1: They don't want to ask the questions. So you have

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Speaker 1: to force them to see the answer to the question

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Speaker 1: that they're not asking. And that's something that we've really

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Speaker 1: focused on and I don't necessarily think that's unique to

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Speaker 1: athletes and entertainers. And and it is scary that this

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Speaker 1: was a big box firm and this was somebody who, well,

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Speaker 1: you know, you should be able to walk into this

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Speaker 1: group and know that this advisor is held to a

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Speaker 1: standard and they're not going to do anything that would

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Speaker 1: be in any way, shape or form perceived as across

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Speaker 1: the line. Unfortunately, if you're not paying attention to exactly

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Speaker 1: what's going on with your assets, anybody can do that

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Speaker 1: to anybody. Hey, no, it's Mike lynch Up in Boston.

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Speaker 1: I know we spoke about this a couple of years ago.

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Speaker 1: I'm involved in this financial literacy program in Boston called

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Speaker 1: Credit for Life. Well, we have about high school kids

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Speaker 1: come in and they pick up profession and they go

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Speaker 1: around to every booth and they have electricity utilities, they

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Speaker 1: have automotive, they have housing, they have education, they have

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Speaker 1: And it's studying how I opening it is that most

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Speaker 1: of these kids don't even know how to balance a checkbook.

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Speaker 1: I can only imagine the lack of empowerment that some

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Speaker 1: and do you feel like you almost have to be

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Speaker 1: a financial advisor. And this goes across the spectrum of

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Speaker 1: whether it's a young athlete or even a veteran, because

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Speaker 1: what we've seen is just over the course of time,

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Speaker 1: there really is a lack of literacy in this space.

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Speaker 1: And the problem is is that they don't even want

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Speaker 1: to recognize it. They don't want to acknowledge it, they

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Speaker 1: don't want to pursue it because listen finance and the

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Speaker 1: handling of assets and all the different things that go on,

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Speaker 1: especially when you start getting into really complex situations with

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Speaker 1: individuals with a lot of with a lot of assets,

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Speaker 1: who are building a lot of wealth, it's very very dauntic.

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Speaker 1: So when you do educate them, when you do help

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Speaker 1: them become literate in this space, it's extremely empowering to them.

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Speaker 1: And if you start with them at the beginning of

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Speaker 1: their careers or when they're younger, you can see it

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Speaker 1: build over time. And it's really impressive when when an

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Speaker 1: older athlete who you've worked with and mentored and helped

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Speaker 1: educate over say five years, ten years, fifteen years, when

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Speaker 1: they come to you and somebody in the locker room

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Speaker 1: or somebody walks up to them after a game and

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Speaker 1: presents them with the with the next the next bitcoin,

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Speaker 1: they've already asked for the right documentation, they've already asked

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Speaker 1: the right questions. They've already in a way done some

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Speaker 1: of the preliminary due diligence, and you can have these

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Speaker 1: conversations and just say, okay, you know what, I've actually

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Speaker 1: given this individual the skill set to defend themselves, to

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Speaker 1: protect themselves, to protect their wealth. No, you are the man.

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Speaker 1: Thank you so much for joining us. Uh. And you

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Speaker 1: give great advice about money. I mean it's right in

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Speaker 1: the name Burden's Capital Advisers. I mean you're right there,

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Speaker 1: so he's built right in the name. So that's why

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Speaker 1: you're very good at this. Thank you so much, sir.

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Speaker 1: You're welcome. You all are very kind. Well you used

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Speaker 1: to see Lynch on a Saturday morning when he's up

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Speaker 1: too early. Next, I don't know if I don't know

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Speaker 1: if I have signed up for that. Up next on

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Speaker 1: the show, we speak with MLB Networks John Morossi, and

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Speaker 1: we'll get the latest on the lockout. That's sure ahead

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Speaker 1: on Bloomberg Business of Sports. I'm Michael bar You can

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Speaker 1: follow me on Twitter at Big Bar Sports. I'm Scarlett

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Speaker 1: Po I'm on Twitter at Scarlett Phil and I'm Mike

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Speaker 1: Lynch on Twitter at Lynch w CDB, and don't to

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Speaker 1: get to catch our podcast that's Monday's, Wednesdays and Thursdays

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Speaker 1: on all your podcast platforms and right here on Bloomberg

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Speaker 1: Business of Sports from Bloomberg Radio. This is Bloomberg Business

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Speaker 1: of Sports with Michael Bart, Scarlett Foo and Mike Lynch

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Speaker 1: from Bloomberg Radio. Thanks for joining us on the Bloomberg

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Speaker 1: Business of Sports show. We explore the big money issues

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Speaker 1: in the world of sports. I'm Michael Barn, I'm Scarlett,

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Speaker 1: and I'm Mike Lynch and let's turn the Major League

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Speaker 1: Baseball now, where the lockout continues. The league announced the

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Speaker 1: delay of the two regular season after failing to come

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Speaker 1: to an agreement on the new collective bargaining agreement with

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Speaker 1: the players Association. Commission At Rob Menfort addressed the media

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Speaker 1: this past week. So the parties have failed to achieve

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Speaker 1: their mutual of reaching an agreement. The calendar dictates that

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Speaker 1: we're not going to be able to play the first

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Speaker 1: two series of the regular season and most games are

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Speaker 1: officially canceled. MLB commission At Rob Menford. Let's break this

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Speaker 1: all down with MLB Networks John Morosi. John, Welcome to

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Speaker 1: the show. What happened. Why do we have this at

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Speaker 1: this moment right now in for sports fans, a lockout

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Speaker 1: in MLB, I think both an issue of the short

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Speaker 1: term and the long term. For a number of years now,

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Speaker 1: the players have had a number of concerns about how

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Speaker 1: younger players in particular are being paid and also how

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Speaker 1: the free agent market is functioning. Where in years gone by,

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Speaker 1: when players had a very strong six years to begin

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Speaker 1: their careers, they were rewarded with lucrative multi year contracts.

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Speaker 1: But now with the current generation of of leadership at

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Speaker 1: the club level very statistically driven, there's been a lot

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Speaker 1: of research done to say, wait a minute, players that

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Speaker 1: are in their thirties are not as productive as they

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Speaker 1: are in their twenties. So when these players at free agency,

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Speaker 1: I'm going to just decide to invest in my younger

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Speaker 1: players and let them be promoted from within because that

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Speaker 1: is cheaper and more efficient. And so when that decision

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Speaker 1: process is replicated, there's a lot of hard feelings on

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Speaker 1: the part of the union. So against that backdrop of

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Speaker 1: years of I think a reduction in the collaboration between

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Speaker 1: the sides, you have now the CBA negotiation becoming very

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Speaker 1: pitched from a standpoint of the feelings on both sides

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Speaker 1: and what each side is trying to achieve. Here where

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Speaker 1: the Union believes the status quo was simply not tenable

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Speaker 1: any longer. And in MLB, I think on their behalf,

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Speaker 1: they've proposed a number of wins for the players, increasing

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Speaker 1: the minimum salary to seven thousand dollars, increasing this new

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Speaker 1: bonus pool for younger players to be paid when they

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Speaker 1: have historic types of achievement. So there have been wins

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Speaker 1: put in this agreement, Michael, but just not enough to

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Speaker 1: where the Union is satisfied. I think ultimately we're gonna

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Speaker 1: have to see that competitive balanced tax threshold that we

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Speaker 1: talked so much about, which is the union calls of

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Speaker 1: the softcap. It is effectively the upper bound that teams

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Speaker 1: can spend to before they're penalized with the luxury tax

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Speaker 1: back into Central Baseball and revenue sharing that is now.

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Speaker 1: I think that the key question is of how high

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Speaker 1: that number can go, and until that number gets higher

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Speaker 1: than where it is right now, which is two million

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Speaker 1: dollars per team per year, I think this lockout is

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Speaker 1: going to continue. So we were talking with No La

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Speaker 1: Montaigne a little bit earlier he's a former collegiate and

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Speaker 1: NFL player and he now runs Verdon's Capital Advisors, And

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Speaker 1: he was just remarking how the MLB Players Union is strong.

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Speaker 1: It's it's stronger than say the NFL players Union. The

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Speaker 1: players are united, they're they're educated on this um. They

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Speaker 1: have a longer career in the sport at then say

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Speaker 1: football players. Dude, they've got the experience, they've gone through

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Speaker 1: a lot together. I'm just curious, from where you stand,

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Speaker 1: how formidable is this union versus say, other players unions

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Speaker 1: and other sports. Because they're up against Rob Manfred who

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Speaker 1: will represent the owners side, right, Scarlett, That's a great question.

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Speaker 1: I think anecdotally this is as strong as we have

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Speaker 1: seen the union in a long time, maybe in decades,

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Speaker 1: in terms of the unification of of that group. And

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Speaker 1: they've been preparing for this for a while. They have

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Speaker 1: seen these storm clouds coming. And I would say this

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Speaker 1: that both sides in in this negotiation. It's important, I

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Speaker 1: think for us all remember that they're they're not monolithic

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Speaker 1: in any way that in the on the players side,

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Speaker 1: there are fundamental differences in terms of the backgrounds of

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Speaker 1: the players. Obviously, a college player, high school player and

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Speaker 1: international player. They all arrived at this point with different

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Speaker 1: life experiences, and in some ways it's it's difficult to

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Speaker 1: stitch together a unified front when you're talking about a

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Speaker 1: player who perhaps has high school education, signs an eighteen

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Speaker 1: and and this is now their chance to make it

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Speaker 1: big professionally. Uh. That person who has not yet really

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Speaker 1: earned a big fortune is in a fundamentally different place than,

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Speaker 1: for example, a Max Scherzer, who just signed another lucrative

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Speaker 1: free agent deal with the New York Mets, the New

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Speaker 1: York Yankees of the Los Angeles Dodgers has a different

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Speaker 1: set of economic and financial parameters and expectations than the

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Speaker 1: owner of the Pittsburgh Pirates or the Miami Marlins or

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Speaker 1: the Tampa Bay Rays. I think if what will never

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Speaker 1: really know, Scarlett, But it's I think it's a very

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Speaker 1: interesting question that you're raising here. Would we already have

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Speaker 1: a deal if you were to put in a vacuum

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Speaker 1: Rob Manford and his negotiating team to say, what do

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Speaker 1: you think is a fair deal, and if they were

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Speaker 1: to then strike that deal, we might already have a deal,

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Speaker 1: so to speak, But for the fact that two thirds

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Speaker 1: of the owners must ratify it. So this is not

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Speaker 1: necessarily just what is a fair According to Rob Manford,

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Speaker 1: it's what is a fair deal in the mind of

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Speaker 1: to you with the political term is caucus. Up next

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Speaker 1: on the show, stay tuned for more of our conversation

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Speaker 1: with MLB Networks John Morrossi, and we'll also talk about

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Speaker 1: trying to get to pay for the young players in baseball.

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Speaker 1: That's straight ahead on Bloomberg Business with Sports. I'm Michael

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Speaker 1: bar you can follow me on Twitter at Dick bar Sports.

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Speaker 1: I'm on Twitter at Scarlett Foo and I'm on Twitter

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Speaker 1: at Lynchy w CVV. And don't forget to catch our

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Speaker 1: podcast that is Monday's, Wednesdays and Thursdays on all your

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Speaker 1: podcast platforms and right here on Bloomberg Business of Sports

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Speaker 1: Bloomberg Radio. This is Bloomberg Business of Sports talk about

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Speaker 1: some of the more interesting aspects of business and sports.

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Speaker 1: So there's all kinds of cool questions. So this is

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Speaker 1: a fun topic. To the country is finally getting the

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Speaker 1: memo about how amazing the sport is. I think this

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Speaker 1: guy's a limit for MLS. We're spending more and more

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Speaker 1: of our time in a digital world, and it's also

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Speaker 1: becoming a really powerful place for commerce. It is so

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Speaker 1: nice to be back and to be able to have

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Speaker 1: fans back in the building. So despite the chaotic schedule,

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Speaker 1: and this is why we do what we do, when

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Speaker 1: you get into the playoffs, there's nothing better as a

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Speaker 1: player for the excitement. It is also for the organization

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Speaker 1: sponsors involved. Bloomberg Business of Sports from Bloomberg Radio. This

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Speaker 1: is the Bloomberg Business of Sports show where we explore

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Speaker 1: the big money issues in the world of sports. I'm

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Speaker 1: like the barn, I'm Scarlett Fee, I'm like lych Well.

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Speaker 1: It's nearly three months since the MLB lockout again, now

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Speaker 1: the first two series cancel, Let's continue our conversation with

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Speaker 1: MLB Networks John Morossi and John. One of the topics

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Speaker 1: that is on the table, it's about trying to get

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Speaker 1: money for the young baseball players. The minimum salary in

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Speaker 1: MLB believe a six hundred seventy five thousand dollars. The

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Speaker 1: owners have offered seven hundred thousand dollars. The players you

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Speaker 1: on seven five thousand dollars and the option to raise

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Speaker 1: that even more, and if younger players perform exceptionally well

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Speaker 1: on the field, the option to renegotiate their contract. Can

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Speaker 1: we get past this sticking point? I hope that we can.

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Speaker 1: It is a very important part of the conversation now, Michael,

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Speaker 1: I do think that the last proposal from MLB included

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Speaker 1: the increase in the minimum salary to seven hundred thousand dollars,

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Speaker 1: as you mentioned, and previous to that, MLB had been

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Speaker 1: at six and the union had been at seven, So

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Speaker 1: that was an exact midpoint settlement. I don't believe that

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Speaker 1: the minimum salary discussion needs to move much more, if

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Speaker 1: at all, for there to be a deal. I think

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Speaker 1: that the the huge issue now now that number has moved

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Speaker 1: up more than a hundred thousand dollars from the end

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Speaker 1: of the last agreement. I believe that they are close

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Speaker 1: to agreeing on what that number is, and the larger

430
00:24:01,240 --> 00:24:04,359
Speaker 1: conversation is now going to be to that per team

431
00:24:04,359 --> 00:24:08,480
Speaker 1: competitive balance tax threshold, which right now MLB has offered

432
00:24:08,520 --> 00:24:11,320
Speaker 1: at two million dollars and the union wants to be

433
00:24:11,480 --> 00:24:14,720
Speaker 1: two million dollars. I think that is probably where the

434
00:24:14,800 --> 00:24:18,440
Speaker 1: large conversation is and and honestly, Michael, I applaud MLB

435
00:24:18,600 --> 00:24:21,280
Speaker 1: for the moves they've made to both increase the minimum

436
00:24:21,280 --> 00:24:24,680
Speaker 1: salary and create for the first time what has been

437
00:24:24,720 --> 00:24:28,520
Speaker 1: called the pre arbitration bonus pool and is a mechanism

438
00:24:28,600 --> 00:24:32,600
Speaker 1: for players who achieve at extraordinary levels. John, when this

439
00:24:32,640 --> 00:24:35,240
Speaker 1: thing is finally settled, there's three questions I want you

440
00:24:35,280 --> 00:24:38,159
Speaker 1: to answer. Chances of making up the games that have

441
00:24:38,280 --> 00:24:44,080
Speaker 1: been canceled, retro pay for the players, and retro service

442
00:24:44,160 --> 00:24:49,879
Speaker 1: time most importantly, right, Yeah, great questions, Mike. I I

443
00:24:49,960 --> 00:24:52,359
Speaker 1: do think that MLB has been pretty clear on this

444
00:24:52,480 --> 00:24:55,560
Speaker 1: that they are not going to pay the players for

445
00:24:55,800 --> 00:24:58,840
Speaker 1: games that were canceled. Uh, and I believe that that

446
00:24:59,080 --> 00:25:01,000
Speaker 1: will be the case, that that that they will not

447
00:25:01,040 --> 00:25:03,240
Speaker 1: be paid here uh and the games will not be

448
00:25:03,280 --> 00:25:05,960
Speaker 1: made up. This is now a part of the the

449
00:25:06,480 --> 00:25:10,520
Speaker 1: both the negotiating posture of MLB and also the reality

450
00:25:10,560 --> 00:25:12,560
Speaker 1: of the calendar in terms of when those games have

451
00:25:12,600 --> 00:25:14,840
Speaker 1: to get done. They're trying to expand the playoffs as well.

452
00:25:15,480 --> 00:25:18,760
Speaker 1: Of course, the players have indicated their support for expanded

453
00:25:18,760 --> 00:25:22,359
Speaker 1: playoffs was contingent on the full season certainly, so that

454
00:25:22,400 --> 00:25:25,080
Speaker 1: there's that other element to be dealt with going forward.

455
00:25:25,520 --> 00:25:30,240
Speaker 1: I think that the service time question is easier to

456
00:25:30,320 --> 00:25:33,480
Speaker 1: parse than the financial one. Uh. It's you can at

457
00:25:33,520 --> 00:25:37,000
Speaker 1: least credit, especially because a full year of service is

458
00:25:37,040 --> 00:25:41,439
Speaker 1: actually a fewer number of days then are in the

459
00:25:41,440 --> 00:25:43,040
Speaker 1: major league season. There's a little bit of a wiggle

460
00:25:43,080 --> 00:25:45,359
Speaker 1: room there of about about a couple of weeks effectively,

461
00:25:45,640 --> 00:25:49,119
Speaker 1: which again speaks to why it is crucial from the

462
00:25:49,160 --> 00:25:51,919
Speaker 1: standpoint of the accounting in that respect to get the

463
00:25:51,920 --> 00:25:54,080
Speaker 1: game back on the field before the end of April.

464
00:25:54,119 --> 00:25:57,119
Speaker 1: Then the service time question is much easier to answer.

465
00:25:57,320 --> 00:25:59,080
Speaker 1: You hope to be able to play games on Jackie

466
00:25:59,119 --> 00:26:02,040
Speaker 1: Robinson Day, But in terms of paying players, if it's

467
00:26:02,040 --> 00:26:05,400
Speaker 1: a hundred fifty four game season, just use that round

468
00:26:05,480 --> 00:26:08,879
Speaker 1: number one. I think they're going to be paid for

469
00:26:08,880 --> 00:26:11,359
Speaker 1: one six. I don't think the retroact to pay is

470
00:26:11,359 --> 00:26:13,920
Speaker 1: going to be restored at the full level, nor will

471
00:26:13,960 --> 00:26:16,960
Speaker 1: those games be made up. And every every week now

472
00:26:17,000 --> 00:26:19,720
Speaker 1: that we go without a deal, I believe Mike is

473
00:26:19,760 --> 00:26:22,160
Speaker 1: going to be a week of regular season baseball games lost.

474
00:26:22,880 --> 00:26:24,840
Speaker 1: Not to get ahead of ourselves, but I was just

475
00:26:24,920 --> 00:26:28,400
Speaker 1: reading a dead Spin and Jessie Specter was talking about

476
00:26:28,400 --> 00:26:31,280
Speaker 1: how when this lockout ends, Because eventually it will, and

477
00:26:31,320 --> 00:26:33,720
Speaker 1: we're not sure what form or shape it will take,

478
00:26:33,800 --> 00:26:36,800
Speaker 1: but it will end. He says, rob Manfred has got

479
00:26:36,800 --> 00:26:40,000
Speaker 1: to go UM as commissioner. He's become toxic because the

480
00:26:40,000 --> 00:26:43,800
Speaker 1: workforce will never trust him. UM, the public is disappointed,

481
00:26:43,840 --> 00:26:47,040
Speaker 1: and the bosses UM. Well, now look at the fact

482
00:26:47,040 --> 00:26:49,879
Speaker 1: that there was no longer a period of labor peace

483
00:26:50,760 --> 00:26:52,600
Speaker 1: and there's a lot of questions about the growth of

484
00:26:52,640 --> 00:26:56,280
Speaker 1: the sport. They appealed the sport to younger demographic. He's

485
00:26:56,480 --> 00:26:59,879
Speaker 1: proposing that the MLB needs a new commissioner, someone like

486
00:27:00,080 --> 00:27:03,240
Speaker 1: Derek Jeter. So I wanted to get your take on

487
00:27:03,240 --> 00:27:05,320
Speaker 1: on Dark Peter, because Dark Peter doesn't have a job

488
00:27:05,400 --> 00:27:07,639
Speaker 1: right now. Right he stepped down as the CEO of

489
00:27:07,640 --> 00:27:10,879
Speaker 1: the Miami Marlins. First of all, what's your take on

490
00:27:10,880 --> 00:27:15,399
Speaker 1: on why Jeter left that club and what do you

491
00:27:15,440 --> 00:27:18,480
Speaker 1: think he's going to do next. It's a great question

492
00:27:18,520 --> 00:27:21,640
Speaker 1: about Jeter's next move, because certainly the game is better

493
00:27:21,680 --> 00:27:24,440
Speaker 1: when Derek Jeter is part of it. A couple of

494
00:27:24,480 --> 00:27:27,879
Speaker 1: things there. Number one, when Derek joined the Marlins, he

495
00:27:27,920 --> 00:27:31,240
Speaker 1: talked about wanting to build a winning culture, and certainly

496
00:27:31,600 --> 00:27:34,320
Speaker 1: they made a lot of steps along that process. They

497
00:27:34,359 --> 00:27:37,439
Speaker 1: made the playoffs in they want a playoff round against

498
00:27:37,440 --> 00:27:39,679
Speaker 1: the Cubs at Wrigley Field. They have one of the

499
00:27:39,840 --> 00:27:45,359
Speaker 1: very best overall pitching uh organizations in the sport right

500
00:27:45,400 --> 00:27:47,520
Speaker 1: now when you consider how much pitching depth they've got,

501
00:27:47,520 --> 00:27:50,840
Speaker 1: so they've had some success there. The issue I think

502
00:27:50,960 --> 00:27:54,640
Speaker 1: is that Derek perhaps looks around and sees that the

503
00:27:54,760 --> 00:27:57,600
Speaker 1: payroll numbers that he thought they were going to be

504
00:27:57,640 --> 00:28:00,960
Speaker 1: able to go to are not in fact going to

505
00:28:01,000 --> 00:28:06,080
Speaker 1: be delivered, and he makes his decision known while the

506
00:28:06,200 --> 00:28:10,480
Speaker 1: MLB and MLBPA officials were negotiating at the spring training

507
00:28:10,560 --> 00:28:15,760
Speaker 1: home of his organization, so clearly the timing of it all,

508
00:28:16,920 --> 00:28:18,919
Speaker 1: I don't think it was a coincidence. I think there

509
00:28:19,000 --> 00:28:22,560
Speaker 1: was certainly a an understanding that that Derek was dissatisfied

510
00:28:22,600 --> 00:28:24,800
Speaker 1: with the way things were going with the vallance, and

511
00:28:24,840 --> 00:28:28,480
Speaker 1: perhaps that could be extrapolated over the industry itself to say, Hey,

512
00:28:28,880 --> 00:28:31,680
Speaker 1: as much as I love baseball, I need to leave

513
00:28:31,800 --> 00:28:34,879
Speaker 1: right now and see what happens going forward. I do

514
00:28:35,000 --> 00:28:38,000
Speaker 1: think there is a role um for him in the

515
00:28:38,040 --> 00:28:40,720
Speaker 1: game in the future, whether it's commissioner or not. Certainly

516
00:28:40,720 --> 00:28:43,320
Speaker 1: it's not for me to say, but I do believe

517
00:28:43,400 --> 00:28:46,400
Speaker 1: his leadership is understanding of what it takes for a

518
00:28:46,440 --> 00:28:49,320
Speaker 1: player to achieve at the highest levels. And also now

519
00:28:49,360 --> 00:28:52,480
Speaker 1: his management background make him a key leader going forward.

520
00:28:52,600 --> 00:28:54,560
Speaker 1: This is a simple and blunt question with his work,

521
00:28:55,880 --> 00:28:59,320
Speaker 1: how much has this damaged the game of baseball? Well,

522
00:28:59,360 --> 00:29:02,080
Speaker 1: the commissioners at himself a month or so ago that

523
00:29:02,280 --> 00:29:05,800
Speaker 1: losing games would be disastrous, and I think that is correct.

524
00:29:06,120 --> 00:29:09,280
Speaker 1: It is. It's a disaster on a lot of different levels,

525
00:29:09,720 --> 00:29:11,640
Speaker 1: certainly emotionally for those of us who love the game.

526
00:29:12,040 --> 00:29:14,760
Speaker 1: My hope with with all of this, Michael's that whenever

527
00:29:14,760 --> 00:29:17,720
Speaker 1: this thing wraps up, that people shake hands in that room,

528
00:29:17,800 --> 00:29:21,200
Speaker 1: walk out and say, listen, we have to humbly put

529
00:29:21,200 --> 00:29:24,760
Speaker 1: our differences aside and grow the game, because if we don't,

530
00:29:25,320 --> 00:29:28,280
Speaker 1: we are we're going to lose people year after year

531
00:29:28,400 --> 00:29:31,120
Speaker 1: after years. John Morossi, you are the man. Thank you

532
00:29:31,200 --> 00:29:35,400
Speaker 1: so much. Their too great guests, John Morossi and Noel

533
00:29:35,680 --> 00:29:38,400
Speaker 1: and I guess I want to talk about what John

534
00:29:38,520 --> 00:29:42,000
Speaker 1: was saying and about baseball. I hope the game is

535
00:29:42,040 --> 00:29:46,440
Speaker 1: not damaged because of this lockout, and I hope both

536
00:29:46,480 --> 00:29:51,400
Speaker 1: sides get it together promptly. Scar. I think that's the hope.

537
00:29:51,400 --> 00:29:54,240
Speaker 1: But I think baseball has already been kind of going

538
00:29:54,280 --> 00:29:56,680
Speaker 1: downhill for the last couple of years. I mean what

539
00:29:56,720 --> 00:29:59,320
Speaker 1: we discussed with John about how long the games are.

540
00:29:59,360 --> 00:30:02,200
Speaker 1: We've talked about this for a while, and this is

541
00:30:02,360 --> 00:30:05,640
Speaker 1: certainly not new. And yeah, the different ways that kids

542
00:30:05,680 --> 00:30:10,200
Speaker 1: can keep themselves entertained has multiplied um while baseball games

543
00:30:10,200 --> 00:30:13,320
Speaker 1: have only gotten longer and the price of tickets has

544
00:30:13,360 --> 00:30:16,760
Speaker 1: gone through the roof with the fancy stadiums. It's going

545
00:30:16,800 --> 00:30:19,400
Speaker 1: to be a long climb back for the sport to

546
00:30:19,400 --> 00:30:23,240
Speaker 1: to make itself relevant to this younger demographic. And this

547
00:30:23,280 --> 00:30:24,960
Speaker 1: is not something we talked about John because he works

548
00:30:25,000 --> 00:30:28,960
Speaker 1: for MLB Networks, which is partly owned by MLB. But

549
00:30:29,520 --> 00:30:32,400
Speaker 1: Rob Manfred is a commissioner. He works on behalf of

550
00:30:32,440 --> 00:30:35,200
Speaker 1: the owners, right, I mean he works, he serves at

551
00:30:35,200 --> 00:30:41,120
Speaker 1: their pleasure. He's not a neutral, impartial person, uh overseeing everything.

552
00:30:41,520 --> 00:30:44,400
Speaker 1: And I think that's something that maybe the public doesn't

553
00:30:44,600 --> 00:30:48,000
Speaker 1: always understand or may not be fully aware of. You

554
00:30:48,000 --> 00:30:50,880
Speaker 1: know what struck me and I didn't forget about this,

555
00:30:50,920 --> 00:30:55,800
Speaker 1: But how fast it's coming down the track. April seventy

556
00:30:55,840 --> 00:30:59,240
Speaker 1: fifth anniversary of Jackie Robinson breaking in. That's two weeks

557
00:30:59,240 --> 00:31:01,640
Speaker 1: and two days into of the season schedule to start

558
00:31:01,720 --> 00:31:04,560
Speaker 1: March thirty one. I just I agree with him a

559
00:31:04,760 --> 00:31:08,920
Speaker 1: thousand percent been absolutely shame and the disgrace. If baseball

560
00:31:09,000 --> 00:31:11,720
Speaker 1: is not back on the field, hopefully that will be

561
00:31:11,840 --> 00:31:15,440
Speaker 1: opening day for everybody. Jackie Robinson Aniversary. I think it's

562
00:31:15,440 --> 00:31:17,560
Speaker 1: something that both sides to shoot for. I think it

563
00:31:17,600 --> 00:31:23,120
Speaker 1: would go miles towards a goodwill all of branch, the fans,

564
00:31:23,720 --> 00:31:27,120
Speaker 1: towards the fans who really have been ostracized. Here Mondros

565
00:31:27,120 --> 00:31:29,520
Speaker 1: will be one pig that's I'm not in Germ. It

566
00:31:29,520 --> 00:31:31,360
Speaker 1: feels better to be than the one than number five.

567
00:31:31,400 --> 00:31:33,000
Speaker 1: I'll wear a number because of Mike. We have a

568
00:31:33,080 --> 00:31:34,920
Speaker 1: chance to go for three and a row good numbers

569
00:31:34,920 --> 00:31:37,080
Speaker 1: in a good time. When I first started wearing the number,

570
00:31:37,120 --> 00:31:40,120
Speaker 1: I would just have been proud. Bloom Bird Business of Sports,

571
00:31:40,320 --> 00:31:47,080
Speaker 1: the number of the week. Now he's got the number.

572
00:31:48,000 --> 00:31:51,520
Speaker 1: The paper It is here, a piece of paper being

573
00:31:51,600 --> 00:31:54,120
Speaker 1: sort of flexed in the time now for the number

574
00:31:54,160 --> 00:31:57,280
Speaker 1: of the week. Our number of the week comes from

575
00:31:57,280 --> 00:32:01,960
Speaker 1: the Bluebird wire. Denise Coats her paycheck. It's pretty dull,

576
00:32:02,040 --> 00:32:04,800
Speaker 1: gone good. Fifty four year old founder and co chief

577
00:32:04,800 --> 00:32:09,320
Speaker 1: executive officer. I bet three sixty five group out of

578
00:32:09,320 --> 00:32:13,200
Speaker 1: the UK, including pay and dividends in the year to

579
00:32:13,400 --> 00:32:18,560
Speaker 1: March one, was her salary in dollars and don't want

580
00:32:18,600 --> 00:32:20,440
Speaker 1: it in pounds. I want it in dollars. I'm gonna

581
00:32:20,440 --> 00:32:24,280
Speaker 1: say two hundred million, but I'm just taking wild stun there.

582
00:32:24,320 --> 00:32:26,200
Speaker 1: If she was a man, I would save a lot more.

583
00:32:26,360 --> 00:32:29,080
Speaker 1: I'm gonna talk that. I'm gonna go two million. You

584
00:32:29,120 --> 00:32:34,160
Speaker 1: know how much den These coats made four hundred million dollars, yes,

585
00:32:34,440 --> 00:32:39,480
Speaker 1: in pay and dividends in the year to March twenty one.

586
00:32:40,040 --> 00:32:43,560
Speaker 1: Lynn she wins the game. Oh thank you very much.

587
00:32:43,800 --> 00:32:48,520
Speaker 1: Are you just made this week? You're number one. This

588
00:32:48,600 --> 00:32:51,720
Speaker 1: is the Bloomberg Business of Sports show, and we're here

589
00:32:51,800 --> 00:32:54,400
Speaker 1: each and every week at the same time to hear

590
00:32:54,480 --> 00:32:58,160
Speaker 1: Lynch she win plus online wherever you get your podcast

591
00:32:58,240 --> 00:33:01,080
Speaker 1: now you can catch those Mondays, when to days and Thursdays.

592
00:33:01,240 --> 00:33:04,040
Speaker 1: I'm Michael bar on Twitter at Big Bar Sports. I'm

593
00:33:04,040 --> 00:33:06,520
Speaker 1: Scarlet Fou, I'm on Twitter at Scarlet Fu One Tea,

594
00:33:06,640 --> 00:33:09,080
Speaker 1: And I'm Mike Lynch on Twitter at Lynchy w CVB

595
00:33:09,240 --> 00:33:10,240
Speaker 1: from Bloomberg Radio