It appears that the RMS Met Titanic is taking on water faster than the original.
It is becoming clearer and clearer that not only have the Wilpons been basically lying about everything since the WFAN appearance at the end of 2009, but much of the entire structure of the current Met organization was very possibly not only backed by Madoff’s non-existent profits—those profits may have even largely made Wilpon control of the team possible in the first place.
Information suggests that Fred Wilpon received the necessary loans to buy out Nelson Doubleday based on his Madoff-based wealth.
The Wilpons have long stated that their personal holdings, the Mets, and Madoff-related issues were unrelated.
This was the biggest lie of all.
——————————————————————————————
Major league baseball supplies a generous line of credit to all teams for various purposes, and now the Mets have used up theirs.
There are suggestions that not only are the Wilpons in debt well beyond their eyeballs, but the current situation points to their potential inability to continue to meet loan payments on their gargantuan debt. One phase of this debt is apparently nearly $50 million a year in Citi Field-related bonds. There is also another roughly $25 million a year in other Met-related debt. So this is about far more than just a Madoff settlement.
When these same eventualities hit Texas Ranger ownership, the team was put up for sale and changed hands.
We may very well be far into very similar waters with the Wilpon-owned Mets.
——————————————————————————————
Fred Wilpon right now is fighting for his entire empire.
The entire Met financial structure has been directly tethered to the Madoff empire of deceit.
Documents state that Madoff accounts were often used for withdrawals during the season to meet Met-related expenses. They also suggest strongly that multiple sources made clear to Fred Wilpon and associates that Madoff’s returns were impossible–that the math did not add up; one large financial house advised them that they would have nothing to do with something as questionable and risky as the Madoff empire.
The Met response to this has been that it does not prove anything. Perhaps true, but it is also very damning as well. The reality might in fact be that the Wilpons may have indeed known–or at least had an idea–that something was rotten in the kingdom of Madoff, but once they realized, Met finances were far too deeply tied in with Madoff to extricate themselves from his world.
If the Wilpons cannot make debt payments, have exhausted their MLB credit line, and face the likelihood of years of litigation ultimately requiring them to pay a nine-figure penalty while at the same time having to continue to pay down their existing debt, the pressure will soon be on them (if it is not already) to sell their entire stake in the team.
Major league baseball surely has been worried about the Met situation, as Selig’s overt pressure on the team to hire Alderson showed. Who knows what the topic of the recent Wilpon-Selig meeting was?
——————————————————————————————
As they have been lying about all aspects of the case, it is reasonable to speculate that the current attempt to sell 25% of the team is not only to build a war chest for a future settlement; it might also be needed to service current debt and simply meet operating expenses. Fans may be forgiving in some cases, but bankers surely never are.
Met financing has seemingly largely come from the backing of Madoff and then MLB; without those sources and with the recent economic situation clearly not favorable to Fred’s other businesses, this move to sell a share could indeed simply be a maneuver to keep the whole empire afloat a while longer.
Regardless, the days of pretending that Madoff did not affect the Mets and that the situation has little to do with on-field realities are now over. Alderson even recently commented on the team’s current payroll being significantly higher than management would like it to be. What should this tell is?
Unfortunately, that it is entirely possible that Met operating expenses are a major concern as well.
——————————————————————————————
It is clearly time to speculate on the future.
One intriguing name is that of Mark Cuban. The Mavericks have become one of sports’ most consistent winners under his leadership. He made himself hugely successful and wealthy at a very young age on the merit of his own intelligence and hard work.
Yes he can embarrass himself, but he also can be very honest and self-deprecating.
In a sport with no salary cap and with a team with the revenue potential of the Mets and SNY, Cuban might be one of the few people who could come in and buy the Mets as a single owner, and be expected to possibly rival the Yankees in spending.
——————————————————————————————
Such speculation may be premature, but what is not premature is taking a cold, hard look at the very slippery man at the helm of the Mets and the very questionable way that he has apparently built his immense fortune.
It is not an exaggeration to say that the entire Wilpon Met era may have been built on deceit. If it turns out that the money to buy out Doubleday, as well as Citi Field financing, were largely made possible due to Madoff pseudo-wealth, and if the end of the Madoff era and its resulting troubles have caused debt payment to be jeopardized, then it is very, very possible that the house of cards which has begun to crumble will indeed come tumbling down.
And if all of this does turn out to be true, Fred Wilpon will be a man for whom few tears are shed.
57 comments
stickguy
2/5/2011-2:45pm at 2:45 pm (UTC -4)
I would rather watch games. The wilpons I don’t care about. Like you said, if the money needs get too high, something will have to give. If they sell the whole team, then so be it, probably best in the long run. If they can cover the whole nut selling 25% (and find someone to buy it of course!) good for them!
If you want more pure speculation, they likely got hammered on the rel estate side. Even with Madoff, that could have put a serious crimp in their finanaces so using the mets as collateral for Sterling to borrow against seems plausible.
I don’t see why though it is such a big deal that they used this set of funds at the time to invest their monies. THere are plenty of other investment management firms that, at the time, probably were quite equivilent, without of course the guy who founded nasdaq running it! Or I suppose they could have invested it all with a safe place, like Bear stearns?
I don’t really care how they got “here”, wherever here is. The legal process will take care of sorting that, and the ramifications, out. And until then, thw Wilpons are the owners (unless of course they sell), so I hope it works out, being as it is best for the team, and that is all I care about.
all I care about is the team, and it’s immediate prospects, and since Sandy is still in place and rebuilding the organization from the bottom (and that isn’t changing now), I am still hopeful about that.
will the payroll be as high next year? Doubtful, but that would be expected anyway IMO based on the influx of younger guys and the expiring deals. Will it be gutted to 80mill or less? Highly doubtful. And totally unknown is what it will mean to wins.
If anything, this probably came at a good time (if your hope is for new owners), since even without the clawback suit, payroll was likely to dip as they retool.
IMO, if they don’t sign any huge $$ FAs next off seaosn, I don’t care, since there isn’t much on the list anyway of interest. as long as they resign reyes and get some solid pieces to fill gaps (say garland/garza level SP in stead of Capuano), I can live with that.
just MHO of course, but this situation is a sideshow of course, but it wil lnot destroy the mets, even if payroll gets cut next year by 20-30 million (depending heavily on what happens with K Rod, and of course Jose).
they got a lot of money coming off the books. If K Rod does not vest, and you extend reyes for say 17/year, that is well over 40mill (before arb raises) by losing beltran, k rod, luis and ollie.
maybe I am just tired of hearing about it all, especially since every piece of speculation about it is negative, so it sucks the life out of sports talk. I just want some games to start, since I really, truly do think the team is primed for a big year.
Omar is gone, Jerry is gone, and hell, that more than makes up for the ghost of madoff.
kingman 26
2/5/2011-3:03pm at 3:03 pm (UTC -4)
Thanks for reading Stick, and thanks for the thoughtful response.
njstuckintx
2/5/2011-3:12pm at 3:12 pm (UTC -4)
It’s this kind of rationale that leads me to believe Reyes coming back is going to be worse than 50%.
saltygary
2/5/2011-3:37pm at 3:37 pm (UTC -4)
Word Kong. Always knew it was going to get worse before it gets better I just naively figured the team was past the madoff crap. Let’s buckle our seatbelts and hang in there.
metsfan4decades
2/5/2011-4:06pm at 4:06 pm (UTC -4)
What is clear to many Met fans – across many blogs/comments – is just not clear to me.
I’m no finance expert and even less experience in the area of law. I’m still having a problem wrapping my brain around the fact that any of the investors who made a profit have to pay it back. I guess ignorance is no excuse and it comes under the heading of ill gotten gain?
Just wanted you to know where I’m coming from up front because the only thing that is clear to me so far is that Madoff is a crook. I have no idea if how the Wilpons were doing business with accounts and such was illegal, suspect or just not all that unusual (should we be privy to how other teams are doing business).
I don’t think we as fans will ever know the whole story. Will the WIlpons wind up selling the team? Very possibly. Will it be like the Rangers where they declare bankruptcy first and MLB steps in for a season? Who knows? On the latter I hope not b/c I’m looking forward to the day Selig steps down…
However this works out, as a fan I want it to be what’s best for the team. I’m just very much afraid right now, whether the Wilpons are forced to sell or not forced to sell, it will at the least a distraction (yet again) and at the worst have the team in limbo for a few years. If the Wilpons retain ownership, who knows what the operating budget will look like? If there are new owners, I’d be surprised no matter who it is, that they hit the ground running by spending money.
I’d just like to know lately why it always has to be some damn soap opera with the Mets……
kingman 26
2/5/2011-4:29pm at 4:29 pm (UTC -4)
Much of the profit was illegally produced—what Madoff allegedly did was not just make great investments—-he continued to use his guile and connections to gain more investors’ money. He then distributed this money to older, closer associates like the Wilpons. So it is entirely possible that Wilpon profit was actually money simply invested by others later on, and then Madoff would use some folks like the Wilpons as examples of how successful Madoff was. So, MORE people would give Madoff money, which he would then use to pay off other previous investors. A classic “Ponzi scheme” as they are called. The “profits” often consisted of money invested by others.
And more and more info is strongly suggesting that MANY people, including Merrill Lynch, strongly suspected wrongdoing for many years.
The Wilpons say they did nothing because Madoff was such a close friend and they could not imagine him doing such illegal things. More and more info strongly suggests the Wilpons were utterly powerless to do anything, as Madoff was their source of credit, via using their Madoff accounts as proof of their creditworthiness AND there is the fact that apparently they consistently withdrew money from Madoff accounts during baseball season to meet expenses.
Hence, it is literally possible that groundskeepers and ushers and secretaries and Oliver Perez were being paid with withdrawals from Madoff accounts, which was originally money new investors put into Madoff.
metsfan4decades
2/5/2011-4:36pm at 4:36 pm (UTC -4)
Thanks for the overview, King.
I more or less get the overall picture. What I’ll probably never understand as the world of finance is not my area of expertise – just what exactly is legal and what is not.
Lots of innuendos and ‘should have known’ and ‘was warned’ etc. in the snippits I’ve been reading.
One thing that occurred to me though is this makes the gov. look really stupid. The SEC audited their books for years and saw nothing. Doesn’t say much about that agency.
stickguy
2/5/2011-4:53pm at 4:53 pm (UTC -4)
losing the profits has nothing to do with prior knowledge.
If someone sells you a stolen watch, and the police track it down, guess who is out their money and the watch?
and the SEC never really audited the books. They just rubber stamped an audit down by a firm, which in this case I believe was just someone connected to bernie.
Prismo
2/5/2011-4:30pm at 4:30 pm (UTC -4)
Great piece Kingman! Turning a blind eye to this situation is naive at best.
As for Mark Cuban, just the other day he said that he would not be contacting the Wilpons about buying a piece of the Mets. He said he’s been in bidding wars for stakes in teams before, and it has never turned out well. Finally, he said that if the Wilpons approached him about it personally, it would be something he could possibly consider.
stickguy
2/5/2011-4:38pm at 4:38 pm (UTC -4)
most likely, after being screwed over by the old boys network a couple of times, he is going to sit back and wait for them to get desperate, and come crawling to him when they get desperate.
Personally, I think finding a buyer is only an issue if it is 25% and no SNY, no say. But, if they put the whole thing up (citi, mets, sny) there will be a ton of suitors showing up to talk.
Prismo
2/5/2011-4:43pm at 4:43 pm (UTC -4)
Agreed – why would a high profile guy like Cuban want to put his name on the Mets if he only has a minority stake and can’t even run the team how he sees fit?
kingman 26
2/5/2011-4:47pm at 4:47 pm (UTC -4)
Thanks Prismo; I really always appreciate your opinion.
metsfan4decades
2/5/2011-4:31pm at 4:31 pm (UTC -4)
And King, that picture is very disturbing – lol….
I read a couple of days ago where the Wilpons offered Madoff a chance to buy into the Mets when they bought out Doubleday. Thank the gods that didn’t happen.
But….if the Wilpons knew about Madoff or even suspected, would they really have offered part ownership to Madoff? If they did know and naively thought if/when it was exposed the worst that could happen was they have to pay back the profits…. would they really have made that offer to Wilpon knowing when it did blow up, they would wind up losing the team outright?
Would they really have been that stupid?
Prismo
2/5/2011-4:33pm at 4:33 pm (UTC -4)
Hey, at least if Madoff had a stake in the team maybe Selig would’ve forced him and the Wilpons to just sell the friggin thing already!
metsfan4decades
2/5/2011-4:39pm at 4:39 pm (UTC -4)
Well, my mind went to it winds up in Picard’s little arena as ‘profits’ and the NY Mets are no more. Although I would hope MLB would have enough power to stop that from happening.
If I remember correctly when arrested, they immediately froze, then seized all Madoff’s assets. Yikes!
metsfan4decades
2/5/2011-4:40pm at 4:40 pm (UTC -4)
‘made that offer to Wilpon’
shoot – meant Madoff but you all probably knew that…..
stickguy
2/5/2011-4:50pm at 4:50 pm (UTC -4)
still hard to believe they would be that entwined with someone they knew was committing a crime.
whole situation is a big mess.
what will be really interesting is if they can keep afloat even after the suit is settled.
say they sell the share in a couple months, and settle the lawsuit, both for 200mill. Then what? can they handle the debt load? can they handle the other stuff that is owed? how badly in hock is the rest of sterling?
one possible outcome is that they still end up bankrupt after this is all over, unless some sucker refinances all their debt.
hell, in any of these cases, we still don’t know what if anything it means to the team on the field (maybe they go to the WS like the rangers did?)
but again, pure speculation.
kingman 26
2/5/2011-4:54pm at 4:54 pm (UTC -4)
“still hard to believe they would be that entwined with someone they knew was committing a crime.”
The possibility remains strong that once they knew what Madoff was up to (and it appears MANY sources were telling them) that the entire Wilpon empire was so entwined with the financing supplied by Madoff that they simply had no choice but to soldier on with Madoff and pretend to turn a blind eye.
Don’t discount this possibility.
Finance and business at this level is not a game played by honest men at all times. Very, very far from it.
metsfan4decades
2/5/2011-5:15pm at 5:15 pm (UTC -4)
Jeeze, how do people like this sleep at night?
I guess it’s a good thing that I’ll never have to make these kinds of decisions. I’m certainly not getting rich working for Uncle Sam – lol.
darknova306
2/5/2011-9:34pm at 9:34 pm (UTC -4)
“Jeeze, how do people like this sleep at night?”
To quote the Simpsons:
“On top of a large pile of money, with many beautiful ladies”
rustyjr
2/5/2011-4:39pm at 4:39 pm (UTC -4)
Comment…
rustyjr
2/5/2011-4:40pm at 4:40 pm (UTC -4)
Great piece my friend !! Been wondering where you’ve been hiding
kingman 26
2/5/2011-4:43pm at 4:43 pm (UTC -4)
Thank you my friend!
I have been busy as can be…January was the best month in the 10 year history of me and my bro’s biz, socially things have been busy, and I have literally not had time to be here.
But I HAVE ready your piece EVERY DAY!!
rustyjr
2/5/2011-5:32pm at 5:32 pm (UTC -4)
Thank you sir !
hazmet
2/5/2011-7:19pm at 7:19 pm (UTC -4)
Great piece buddy, and I agree 100% with every word. Last night after spending about an hour skimming the brief I was taken back by what the picture appears to be. As part of a post I commented similar thoughts stating:
“This increased profits and expanded borrowing limits afforded from these techniques enabled them to continue growing both their Madoff holdings but imo also the ability to buy out Doubleday and build Citifield”
The other thing you touched on here which I didn’t even get into was that aside from all the clawback dollars the Wilpons had aprox. $296M in outstanding debt circa 2009. Debt they were probably planning to payoff in part from proceeds from their Madoff investments. So on top of all the dollars Irving the trustee lawyer is going after they’ve got this mountain of debt it appears. Another incredibly disturbing thing was that the Mets 401K plan for their employees were exclusively invested in Madoff only. So all the Mets employees 401K’s from the past decades were completely shot. Now those employees are starting to go after the Mets in law suits for the 401K tie in to Madoff. So there’s the trustee’s suit, the outstanding debt, and more lawsuits coming from ex employees. Also for the trustees suit the estimate in penalties is estimated at 9% per year as per reports today.
Some bad stuff, I’m going to continue my rant in a second post….
stickguy
2/5/2011-7:53pm at 7:53 pm (UTC -4)
the employees will be plaintiffs in the suits (well, the equivilent of creditors in a bankruptcy, not sure what they call them here.
at some point once all the clawing back is done, the net losers will get some % of their money back. And since they have quite a bit collected already, they are not completely gone. interest is though.
there are actually a lot of suits outstanding where employees sued for breach of fiduciary duty over lost 401(k) balances when the markets crashed.
stickguy
2/5/2011-7:59pm at 7:59 pm (UTC -4)
quite the mess they made though, that is for sure.
in my mind, there are really 2 distinct issues.
1 of course is how much they end up having to pay back to make the legal mess go away. and that is the giant unknown, with a huge potential spread.
the 2nd is, once #1 is settled (and hell, before that and even it the answer is 0), can they afford to run the sterling operation, including the mets, and keep up with all the obligations and debt load? that was quite possibly an issue even before they got hit with the lawsuit.
hazmet
2/5/2011-8:04pm at 8:04 pm (UTC -4)
Yup, there best avenue was to settle. Knowing this was in there I don’t know how they didn’t pursue that route. Granted this is a dance and they probably will still settle but man this is going to be ugly and long.
At least the caribbean WS has started to quench my thirst
stickguy
2/5/2011-11:04pm at 11:04 pm (UTC -4)
yeah, settling is most likely. and I am sure they were willing.
most likely, at this point, the trustees idea of settling was they pay everything he asked for.
it does seem that the trustee has no real incentive to settle it quick (unlike the wilpons)
hazmet
2/5/2011-8:02pm at 8:02 pm (UTC -4)
Sorry bout that, my laptop is getting shot…continuing:
Now granted, I’m not a lawyer but the perspective I bring to this from my experience is from one of the companies I’ve worked for I was the guy who had to work with the corporate lawyers in NY to structure arguments and blow holes through contracts, agreements or whatever documentation in an agreement that the company was going after. When something was difficult the lawyers would say give it to “haz” to review first and try to develop the argument. I’ve won against Boeing and other major companies to date, and hopefully I don’t get mixed up in more stuff as it is draining. But it does give me a unique perspective in reviewing this type stuff. I read this and it is loaded with multiple area’s they are in deep on. In their defense, there’s also stuff in there that they can use to blow up aspects of the trustees case but I won’t get into that.
This is an embarassment, and to me after reading parts of the brief on field operations have to have been compromised. I’ve been holding back the questioning of OK why have we been signing the likes of Tankersly & Bonsers when guys like Dotel, Wheeler, Fuentes and others were available to bolster a clear weakness. Maybe these aren’t earth shattering names but they’re certainly better pen options available that didn’t go for huge dollars.
Well hopefully we can get back to baseball at somepoint but I just sense no matter what they do on the field will be overshadowed by this debacle. And that is a shame.
darknova306
2/5/2011-9:45pm at 9:45 pm (UTC -4)
Very nice piece, kong. Between this post and Hazmet’s comments, a much clearer picture is painted that by just reading all the meandering diatribes posted by Rubin and all the others. The crap for the Wilpons just keeps getting deeper and deeper, it would appear. To have your financial empire so intimately entangled on all levels with a swindler like this is insane. Talk about blind greed.
This takes my already uber-pessimistic outlook on the team and stabs it in the taint.
oleosmirf
2/5/2011-10:54pm at 10:54 pm (UTC -4)
I dont think any of us are in any position to really comment on the situation. Im just going to wait and see what eventually happens…
stickguy
2/5/2011-11:07pm at 11:07 pm (UTC -4)
a very reasonable position.
just focus on the team on the field, which is going to be much better than many are expecting.
worry about madoff tanking next years payroll, if it even happens, next year!
TRS86
2/6/2011-9:56am at 9:56 am (UTC -4)
That would be ridiculous.
kingman 26
2/6/2011-9:58am at 9:58 am (UTC -4)
LOL!
As opening your eyes, studying the thus-far known facts of the case from reliable sources, and facing reality would be.
TRS86
2/6/2011-10:13am at 10:13 am (UTC -4)
Kingman you never do face the fact that there are two sides to every issue and neither are as ridiculous as you make out.
Of course you will not agree but the new post from Outside the Lines presents a much different story.
kingman 26
2/6/2011-10:16am at 10:16 am (UTC -4)
Have you actually read anything from a non-sports source? I.e., people who are actually expert in things like this?
kingman 26
2/6/2011-10:19am at 10:19 am (UTC -4)
And there are two sides to MOST issues. Not all issues.
The Wilpons have pathologically lied every time they said that the Madoff issue had nothing to do with Met financing.
There aren’t two sides to that.
Every time any of us–me included–optimistically tried to hope that the Madoff thing would not affect team operations, we were wrong.
There aren’t two sides to that.
Of course we do not know how it will ultimately play out, but there are not two sides to the question of the honesty of Fred Wilpon, the close ties between Met finances and Madoff’s financial operation, or the direct effect Madoff’s fall did in fact have on the Mets.
TRS86
2/6/2011-10:33am at 10:33 am (UTC -4)
Kingman, when you get on something you get on it. Again, having a different opinion from you is not ridiculous nor at this point wrong. Get over it buddy you nor I are that knowledgeable or really even significant at all.
Also, having your opinion is one thing but continually having this need to call out those that don’t share it is growing very tiresome. You are a great author but just write your damn story and leave the rest of us out of it.
kingman 26
2/6/2011-10:36am at 10:36 am (UTC -4)
Then don’t comment on my damn story if you cannot handle disagreements.
Your constantly calling me out for disagreeing is also growing very tiresome.
Get out of the sports pages and do some real research on this. You might be surprised at what you find—as was I.
TRS86
2/6/2011-10:38am at 10:38 am (UTC -4)
“The most catatonic of optimists continue to pretend that this will not affect the team, will not affect spending, will not affect the future, etc. This is folly of the most ridiculous nature.”
Do you need this in your story to make your point?
Do you need to be condescending to those who do not share your viewpoint? Can’t you just present your side and let others make their own opinions without fear of being called ridiculous or ignorant or whatever your word for the day is?
kingman 26
2/6/2011-10:43am at 10:43 am (UTC -4)
Ever occur to you that you are thin-skinned?
kingman 26
2/6/2011-10:45am at 10:45 am (UTC -4)
And also, OPINION pieces express OPINIONS.
Should we all just copy and paste Tweets from Heyman and Rubin and post agreement with each other?
TRS86
2/6/2011-10:49am at 10:49 am (UTC -4)
LOL, you calling me thin-skinned would be both correct and ironic.
However, no I just grow incredibly tired of having myself and others called out in your POST for having a different opinion. I want you to state your opinion and as I say below it is rational. However, there is no need to try and belittle those who do not agree with you or really even mention them in your story. To me that takes away from your ability.
kingman 26
2/6/2011-10:34am at 10:34 am (UTC -4)
“Of course you will not agree but the new post from Outside the Lines presents a much different story.”
Uh, not it doesn’t; not at all.
It presents precisely the picture I present—the Mets probably have trouble with operating expenses and might have to sell.
And even Adam Rubin commented on one of the previous similar involvements in Ponzi Schemes the Wilpons have been accused of!
TRS86
2/6/2011-10:39am at 10:39 am (UTC -4)
You know what is funny is that we both can watch the same thing and get two different things from it, yet one of us is completely wrong and ridiculous while the other has his eyes clearly open. That’s just plain BS.
kingman 26
2/6/2011-10:42am at 10:42 am (UTC -4)
OK, trying to comprehend here—what in that Metsblog-linked Outside the Lines piece presented a “much different story”??
What?
They largely said just what I did–expressed opinions about what MIGHT happen if the info cited from NON-SPORTS SOURCES about this turns out to be true–even Rubin!
What was “very different”? Please tell me.
TRS86
2/6/2011-10:45am at 10:45 am (UTC -4)
One…. to early to take any of the complaints as gospel.
Two… Mets will be fine and within 1-2 years you will not even notice
Three… too early to speculate what might happen
Four… Mets were in such a mess because of Omar that it’s too early to tell if Madoff had any impact on finances at this point.
Again, keep your opinion I am fine with it and it seems rational enough. However, there is absolutely no reason to continue to call out some of our valued readers and myself for disagreeing with you. Write your piece and let people decide on their own.
kingman 26
2/6/2011-10:49am at 10:49 am (UTC -4)
TRS, I said speculation may be premature, and I also suggested that if someone like Cuban came in, he might spend like the Yanks.
The point of my piece was about the Wilpons and what might happen to them.
Nothing was stated as fact, and nowhere did I suggest the team might not recover within a couple of years with a new owner.
And my previous pieces have often suggested that Omar is the father of the on-field failure which is the Mets.
You constantly have a crusade to give me grief.
TRS86
2/6/2011-10:53am at 10:53 am (UTC -4)
OK so explain your need to make the comment:
“The most catatonic of optimists continue to pretend that this will not affect the team, will not affect spending, will not affect the future, etc. This is folly of the most ridiculous nature.”
That not only calls out me but many other readers on this site who disagree.
I grow tired of these white vs. black, dark vs. light debates. As I said there are two sides to every issue and both are welcome here. However, calling out me or any of the readers in a post is not something I will allow. Comment section things are much more fair game, however the post themselves are not a place for those type statements. Sorry if you disagree.
kingman 26
2/6/2011-10:44am at 10:44 am (UTC -4)
And again, try out the Wall Street Journal, Fox Business News, the New York Times—check out sources that are not sports-based and the wide variety of experts whose opinions are presented there.
TRS86
2/6/2011-10:47am at 10:47 am (UTC -4)
Kingman, either they will be able to afford to run the Mets or they will sell. I have yet to see any hard evidence of it affecting daily operations and until then I will just anticipate baseball in a few days. Unless you think the season will not start.
gategem
2/6/2011-12:36am at 12:36 am (UTC -4)
Excellent piece Kong.
My greatest fear is the Wilpons gutting the team in an effort to lessen the cash outflow. Would they be open to basically giving away Reyes, Wright, Santana, Bay, Beltran and K-Rod to other teams willing to pickup the remainder of their contracts with little in return (i.e. no blue-chip prospects in return).
It should be interesting to see how it plays out.
Mr North Jersey
2/8/2011-11:44pm at 11:44 pm (UTC -4)
I have over the past few days read your post Kingy and I have re-read it and re-re-read it.
I tried to see why is it that what appears to be an open and shut case still somehow keeps me from just fully agreeing and falling in line with much of your argument.
The best I can come up with is as follows.
Everything you are using to base your claims are the trustee’s allegations in the lawsuit. In other words just half the story.
If I understand it right Sterling Equities have turned over to Picard “numerous depositions and over 700,000 pages of documents provided by the Sterling partners over the last year and a half.”
It is from these items that Picard made his complaints in the lawsuit.
What is still left to hear is the Mets side of those documents and depositions. You have to believe that the Mets lawyers while giving Picard the information he has have not also fully discussed how to address each of the items in question.
You say, “The Wilpons have long stated that their personal holdings, the Mets, and Madoff-related issues were unrelated. This was the biggest lie of all.”
What if they lied? What if they lied for fear to cause a bigger panic than there already was amongst Mets fans? What if they lied cause they didn’t want others to know how they financed certain items for example the 401k’s or deferred payment plans or the loans to buy out Doubleday and was hoping to reach a settlement? What if they have any other reason that we are not aware of for lying that while not admirable doesn’t constitute an attempt to hide a criminal act?
Why they may even come out and explain why they feel they did not lie. I mean I just don’t know.
What I keep coming back to is that as far as I know Fred Wilpon has been held in high regard by everyone that has ever come into contact with or have dealt with him over his lifetime. I tend to give a man like that the benefit of the doubt till proven otherwise.
Now in time it may be proven that Fred is as big a deceiver and a liar as Madoff ever was but I want to at least reserve judgment before making that conclusion.
You go on about the Wilpons lying since Oct of 2009 when they were on with Francesa. What did they lie about that day?
That the Bernie Madoff situation will have no impact whatever on the New York Mets and they are separate entities?
That the Mets will have one of the highest payrolls in baseball?
Let’s look at the 1st question.
When this was said in Oct 2009 the Mets payroll that year was the highest it has ever been this decade at $149,373,987. Wilpon even said they didn’t spend that money well (obviously) and that they didn’t plan to spend that much but he did say the Mets would still have one of the highest payrolls in baseball.
If you look at what they spent in 2010 they spent $134,422,942 which was 5th highest in MLB. They signed Jason Bay as a free agent.
As far as on the field goes I don’t see how the 2010 Mets was impacted by Bernie Madoff. You want to say this year will be impacted cause of how they went about free agency?
OK maybe but the Mets barring something unforeseen will end up actually with a payroll similar if not higher than 2010′s payroll. If you see the Mets not going overslot in June’s draft after Alderson basically said in so many words that they would. I would start being concerned.
Let’s look at the 2nd question.
Like I said the Mets had the 5th highest payroll in MLB.
Finally at one point you say, “It is not an exaggeration to say that the entire Wilpon Met era may have been built on deceit.”
Unless your suggesting the Wilpons knowingly knew what Madoff was doing and turned a blind eye what else can saying “the entire Wilpon Met era may have been built on deceit” mean?
If so then how can you not be exaggerating if no criminal arrests have yet to be made?
The thing is that even with all i said a year from now you may be accurate in what you said. I’d just rather wait and be sure then assume now and be wrong and that is what is keeping me from fully agreeing with most of what you said I think Kingy..
You do make one hell of a case though I will give you that for sure.
Quote: “…we didn’t necessarily spend well with $147 million this year, so I don’t want to say what it’s going to be. Last year (2008) we started the offseason with a $135 million payroll.
It went up to $147 [million]. We didn’t have that as a plan.” http://njmg.typepad.com/metsblog/2009/10/the-mets-day-of-apologies.html
stickguy
2/9/2011-12:27am at 12:27 am (UTC -4)
NJ, there is also a timing issue to keep in mind. when all those comments were made (october 2009), the madoff scheme had been exposed for almost a year (lid blew off 12/2008). Now, the clawback suits (and some of the accounting stuff to determine wins/losses) were still in the works. But, it was 100% clear that the money was gone. whatever you had with bernie (and the mets had a lot) was vaporized, and there was no idea how much, if any, would be recovered and returned.
so while they may not have expected to be sued for a billion, they knew what they were on the hook for ongoing without the bernie money. So, anything they said about bernie was almost moot, and they wouldn’t be lying if they said (and their actions seemed to support) that ongoing operations would not be impacted. they probably expected that to continue.
a lot changed in the last year, which is why their plan had to change (and it does not mean they were lying before).
I still say that whatever they had with bernie (the ATM concept) only matters now for the lawsuit and criminal charges (which they have not faced). the key now is they have debts and expenses to cover (including clawback hit) to maintain the mets, and if they can’t cover, most likely they sell (it would be a shock to see MLB start financing them now).
that Madoff ATM has been closed for well over 2 years now. if that meant they weren’t going to be able to fund the team, they would have had to cut by now!
metsfan4decades
2/9/2011-9:48am at 9:48 am (UTC -4)
I agree with just about all of this.
I think Wilpons comments in 2009 were what they were b/c the situation was different then.
I believe the Wilpons probably believed just about everything they were stating publically, no matter how naive they might have been.
I’ve seen plenty of accusations as well as snippits from the lawsuit Picard is going forward with. I’ve seen hardly anything in response from the WIlpons – yet.
Based on the above, it’s nearly impossible for me to make an informed opinion. Not to say I don’t have an opinion, it’s probably just not based on facts. And I don’t know that any of us will ever know all the facts. However, if the Wilpons do sell outright, I think this pretty well tells us they don’t have enough capital – and can’t raise it – to recover from the losses.
TRS86
2/9/2011-7:54am at 7:54 am (UTC -4)
Nice post NJ. Only quibble I have is that the Mets payroll last year after adding in Bay’s signing bonus and a few other things Cot’s left off was around 145M. They clearly spent an incredible amount of money in 2010 and now have done the same in 2011.