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If I were betting – and this is purely me guessing at what I believe to be true based on the data that I see – I would bet that most baseball teams have a negative operating profit. But, because the “value” of these teams continues to increase astronomically because demand is out there to own one, owners stay in the game and either draw from some of that equity to stay in business or just accept the loss knowing that one day there will be a huge bonus cashing out.
I would bet that most baseball teams have a negative operating profit.
I seriously doubt the billionaires are running their corporations at a loss. There is zero reason for these welfare recipients to be operating at a loss.
They have just figured out their profit-maximization model is to cry poor and accept welfare while their investments multiply in value.
The Dodgers and Mets are playing within the rules. There is also enough volatility and randomness in the playoffs that I doubt that either one of them will run off several titles in a row.
As for the disparity between teams the only way to address is that to have much tougher rules and regulations in regards to a luxury tax and spending caps. The NFL model seems to work. Teams from Kansas City, Buffalo, and Cincinnati are successful while teams from New York, Chicago, and Dallas stink. Market size doesn’t matter in the NFL.
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