Abramovich: Billionaire. Owner. Lord of Irony.

By: Rob | August 28th, 2009

$REDROM wait, that\'s not right.$ Chelsea owner Roman Abramovich has reportedly backed plans to curb clubs spending crazy money in the form of a spending cap during transfer windows. While obviously Chelsea have not been anywhere near as outrageous as some other clubs we could mention this summer, its not such a long time ago that Chelsea were the market bullies (including Claudio Ranieri’s £100m spree that delivered absolutely no trophies (there’s a lesson in there for someone) so the irony of course will escape absolutely nobody.

Abramovich isn’t, of course, the only owner who backs the spending cap – both Inter’s Massimo Moratt (who sold Barca’ Ibrahimovic this summer) and Milan’s Silvio Berlusconi (who obviously lost Kaka’ this summer) have asked UEFA president Michel Platini to do something about the problem.

Its easy to see what they’d gain. But the big question is what such a cap would do to transfer prices.

I’m no economist. I mean the whole world of numbers makes absolutely no sense to me, and I’m still to totally understand why we’re in a recession. I failed Business Studies at school. So when I speculate on what this kind of thing does to the market, I should point out before I start that it actually is just speculation.

But say clubs were faced with a spending cap of, lets say £80m. I pick that nuimber pretty much at random. It could be £100m, it could be £50m. But I’ll stick with £80m on the assumption that the market value of the best player in the world is that, as that’s what Ronaldo moved for in the summer.

Anyway, It would mean that in future, if you were to buy a Ronaldo, Kaká or Messi you wouldn’t be able to buy anyone else that summer. It would probably mean that big players would rarely move, and players actually would become more valuable than clubs could spend, meaning that every player no longer had a price.

What would be really fascinating would be how it affected lesser players. Prices are spriralling out of control, because after Kaká and Ronaldo moved to Real, it pushed up prices all along the board. There was a sense of “If Ronaldo is worth X then Lescott must be worth Y”

Theoretically, the transfer prices could become quite static if there was a top to spending. The best players would always be worth the top of whatever the limit was (with a few players “worth” more, and so wouldn’t get sold), the next players a bit less and the others a bit less and so on.

What Platini has to keep an eye on is the affect it would have on lower league clubs. If all players find their value all the way down the divisions, the players at the small clubs have to be worth enough to keep some clubs going, who rely on producing gems and selling them up the league.

So what do we think? Budget caps? Good? Bad? Ugly?