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Is Hypocrisy Necessary? Part 2

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Part 1:

On the publishing of our financial results for 2010-11, The news that our wage bill was 93% of our turnover at the time came as something of a shock, albeit not a totally unexpected one. Just before the start of the season I asked the question, "Is hypocrisy neccessary" as we looked to sign players on large wages to enhance us on the field. With the revelation that our wages are largely disproportionate to our income it is certainly prudent to ask the question again.

So, are we having to spend money to make ourselves immediately competitive? And is it a bit rich to be slating the Skates for spending themselves to death when we are at risk of the same problem?

In answer to the first question, the answer is yes. Without the wages spent Jack Cork wouldn't have signed and Adam Lallana, Jose Fonte, Rickie Lambert, Morgan Schneiderlin would almost certainly have not pledged their ongoing allegiance to us for the foreseable future. Are wages the only factor? The fan in me says 'No! We are progressing nicely, that's why they want to stay!' yet just like the symbiotic nature of the chicken and the egg, the money and the success working together keeps the whole project together. So it would be extremely rich for us to speak out at clubs that spend money to achieve. Sadly, the likes of Manchester City, Leicester and Chelsea are on the same moral plain.

So, question two. What about the clubs that spend themselves into oblivion and claim to be victims afterwards? Well, 93% of our turnover is wages. On top of that, 33 Million Pounds has been loaned to the club, that's one hell of a loss leader! At that rate we'll be at Skate levels of debt by the end of the '5 year plan,' that Chief Executive Nicola Cortese is masterminding. This loan however has been converted into club equity. In essence, the Liebherr family has invested the money into the club, it is absolutely integrated into Southampton Football Club and would need to be sold by them to get it back, it cannot simply be 'claimed back.'

Now, we know what happens when loans are recalled, don't we Mr Gaydamak? This is the key difference as to why although our behaviour is a little vulgar it is not the same. 33 million pounds worth of shares may be worth a bit more, or less in future. Yet it is now a certain percentage of the overall value of the club. In short, we have been gifted the money, it is ours. And the price for the Liebherrs? Hopefully the value of their assett will increase by the amount of money they have parted with.

The Skates just kept borrowing with no long term benefit or fall back. The money was always someone elses, therefore, they cheated and for a brief time lived like kings on the rewards.

So, question 2. Is it a bit rich to be slating the Skates for spending themselves to death? No, the circumstances are quite seperate and not comparable.

At this moment in time then, is Hypocrisy Neccessary? No. It thankfully is not. And all thanks to three men.

Firstly, Nicola Cortese, for introducing our second individual, Markus Liebherr to the club. Markus' money has given Cortese the means to propell us upwards. His will has been for the money to become ours to invest in infrastructure and playing staff at no real detriment. If the Liebherr familly want the investment back at some stage they will have to sell the club on at market value to reclaim it and there is no certainty that they will get it back unless the club grows.

And the third person to thank? Well, we didn't end up with such seemingly benevolent owners by complete chance. Our club has always looked to invest in infrastructure and it's future and the seeds for our academy and stadium where laid by (braces self).... Rupert Lowe. Thankyou Rupert Lowe for giving us an excellent foundation for the future and then for nearly killing it.... thus reducing the asking price to a level that Markus Liebherr saw as a bargain. Whatever Markus' motivations for buying us he certainly wasn't seeking a quick return. As our Chief Financial Officer Gareth Rogers stated:

In isolation you could say it's a very scary figure, but in the context of the [five-year] plan it was expected. It includes £1.4m of one-off payments that won't re-occur.
The loss incurred to date is absolutely beneath what we expected, so perverse as it sounds, we're pleased with that size of loss,
I am absolutely confident fans need not be concerned about the future financial stability of the club.
Nothing has changed operationally or strategically with Markus not being here. Nicola will drive the club forward and has every plan to do so.
And as we sit at the top of the Championship with new academy and training facilities under construction... as promised, we should surely have no reason to doubt him. I will say it again, the money being spent on wages, development and other aspects is vulgar. We are not a self sufficient club but we are absolutely trying to build something with solid foundation that can be in the future.

On the day of Markus Liebherr's 64th Birthday I would like to again just say two words.

Thank you.

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Updated 30-03-2012 at 05:59 PM by Colinjb

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