[QUOTE="Oleg_Huzwog"] How is it a bad analogy? They are investments based upon expected returns. Some investments work out with great success. Some are written off as losses.
Of course I understand what overpaid means. Overpaid means receiving more than a person is worth. It means the skills and marketablity of the athlete/artist can be found elsewhere at a reduced price. If my understanding is incorrect, please enlighten me as to what it really means.
LJS9502_basic
It's a bad analogy for several reasons. One...unless you are a real estate mogul that buys and sells....the investment return is NOT the reason a home is bought. It's bought to provide shelter for an individual/family in a location that is desirable, with a price that is considered reasonable for the budget/neighborhood. It provides what is sought....Period. They may or may not move again and it's not a future return they seek. Basically, it's the now that matters....the neighborhood, school district, location etc.
Athletes on the other hand are unknown. I know I wanted four bedrooms and three baths...that is what I bought. I don't know if the rookie is actually going to perform well this year....next year...or never. His skills were in the minors or in college depending on the sport....and they are not at the pro level...which is different. The competition is better....bigger...and stronger.
There is NO guarantee on the NOW aspect of the athlete...while there is on the house. And FYI...an analogy to natural disasters would be better suited to a career ending injury to the athlete. Not job performance.
Pro sports have all become overpaid...and it's taken it's toll on ticket prices. Revenues have shrunk in some cities and they can't sustain the sports. This is not good for the overall health of sports....but hey...let's escalate the costs until no one can afford the games anymore...and then see what happens. Personally....I'd rather they reigned in the overspending now.
If a place to live was my sole goal, then I would've continued to rent. I purchased for the added financial benefits. But hey, if you're uncomfortable with the house analogy, I'll gladly replace it with any other investment.
There ARE guarantees on the "now" aspect of athletes. A wide receiver's speed and catching ability is known before the draft, as is a quarterback's throwing ability, a lineman's strength, etc. Certainly, there are some unknowns, the so-called "intangibles" that separate good players from great players, but even those aren't a complete crapshoot. Example:a player who shines in a bowl game is one who likely has greater composure in high pressure situations.
I must also object to your contention that salaries inflate ticket prices. Ticket prices (along with every other source of revenue: merchandise, television contracts, etc.) are established in a manner that maximizes income. If player salaries were reduced, ticket prices would remain the same because the public is willing to pay the current prices. The only result of reduced salaries would be increased profits for ownership.
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