AEG owns the arena, AEG owns the Kings and some of the Lakers. The Clippers are just a tenant, a tenant who lies around all day and smells bad.

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Just because somebody pays $2 billion for something doesn't mean it's automatically worth that. People overpay for things all the time. Assets have an intrinsic value separate from what 1 person may be willing to pay for it. That value in this case is probably somewhere between $750 mil - $1 billion.

It's worth an extra $1 billion to this guy for whatever his reasons may be - ego, whatever.

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You know me like that.

He's got way too much energy to play shuffleboard in his retirement


He might have more money than you

Oh, I'm sure our rich old Jewish guy who made his money gaming the system in real estate and throws lots of jobs and donations at minorities to show how racist he isn't would never think the way Donald Sterling thought.

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Yes! That is because he may lose 50%. You don't risk losing 50% if you expect to make 1.6% a year. It just doesn't work that way. You can buy cds with better returns on investment with no risk. A 1.6% yearly return on investment may not even beat inflation.
I know plenty with expected returns of investment of at least 5%. That doesn't mean it will do that every year. It will over a long enough time period.

According to this link: http://blog.petetheplanner.com/what-rate-of-return-should-you-expect-on-your-investments

The S&P averages 7.81% per year over the last 20 years. So buy a fund that invests in the S&P and expect 5% and then give me the other 2.81% for helping you.

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You do not talk to me like that! I work too hard to deal with this stuff! I work too hard! I'm an important member of the CSFMB! I drive a Dodge Stratus!

Right. Invest in the S&P and just watch the profits roll in.

Sounds good.

How dare you!! Jerry even had a black GM to show how even handed he is . Did Sterling?? Oh, wait a minute...

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Proud member of the white guy grievance committee

It aint the six minutes. Its what happens in those six minutes.

There are better ways to do it but you will almost certainly do better than 2%. Also, as I said, if the economy were to tank that poorly, the Clippers would also be severely impacted so even that is a moot point.

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You do not talk to me like that! I work too hard to deal with this stuff! I work too hard! I'm an important member of the CSFMB! I drive a Dodge Stratus!

High Risk Investments, Diversified Stock Funds

High risk investments like stock index funds are best understood by looking at a specific example.

An index is like a ruler. It measures the performance of a basket of stocks. One widely followed index is the Standard and Poor's 500 Index (S&P 500), which tracks the performance of five hundred of the largest publicly traded companies in America. These are companies like Proctor & Gamble, Microsoft, WalMart, Johnson & Johnson, GE, Pfizer and Exxon Mobil, just to name a few.

When you buy an S&P 500 Index fund, the fund owns a little bit of all five hundred stocks. If one of those companies gets in trouble, it has a minimal affect on your overall investment.

What about the odds of all five hundred of the largest companies in America going under, all at once? If that happens, we've got bigger problems on our hands than how to invest our money. For the sake of this discussion about risk, I'm comfortable saying you cannot lose all your money in a stock index fund. Yet you can experience times where your investment value will go down by 50%. For this reason, this type of investment is considered high risk, yet if you're in it for the long term, you've protected yourself from the risk of losing it all.



Rick if things happened the way your described the S&P would be trading at 40 Billion. I dont know what else to tell you here. You're just way off on a lot of your assumptions.

Can you explain this further?
What should be the expected rate of return on diversified stock market investment? Educate me.

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You do not talk to me like that! I work too hard to deal with this stuff! I work too hard! I'm an important member of the CSFMB! I drive a Dodge Stratus!

but hey, that's ok with donald sterling.... you know he's down with the lazy mexicans who lay around drinking beer all day because they're good salt of the earth people who are easy to get along with.

anyways, i'm going to resume not being a part of this thread because b-rick argument #438792614-D is going on and well, hey, at least in this age of participation trophies if there's nitpicking going on there's fundamentally gonna be "picking" involved, so that's good for the psyche. and you can't bemoan a point without moaning, and hey LOLSEX, so yeah, it's getting hot in here so take off all your clothes and remember that nelly used to be relevant in your life for about 5 minutes in 2002. feels good man.

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Power is always in the hands of the masses of men. What oppresses the masses is their own ignorance, their own short-sighted selfishness.
- Henry George

Thanks then I do not get the value amount. But as was said they are worth what some goof will pay.

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Elections have consequences.

Well, youre only looking at the upside. In your world it's apparently impossible for the S&P to go down.


Im not sure what that has to do with buying the Clippers and selling them three years later for a 100 Million dollar profit.

If you look at average 5 year returns on the S&P it ranges as low -2.29% to 12% from 2002-2011

In those 5 years, you would have lost money about half the time depending on when you invested.


But like I said, there are probably better investments. None of them are even close to guaranteed as you present.

A 100 Million dollar profit is never a loss. Ever.

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This is my signature...

I am using the concept of expected return. Nothing is guaranteed. Of course the S&P could go down. It also could go up 25%. That is why you use the concept of expected return. Investments do lose money. That is why investing in something you expect to make a 1.6% return on is stupid.
It's because that would be a poor return on investment.
It is not a literal loss but I didn't say it was. I said it was like you took a loss, because of how poor of a return that is.

A $1 profit over 500 years is a not a loss either unless you start to factor in other things that matter too.

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You do not talk to me like that! I work too hard to deal with this stuff! I work too hard! I'm an important member of the CSFMB! I drive a Dodge Stratus!

I always thought something is only worth what someone is willing to pay.

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Be well

GO BEARS!!!

Given Ballmer's track record, wouldn't be surprised if he ends up selling the Clippers for under $1 billion:

Microsoft's mkt cap:

$601 billion (Ballmer takes over as CEO)
$270 billion (MS Board forces Ballmer to announce his resignation )
Change: -55%

Put Nas in the "impossible to overpay for anything" club!

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You do not talk to me like that! I work too hard to deal with this stuff! I work too hard! I'm an important member of the CSFMB! I drive a Dodge Stratus!

I've seen this theory, but don't buy it. If you're selling a car, you can't tell prospective buyers that you need x amount extra over the car's true value just because you're having money troubles.

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I'm thinking it's more like Adam Silver/the NBA put the word out to prospective buyers that they needed to kick in the extra bucks to facilitate the sale now instead of post-death.

$660 mil is the estimate of total State/Fed capital gain taxes on the $2 bil sale price. So the Sterling's net $1.3 bil. Someone mentioned the other bids came in around/under $1.6 billion--which if the franchise was valued at best at $1 bil, the $1.4-1.6 bil sale price would've been the right amount to allow the Sterling trust to net what they would've if they held after death.

There's also talk of the Sterling's claiming a "forced sale" exemption to the capital gains tax. Their tax bill won't be due for a year. Wouldn't be surprised if they threaten to litigate and then offer/compromise with the IRS for less than the full amount of the tax due.

Yeah, but is a cabal of billionaires begging you to sell your car?

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I don't think the new owner gives a shit if it makes much money for him. Its viewed more as a toy.

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In many ways it is. The value of things is subjective. We have all spent more for things than someone else was willing to spend. To someone else we overpaid but we saw the value in spending a little more than someone else was willing to spend. It was worth more to us.

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Be well

GO BEARS!!!

She wasn't going to spend all of her money on a basketball team. Putting her name out there was nothing more than a reminder to the world that she is a billionaire.

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Be well

GO BEARS!!!

The Steve Ballmer era has begun. Should be interesting to see who can spend the most on horrible contracts -- Ballmer or the Russian Douche who owns the Nets.

Now the NBA is suing Sterling.

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Be well

GO BEARS!!!

I don't even...

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Rick Hahn is the best GM in baseball.