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Random thought of the day: If the economic collapse of 2008 hadn& #39;t happened, I don& #39;t know if the Bobby Bonilla contract deferral is such a bad deal.
(Short thread, incoming.)
(Short thread, incoming.)
As might be well-known, the Mets bought out the final $5.9M of Bonilla& #39;s contract in 2000, agreeing to give him annual payments of $1.19M from 2011 to 2035. In all, Bonilla will bank about $30M.
How this could have been a good deal for the Mets: They had 11 years to get as good of a return on investment as possible for that $5.9M before they had to start making payments of essentially $100K a month for 25 years to Bonilla.
Now, in some robust stretches for the economy, $5.9M invested might have doubled in 11 years. This would have theoretically given the Mets $11.8M at the start of payments to Bonilla.
Of course, we know what happened in 2008. But let& #39;s pretend the Mets doubled their investment.
Of course, we know what happened in 2008. But let& #39;s pretend the Mets doubled their investment.
I found this compound interest calculator that shows someone investing $11.8M and withdrawing $100K a month for 25 years would come out with $8.4M at the end if they got 10 percent annual interest: https://www.thecalculatorsite.com/finance/calculators/compoundinterestcalculator.php
And">https://www.thecalculatorsite.com/finance/c... sports teams might be able to beat that.
And">https://www.thecalculatorsite.com/finance/c... sports teams might be able to beat that.
And if the Mets had gotten really lucky and tripled that $5.9M between 2000 and 2011, the numbers really start to go insane. The calculator shows them with just shy of $80M in 2035.
