Yesterday, the rant here dealt with the outcome of a lunch discussion with a friend. After posting it, I went about my normal routine of grazing through an assortment of sports news sites to do some notetaking. I casually glanced at my email inbox and saw a note from my friend who accused me of an ulterior motive for my participation in our lunches. He sees it as me using him as mental stimulation when I am running short of topics for these rants.
And in a spasm of generosity, he sent along the link to an old Sports Illustrated article that he said, “just might make you think enough to write about it.” He warned me that it was a long article but that he thought it contained useful though dated information. Obviously, I hit the link…
The column was written in March 2009 by Pablo S. Torre. His authorship alone would have made me interested in finding out what he had to say about a sports topic; Messr. Torre is a top-shelf writer and thinker. Here is the headline for the piece:
HOW (AND WHY) ATHLETES GO BROKE
RECESSION OR NO RECESSION, MANY NFL, NBA AND MAJOR LEAGUE BASEBALL PLAYERS HAVE A PENCHANT FOR LOSING MOST OR ALL OF THEIR MONEY. IT DOESN’T MATTER HOW MUCH THEY MAKE. AND THE WAYS THEY BLOW IT ARE STRIKINGLY SIMILAR
Here is a recitation of how pro athletes had run into rough times financially just in the month in which this article was written:
“In this month alone Saints alltime leading rusher Deuce McAllister filed for bankruptcy protection for the Jackson, Miss., car dealership he owns; Panthers receiver Muhsin Muhammad put his mansion in Charlotte up for sale on eBay a month after news broke that his entertainment company was being sued by Wachovia Bank for overdue credit-card payments; and penniless former NFL running back Travis Henry was jailed for nonpayment of child support.”
And here is even more shocking data:
“By the time they have been retired for two years, 78% of former NFL players have gone bankrupt or are under financial stress because of joblessness or divorce.
“Within five years of retirement, an estimated 60% of former NBA players are broke.”
Remember, this report came at a time when the US economy was just beginning to recover from the “Crisis of 2008”. That might explain some of the “current events at that time” but the data related to NFL and NBA players cited here means there is a lot more going on than a recession.
It appears that athletes who come upon lots and lots of money at an early age have a few things going against them:
- They do not realize that at least a third and maybe as much as half of their salary will go to taxes levied by various jurisdictions.
- They do not understand the language of finances and investing so they are talked into bad investments that are made to sound good.
- They find it difficult to say, “No,” to old friends, newfound friends and extended family members who need/want something from them.
Ed Butowsky was cited in the report as someone who was trying to educate young newly rich athletes about how to spend some of their money and how to invest the rest. He sets up “financial boot camps” for athletes which they can attend free of charge and where he tries to educate them financially. Here is his assessment of the situation back in 2009:
“The bar for radically improving the financial habits of pro athletes, Butowsky acknowledges, is low enough for a toddler to trip over.”
The vignettes in this report are shocking and dumbfounding. Some of the incidents reported sound as if they came out of a scriptwriter’s imagination as he set the plot for a gangster movie. As my friend said, you should read this LONG report; you will shake your head in disbelief at least a half-dozen times.
At this point I would normally provide a link to the article but somehow when I try to do that the link does not work when I put it on the website. However, necessity is the mother of invention; and I have a way for you to find the report simply and quickly:
- Go to Google.com and search on:
- “Pablo S. Torre, SI article, athletes gone broke”
When I do that, the link to this article is the first thing that pops up thanks to Google. [Aside: Should we consider everything before Google as The Dark Ages?}
The upshot today is that my friend was right, and he was wrong in his email to me. I do not go to lunch with him only because I am running out of things to write about – – even if I used him as inspiration again this morning. However, he was dead right that this was an important and useful thing for me to read.
Finally, let me close today with three observation(s) from my favorite curmudgeon, H. L. Mencken:
“For every complex problem, there is an answer that is clear, simple and wrong.”
“On some great and glorious day, the plain folks of the land will reach their heart’s desire at last, and the White House will be adorned by a downright moron.”
“An idealist is one who, on noticing that roses smell better than a cabbage, concludes that it also will make better soup.”
But don’t get me wrong, I love sports………
2 thoughts on “Surprise!”
File this weblink story of Technical Equities under the adage: “If it sounds too good to be true, it usually is.”
Indeed, you are 100% right – – and yet, many former pro athletes succumb to siren stories of great wealth and humongous opportunities on a regular basis.