What does a Brexit mean for NYCFC?

[NYCFCfan]

A lot of people are talking about the Brexit, I figured I'd consider what it means for us: I see two key areas.

1. CFG might look to invest it's £££ in the United States so as to better diversify their assets. Building a stadium and making NYCFC worth more is a good way to do that.
   
   
2. NYCFC/MLS can reach out to UK based players who might be nervous about the future economic impact in the UK.
   
   
   2 1/2. MLS can reach out to players in the UK who are worried their work permits may be revoked.​

The Pound Sterling is dropping like a lead weight right now and with the UK opting to leave the EU, there's a very good chance many players who were able to obtain work permits there via EU citizenship elsewhere, will have to look elsewhere to play football.

While the entire situation is VERY complex, and we're looking at a very small part of it, we'd be foolish to ignore such a large event taking part in the country where CFG is based, so let's talk about it.

 

[Ulrich]

A lot of people are talking about the Brexit, I figured I'd consider what it means for us: I see two key areas.

1. CFG might look to invest it's £££ in the United States so as to better diversify their assets. Building a stadium and making NYCFC worth more is a good way to do that.
   
   
2. NYCFC/MLS can reach out to UK based players who might be nervous about the future economic impact in the UK.
   
   
   2 1/2. MLS can reach out to players in the UK who are worried their work permits may be revoked.​

The Pound Sterling is dropping like a lead weight right now and with the UK opting to leave the EU, there's a very good chance many players who were able to obtain work permits there via EU citizenship elsewhere, will have to look elsewhere to play football.

While the entire situation is VERY complex, and we're looking at a very small part of it, we'd be foolish to ignore such a large event taking part in the country where CFG is based, so let's talk about it.

Brexit will definitely impact the players that can play in the EPL, unless somehow the league creates an exemption to keep the status quo of recognizing EU passports - I could see that happening to keep the league from becoming more isolated in terms of supply. But if not, the dollar is always a safe currency to be paid in.

 

[NYCFCfan]

Graeme Bailey on SiriusXM:

"If the pound keeps dropping it's going to cause Premier League clubs millions more to buy players in the transfer market"

"It may be easier for EPL clubs to sign South American players because they are no longer subject to EU work permits"

 

[Calmness Personified]

Potential Man City loanees to NYCFC just got a bit cheaper.

If City were paying one of their youth players £200,000, NYCFC would now have to pay him a salary of $275,000 to match his City salary, a year or two ago that would have been $315,000.

 

[Jack]

http://www.foxsports.com/soccer/sto...ge-epl-landscape-says-financial-expert-062416

"Currently players from countries within the EU can work in Britain without a work permit but that is set to change following the vote to leave, although it is likely to be several years before the effects are felt.

Last season 432 European players were registered to play in the Premier League. Those players are unlikely to have to leave following the vote, but new players will not have an automatic right to live and work in the UK.

However, Harris believes that anyone thinking of investing in a club in England could now find the prospect very attractive."

In addition, great strategy for a hybrid-Carry Trade...
What is a 'Currency Carry Trade'
A currency carry trade is a strategy in which an investor sells a certain currency with a relatively low interest rate and uses the funds to purchase a different currency yielding a higher interest rate. A trader using this strategy attempts to capture the difference between the rates, which can often be substantial, depending on the amount of leverage used.


Exchange Pounds for Dollars, invest in New York real estate (stadium), exchange back to Pounds after stability

 

[dannd23]

Potential Man City loanees to NYCFC just got a bit cheaper.

If City were paying one of their youth players £200,000, NYCFC would now have to pay him a salary of $275,000 to match his City salary, a year or two ago that would have been $315,000.

Give it a week and we will be able to pay less! Kind of kidding.

I read somewhere that only 28 of the EU nationals in the championship would be eligible for a WP. Time to swoop in and grab the cream of that crop.

 

[adam]

Potential Man City loanees to NYCFC just got a bit cheaper.

If City were paying one of their youth players £200,000, NYCFC would now have to pay him a salary of $275,000 to match his City salary, a year or two ago that would have been $315,000.

Down to $270k and falling. If I were a MCFC youth player I'd be begging to get transferred to NYC just for some stability in my earnings. The pound will eventually sort itself out and stabilize, but this summer's transfer window is great time for a MCFC development players to come over here and earn some dollars till it does.

 

[sbrylski]

Demand for Europeans down, with England being less attractive and more difficult to play for.

Demand for South and maybe even North Americans up, as England looks elsewhere to import talent.

But keep in mind, Brexit will be a multi-year process. This isn't happening overnight.

 

[mgarbowski]

Don't take a one-day trend and project it out for years. Brexit won, which shocked some people. It also makes the status quo a little more shaky. In reaction to that the pound tumbled big. But, markets routinely overreact.

1. the process of disengagement from the EU will take 1-2 years at a minimum, and might not even happen. It probably will, but the referendum is not binding and there is a non-zero chance that the UK and EU leaders will go through the motions and say we couldn't work it out.
2. If it does happen Britain can make trade deals with the rest of the world and even with the EU. That may or may not happen, and we don't know on what terms. But the vote and even disengagement do not mean Britain is doomed to lose.
3. Despite the doom and gloom of the Remain side, it is possible that this is good for Britain. I won't pretend to know. It might be as bad as the experts say. Or not. Economic forecasting is basically worse than dart-throwing for successful predictions, and the elites who put the EU together have an even worse track record. For example, the EU was supposed to make the economies of countries like Greece more stable. That didn't exactly work out. So their predictions that England will suffer for this are 50/50 chances at best.

But the bottom line is the pound will move back up and stabilize as adam just said while I was typing.

 

[sbrylski]

Don't take a one-day trend and project it out for years. Brexit won, which shocked some people. It also makes the status quo a little more shaky. In reaction to that the pound tumbled big. But, markets routinely overreact.

1. the process of disengagement from the EU will take 1-2 years at a minimum, and might not even happen. It probably will, but the referendum is not binding and there is a non-zero chance that the UK and EU leaders will go through the motions and say we couldn't work it out.
2. If it does happen Britain can make trade deals with the rest of the world and even with the EU. That may or may not happen, and we don't know on what terms. But the vote and even disengagement do not mean Britain is doomed to lose.
3. Despite the doom and gloom of the Remain side, it is possible that this is good for Britain. I won't pretend to know. It might be as bad as the experts say. Or not. Economic forecasting is basically worse than dart-throwing for successful predictions, and the elites who put the EU together have an even worse track record. For example, the EU was supposed to make the economies of countries like Greece more stable. That didn't exactly work out. So their predictions that England will suffer for this are 50/50 chances at best.

But the bottom line is the pound will move back up and stabilize as adam just said while I was typing.

The new trade deals are key, really. Will the EU play nice with them, or punish them for leaving? Britain took the hard road, but doesn't necessarily lead to hell.

 

[adam]

Also, when worrying about European transfers to the EPL, I'm sure they will have something similar to an EB-5 set up over there. (Allows a path to citizenship, or in this case at least a work visa, for certain level of financial investment in the country). With the money a player could earn in the EPL, there's no reason they can't invest some of it back into Britain in the form or RE holdings until their contract runs up. It might even be a good way of stopping some of them from pissing all their money away. mgarbowski is right, this could turn out to be beneficial overall, we just have to wait and see.

 

[NYCFCfan]

Don't take a one-day trend and project it out for years. Brexit won, which shocked some people. It also makes the status quo a little more shaky. In reaction to that the pound tumbled big. But, markets routinely overreact.

1. the process of disengagement from the EU will take 1-2 years at a minimum, and might not even happen. It probably will, but the referendum is not binding and there is a non-zero chance that the UK and EU leaders will go through the motions and say we couldn't work it out.
2. If it does happen Britain can make trade deals with the rest of the world and even with the EU. That may or may not happen, and we don't know on what terms. But the vote and even disengagement do not mean Britain is doomed to lose.
3. Despite the doom and gloom of the Remain side, it is possible that this is good for Britain. I won't pretend to know. It might be as bad as the experts say. Or not. Economic forecasting is basically worse than dart-throwing for successful predictions, and the elites who put the EU together have an even worse track record. For example, the EU was supposed to make the economies of countries like Greece more stable. That didn't exactly work out. So their predictions that England will suffer for this are 50/50 chances at best.

But the bottom line is the pound will move back up and stabilize as adam just said while I was typing.

Spot on, don't expect this to be permanent but it's a big factor right now.

How?

https://twitter.com/x/status/746303012755365888

Lots of players might take a look at their wages take a hit, especially those negotiating contracts this summer, combined with the relatively low tax rate in the US compared to European countries and MLS is a lot more attractive than it was yesterday.

As for CFG, like Jack said... New York real estate is viewed as a safe place to invest money.

 

[adam]

combined with the relatively low tax rate in the US compared to European countries and MLS is a lot more attractive than it was yesterday.

If the players are remaining a citizen of their native country, US tax rates don't matter. They still have to pay taxes at home, they'll just have the taxes paid in the US subtracted from that number owed back home.

Only time tax rates matter is for US players choosing between states. States like Florida are income tax free and are therefore more attractive from that perspective.

 

[NYCFCfan]

If the players are remaining a citizen of their native country, US tax rates don't matter. They still have to pay taxes at home, they'll just have the taxes paid in the US subtracted from that number owed back home.

Only time tax rates matter is for US players choosing between states. States like Florida are income tax free and are therefore more attractive from that perspective.

Really? I thought the US was the only country that made citizens pay taxes even if they didn't live/work there. Learned something new today.

 

[Gotham Gator]

https://twitter.com/x/status/746272130992644096

https://twitter.com/x/status/746316076774989825

 

[adam]

Really? I thought the US was the only country that made citizens pay taxes even if they didn't live/work there. Learned something new today.

Or maybe I'm talking out of my ass. I know that's exactly how it works for the US. I figured it would work the other way as well. However, a quick google to figure this out shows I might have been right. Always go with your gut!

http://europa.eu/youreurope/citizens/work/taxes/income-taxes-abroad/index_en.htm

 

[Gotham Gator]

Really? I thought the US was the only country that made citizens pay taxes even if they didn't live/work there. Learned something new today.

Americans living abroad have to pay U.S. income tax, but they get a credit for taxes paid overseas, so if the tax rates where they work/live are higher, then it doesn't cost the U.S. citizen anything extra.

Interestingly, Boris Johnson, the UK politician leading the Brexit movement was born in NYC and a couple of years ago had to make a big capital gains tax payment to the IRS.

 

[Gotham Gator]

The new trade deals are key, really. Will the EU play nice with them, or punish them for leaving? Britain took the hard road, but doesn't necessarily lead to hell.

44% of English exports go to the EU, so England can't afford to implement trade barriers. Most likely outcome is that they end up with something like Norway - they get free access to the markets, but have to adhere to many EU regulations with no ability to participate in rulemaking in Brussels.

 

[adam]

Americans living abroad have to pay U.S. income tax, but they get a credit for taxes paid overseas, so if the tax rates where they work/live are higher, then it doesn't cost the U.S. citizen anything extra.

Interestingly, Boris Johnson, the UK politician leading the Brexit movement was born in NYC and a couple of years ago had to make a big capital gains tax payment to the IRS.

What about UK or EU citizens living/working in the US?

 

[Ulrich]

Not NYCFC related, but now a lot of the US players with EU passports aren't going to make the cut of 75% int appearances that allows them a work permit in England/Scotland..... Hyndman, Miazga, Kitchen, Tim Ream, Danny Williams, Gedion Zelalem could all have issues playing in England.

Cameron and Yedlin will be safe because they are full internationals/starters.