MNC: Transfer deadline eve & Messi says goodbye to Argentina

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1:04This is the Monday Night Club with Mark Chapman. On the Football Daily Podcast. Monday Night Club on the way, Glenn, in the company of Chris Sutton, Rory Smith and Stephen Warnock. We're going to do transfers, really, for the first half hour or so as we get closer to the window closing. Do you find this, Stephen? I'll come to you first. Is this the most baffling transfer window? you have ever seen? Yes. And could you put a reason why on that? Honestly, no. I find it bizarre how much prices have been inflated and how much people are going for. I find it, we were just talking off air, weren't we, I find it incredible how players who were signed last year by clubs have scored one goal, i.e.

1:55De Lapp, goes for£10 million more. I look at James Trafford and I think went to Manchester City, they sell them for what,£13 million more. I find it incredible that clubs are actually willing to pay those inflated prices for players. I think there's a lot of panic buying going on. I think there's a lot of pressure now to get within the top four, top five of the Champions League places to make sure there's more money coming into the football club. But I think what we're seeing in England between clubs and certainly for homegrown players, I feel really sorry for homegrown players at the moment. Because I just think you go to an academy and ideally you go to the academy of the team you support if you're lucky and that becomes your team.

2:41And you want to play for that team. As soon as you get in the first team, they look at you and go, well, there's a value in you and there's full profit in it. And I look at Harrison Armstrong. Do you really think Harrison Armstrong wants to leave Everton after just breaking into that first team, going out on loan to Preston, working hard, getting his opportunity, and then they get a call and say, by the way, Everton have accepted a bid. It's not, would you like to go? It is, they've accepted a bid. And I was like, how can you accept that bid for a homegrown player? Don't get me wrong, it's big money.

3:14It's astronomical money for a homegrown player. But yeah, I think we need to re-evaluate what's going on because a lot of homegrown players. I actually had this conversation with someone the other day at the Liverpool game. And I thought, what a great point this is. It was, could you imagine Steven Gerrard coming through the academy and he plays a handful of games towards the end of the season and Nottingham Forest come in with a£40 million bid and Liverpool go, we need that money because it's full profit. And you potentially lose a great of the club all because of PSR. But the interesting thing about that, Rory, is that the fans were furious about it.

3:58Now, I don't know in how many examples of transfers this, because there have been a lot of transfers between clubs where you go, whoa, where's that come from? Or actually, aren't the fan base fuming that that's happened? Now, I think the Chelsea fans are not happy with Fernandes, but I think that's as much comments over the last six months as necessarily going to City. But the Everton fan base going, hang on a minute, you can't do this, is one of the few examples of real anger this summer. Is everybody just becoming more immune, do you think, to, oh, well, they're just going to go there from there?

4:38Well, yeah, I think the Harrison Armstrong one is a slightly unusual case because as Stephen says, he's a homegrown player at a club that's got a really proud tradition of having Liverpoolians and Evertonians in that team. And I think he's the only one. And that hurts fans. That would hurt at Man United, it would hurt at Liverpool. To see a kid who's a boyhood fan come through, get into the team and then just be sold because he represents pure profit, that's damaging. I think fans find that really kind of... it calls into question what the purpose of the club is effectively. I think in most of the cases, if you've got a player who's not in that circumstance, who's been kind of brought into that team for money, I think we've all got a little bit like inured to the figures.

5:25I mean, Cody Gakpo now looks like he's about to not go through, but Lord knows. But, you know, that's 80, 85 million quid for someone who at City would be a squad player. That's almost a meaningless amount of money. and I think it's maybe a split. There's fans who I think are kind of bamboozled by just the sheer scale of the spending and there's other fans who think, well, look, that's fine because that means you can spend that on somebody else and as long as that dopamine hit of a new player coming in keeps rolling, they're okay with it. But I'm the same as you, Mark. I found it, I don't understand what's happened in this window, partly the inflation, partly why everyone's left it so late.

6:05Forrest made a bid for two goalkeepers yesterday. did they not think they needed a goalkeeper in July? Why? I mean, I get that you can try and drive a bargain. Well, and also, Rory, let's not forget, as Chris very helpfully told me two or three weeks ago, you can't play two goalkeepers, because up until that point, I was quite confused by that. Well, it's a tactic that only managerial visionaries can see. No, I presume they went for Mamadashvili because they got told no by Dean Henderson or by Palace, but why are you doing that on August the 30th? Yeah. doesn't make any sense and you can kind of make a case that you hold and hold and hold in the hope of strengthening your negotiating position but then if you put a bid in this late on it does kind of look desperate and when you look desperate what happens is the price goes up Can I just go back to the talk about the homegrown players very quickly so when Liverpool sold Curtis Jones the next squad was the first time in 134 years they hadn't had a scouser in the team And that matters It's huge for the fans It's huge.

7:04But it's not only the fans, Chappers, it's the academy. Because you draw players to the academy by the fact of, well, we progress our players into the first team. Now they'll be looking at it going, we progress our players to sell them. How do you see it, Chris?

7:21Chris Sutton:I think Stephen makes a great point, actually, about homegrown players and that feeling and that connection. if this carries on, will there be the same sort of feeling for young players going into their boyhood club and really cherishing that? It has been wild. I quite like some of it. I quite like what Ipswich have done. I love clubs who come up and they spend and they're having a go. They evidently had a plan in the summer, this is what they were going to do. And you could probably say that it feels like maybe Hull have had a plan as well. But there are – and who knows what to believe and what not to believe.

8:08And a little later on, we'll talk to David Ornstein. But, well, hang on a minute. If you're City, well, so you've sold Savino and you've brought in Alan. Savio. Sorry, Savio. You've brought – well, they sold Savino, but Spurs lost Savio, right? That's madness, isn't it? Right, okay. if you want to be really factually correct. But they've done that, and then they've sort of pivoted to, oh, we'll see if we can get Cody Gapot, but then they can't get Cody, don't appear to be able to get Cody. So we might then go for... There's no plan. No, we might then go for NJ, who's also on a Spurs list. But now, I mean, and these are, these bigger clubs are the ones with the, well, they've all got sporting directors, but we're told we're living in an age of sporting directors and carefully planned squads.

9:02Chris Sutton:Yeah, but there's... I mean, they're just all pretenders, aren't they? You know, essentially, clubs pretend they plan, but they don't. The Cody Gakbo thing, I mean, I've got to say, I thought he'd gone to City the other day. I thought that was done and dusted. I only saw before I came on tonight that Liverpool have... Until you did your research. So you didn't research that bit today. But that's incredible in itself, really. what Liverpool's mindset was in letting him go. I never understood that. And, you know, Iriola's gone in and you think, well, you know, what's wrong with Cody Gakpa? I think he's, you know, been pretty reliable for them.

9:43Chris Sutton:I don't understand why Manchester United haven't brought a left back. I think that that is, that's pretty alarming in itself. But there are stories, you know, all the way through the Aston Villa situation where, I mean, I thought they'd beat Brighton last week based on their results against Brighton the previous season, and then I saw they had half a team. And that is, I mean, if you're a Villa fan, you're thinking, what on earth is going on? I mean, they've sold half the team who won the Europa. And, I mean, stuff like Ollie Watkins, that winds me up. 30-year-old going to Saudi. I know people can talk about the Saudi league maybe getting better.

10:23Chris Sutton:but I think it's a horrible look for him. So there's a lot which has annoyed me about the window but it does seem wilder than ever. Let's talk about the money side of things and where clubs are getting some of this from. Dr Tom Basin joins us now. Do you look at some of these fees given your football finance expertise and think how are they managing to do this or does it make sense to you when you have the numbers in front of you? Well, I was talking to my dad about it yesterday and he mentioned about Everton selling a player for 80 million or so he's an Everton fan and saying that that's maybe not enough and I was saying that if Everton had sold a player for 80 million two seasons ago you'd have thought that would be ridiculous that fund the club for transfers for a couple of years so the amount of transfers seem to have gone up this season you know the number of 100 million pound signings this season yeah it's been surprising but then the line goes up you know club's revenues are going up and for most industries when revenues go up that translates into profits but football clubs aren't there to make profits so when the revenues go up so do the transfer fees and the salaries and that's very much what we've seen this this summer where where are the revenues going up and maybe this is a bit this a bit difficult because i'm lumping i'm lumping a whole load of clubs together here who have spent a lot of money and and they may have different reasons for their revenues going up but if you take the outlay that Spurs have made now their fans would probably go oh we haven't done that much in previous years so maybe that's why we're doing it now but does that come from basically having been having had Champions League football every now and then over the last two does the new Champions League format immediately skew it to teams who have been in there even if it's just been for a season or two well it definitely skews it I think to those teams have been in for longer because we have you know the way that UEFA set up the payments in in the wake of the European Super League was that the clubs have been in the Champions League for longer get more money than the clubs have just been in for for one season or two seasons but yeah even Aston Villa I think and 70 million or so from their run to the quarterfinals that was two a couple of years ago that's a huge amount of money for you know a mid-table Premier League club you That's almost half of what Bournemouth earn in a season.

12:43So, yeah, I think those clubs that are in the Champions League and are in the Champions League year after year are always going to have far more spending power than most clubs that aren't. Tom, can you explain the difference between PSR in our league and then, am I right in saying that, in the Champions League you can only spend 70 % of your profit? So squad cost ratio. Squad cost ratio. So that's different, isn't it? So it's okay saying we make this money in the Champions League, but then for 70 % of it, it's surely you're going to have to take a hit at some point. So, yeah, we've got the new squad cost ratio being introduced to the Premier League this season, which is broadly similar to UEFA's rules.

13:23And what it basically says is that a club can spend either 85 % in the Premier League or 70 % for UEFA. They can spend that percentage of their football revenues on their first team. So that's money that's spent on transfer fees, on player wages, on agent's fees and on the head coach or manager's salary. So what it does is it directly links the amount of revenue a club makes to the amount that it can spend. PSR previously said that a club could lose£35 million a season, up to£105 million over three seasons. That was kind of a different question. That was asking how much a club can lose. And that£105 million was the same whether you have£500 million revenues like Manchester City or£100 million revenues like Bournemouth.

14:10Now we have Premier League clubs can spend 85 % of their revenues and 85 % of Manchester City's revenues is an awful lot more than 85 % of Bournemouth or Brentford's revenues. And yes, clubs in European competition, very, very similar regulations in UEFA. They're limited to 70%. I think for the clubs in the Champions League, the extra money they get probably mean that that's broadly offset. Like I say, Villa made 70-odd million a couple of seasons ago. The clubs that I think are going to be really hard hit are the ones that are in the Conference League and the Europa League because they're going to be bound by that UEFA 70 % rule, but the revenues they make are far, far less.

14:49Tottenham made half the money in winning the Europa League that Villa made in the Champions League a couple of seasons ago. Which then brings us to this point. People are praising Brentford for what they have done, not just this summer, but in the past. But actually, Brentford, by not qualifying for Europe, did themselves a favour on the squad cost ratio, didn't they, Tom? Because it means they can still be at the squad cost ratio of 85%, where, say, Bournemouth and Brighton have to drop to 70 because they are in European football. Yeah, I suspect that Brentford have probably run well enough that they're probably not up towards that 85 % anyway.

15:33But yeah, I mean, Chelsea, not in European competition this season. They don't have to abide. They've got some European restrictions because of, you know, how they've failed UEFA regulations in the past. But Chelsea broadly have this 85 % rule that none of their other title challengers have because they're all playing in Europe. So, Tom, is that partly what's happened then? that the clubs basically driven by the Champions League five, I suppose, that they have basically looked at it and thought, well, we're no longer hidebound by this need to not make losses. We can just cut loose and do what we like.

16:08The part of SCR that wasn't passed by the Premier League was the bit that would anchor it by a factor of 1.8 or whatever to the bottom club, which would effectively have put a cap on spending, even for the richest teams. that bit didn't get through so now what you have is a this kind of supercharged market where the big teams can basically do what they want as long as they kind of keep some money rolling in to offset a bit of it from sales yeah or they get those revenues from playing in the club or cup for example every every two years or you know the money they get from the champions league every season so yeah we're now in a situation where the clubs at the top are going to have far more revenues coming in and can spend 70 % of it instead of 80 % because they're going to be in the Champions League every season.

16:53Although UEFA's restrictions are stricter, their punishments are far less punitive than the Premier League's. There tends not to be points deductions in UEFA. I suspect that some of the clubs that are in European competition think they could probably ride out any UEFA restrictions if they fail. Villa failed last season, had I think two-thirds of their fine suspended so even that 70 % restriction in UEFA competitions isn't necessarily that you know a hard line. And even then you could take it as a luxury tax which is not unfamiliar to people in in US sport. The other thing I'd say or I'd ask you you mentioned revenues are going up which is obviously true they cannot possibly even for the like the big clubs be going up at the rate of football inflation because you're looking at if suddenly kind of it's 70-80 million quid for a pretty bog standard right-winner, that is a factor.

17:50You know, that maybe not quite doubled from a couple of years ago, but it's not far off. For most clubs, their revenues are not going up that way. So is that just kind of an inflationary spiral that prices at the top are driving that and everyone's kind of saying, OK, well, we'll have to pay that to keep up? Or is there something else at play? I suspect it's partly that. I also think that in the Premier League, we have the fact that the revenues are increasing for all the clubs. whereas they're not in other leagues. I think in the last Deloitte report that there were 15 of the 30 richest clubs in the world all play in the Premier League.

18:24And so it's not just the big clubs that are spending big money. These transfer inflation is being driven as well by clubs that are in the mid-table, whose equivalent clubs in Spain and Italy and France are probably spending£10 million this season. But is it a bubble that won't burst as long as they keep trading between themselves? Possibly. Possibly that might be the case. I mean, whether it's a bubble, I remember when I studied this 20 years ago, my lecturer then telling me this is a bubble that's going to burst in 2005. Because the first match of the day of this season, we were talking about transfer fees.

19:07and there is a website where you can look at what somebody cost back in the day and what it would cost now and we may have mentioned this on the show before but shearer for example the 15 million that shearer went to new went to newcastle for in 96 from blackburn equivalent now would be somewhere around 240 million 240 million pounds so when you hear that there is an element of perspective but but there weren't there weren't deal after deal i don't remember there being deal after deal after deal after deal back then at that well that's that's the bit that i find baffling is that you you can say the the big clubs revenues have gone up to sit 700 million a year but as a percentage of those revenues the amount that these deals are costing is much higher because they're doing multiples of them.

20:00It's not just that they're... If they were signing one 75, one 80 million pound player each, that would be different. But they're trying... Man City have spent, or will have spent, if they get Enzo through, and they are now talking to Chelsea, will have spent 300 million quid just on midfielders in one summer. And that's half their entire revenue. Yeah, you only have to look at Liverpool, don't you? You look at Isak Wirtz and then Barcola, all 100 million plus players. And that's probably more than 300. in the last, what, two windows or three windows if it's summer to summer. That's just, it's absolutely baffling.

20:36But I do think that point you make about the clubs buying from each other is also driving this. You know, Chelsea, say City spent 300 million or so on midfields, but they've sold 250 million odd of players. You know, they've sold Savio, they've sold Rodri. They've sold quite a few players this summer as well. So the fact that there is a transfer market that's been very, very active means that that money's circulating through the club so this may be a really stupid question then do the higher fees benefit everybody if if they're buying and selling from each other because as Stephen made the point earlier how how do you how do you work out and we're not picking on him but it is a how do you work out Liam DeLapp scoring one goal in in nearly 30 appearances going for 30 million last summer and 50 million this summer or Savio going for 75 million two years after going for 30 million but if everybody's going well actually if we all if we all pay more it helps us can it help them all i think those are two interesting examples because the lap had a release clause didn't he when he went to chelsea and Savio was signed from another city group club So whether the extent to which those two transfers were what we maybe would say were the market value for those players at the time, I don't know.

21:58But I think because the transfer values are going up, it means the clubs are more willing to spend a lot of money on a young player because the values keep going up. Spurs might be thinking that if they spend however much they're spending on Savio, that if he's great for them, brilliant, that works out. if he's middling and the value of players continues to go up in two, three years, when he's 24, 25, he's not going to be past it. There's still going to be a market for him then and they'll still be able to move him on. I find it incredible because if you had two bad seasons at a football club, your value just completely fell off the edge of a cliff.

22:38And that was the way it was. Why are you laughing? Why did you look at Chris when I said that? Because I was just going to ask him what Celtic paid for it.

22:45Chris Sutton:Yeah, no, it's quite interesting, really. So I went for£10 million to Chelsea from Blackburn, had a bad season and went to£6 million, which was a Scottish record fee at the time mark. So I've been at an English record fee and a Scottish. So I devalued£4 million. And then the Liam to Lab thing is astonishing, really. And I get what you say about the release clause, but it still was£30 million. And, you know, people looking there, laymen looking at that situation would just think it's absolutely mad. I mean, I looked at that. I couldn't believe it. You know, that someone can, you know, can nearly double in value after having such a poor season.

23:33Chris Sutton:It's just, I mean, it's absolutely wild. and the stuff about, you know, listening, the stuff about the difference with the Champions League revenue and the Premier League revenue. Basically, if you're a football fan, you're thinking, the dream is for our club to qualify for Europe. Yeah, actually. But then the club will think, well, maybe we don't want to qualify for Europe. That's bonkers. And? If I'm right in saying that. Yeah. Yeah. When we were doing this last season, talking about PSR against squad cost ratio, and we were going through the vote on it, Bournemouth, Brentford, Brighton, Palace, Fuller and Leeds, all voted against squad cost ratio.

24:21And at the time, we were like, oh, really? And then when it's all explained, you can see why they did. I just wanted to say I did make that point last season. You did. I remember doing it. Yeah, PSR had many, many, many faults. But what it did was keep some sort of lid on this thing. SCR, what they replaced it with because they didn't pass the anchoring, SCR is free rank. And the thing that will limit them to some extent is the UEFA rules. So Tris is totally right. The Europa League and the Conference League are basically a punishment for doing well, but not well enough. But if you didn't have that, if UEFA said, okay, well, you can have 85 % as well, then you can't there is then it it just kind of solidifies that hierarchy whereas PSR was it did it had checks and balances in it that certain teams didn't like because they were in specific circumstances that did meant it didn't work for them but for the clubs that were quite well run Palace, Brentford, all those it was it was quite a good thing I think.

25:21Just a final one Tom them with all these regulations are there benefits with clubs for the clubs if they trade between each other several times potentially i mean we saw in psr a couple of seasons ago we saw that the final day transfers between nottingham forest and villa and chelsea and everton and all those transfers that that went on that's that doesn't work quite the same under under sdr because under PSR, under the profitability and sustainability regulations, when you sold a player, you've booked all that profit in this season. In squad cost ratio rules, that's not quite the same. So I think you were talking about Armstrong from Everton when he joined.

26:04If they sold him for, say, 45 million just for the sake of arguments, that wouldn't be 45 million profit booked onto this season. That would be 15 million one season, 15 million another, 15 million another. So they have changed that in the score cost ratio regulations to try and avoid these last minute sales, the old pure profits of academy players to solve the financial issues. Clubs don't quite have that same out anymore. But do you still book a purchase over the duration of the contract? Yes, up to five years. The transfer fee is still amortised over the duration of the contract up to five years.

26:42and then the sales spread over three years to smooth it out. So even if you gave someone a six or seven-year deal, you can only do it over five years? Yes, that changed after Chelsea were giving their eight-year deals to Mudrick and players like that. Tom, thank you very much for coming on this evening. Appreciate it. Very welcome. Thank you, Dr. Tom Basin, Assistant Professor in Sport Management at Coventry University. This is the Monday Night Club with Mark Chapman. On the Football Daily Podcast, We'll be right back.

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27:49This is the Monday Night Club. On the Football Daily Podcast. Chris Sutton, Roy Smith and Stephen Ward on the Monday Night Club. It is being announced that Manchester City have reached an agreement to sign Illiman and Jai from Everton for around£65 million. so£60 million plus five add-ons I think that's an actually that's a sensible figure It is but why is Ilaman Jai who is Everton's best player worth£20 million less than Cody Gattpott I've got no idea because my other point was going to be I mean Liverpool have I don't know that it's gone through but he's the Genk goalkeeper has just signed after playing 12 games for£35 million I mean what's going on here He must be good

28:38Chris Sutton:He must have been really good in those 12 games. He must have been incredible. Scouts must have been impressed, yeah. But what is it with younger players now who've got potential that suddenly, I mean, even Harrison Armstrong. Do you think people in the offices of these football clubs, in the sporting director's offices and whatever, think the same? I've got no idea. Because they're not sort of new to football. They've been around. I'm not just saying Liverpool at any point do they sit back and think blimey £35 million for someone who's played 12 games it's not their money it's not their money exactly that they don't care I tell you who's having a great time European sports European sports and directors who must be sitting there thinking hang on they're going to pay how much they will be I mean they have different issues and if you look at the French clubs they're all having to kind of ship players out Lyon, Monaco at Lille as well to meet their debts, just the collapse of the media rights and stuff.

29:43But they must be, they've always preferred selling to Premier League clubs because Premier League clubs generally pay up front. And now there is very clearly a system where there is one fee for other European teams, there is one fee for mid-range Premier League teams, and there is one fee for the big Premier League teams. And I don't think they're even pretending that it works any other way now. They are plucking figures from the sky. It's the easiest thing in the world