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Livan Hernandez Firesale


PhxPhin
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Apparently Livan has gone into full auction mode

http://hardballtalk.nbcsports.com/2013/12/18/livan-hernandez-is-auctioning-off-his-world-series-ring-and-mvp/

Interesting to see what some of the stuff went for

http://www.lelands.com/Auction/CategoryView/3907/Fall-2013-Catalog-Aution/Sports/The-Livan-Hernandez-Collection

His 1997 WS Ring brought in $18,752.10 - which was the most expensive item

The first pitch baseball for the Nationals didn't meet it's $5,000 reserve

His WS MVP was just under $10k, which is interesting as unlike a ring there is no real stripped down value in there - it's lucite & a baseball - however, it's not something shared by everyone on the roster

I found the Silver Slugger award interesting as well

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How do some highly paid guys wind up with no money?

 

Simple. Federal income taxes take 39.6% (it's been a little higher/lower in the last 30 years) off the top. Plus the new Medicare surcharge of .9% (over 250K.) State income taxes takes another 6.4% or so on average (of all 30 clubs, and that has generally been higher in the past.) That's about 46.9%.

 

An agent will cost about 5% of your gross (closer to 4% if you're super-elite on a monster contract.) That's 51.9% for almost all of them. A manager/financial adviser-type is going to get 2% to 5% depending on how bad a deal-maker/stupid/gullible you are. That's 54-57%.

 

So, you gross 10 mill and spend like you make 10 mill, but you only net 4.3-4.6 mill. There are innumerable family members/hangers-on/"friends" who want hand-outs. There's always another party to have, another vacation to take, a bigger house to buy, another car to buy. Throw in a few bad investments along with a lot of stupid spending and you can wind up with nothing very, very easily.

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Curt Schilling sunk a good amount of his money into a gaming company, didn't he?

Yup. Released one mega-budgeted game that didn't sell well and the company completely sunk. Shame, because I hear the game was pretty good, though I never got around to it myself because I had my own budget problems to worry about.

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38 Studios' second game (Copernicus, then in development and estimated to need 75 mill to complete) was the one that attracted the 75 mill loan from Rhode Island. So, they moved to RI from MA to get the loan.

 

Less than two years from the date the loan was made they filed bankruptcy. Just illustrates why government should never be involved in picking winners and losers or financing them. Since when does a state government know anything about developing software (or anything else)?

 

RI is now on the hook for 90 mill plus another 23 mill in interest payments due over the next 7 years. RI has recovered less than 2 mill from sales of bankrupt 38 Studios' assets -- furniture, equipment, etc. -- the software is worthless. 110+ mill will be eaten by RI taxpayers.

 

Schilling is financial toast. He put 50 mill into his 38 Studios venture (he started it) and it's all gone. Talk about a bad investment. He blew his entire net career earnings. Although, he did do a very good job of piling it up before he blew the entire pile.

 

He's reduced to selling personal possessions, just like Livan. They gave the bloody sock back to him and it sold for 92K. When he still had the 50 mill, maybe spending 4.5 mill for Bledsoe's house seemed like a good idea. He tried to sell it for 8 mill back in '08. Last I saw it was for sale for 3 mill. I have no idea if there's a mortgage on it or not, but any way you cut it it's a sad story.

 

There are many investment tropes about the benefits of diversification and some of them are true. Alternatively, if you don't want to diversify and instead put all your eggs in one basket, you'd better watch that freaking basket very carefully. Schilling obviously failed massively on both ends.

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I don't particularly like the guy but it's definitely sad to see it happen. He picked something he had a passion for but he basically went all in which is all kinds of insane, especially without any background or experience with that kind of company, other than playing games. He admitted he went in 100% because that's how he was successful in baseball, really the only way he knew how. I mean he apparently had R.A. Salvatore writing, Todd McFarlane designing, was throwing around all kinds of perks for the employees.

 

He wanted to be "Bill Gates wealthy" as he put it and bet on making the next MMORPG. So many of those games don't hit it big though, doesn't seem like a good bet to make.

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Guys like this are aggressive competitors and will often go all in. That was just a business failure. Schilling will continue to be wealthy and get excellent compensation as a commentator. He will probably never be $100 million rich, but once he gets out from under the house, he should be back to multi-millionaire in short order.

 

Livan is just fucked.

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