http://m.espn.go.com/general/blogs/blogpost?blogname=new-yorkmets&id=90512&city=newyork&src=desktop&rand=ref~%7B%22ref%22%3A%22https%3A%2F%2Fwww.google.com%2F%22%7D&ex_cid=espnapi_public

More to the story-

http://www.celebritynetworth.com/articles/entertainment-articles/bobby-bonilla-baseball-contract/

The Mets were taken in by Bernie Madoff. They were convinced they were making 18%, which would have made the NPV of that contract less than the PV of keeping him. Pretty humorous, good for Bonilla

good for bobby

It doesn't matter how you dress it up or with what extenuating circumstances you cite to rationalize it, agreeing to pay what amounts to a 500% rate of return is insanity. Depending on a single large investment that had to have been known to be, at the very least, high risk, to make said contract profitable is even further insanity.

And to rub more salt in it, the Mets had a golden opportunity to make this contract go away by declaring bankruptcy when they had the chance, blow up the whole thing and start over from scratch. Instead, they decided to keep a tenuous situation afloat by borrowing money.

Of course, if they were actually a good team, all of this may be forgivable, but there they are, sitting at the bottom of the NL East and not making any significant moves to try to better themselves. For a team in one of the biggest money markets in the country, that's pathetic.

I'll defend them somewhat. People were paying 8% interest rates on 15 and 30 year mortgages in 1999 (and those are collateralized, obviously), so they entered into a long-term financing structure that was basically a market rate deal. Organizations do this. People do this.

I don't know enough about the bankruptcy aspect, but I'm not sure they could have avoided it. If I recall, the Rangers still had to pay their deferred comp when they went bankrupt.

[This message has been edited by Danny_Duberstein (edited 7/4/2014 10:49p).]

On the plus side for a player, Bonilla likely won't be dead broke 3 years after leaving the game.