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Alvin Kamara Arrested

this is a discussion within the Saints Community Forum; Originally Posted by voodooido I lived through the 80’s, 90’s and the early 2000’s. I’d do it again to get out of this cap mess. Originally Posted by AsylumGuido The cap is a matter of perspective. I personally have no ...

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Old 02-07-2022, 12:27 PM   #11
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Re: Alvin Kamara Arrested

Originally Posted by voodooido View Post
I lived through the 80’s, 90’s and the early 2000’s. I’d do it again to get out of this cap mess.
Originally Posted by AsylumGuido View Post
The cap is a matter of perspective. I personally have no issue with the way Loomis and Khai Harley manage it. It's all founded on sound cost management principles. More and more franchises are beginning to adopt many of those same principles to maximize their assets, as well.
I have a bit more time to explain, voodooido. First of all, the excellent interview below with Khai Harley covers several of the philosophies of cap management that the Saints utilize. He points out how they take advantage of GAAP (generally accepted accounting principles) to maximize the cap. He also covers the misconception of "kicking the can down the road".

Secondly, I'll try to give a simple example of that part of their strategy. This utilizes the cost accounting principle of current value versus future value, or the "kicking of the can" referred to above.

In year one we're working with a $100 million dollar cap. Let's assume a 10% annual increase in the cap. In year one a $20M asset counts as (20/100=.20) 20% of the cap.

In year two the cap becomes $110M. That same $20M becomes 20/110=.1818 or 18.18% of the cap.

In year three the cap becomes $121M. That same $20M becomes 20/121=.165 or 16.5% of the cap.

In year four the cap becomes $133.1M. That same $20M becomes 20/133.1=.15 or 15% of the cap.

The cash paid in year one is better accounted for in subsequent periods when it becomes a smaller percentage of the cap. This frees up cap for other assets in all periods. This is the maximization of assets. However, the selling off or trading of assets in a current period negates all of the savings by forcing all future accounting for the costs of those assets into the current period.


“The pessimist sees difficulty in every opportunity. The optimist sees the opportunity in every difficulty.” — Winston Churchill
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