Finally, Goldman Sachs delivered what we’ve all been waiting for. No, not the FCIC requests for documents and interviews – in fact, the Wall Street giant has been hit with a subpoena for a "deliberate and disruptive" failure to co-operate with requests for information about its role in the credit crunch that shook the global economy. It doesn’t have anything to do with the SEC fraud charge either…that would be far too prosaic for such anticipation and excitement. What I’m talking about is the publication of Goldman Sachs World Cup and Economics 2010 – the fourth book they’ve compiled since debuting at France ’98. With WC2010 one day away, the only Fabulous ‘Fab’ that football fans want to hear about is Fabio Capello or Cesc Fabregas. So, Monsieur Fabrice Tourre, back in your box, while the rest of us watch the beautiful game enraptured.
The World Cup paper is a fairly hefty tome – some 75 pages – but makes surprisingly easy reading (provided you like football of course). Jim O’Neill, Goldman’s chief economist and avid football fan, kicks off the report and as you might expect from the man that coined the Bric concept, mentions it repeatedly. Honestly Jim, it’s always ‘Bric this Bric that’…enough already. The acronym doesn’t even hold up for the World Cup (notwithstanding Brazil) as Russia, India and China didn’t even qualify.
Some may ask what all this has got to do with the world of finance and, despite my best efforts to turn this into a football blog, that would be a fair question. Well, as outlined previously – the world of football and finance are intimately acquainted and the business of the beautiful game is just as prevalent when we talk about nations as when we talk about domestic sides. In fact, the sovereign state has it all to play for as the World Cup offers real revenue and growth potential for hosts. Igor Shuvalov, First Deputy Prime Minister of Russia, makes this point in the Goldman report when discussing Russia’s 2018 bid: "Modern football is a whole industry. It includes complex infrastructure, such as top stadiums, rehabilitation centres and training bases, as well as sports gear and equipment, to say nothing of advertising and TV rights….Intensive development of football infrastructure will act as a huge boost to both regional and national economic development."
Moreover, the World Cup also provides a truly global forum to highlight the ambitions and capabilities of a country. For instance, what better way for Brazil to communicate its status as an economic force, than to put on a stellar World Cup in 2014 and then Olympics in 2016. To keep with the Bric theme (sorry) – China did a similar thing with the Olympics two years ago. Beijing 2008 was a formidable event that showcased the economic might of the nation to a global audience.
Towards the end of the Goldman report, my attention turned to the section on Spain entitled "Leading in Football, Lagging in the Economy." Angel Ubide, a former Real Zaragoza FC player and Director of Global Economics at Tudor Investment Corporation, makes some great comparisons between the success Spain enjoys on the pitch compared to its economic shortcomings. He concludes: "Without a question, the football team has been more dynamic, creative and successful than the economic team, and thus the odds of success in the World Cup are certainly much higher than the economic league. Good luck to all." His erudite comments are a long way from the monosyllabic and anodyne trivialities we’re used to on Match of the Day each week.
Anyway, Jim O’Neill and his gang predict that England, Argentina, Brazil and Spain make the semi-finals. I’d certainly settle for that. God bless the World Cup.