Is transfer spending finally normalizing? Why $100 million players may be a thing of the past

Deflation is the opposite of inflation; prices fall over time, rather than rise.

Most economists will tell you that while excessive inflation is bad, deflation is usually very, very bad. If people think the price of something will be lower next month than now, they will delay buying it. This slows economic activity and production, the government collects less tax, people are laid off because they spend less, and everyone becomes worse off.

Well, that's in the real world. So what about in the fantasy world of sports entertainment we call football?

No one likes to talk about it because the outlook can be bleak. At best, when clubs have to cut back, they complain about the need to meet profit and sustainability rules…as if they weren't the ones who chose to implement the PSR in the first place.

But an analysis of what happened in the last transfer window for the world's richest league, the Premier League, saw net spending fall by 40% and reach its lowest inflation-adjusted level since a non-COVID summer in 2014, as well as the Conversations between club officials, owners and intermediaries paint a rather grim picture.

Now, this isn't something you necessarily measure in the current January transfer window, as winter transfers tend to have a “domino effect” anyway. Club A acquires player X from club B, then club B replaces him with player Y from club C at some cost, and so on. Football finance blogger Swiss Ramble said there are some obvious outliers, such as Manchester City, who may spend big money because their ownership seems to have no obvious profit motive, and their huge profits in the past few seasons mean they can spend big money. , with losses of up to £369 million ($450 million) this year but still complying with the PSR.

However, there are other ways you can see it. Take midfielder Adrien Rabiot, who became a free agent last summer. He just turned 29, is a 50-cap France international (starting all three group games at Euro 2024), and has big-club experience with Paris Saint-Germain and Juventus: You'd think he'd bring a lot of opportunity interest to the team as a free transfer. No. The summer transfer window came and went and it wasn't until mid-September that he found a club (Marseille). Even so, it's a paltry two-year deal that pays him less than half of what he earned at Juventus.

Or how about Victor Osimhen? Napoli wanted to pay more than €100 million for the then-25-year-old Nigerian striker (who scored 48 goals in 71 appearances in his first two seasons), eventually reducing their offer to €80 million, then €60 million, but still No one wants to accept it. In September, he eventually moved to Türkiye's Galatasaray on loan.

This is evident in other ways as well. Consider the league leaders in the Bundesliga (Bayern Munich) and the Premier League (Liverpool). Joshua Kimmich and Alphonso Davies are Bayern's free agents at the end of the season and they rank first and fourth respectively in terms of minutes played in the league this season. Kimmich is 29 years old, captain and one of the best midfielders. Davis, 24, is one of the best players on the left side. Both have been a huge part of the club's success in recent years.

(Heck, while we're on the subject, add attacking midfielder Jamal Musiala. He's not contracted until 2026, but he's already 21 and arguably the club's best player. Not long ago, people like this were allowed to enter the last 18 months of their contracts).

As for Liverpool, forward Mohamed Salah (32 years old, top scorer in the Premier League), center back Virgil van Dijk (33 years old, club captain) and right back Trent Alexander-Arnold (26 years old, born in Liverpool) and growing up) have been well documented. The talks are “ongoing”, everyone is “relaxed” (a word you always see in stories like this) and it doesn't affect the performance, but no one remembers the last time in such a successful campaign, two big Big, well-run, solvent clubs like Bayern and Liverpool are extending the contracts of key players so late.

Everyone keeps their cards close to their chest, but you can only guess that the reason it's taking so long is because the delay is far from simple. Players and their agents have some understanding of the value of their services, while clubs deal with new economic realities.

Real Madrid insist they will not enter the transfer market this January despite only having one 33-year-old winger (Lucas Vázquez) left at right-back due to injuries and a 6ft 6-footer 1 midfielder plays center back (Aurelien). Chuameni). Manchester United are trying to cut wages (and not just that of unpopular striker Marcus Rashford), while Manchester City are trying to get rid of club captain Kyle Walker, who just four months ago was cut off from the team Captain Kyle Walker has signed a contract extension until 2026.

According to Transfermarkt statistics, there have been 16 transfers in history worth more than 100 million euros. Take a closer look at this list and you'll see that more than half of them have proven to be failures, or at least, something they wouldn't do again if the club could go back.

There was a time when you could roll the dice on expensive transfers because you knew that even if you made a mistake and had to move a player for a loss, you would still find a taker who could take the hit. This is no longer the case. Look at Paris Saint-Germain, who are trying to find a club to replace Randal Kolo Muani, the forward they paid €80 million to sign from Eintracht Frankfurt 18 months ago. If they can find a permanent deal, they will be lucky to get more than half of what they paid for him and he will join Juventus on loan for the remainder of the season.

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Why? Partly because there aren't many centre-forward positions, partly because not many clubs are willing to spend €40 million or more on a forward, but mostly because the atmosphere has changed. The club now has to be prudent.

This doesn't just affect the biggest clubs, either. Teams that rely on player trading as part of their business model – Brighton or Brentford in England, Borussia Dortmund in Germany, Atalanta or Udinese in Italy, Monaco in France or Sevilla in Spain – — also found things getting tougher. If you think you're not going to get more than that for the promising young winger you've discovered once he develops, you'll be even less willing to spend €20 million or €30 million on him.

Take Borussia Dortmund’s Donyel Malen, for example. In 2021, they spent 30 million euros to acquire the 22-year-old from PSV Eindhoven. He won't necessarily be a second-generation Lionel Messi, but he did score 15 goals as a winger last year and was a mainstay in the team. Netherlands. Just 3.5 years later, he joined Aston Villa for €25 million.

Maybe this deflation is just a belated adjustment, delayed by Saudi Arabia's crazy ride two years ago. Maybe the club realizes that revenue won't continue to grow the way it did before. Maybe they understand that regulators – whether it's UEFA, the Premier League, La Liga (just ask Barcelona), whoever it is – are serious about enforcing the rules. Maybe they've finally come around to the fact that what was once billed as an “investment in the team” is actually a combination of ego trip and Ponzi scheme, and it's actually getting very, very expensive.

Maybe they just accepted the fact that transfer fees and wages have reached such a level that once revenue stops growing vertically, you can only justify theirs if there is a certain number of fools and irrational actors to compensate for your mistakes. rationality. And there are fewer and fewer people around.

Maybe we've reached some level of sanity. Maybe one day this will become a real, full-fledged, sustainable business.