"The 2010 PGA Tour season begins on Jan. 7 in Hawaii. Cohen’s estimate suggests ad losses may be at least $192 million if Woods is out all year. That, plus the potential damage to Nike, would put the effect at more than $220 million."
So you should have no doubts why Tiger is a $1 billion man (according to Forbes).
Readers should be careful when reading the report, since it consists of many numbers and could be very confusing. The financial flows affected are not so easy to understand i.e. when Tiger Woods sits out, what is the financial impact to the industry.
If you switch the angle a bit, and think in terms of the "business" flow, it is easier to understand. Basically, if Tiger Woods sits out :
--- Less people will watch the PGA tours directly. Less hostel, Food & Beverage and travel activities. Pretty straight forward.
--- (Broader terms) Less audience will watch the PGA tours via TV and other indirect channels. There will be less advertisement and other marketing campaigns. (Similarly, less marketing campaign by PGA - if it has)
--- (Broader terms) Tiger Woods has been the icon of Golf for Nike. So less people will buy Nike and to a less extent, Golf-related sports item. They might switch to the items for other brands (e.g. Adidas) or sports (e.g. basketball), but there should be some net loss in purchase of Gold-related merchandise.
--- (Even broader terms). In the longer term, golf could lose its favor to audience and potentially golf players (which somewhat creates viscous cycle). Depending on the impact (which I suspect could be immense), golf course operator will invest less, less merchandise of golf will be sold, and the whole sports could be less popular.
In broad terms, some headline figures for US labor market showed initial signs of stabilizing in November-2009 : Unemployment rate edged down, jobs cut almost eased. But some underlying fundamentals remained very weak (e.g. long-term unemployment)
Unemployment rate dropped slightly to 10% from 10.2% in October. An encouraging sign. This is the second time in this year where unemployment fell while company still cut jobs. It is too early to judge whether jobless rate has already peaked. But as you can see in previous hikes, peak in unemployment rate is really "steep", instead of being a plateau.
By and large, it is more prudent to wait for 1 or 2 months to judge whether 10.2% in October is the peak for this cycle.
At the same time, companies cut less jobs in November, only -11k (at the same time, figures for Sep and Oct are revised, showing less jobs cut). Note that companies still cut jobs, but at a lesser pace. Since recession in January-2008, US lost a total 7.2 mn jobs, about the whole population of Hong Kong.
In a recent interview, Greenspan expected companies to add jobs very soon; but unemployment rate could still rise, seeming paradoxical (but it is not). See the interview and Greenspan's explanation here.
What has been bothering me, and still being unresolved, is the long-term unemployment. Both the number of long-term unemployed (individuals unemployed for at least 6-months) and the average duration of unemployment broker record, again.
Greenspan in the above interview highlighted the risks of long-term unemployment (again) :
These people are losing their skills...It is very critical that those people have the skills when the economy comes back or we will not be as productive as we ought to be."
Hours of work eventually rose, after hovering around record low for quite a number of months. Good initial sign.
But wage growth continued to decelerate (from 2.5% yoy in October, to only 2.2% in November).
Given that in labor market, quantity adjusted first and then pricel; that is to say, jobs are adjusted first, salary adjustment lag behind, we could have ongoing deceleration in wage growth.
When recession ended (shaded regions denote recession), unemployment rate would have peaked or soon peaked...
But wage growth continued to decelerate even way after recession is over...In the recession of 2001, wage growth slowdown did not stop until 2004.
