Wait A Second, Real Madrid Can’t Possibly Pay for All of This, Right?

↵
↵As we stand and marvel at the orgiastic spending spree by Real Madrid’s soccer club (or, as we in the biz call them, Mad Real) in the offseason (first Ronaldo, then Kaka, and hey, why not David Villa for another $34 million?), it’s time to take a step back and contextualize everything.
↵
↵That’s now $282 million in transfer fees alone for three players. That’s a record, of course, and there’s a reason: nobody has that kind of money to drop on a single roster, right? Real’s president, Florentino Perez, reportedly has a $420 million war chest for bringing in these types of players, to which someone might respond in one of three ways:
↵
↵A) Wow, that’s impressive.
↵B) Okay, and you’re trying to spend it all on transfer fees? You’re going to pay salaries too, right?
↵C) Wait, what?! Where in the hell did that come from?
↵
↵So let’s talk about C.

The great Unprofessional Foul compiled an idea of where this money might come from (very short answer: TV, shirts, chicanery), and it’s well worth a read. For example: ↵↵⇥Unlike England where the league negotiates its TV rights, in Spain clubs are free to negotiate their own individual rights. Apparently Real Madrid is pretty popular in Spain as they were able to secure a six season deal for €1.1B (or about $1.4B) with Mediapro. For comparison the same folks paid FC Barcelona €600M for five years (somewhat interestingly, Mediapro is a Catalan company).
↵⇥
↵⇥Assuming straight line payments, that means a little over €157M for Madrid every year in domestic TV money. As another comparison, EPL money gets a team in the neighborhood of €35M.
↵⇥
↵⇥[...]
↵⇥
↵⇥But media reports have circulated around the Spanish capital of new Real Madrid president Florentino Perez having €300M to spend (over half of which he’s already dropped on Kaka and Cristiano Ronaldo). So even if every penny of Real’s TV money went to transfer funds, that only covers a little over half the supposed transfer till. ↵↵That means, of course, that loans are coming into play here, loans for staggering amounts of money, considering the state of the global economy and the regular operating costs of a soccer franchise. Here, too, there is a way around the problem: ↵↵⇥Real are a social trust, and as a result aren’t necessarily subject to the same laws and pesky regulations that might hamper their stature and status.
↵⇥
↵⇥So, this whole thing is just who knows who. Then, over here, you have favoritism.
↵⇥
↵⇥Real Madrid doesn’t need to put up collateral or service debt. Their debt is held by local banks or creditors and those banks are often chaired by people allied with the club’s interests or, it not, they come under political pressure not to put economic pressure on the club. And if Real Madrid need a line of credit, then apparently, hey, there’s €300M available. ↵↵And to be clear here, this is not money flushed down the drain. This is potentially over $400 million in investments. That money is spent with the sole intention of earning back more than $400 million--ideally, much, much more.
↵
↵So the question is this: is the key to such a task spending it all on a handful of some of the most highly skilled soccer players in the world? Even if they, say, take 3 straight UEFA titles, does the resultant windfall actually pay for the hefty fees, or has Real spent itself into an inalterable course for oblivion?↵