No econ background here, but I'll tell you how I understand it. Corporately, debt is bad. However, it's bad debt that's "really bad". Debt accrued for things that are guaranteed to fail, or already have, like if we owed Sammy Sosa $11million a year, in deferred money for the next 5 years, or owed $400mil on a stadium that always sat empty. The Cubs have increased their costs for future years, by signing all these guys to contracts, however, by signing (at least some) of these players they are increasing their likelihood of a very solid return on that investment. Individually, there may be some really bad promises of payment in that mix, but overall, the return on the investment (no matter how poor part of it might be) will be worth the cost. That's at least how I understand it. I still don't get it. Hendry did nothing to maximize bang for the buck on these deals. He paid top dollar for every ounce of improvement he made to the overall talent level of the club. I don't understand how that should increase the value of the team. The Cubs have certainly gotten better, but they took on a gazillion dollars of debt to get that way. If Hendry had made some great moves that improved the team's talent level without incurring a ton of debt then I can see how that would have increased the value of the team, but that's not what happened. I would suppose that the cost of winning versus the return on the investment is not a dollar for dollar even trade. Based on the acquisition of the players (and staff) they acquired this offseason, they are projected to earn x number of dollars. The increase in earnings from last year to this year are proportional to the "winningness" of the players/debts acquired (or lost). Because of the increase in earnings as a whole team for the duration of each contract will outweigh the cost associated with maintaining that team, the value of the franchise then rose. Marquis is owed $21mil a year over the next 3 years. Add into that everyone else who is guaranteed to be paid a set amount over those 3 years. And the forecast is that they will earn more than they spend, by such a rate because of those persons, that the overall speculative value for the team for that 3 year span, is higher by some % of those profits.