An Extra 10 Million $$ . . . . . Discuss . . . .

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An Extra 10 Million $$ . . . . . Discuss . . . .

Post by ski »

Wow ! I pulled this quote from a story by Alan Keays in the VT Digger, reprinted on the front page of this weeks Mountain Times. That is a staggering amount. Let's discuss.
In looking at the economic impact of the World Cup event last year, town of Killington officials have said that based on tax receipts they estimated that an additional $10 million in revenue came into the community of Killington compared with the same quarter the year prior.
I seem to hear from a number of sources that the World Cup doesn't really bring in much more than a regular Thanksgiving weekend . . this seems to indicate otherwise . .
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Re: An Extra 10 Million $$ . . . . . Discuss . . . .

Post by innkeeper »

The source of an economic impact may be hard to directly measure... but the anecdotal evidence is pretty strong. Thanksgiving weekend can be especially fickle. If you have minimal snow and a poor economy..Thanksgiving weekend is nada. Last year, with some snow and a reasonable economy, Thanksgiving weekend should have been fairly strong in it's own right. Clearly on the exact weekend, the World Cup did add some revenue, but the area only has so much capacity. Once it is busy/full... you can't generate more.

What people miss, however, is the impact around the World Cup. Because of the marketing value of the World Cup, it did appear that November overall and early December were stronger. Remember, the year before was an exceptionally poor snow year. By all rights, people were "forgetting" about Killington. Early season attendance should have been down all things being equal. However, with the World Cup, people "heard" about skiing at Killington. And anecdotally more people came in the 6 weeks around the World Cup than usually appear in Killington in the early season.

Also, do not forget all of the economic activity related to producing the overall event. Literally hundreds of people were in Killington in the weeks leading up to the event to produce the event. You had people working on the venue, TV people, coaches, athletes, athletes families, etc.... all were in Killington ahead of and during the event. They also contributed to economic activity.

Bottom line... there clearly are a lot of moving parts. But attributing additional economic activity to the World Cup for Q4 last year is reasonable.
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Re: An Extra 10 Million $$ . . . . . Discuss . . . .

Post by f.a.s.t. »

ski wrote:Wow ! I pulled this quote from a story by Alan Keays in the VT Digger, reprinted on the front page of this weeks Mountain Times. That is a staggering amount. Let's discuss.
In looking at the economic impact of the World Cup event last year, town of Killington officials have said that based on tax receipts they estimated that an additional $10 million in revenue came into the community of Killington compared with the same quarter the year prior.
I seem to hear from a number of sources that the World Cup doesn't really bring in much more than a regular Thanksgiving weekend . . this seems to indicate otherwise . .
If there were 16,000 people watching the races: ten million dollars divided by 16,000 people = $625 each. Ten million isn't too far of a stretch. I can easily spend more than $625 in a weekend at Killington with my wife. Four lift tickets at that time of year $250, two nights lodging at $300, food and beverage $300, throw in some gas, store shopping, etc. it can easily add up to over $1,000. Once you deduct all the money spent by Killington and others, the average amount per person is a lot lower to reach that ten million mark.
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Re: An Extra 10 Million $$ . . . . . Discuss . . . .

Post by Guy in Shorts »

Tons of positive press with good return on investment. Keeping the party from returning to Aspen in two years will be challenging. Killington has a couple more shots to sell The Beast as the place to be.
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Re: An Extra 10 Million $$ . . . . . Discuss . . . .

Post by ME2VTSkier »

If this year is a relative success as well, the sanctioning body should consider making a New England stop permanent on the tour. A men's event should be on the top of their list of future projects as well. The northeast may not be the skiing capital of the world, but the amount of people and money they have to draw on, you would think could support two events per competitive season/year. They don't necessarily have to be at the same venue... but if they are trying to fill the schedule early season, the Northeast knows how to make snow when Mother Nature allows.
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Re: An Extra 10 Million $$ . . . . . Discuss . . . .

Post by rogman »

10 million? Maybe, but it wouldn't be surprising. An additional couple of million was injected into the economy by Killington's expenditures in prepping and running this event. Add in what the 16000 people times 2 days spent. However, it doesn't end there: there's a multiplier effect: the workers, businesses, bartenders, etc. take this windfall and spend it as well. Someone receives 100 bucks, they spend 60 of it somewhere else, and that 3rd party spends say 40 of that. That $100 has now become $200 by virtue of the multiplier effect.

This is all Econ 101 stuff, and is actually the basis of the trickle down theory, except that in that case the tax cuts are given to the well to do, and it is well established that they are far more likely to put it in the bank as opposed to spending it (thus breaking the chain).
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Re: An Extra 10 Million $$ . . . . . Discuss . . . .

Post by GSKI »

the tax cuts are given to the well to do, and it is well established that they are far more likely to put it in the bank as opposed to spending it
What do you think the banks do with it? Is investing the money spending it? Yes. Most all money is working very little of it is under a mattress or piled up in some rich guys vault. If money is not working it is losing 2% a year in value due to inflation. After 20 years that is 40% lost value and 2% inflation is considered low. So yes even rich people who pay most of the federal income taxes do spend their money when they get a tax cut. They buy things but they also invest for a better return. That investment may be to grow a company which buys capital equipment to expand and hires people. Many people not only do not pay any federal income taxes but actually get money back from the federal government in the form of the Earned Income Tax Credit. This idea that taxes do not influence behavior is crazy. It is put forward by the people who are interested primarily in the never ending growth of the federal government and supported by phony "studies" from their "think" tanks. When people rich or poor have more of their own money they spend it and it benefits everyone.
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Re: An Extra 10 Million $$ . . . . . Discuss . . . .

Post by f.a.s.t. »

rogman wrote:
This is all Econ 101 stuff, and is actually the basis of the trickle down theory, except that in that case the tax cuts are given to the well to do, and it is well established that they are far more likely to put it in the bank as opposed to spending it (thus breaking the chain).
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Re: An Extra 10 Million $$ . . . . . Discuss . . . .

Post by Seacoaster »

I ran into a lot of people early in the season last year who had never been to the resort before and it seemed fairly clear that they came because they heard about the World cup and wanted to ski the same trail as the "pros". So, I think it not only had the immediate impact but also trickled into the season.
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Re: An Extra 10 Million $$ . . . . . Discuss . . . .

Post by brownman »

The cited Digger article was mainly focused on how Rutland can 'glob onto' the increased traffic.
If Rutland seeks to capitalize on the draw, they need to sponsor something that actually brings people down there. :idea:
As to $10M of economic impact .. anyone can throw a number out there when it's nearly impossible to validate it.

Clearly, the Michaela show did have a net positive impact on the region. :like
Many of the 'newbies' that showed up were skiing families wanting to expose their kids to a World Cup ski festival.
Lots of those families have skied here before and will occasionally ski here in the future.

Keep in mind, in terms of ski conditions, the previous Thanksgiving weekend was not as kind as last year.
World Cup race conditions need to meet specific snow condition standards, or the show gets cancelled.
Happens even in the historically snowy signature venues .. and contributed to K even having the event opportunity.

Other Resorts in the region took notice last year. They are not sitting idle.
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Re: An Extra 10 Million $$ . . . . . Discuss . . . .

Post by rogman »

GSKI wrote:
the tax cuts are given to the well to do, and it is well established that they are far more likely to put it in the bank as opposed to spending it
What do you think the banks do with it? Is investing the money spending it? Yes. Most all money is working very little of it is under a mattress or piled up in some rich guys vault. If money is not working it is losing 2% a year in value due to inflation. After 20 years that is 40% lost value and 2% inflation is considered low. So yes even rich people who pay most of the federal income taxes do spend their money when they get a tax cut. They buy things but they also invest for a better return. That investment may be to grow a company which buys capital equipment to expand and hires people. Many people not only do not pay any federal income taxes but actually get money back from the federal government in the form of the Earned Income Tax Credit. This idea that taxes do not influence behavior is crazy. It is put forward by the people who are interested primarily in the never ending growth of the federal government and supported by phony "studies" from their "think" tanks. When people rich or poor have more of their own money they spend it and it benefits everyone.
I used banks as a short hand (and as an example) for what the well to do might do with their money. Regardless, it is really about the velocity of money: how fast does a unit of money change hands per unit of time. The lower down the economic ladder you go, the faster the money will change hands. At the bottom (for example), you give a few bucks to a panhandler, it is in the hands of a liquor store owner within minutes. As you move up, someone who is living a hand to mouth existence will spend it fairly quickly. Finally, you give it to a bank, it will be a long time before it turns over.
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Re: An Extra 10 Million $$ . . . . . Discuss . . . .

Post by GSKI »

Finally, you give it to a bank, it will be a long time before it turns over.
Banks only have a 10% liquid reserve requirement so believe it or not most of the money is being used. The banks would like the reserve requirement to be 0 but the federal reserve makes 10% a requirement. As I said inflation forces money to be working or it devalues substantially over time. I know some advocate giving money from the government which it acquired through record debt to bums to buy booze is a far better way to stimulate the economy than private sector lending building wealth and jobs over time but I am not one of those people. The people making the argument that the government giving out $1 generates far more economic effect than a private businesses are the ones looking to give away the free stuff in return for perpetually guaranteed power. They look like heroes to the desperate and ignorant.
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Re: An Extra 10 Million $$ . . . . . Discuss . . . .

Post by Dr. NO »

GSKI wrote:
Finally, you give it to a bank, it will be a long time before it turns over.
Banks only have a 10% liquid reserve requirement so believe it or not most of the money is being used. The banks would like the reserve requirement to be 0 but the federal reserve makes 10% a requirement. As I said inflation forces money to be working or it devalues substantially over time. I know some advocate giving money from the government which it acquired through record debt to bums to buy booze is a far better way to stimulate the economy than private sector lending building wealth and jobs over time but I am not one of those people. The people making the argument that the government giving out $1 generates far more economic effect than a private businesses are the ones looking to give away the free stuff in return for perpetually guaranteed power. They look like heroes to the desperate and ignorant.
GSKI, you quoted from my Econ 101 books with the $1 spending can create a domino effect. I would say that a worker can spend that $1 better than government. Not sure how I passed that course but I aced it while still disagreeing with the professor..
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Re: An Extra 10 Million $$ . . . . . Discuss . . . .

Post by f.a.s.t. »

rogman wrote:
GSKI wrote:
the tax cuts are given to the well to do, and it is well established that they are far more likely to put it in the bank as opposed to spending it
What do you think the banks do with it? Is investing the money spending it? Yes. Most all money is working very little of it is under a mattress or piled up in some rich guys vault. If money is not working it is losing 2% a year in value due to inflation. After 20 years that is 40% lost value and 2% inflation is considered low. So yes even rich people who pay most of the federal income taxes do spend their money when they get a tax cut. They buy things but they also invest for a better return. That investment may be to grow a company which buys capital equipment to expand and hires people. Many people not only do not pay any federal income taxes but actually get money back from the federal government in the form of the Earned Income Tax Credit. This idea that taxes do not influence behavior is crazy. It is put forward by the people who are interested primarily in the never ending growth of the federal government and supported by phony "studies" from their "think" tanks. When people rich or poor have more of their own money they spend it and it benefits everyone.
I used banks as a short hand (and as an example) for what the well to do might do with their money. Regardless, it is really about the velocity of money: how fast does a unit of money change hands per unit of time. The lower down the economic ladder you go, the faster the money will change hands. At the bottom (for example), you give a few bucks to a panhandler, it is in the hands of a liquor store owner within minutes. As you move up, someone who is living a hand to mouth existence will spend it fairly quickly. Finally, you give it to a bank, it will be a long time before it turns over.
Here is your final grade for Econ 101 F-
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Re: An Extra 10 Million $$ . . . . . Discuss . . . .

Post by Guy in Shorts »

As long as Killington opens with at least 1 lift running the worse grade I would ever assign would be a D-.
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