Dave Cameron wrote an article on the state of baseball's economy for The HBT:
http://www.hardballtimes.com/10-things-i-learned-about-the-baseball-economy/
I wonder what he would be saying if he was an economist for a Wall Street firm in 2005. This has been discussed in other threads, but it should be obvious to everyone that MLB is experiencing a bubble. Their finances are private, so it is impossible to say how inflated it is. We know that the TV market is the main driver, and the foundation of all regional sports networks are carriage fees charged to all their consumers. This is an oversimplification, but the poorest cable consumers have some similarities to the subprime market in mortgages during the housing bubble. Monthly cable costs are at record levels, and analysts project costs to continue rising. A large percentage of cable consumers will be priced out, and will seek cheaper alternatives. Cable companies are slow to react to everything, but they will either start offering a la carte programming, or cater to their richest consumers, therefore making cable a luxury item.
The first scenario is more likely, but both of them will pop the MLB TV bubble. As mentioned before, sports networks, including ESPN, make their majority of their revenue by the ability to charge all cable consumers a carriage fee. In the a la carte scenario, most regional sports networks will go bankrupt. The CSN Houston bankruptcy is the most likely course for the smaller and middle market teams. They will take huge losses in their equity stakes, and lose out on the hundreds of millions in broadcasting rights. The new TV deals they sign will be for significantly less. This will also happen to the richer MLB teams, but in a less dramatic fashion. They should be able to survive, but with a much reduced revenue stream. The national TV deals will also be much less lucrative. Most TV viewers just don't like sports.
Cameron has even alluded to this scenario on multiple occasions, which is why I am completely perplexed how one can conclude that it is "remarkably healthy." It is literally one of the most bizarre connection between a premise and a conclusion I've ever seen. The whole foundation is built on an unsustainable source, and when it breaks it will reveal how "remarkably healthy" MLB economy is.
There is also signs that the last great MLB bubble (new stadiums) might blow up at the same time. I would have to look into this deeper, but the Yankees and Cubs are heavily involved in securitizing their debts. I'm pretty sure the Dodgers, Mets, and Rangers are playing the derivatives market as well. If anything has the chance to blow up as spectacularly as the 2008 financial crisis it would be this one.