So Much For The Jeremy Lin Effect: MSG Stock At All-Time High

Shares of $MSG closed the day at 39.39, for a market cap of $2.98 billion. That's an all-time high for the stock, squeaking past the previous high at the beginning of NBA free agency, and blowing past the numbers at the height of Linsanity. This means nothing, but so does everything that came before it.

We all went a little Linsane this year. It's OK. It was a crazy time, we all said some things we wish we hadn't, made some grand pronouncements that look silly in retrospect. One of the more pernicious and stubborn memes was that Lin was some kind of bottomless ATM, whose monetary value to the Knicks would easily pay for his contract and any luxury tax penalties. A golden goose whose eggs would be worth far more than the $58 million they could owe him in 2014-2015.

The problem was, everyone was a little fuzzy on the details on how he'd print the money. Considering NBA merchandise revenue is split among all teams, all those Lin jerseys weren't going to help. And the Garden sells out every night with or without Lin (or a quality Knicks team), so he wasn't about to bring in the ticket revenue—and ticket prices are still rising five percent this year.

That leaves the intangible—Jeremy Lin's value to the MSG "brand," which had a good run of being treated as an actual thing in the week he left for Houston. Blame it on Nate Silver, who pointed out that MSG's market capitalization rose $600 million since Lin's first start in February. The headlines followed. On the Monday when it first emerged the Knicks wouldn't match the Rockets' offer: "Monday's MSG market-cap drop would have paid for Lin contract!" Later that week: "MSG Market Cap Falls $100 Million After The Knicks Lose Jeremy Lin To The Rockets For $25 Million!"

The Lin soap opera did have an effect on MSG stock, but the mistake was to think it had any sort of long-term significance. Jonah Keri, the only writer who treated the nosedive with any sort of nuance, explained what we were looking at.

On July 2, news broke that Lin might not return to New York, if other suitors were to offer him a back-loaded contract that threatened to detonate the Knicks' cap situation three years down the road. Yet the stock actually motored 1.4 percent that day. In technical terms, you could call that move a breakout: MSG's stock had drifted slightly lower for eight weeks, marking the kind of consolidation that can often portend a big jump in price to new 52-week highs. The stock did in fact hit a new high the next day. But after a big move in the morning, it closed up just 0.1 percent for the day, bearish action at such a crucial juncture. Turns out that potential breakout on July 2 came in below-average volume. In layman's terms, that means the big mutual funds and other institutional investors who normally drive stocks and the overall market higher weren't buying, with the action instead coming from regular shlubs like you and me. When a breakout occurs under those circumstances, a stock's move is almost always doomed to fail, Jeremy Lin or not.

In other words, no one with any real influence gave a damn about what uniform Jeremy Lin would wear in the fall. MSG is a strong company, with or without Jeremy Lin, and we're seeing that re-correction. From a three-month low of 34.73 on July 23, shares have climbed steadily, gaining 13.4 percent in just 28 days. Which isn't to say the Knicks aren't a better or more marketable team with Lin than without him, only that his departure wasn't the death blow it was made out to be, and that MSG Inc. is healthier than ever, even Lin-free.

Today's big MSG news, that boosted the price from the opening bell: the New York Liberty's licensing deal with NBA Baller Beats, a sort of dribbling Dance Dance Revolution for Xbox 360. The point being, MSG's house contains many mansions. Madison Square Garden Inc. owns four professional sports teams, a number of TV networks (not all sports), and stadiums and venues around the country, including the Chicago Theater and Los Angeles Forum. Jim Dolan's fortune is not tied to the Knicks' starting point guard.