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Brazilian soccer fan Marilza Guimaraes da Silva, 63, plays with a ball as she poses for picture, dressed in one of her many outfits matching the colors of the Brazil's national flag (green, yellow, white and blue) at her home in Brasilia May 27, 2014. (STRINGER/BRAZIL/REUTERS)
Brazilian soccer fan Marilza Guimaraes da Silva, 63, plays with a ball as she poses for picture, dressed in one of her many outfits matching the colors of the Brazil's national flag (green, yellow, white and blue) at her home in Brasilia May 27, 2014. (STRINGER/BRAZIL/REUTERS)

World Cup: Stacking up the odds of world’s most popular sport Add to ...

Just about everywhere on the planet, the World Cup is both religion and global economics in the form of tournament. Some 3.7 million fans are expected to descend on Brazil this summer for the defining competition of the world’s most popular sport. All told, the country’s government has spent about $10-billion (U.S.) on direct and indirect costs to prepare for the Cup, which kicks off on June 12.

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In the lead up to the World Cup tournament, Goldman Sachs has released a detailed statistical manual, estimating not only each team’s chances of winning it all (Brazil leads the way, with a whopping 48.5-per-cent chance, followed by Argentina at 14.1 per cent), but also the tournament’s indirect economic impact.

On average, the nation that wins the World Cup sees its stock market outperform the global market by about 3.5 per cent in the first month after victory, according to the report. But those gains don’t last – in the year following the tournament, the winning country’s stock market will underperform by about 4 per cent.

If the predictive power of such statistics sounds dubious, that’s because it probably is. Indeed, the report’s authors acknowledge that their complex algorithms for measuring team strength will probably be outplayed by reality: “Football is ultimately,” they write, “a pretty random game.”

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World Cup teams for Brazil 2014

 

Brazil

Previous World Cup appearances: 19 (5 wins)

FIFA world ranking: 4

Goldman Sachs’ probability of winning: 48.5

The team: The undisputed favourite to win the World Cup, Brazil’s deep talent pool and unchallenging group makes it poised for a deep run.

The economy: The host country is trying to move past four years of “low growth, high inflation, high and internationally uncompetitive unit labour costs, and an overvalued currency.”

 

Cameroon

Previous World Cup appearances: 6

FIFA World ranking: 50

Goldman Sachs’ probability of winning: 0

The team: Samuel Eto’o and company will look to move past the group stage for the first time since they reached the quarter-finals in 1990.

The economy: Similar to its team, Cameroon “has no shortage of raw talent and resources, but has failed to generate a fundamental transformation while conditions were favourable.”

 

Croatia

Previous World Cup appearances: 3

FIFA World ranking: 20

Goldman Sachs’ probability of winning: 0.1

The team: Having not qualified in 2010, Croatia will look to make an early statement as they face off against Brazil in the tournament’s opening match.

The economy: The country’s “economic performance has been one of the weakest in the European Union since the onset of the Great Financial Crisis.”

 

Mexico

Previous World Cup appearances: 14

FIFA World Ranking: 19

Goldman Sachs’ probability of winning: 0.1

The team: Mexico will look to build on its gold-medal finish at the 2012 Summer Olympics, but with only three games under his belt, new coach Miguel Herrera is a wild card.

The economy: The short and medium-term outlook for Mexico is positive as a result of “the macro resilience built in recent years and overall disciplined market-friendly policy approach.”

 

Australia

Previous World Cup appearances: 3

FIFA World ranking: 59

Goldman Sachs’ probability of winning: 0.1

The team: Australia heads to Brazil as the lowest ranked team in the tournament and will be competing in a group with Spain and the Netherlands.

The economy: After 22 years of growth, major risks are intensifying as the “commodity prices and mining construction that delivered Australia through the global financial crisis relatively unscathed are now swinging sharply into reverse.”

 

 

Chile

Previous World Cup appearances: 8

FIFA World ranking: 13

Goldman Sachs’ probability of winning: 0.5

The team: Head Coach Jorge Sampaoli’s fast-paced offensive tactics should complement the skill sets of Eduardo Vargas and star forward Alexis Sanchez nicely.

The economy: The best managed nation in Latin America’s copper dependent economy is grappling with “adverse consequences of what looks to be the beginning of the end of a decade-long boom in commodity prices.”

 

Netherlands

Previous World Cup appearances: 9

FIFA World ranking: 15

Goldman Sachs’ probability of winning: 5.6

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