Hi guys, let me put things into perspective. While I am not exactly pleased with this game as a whole, I will be happy to explain this following economic fact.
When the government decides to invest 100million more into infrastructure in 2008 than in 2007.
All other things remaining constant, let's say that the contractors who build the infrastructure make a 40 million profit. They then spend the 40 million, for example, food, cds and cars. Food factory owners, car makers and musicians earn a 16 million after taking into account costs. They spend these these 16 million on, say, computers. So the computer makers will pass on their profits again and again. What is the net effect to the economy? 100+ 40 + 16+ ...+ ...+ 0 = a really larget number.
This is the multipler effect in action.
Similarly, when Chelsea pumps 200 million into the European transfer market, the clubs who profit from chelsea will in turn pump the money around and make the transfer market look really really big and busy.
My main assumption is that the clubs in question, at the very least, sell a few players to generate a part of their transfer budget.
However I also believe that clubs receive a lot of money from TV revenue. Whether realistic or not, my Barcelona team in FM 08 scored almost 450 million GBP in TV revenue over 5 seasons. Real Madrid, Valencia and Atletico Madrid were not far behind in almsot 300-400 million GBP over 5 seasons.
The net effect was that by the 6th season the Spanish league was full of talents depleted from the EPL, german, italian and french leagues.