Blue Jays Discussion: Let the post-winter-meeting, pre-spring-training baseball withdrawl commence!

[Discoverer]

Can I get a hallelujah that Dan Duquette did not become the Jays' pres as was rumoured? Other than a congratulatory phone call from Ruben Amaro Jr, I can't imagine anyone will defend this contract.

I'm pretty sure this is on Angelos.

 

[Edo]

Can I get a hallelujah that Dan Duquette did not become the Jays' pres as was rumoured? Other than a congratulatory phone call from Ruben Amaro Jr, I can't imagine anyone will defend this contract.

Remember the little hissy fit all of the Jays fan had when the 2 month Blue Jay David Price left? You sometimes just have to bite the bullet. The Orioles have lost a couple of guys in the last little bit and you gotta throw the fans a bone at some point.

 

[as Pure as Evil]

and we all thought Davis' payday had passed him by

I for one didn't think it was possible for a team to replicate the howard mistake, but low and behold. your also banking on a guy that has major character flaws, up and down year after year. what says having a larger bank account isn't going to make him become less focused ala Hamilton. it just baffles me these management groups will not learn from other teams mishaps

 

[as Pure as Evil]

Remember the little hissy fit all of the Jays fan had when the 2 month Blue Jay David Price left? You sometimes just have to bite the bullet. The Orioles have lost a couple of guys in the last little bit and you gotta throw the fans a bone at some point.

I think with that money thrown at davis, it would have been smarter for the team to have went after cespedes, but hind sight is always 20/20 when you don't know what happens for the next few years.

 

[The Nemesis]

Remember the little hissy fit all of the Jays fan had when the 2 month Blue Jay David Price left? You sometimes just have to bite the bullet. The Orioles have lost a couple of guys in the last little bit and you gotta throw the fans a bone at some point.

You don't make decisions based on the fans. You make them for the team.

Make the right team decisions, the team wins, and the fans keep showing up regardless. Make bad decisions and the team starts losing, the fans stay away and it doesn't matter how much money you threw at a fan favorite or star player, it doesn't buy back the goodwill of winning.

"win with nobodies, the fans show up, and the nobodies become stars. Lose with stars, the fans stay away, and the stars become nobodies."

 

[p.l.f.]

Oh well

 

[hockeywiz542]

free agency will be a big issue. The eight pending free agents at the end of 2016 include bautista, encarnacion, michael saunders and justin smoak, and pitchers r.a. Dickey, drew storen, brett cecil and jesse chavez. That’s an estimated $59 million in guaranteed salary that could disappear from the books. If the jays wait until november before dealing with their free agents, it will already be too late.

The blue jays ended the 2015 campaign with a payroll of $135.7 million, the 10th highest in baseball and the largest in the team’s 39 seasons. Yes, that looks good on them but, as forbes reported in december, mlb’s gross revenues increased by $500 million in 2015, to an estimated $9.5 billion. Nobody is losing money.

The jays, by winning the al east and battling the royals to game 6 of the al championship series, reportedly generated $50 million in unexpected revenues. Where is that money headed? The payroll for the 25-player opening day roster in 2016 projects to $138 million. If winning generated that much extra revenue in 2015, why not try it again?

shapiro and gm ross atkins received word at the winter meetings from encarnacion’s agent that if the club waits until after opening day to try to extend his contract, encarnacion will go through the free-agent process. Other important contracts that need to be addressed by the jays include bautista, storen and cecil. They will talk to them all in the spring.

Then there’s the al mvp. Can the jays convince josh donaldson to sign a long-term contract and avoid future free agency? Donaldson is headed to arbitration next month and will earn just under $12 million in 2016, with two more arbitration years after that. The jays need to lock up at least some of their stars as a show of good faith to fans and as a sign to other players that they are intent on remaining contenders.

If the jays make no serious effort in the next six months to extend their own free agents and if the club is struggling in the standings by the all-star break it all changes. With the trade deadline looming, what will be the message to jays players that are already locked up long-term? Tulowitzki is signed through 2020, with a total of $98 million guaranteed. Catcher russ martin is signed through 2019 and is owed $75 million. And the two men who convinced the montrealer to come to toronto, anthopoulos and former president paul beeston, are gone. If the jays aren’t contending, do they ask out?

But, hey, all is not payroll doom and gloom. The jays still have at least 14 solid major-leaguers who will be under club control for three to six years of major-league service. In addition to tulowitzki, martin and donaldson, the list includes marcus stroman, kevin pillar, aaron sanchez, happ, roberto osuna, chris colabello, devon travis, ryan goins, dalton pompey, drew hutchison and aaron loup.

 

[The Nemesis]

http://espn.go.com/mlb/story/_/id/14580503/chris-davis-agrees-deal-remain-baltimore-orioles

portions of Chris Davis' contract are deferred through 2037.

 

[dredeye]

http://espn.go.com/mlb/story/_/id/14580503/chris-davis-agrees-deal-remain-baltimore-orioles

portions of Chris Davis' contract are deferred through 2037.

Just insanity.

 

[Swervin81]

http://espn.go.com/mlb/story/_/id/14580503/chris-davis-agrees-deal-remain-baltimore-orioles

portions of Chris Davis' contract are deferred through 2037.

Even Bobby Bonilla is laughing at that.

 

[Shimso]

http://espn.go.com/mlb/story/_/id/14580503/chris-davis-agrees-deal-remain-baltimore-orioles

portions of Chris Davis' contract are deferred through 2037.

It's actually kinda shrewd, IMO. The NPV of the contract is lower and he benefits from supposedly lower taxes because he'll be earning it while residing in a low tax state (rather than being taxed partially across various states during an active season).

 

[Fantomas]

"win with nobodies, the fans show up, and the nobodies become stars. Lose with stars, the fans stay away, and the stars become nobodies."

- Albert Einstein.

 

[Doug Gilmour]

http://espn.go.com/mlb/story/_/id/14580503/chris-davis-agrees-deal-remain-baltimore-orioles

portions of Chris Davis' contract are deferred through 2037.

......

There are no words to describe how handcuffed that organization is with that burden of a contract.

 

[Kurtz]

It's actually kinda shrewd, IMO. The NPV of the contract is lower and he benefits from supposedly lower taxes because he'll be earning it while residing in a low tax state (rather than being taxed partially across various states during an active season).

Yep, well observed. Very shrewd by the Orioles. They completely bent Boras over the table with that arrangement. I suspect he agreed to it to save face.

To elaborate with some rough math: O's are paying him 17 mil a year, thus 42 mil of his deal will be deferred until after his 7 years deal ends, to be paid out over 14 years. So $3 mil a year over 14 years.

The net present value of $3 mil annual payments over 14 years, discounted at a fairly standard 7% (I think that's fairly standard at least, I could be a bit off) is actually only $29 million.

So by throwing that little wrinkle into the deal, the O's save about $13 million dollars on the contract.

 

[LaCarriere]

It's actually kinda shrewd, IMO. The NPV of the contract is lower and he benefits from supposedly lower taxes because he'll be earning it while residing in a low tax state (rather than being taxed partially across various states during an active season).

I was thinking the same thing. It actually benefits both the Orioles and Davis.

Orioles benefit because instead of paying 161 over 7 years they are paying 161 over 22 years. They are deferring 42M after the contract is over, without interest being paid to Davis (as per Buster Olney). This gives them a bit of wiggle room to add some cheap depth players while keeping Davis. The 3.5M from 2023-32 and 1.5M from 2033-37 are going to be a good margin cheaper in ~2025-2037 due to inflation and considering how fast revenues are growing, so while the contract drags on it's going to save them money in the long run.

Davis benefits because he gets to collect a fat annual check well after he's retired, plus his MLB pension.

I'm surprised more of the 7+ year deals aren't structured this way. Maybe this is the start.

http://www.fangraphs.com/blogs/the-other-side-of-the-chris-davis-contract/

 

[LaCarriere]

Yep, well observed. Very shrewd by the Orioles. They completely bent Boras over the table with that arrangement. I suspect he agreed to it to save face.

To elaborate with some rough math: O's are paying him 17 mil a year, thus 42 mil of his deal will be deferred until after his 7 years deal ends, to be paid out over 14 years. So $3 mil a year over 14 years.

The net present value of $3 mil annual payments over 14 years, discounted at a fairly standard 7% (I think that's fairly standard at least, I could be a bit off) is actually only $29 million.

So by throwing that little wrinkle into the deal, the O's save about $13 million dollars on the contract.

That's not quite how it's structured (check the fangraphs link I posted), but yeah, it definitely saves them money in the long run.

Anyone thinking this handcuffs the Orioles simply doesn't understand. It's actually pretty clever on their part.

That said the Orioles were practically bidding against themselves, so the fact that it went above the earlier estimated 150M is strange. I wouldn't say Boras got bent over -- both sides are probably walking away thinking they won.

 

[Kurtz]

That's not quite how it's structured (check the fangraphs link I posted), but yeah, it definitely saves them money in the long run.

Anyone thinking this handcuffs the Orioles simply doesn't understand. It's actually pretty clever on their part.

That said the Orioles were practically bidding against themselves, so the fact that it went above the earlier estimated 150M is strange. I wouldn't say Boras got bent over -- both sides are probably walking away thinking they won.

Ok, found a decent NPV calculator, here's some better math:

Davis makes $17 instead of $23 mil a year for the first 7. Discounted at 7%, the NPV of 6 million (deferred annually) over 7 years is $36 million.

The NPV schedule the Orioles negotiated has them paying out the remaining $42 mil like this: $0 for first 7 years, $3.5 mil for next 10, and $1.4 mil for 5 after that. The NPV of this schedule is about $19.6 mil.

$36-$19.5= $16.5 million saved by the Orioles by structuring the deal this way. Quite brilliant.

That's discounted at an arguably aggressive 7%. If we discount it at a more conservative 4% it goes back to about $12 mil saved. Still quite great for the O's.



I also thought going to 161 mil from their original 154 was strange given that there was seemingly no bidding war for the guy, but when you add in the $12-17 mil the O's save with that payout schedule, it actually makes a lot more sense.

And Believe me, Boras is not at all a fan of having that extra $42 mil payed over 22 years instead of 7 to his firm. It's a terrible payout schedule for him/his company. That's what I mean by him getting bent over. But at the end of the day he can tell his clients that he negotiated an extra $7 mil for Davis, and come out with the PERCEPTION of being a winner, which is largely what matters when you're an agent.

 

[LaCarriere]

Ok, found a decent NPV calculator, here's some better math:

Davis makes $17 instead of $23 mil a year for the first 7. Discounted at 7%, the NPV of 6 million (deferred annually) over 7 years is $36 million.

The NPV schedule the Orioles negotiated has them paying out the remaining $42 mil like this: $0 for first 7 years, $3.5 mil for next 10, and $1.4 mil for 5 after that. The NPV of this schedule is about $19.6 mil.

$36-$19.5= $16.5 million saved by the Orioles by structuring the deal this way. Quite brilliant.

That's discounted at an arguably aggressive 7%. If we discount it at a more conservative 4% it goes back to about $12 mil saved. Still quite great for the O's.



I also thought going to 161 mil from their original 154 was strange given that there was seemingly no bidding war for the guy, but when you add in the $12-17 mil the O's save with that payout schedule, it actually makes a lot more sense.

And Believe me, Boras is not at all a fan of having that extra $42 mil payed over 22 years instead of 7 to his firm. It's a terrible payout schedule for him/his company. That's what I mean by him getting bent over. But at the end of the day he can tell his clients that he negotiated an extra $7 mil for Davis, and come out with the PERCEPTION of being a winner, which is largely what matters when you're an agent.

I think this is all he cares about; getting the biggest possible deal for his clients. All that's going to do for him is attract more business when players see that Davis got 161M instead of the rumored 150M when there wasn't much of a bidding war/market for him.

If you assume his fee is 5% (I read he averages 4.7%), that means 2.1M of his money is deffered, with him getting 7.57M over the length of the contract.

Who knows, he may have structured the contract in a way that his money isn't deferred, and just spread out over the 7 years. Even if it isn't, I doubt he cares too much about that 2.1M, given how wealthy he is.

 

[The Nic]

So... based on the Davis contract... is $23M per year the annual salary that Jose and Edwin will be looking for? It's a sizable jump for Bautista and basically double what EE is making now. Then again, there is no cap and so we can definitely afford it if we want to. The potential term in both cases is perhaps the harder issue to resolve.

 

[Canada4Gold]

So... based on the Davis contract... is $23M per year the annual salary that Jose and Edwin will be looking for? It's a sizable jump for Bautista and basically double what EE is making now. Then again, there is no cap and so we can definitely afford it if we want to. The potential term in both cases is perhaps the harder issue to resolve.

I would think they would both get in that 20-25 range, but they won't get the same term as Davis because they're much older

 

[King Mapes]

So... based on the Davis contract... is $23M per year the annual salary that Jose and Edwin will be looking for? It's a sizable jump for Bautista and basically double what EE is making now. Then again, there is no cap and so we can definitely afford it if we want to. The potential term in both cases is perhaps the harder issue to resolve.

I hate the "there is no cap so we can afford it" stuff. Technically no there is no cap but there is an internal cap. Owners aren't in it to lose money. Yes they are billionaires but the phones is seperate from baseball. Otherwise, we would have signed Price, Gallardo and Davis. So them making 40-50 mill combined will hurt which is why we need to go for it this year. JD will be making more as well.

 

[LaCarriere]

I don't know if EE will get 20. I guess it's possible with some of the money being thrown around and depending on how desperate some AL teams are, but it's not unreasonable to think pretty soon he will be exclusively DHing. Davis is younger and still has quite a few position years left, not really the case with EE.

Bautista should get 20M for 3-4 years though.

 

[Cor]

We just hired someone for something

 

[Throw More Waffles]

A runner on third, nobody out, and they couldn't get him in.
I just can't get over it.
If they were trying their best to NOT score the runner, they likely would have still scored him by accident. But to actually be trying their best to score the runner and they couldn't?

It would be like in hockey having a breakaway to an empty net... and missing. Not just once, but THREE players in a row.

 

[Canada4Gold]

I don't know if EE will get 20. I guess it's possible with some of the money being thrown around and depending on how desperate some AL teams are, but it's not unreasonable to think pretty soon he will be exclusively DHing. Davis is younger and still has quite a few position years left, not really the case with EE.

Bautista should get 20M for 3-4 years though.

That's why EE won't get the same term, he's older and not as many years left, if EE has the same type of year this year as he's had I find it difficult to believe nobody would give him 20 million over 3 or 4 years.

Bautista, I think he might end up closer to 25 than 20 for the same term.