OT: MLB Discussion Thread: Part XXIV

[True Blue]

I think the bottom line is the Yankees can afford to go over. They will have about $16-$20 million coming off the books next year after CC retires and Gardners is let go. Ellsbury will either be moved or they will wait out the deal. By that time, they will have money available to re-sign Judge, Sanchez, Severino. They will have team control on others like Torres and Andujar. Also, they will probably let Tanaka walk in 2-3 years and hopefully have a cheaper replacement by then...they drafted pitchers with 10 out of their first 11 picks, or something like that in the 2017 draft. 2-3 years from now will be 4-5 years removed from that draft. Hopefully you will have a new wave of arms, for SP and RP. By then a deal you hand to say Andrew Miller or Zach Britton is probably expiring or about to.

Sure some contracts are coming off, but the resigning of the players that you are mentioning is going to take a lot. If Judge's $300m contract, now costs $450, that is not insignificant. You are presuming a wave of young arms, but there are no guarantees. Tommy John (see Montgomery) or just them not developing plays a role. Sure they have control over a Torres. But his time will come while you are significantly over the threshold.

I mean youre worrying about a ton of factors that may or may not happen. They can afford to go over the luxury tax by $10-$15 million this year and find ways to shed later on. The team DOES print money. They are incredibly profitable. They will continue to be with a very competitive team. And from what I have read and listened to, the biggest issue for management was paying a luxury tax over the last several years which meant helping out 24-27 teams in the league via that tax while their own roster was a waste. They werent winning squat AND they were paying other teams to do so. Couple that with getting under to reset for this free agent class.

The team is profitable, and becomes a lot less profitable when they have to pay $70m to retain a Betances, as opposed to $50.

Just like they shouldnt prospect hug for the right deal, they should penny pinch either. This isnt the time. The window is open now. And it is open while all their homegrowns are playing for nothing and are 21-26 years old

Penny pinching? Are you kidding me? This team was 7th in salary, only $6m less than the Cubs for 5th. They have a $300m players. And they are penny pinching?

 

[True Blue]

It's not a question whether they can afford the tax - of course they can - but it can put them at a real disadvantage when signing long term contracts (again, the CBA may change in a few years ). But let's assume the CBA stays the same wrt to the tax. If the Yanks offer Machado $30X10 (the presumed asking price) then the after tax total would be $433 million or about 44% unless they shed payroll (but if they can afford the tax why would they). That's a large gap that allows a non-luxury tax team (say the Mets ) to offer much more than the Yanks while paying less. The Yanks would have to overpay to get Machado in that case and that overpayment would get taxed as well.

Not to mention, that they would have to overpay in this way on EVERY contract that they sign. That is just not a feasible scenario.

 

[One Winged Angel]

Recently, moving salary has not been that easy. Otherwise, why is Ellsbury still on the team? You may move a salary, but often you need to take one back. Aside from a complete dump like Stanton. But there are few teams that can afford to do that. It is not a question of paying more. It is a question of how much more you paying. When the cost of a $100m contract becomes $150, you are officially at a competitive disadvantage directly due to poor business decisions.

Ellsbury is the extreme of all extremes. If he was playing, then maybe you find a way to get him out of there.

Stanton could be moved to LA if the price is right. Gardner and Sabathia were not necessary re-signs. Those were two bad business decisions.

There is profit, but when the tax implications get worse and worse every year, you profit margin shrinks. When you are paying more than anyone else has to pay, have a drafting position that is much worse and have less money to spend internationally than other teams, you compromise your ability to be a successful team.

Again, you prove my point. All of this is coming down to money and that's it, nothing more. If money is what's stopping them, they're being cheap. Obtaining that type of talent and winning will help offset the "shrinking margin" of profit. Ticket prices will raise and they'll still have people who will buy them because they're winning and will be an absolute juggernaut. The margins right now are beyond anything that the human imagination could even fathom.

You and I will never agree, which is fine, I love the discussion. However, you can't tell me it's not being cheap when you're looking at a profit margin which is in the hundred millions. It's ridiculous what they're bringing in. The discrepancy between total revenue brought in and player salaries is absolutely frightening and it's gone up each year. It's time for Hal to start re-investing more money in the team.

 

[True Blue]

Ellsbury is the extreme of all extremes. If he was playing, then maybe you find a way to get him out of there.

Or maybe not. Not at this stage of his career. Not for that much money.

Stanton could be moved to LA if the price is right. Gardner and Sabathia were not necessary re-signs. Those were two bad business decisions

No offense, but now you are the arbiter of what is and what is not a bad business decision? Cashman, like any other executive will have some good decisions and some bad decisions. And with the luxury tax the way that it is, what you are proposing becomes astronomical as far as dollars go. Signing Machado for $300 will cost you an additional $150m. Then you will need to pony up another $300 for Judge. Congrats You have now spent $900m to sign $600m in salary.

Stanton could be easily moved? What is the right price? Eating half his salary? The markets for that salary are very small.

Again, you prove my point. All of this is coming down to money and that's it, nothing more. If money is what's stopping them, they're being cheap. Obtaining that type of talent and winning will help offset the "shrinking margin" of profit. Ticket prices will raise and they'll still have people who will buy them because they're winning and will be an absolute juggernaut. The margins right now are beyond anything that the human imagination could even fathom.

Of course it comes down to money. But there is a HUGE difference between being cheap and making smart business decisions. There is only so much that one can raise ticket prices. Even the Yankees. There is only so much a team can pay each year by constantly needing to spend an extra 50 cents for each and ever y dollar spent.

You and I will never agree, which is fine, I love the discussion. However, you can't tell me it's not being cheap when you're looking at a profit margin which is in the hundred millions. It's ridiculous what they're bringing in. The discrepancy between total revenue brought in and player salaries is absolutely frightening and it's gone up each year. It's time for Hal to start re-investing more money in the team.

I can tell you it is not about being cheap. In fact, that is what I have been saying. And needing to play the luxury tax of $300 to sign two players for $600 is pricey no matter who you are.

 

[One Winged Angel]

Or maybe not. Not at this stage of his career. Not for that much money.

No one knows because we haven't seen him. If he came back and was productive, there's a chance you would still have to eat salary, but it could be plausible.

No offense, but now you are the arbiter of what is and what is not a bad business decision? Cashman, like any other executive will have some good decisions and some bad decisions. And with the luxury tax the way that it is, what you are proposing becomes astronomical as far as dollars go. Signing Machado for $300 will cost you an additional $150m. Then you will need to pony up another $300 for Judge. Congrats You have now spent $900m to sign $600m in salary.

Re-signing an outfielder who is clearly on the decline and giving him too much money for a bench role when you have a cluttered outfield as is and a 5th starter who can't even complete 4 innings consistently who belongs in the pen as a long man or a spot starter almost 10 million are smart business decisions?

If money is the issue, then promote from within. Loaisaga, Frazier, etc. the Yankees have pieces within that could have given them an option in those spots without costing almost 20 million in salary. That salary could have went to Machado.

If giving Machado a contract because of Didi's situation is not smart, then neither was giving Sabathia that contract because of Montgomery's situation.

Stanton could be easily moved? What is the right price? Eating half his salary? The markets for that salary are very small.

I can't speak to an absolute that no one has the answer for right now. However, Cashman has show that he can get creative and make things happen.

Of course it comes down to money. But there is a HUGE difference between being cheap and making smart business decisions. There is only so much that one can raise ticket prices. Even the Yankees. There is only so much a team can pay each year by constantly needing to spend an extra 50 cents for each and ever y dollar spent.

I can tell you it is not about being cheap. In fact, that is what I have been saying. And needing to play the luxury tax of $300 to sign two players for $600 is pricey no matter who you are.

You're also throwing out hypothetical numbers which aren't even assured to be the case. We don't know what the numbers are yet. It also goes up for every million you spend after breaking the threshold.

You're presenting extreme examples of what happens down the road as if everything is set in stone and you have some concrete number to work with, when none of us actually do.

I'll reserve judgement until I see what actually happens and not claim the sky is falling.

 

[sbjnyc]

About being profitable, here is a chart of the Yankees operational income. New York Yankees operating income 2002-2017 | Statistic

I'm not entirely sure what's left out since their net profit is much, much larger. If I were to hazard a guess I'd think that maybe a restriction imposed on Cashman would be to keep operating income positive. It might be a spurious correlation but the chart shows that operating income changed directions immediately after George retired.

 

[offdacrossbar]

the mets are already worlds better than last season right now.

the rotation is intact.

ramos is a real catcher who can hit. dRNO is garbage. plawecki same.

diaz improves one of the worst pens in baseball last season. he should be lights out.

cano is a legit bat that can bat 3rd behind rosario and nimmo.

look at last years stating lineup opening day. ugh.

just add a healthy lagares and alonso and mcneil. dump frazier. add cesspool in august.

one more righty bat and a left specialist and i actually like this team right now.

 

[True Blue]

If money is the issue, then promote from within. Loaisaga, Frazier, etc. the Yankees have pieces within that could have given them an option in those spots without costing almost 20 million in salary. That salary could have went to Machado.

Providing that they can provide what you are looking for. Because if not, then you need to spend more money to get them. And even more considering that every dollar spent, requrires you to spend 50 cents more.
It's not that money is the issue. The issue is that NO TEAM is made of money and can literally spend unlimited amounts.

If giving Machado a contract because of Didi's situation is not smart, then neither was giving Sabathia that contract because of Montgomery's situation.

$10m for one year is a lot less saddling than $300 for 10.

You're also throwing out hypothetical numbers which aren't even assured to be the case. We don't know what the numbers are yet. It also goes up for every million you spend after breaking the threshold.

The thresholds are pretty set.You're presenting extreme examples of what happens down the road as if everything is set in stone and you have some concrete number to work with, when none of us actually do.

You have to operate with an eye on what happens down the road, when down the road is a year or two away.

I'll reserve judgement until I see what actually happens and not claim the sky is falling.

No one said the sky is falling. But presenting facts as constituted by what actually is out there, not just closing my eyes and yelling "Sign them ALL! Pay whatever! Who cares?"

 

[RGY]

I understand how the Tax works. Or at least my understanding is 85% without having to do all of that math.

You sign a Machado and Reliever(s) to win this year and the next couple of years. You absolutely can shed salary in the coming years to keep certain guys on board. Maybe they move on from Betances. You can find or develop 1-2 inning arms. The window is right now. Not the time to worry about their finances in the years in which they will have to re-sign Judge longterm. The personnel will likely not be the same at that time. That is the future. We are in the present right now. Make the team better to win the World Series.

 

[East Coast Bias]

the mets are already worlds better than last season right now.

the rotation is intact.

ramos is a real catcher who can hit. dRNO is garbage. plawecki same.

diaz improves one of the worst pens in baseball last season. he should be lights out.

cano is a legit bat that can bat 3rd behind rosario and nimmo.

look at last years stating lineup opening day. ugh.

just add a healthy lagares and alonso and mcneil. dump frazier. add cesspool in august.

one more righty bat and a left specialist and i actually like this team right now.

Oh man. Every offseason we do this.

THIS IS OUR YEAR

then everyone gets injured

 

[One Winged Angel]

I understand how the Tax works. Or at least my understanding is 85% without having to do all of that math.

You sign a Machado and Reliever(s) to win this year and the next couple of years. You absolutely can shed salary in the coming years to keep certain guys on board. Maybe they move on from Betances. You can find or develop 1-2 inning arms. The window is right now. Not the time to worry about their finances in the years in which they will have to re-sign Judge longterm. The personnel will likely not be the same at that time. That is the future. We are in the present right now. Make the team better to win the World Series.

This.

Thank you.

 

[One Winged Angel]

Providing that they can provide what you are looking for. Because if not, then you need to spend more money to get them. And even more considering that every dollar spent, requrires you to spend 50 cents more. It's not that money is the issue. The issue is that NO TEAM is made of money and can literally spend unlimited amounts.

I never said unlimited. I said the profit margins are astronomical. Between ticket sales, merch sales, concessions, TV deals and so on, they're the highest grossing franchise in the entire sport and player salaries, which a make up a vast majority of the operating expenses don't even come close to what those figures are bringing in. There's a chart that's been going around that shows the disparity.

$10m for one year is a lot less saddling than $300 for 10.

It's the principle and the fact that if those players weren't signed, that's nearly $20 million more that could have went towards Machado and a reliver. Plus, they're dealing Gray. That contract will be gone.

So in essence they spent nearly 20 million on a 4th outfielder and someone who doesn't belong in a rotation when you could have put that towards a stud 3B/SS and a damn good middle reliever.

Bad business decisions.

You have to operate with an eye on what happens down the road, when down the road is a year or two away.

Well, thankfully Judge, Sanchez and Severino don't have to be dealt with until 2023.

No one said the sky is falling. But presenting facts as constituted by what actually is out there, not just closing my eyes and yelling "Sign them ALL! Pay whatever! Who cares?"

Just like no one said the sky is falling, no one said "Sign them ALL! Pay whatever! Who cares?"

I even went out of my way to explain how it could work. If you don't want to see that for whatever reason, that's fine, but there are ways to make it work and there's a lot more time than 1-2 years to worry about it.

 

[JimmyG89]

Oh man. Every offseason we do this.

THIS IS OUR YEAR

then everyone gets injured

One thing that has happened so far is that Brodie has some versatile players. Right now, we are slated to have McNeil on the bench. If we were to lose an IF, he would become a starter and that isn't a bad thing.

What we do need is Alonso to work out at 1st. I'm curious what vet 1st baseman gets an invite to spring training and a minor league deal. They could also look at a LHB 1st baseman on the cheap for a major league deal in the mold of a Lucas Duda (not advocating this, but someone like this) for 3-4M. I think that role will be going to Dom Smith, but he is not a given to be a MLB player this season. Rather sign someone to fill that void and be veteran depth.

EDIT: Speaking of some veteran depth.

 

[Bob Richards]

RAJAI DAVIS LOL

I love this man. I'm about it regardless.

 

[JimmyG89]

He can still fly and he's a base stealing threat. Best case is 5th OF. Defense is still solid too.

 

[darko]

Provide evidence of how luxury tax affects big spending teams and how they are disadvantaged when it comes to UFAs.

Nah Yankees can afford it. Stop penny pinching and prospect hugging.

 

[nyr2k2]

Doesn't the luxury tax only tax money spent over the threshold? Like it's being talked about as if every move would suddenly become 40% more expensive. It's only the money you spend in excess of the threshold that gets taxed. So even if you were $60M over, at the 40% rate, that's a bill of $24M. It's not like the $250M payroll becomes $350M or whatever. Am I roghr on this?

 

[Paulie Walnutz]

Classy move

 

[I Eat Crow]

Classy move

I'd cover it too if I was his teammate or boss.

 

[RGY]

 

[RGY]

 

[JCProdigy]

Doesn't the luxury tax only tax money spent over the threshold? Like it's being talked about as if every move would suddenly become 40% more expensive. It's only the money you spend in excess of the threshold that gets taxed. So even if you were $60M over, at the 40% rate, that's a bill of $24M. It's not like the $250M payroll becomes $350M or whatever. Am I roghr on this?

No you are correct on this. A team is taxed on the overage of the average annual salary + earned bonuses of all players on the 40 man roster (including those in minors). Players acquired/dealt during the season have their salaries prorated.

Per 2016 CBA: 1st time over = 20%, 2nd time = 30% 3rd time = 50% (there is no 40% tax). Also important is the rates go up the further you go over the threshold.

http://m.mlb.com/glossary/transactions/competitive-balance-tax

 

[Machinehead]

Pop the champagne.

 

[Bob Richards]

Rex Brothers is an all time 'That Guy' name.

 

[BMOK33]

I'd cover it too if I was his teammate or boss.

He overreacted to what was clearly two unintentional HBPs but it’s part of the game. I see no reason why he shouldn’t have gotten the money. Also it’s not the catcher’s fault the pitcher decided to be a dick and continue what was basically settled. Remember that Ian Kennedy did that a few years back by hitting grienke after both teams had been hit once and after the game the DBacks catcher pretty much said without saying it that Kennedy did it on his own.