If you told me to sign now or wait until free agency, that's tough. Obviously if all goes to plan, you hit FA and strike big. But cashing out now and then waiting a few more years for FA is never bad. Or getting paid again. None of these contracts are guaranteed to succeed, there's plenty of risk in them going forward.
Anyone that advocates for front loaded contracts in a non salary cap sport shows they don’t understand the time value of money.Originally Posted by bravesfanMatt
For sure. 10 years ago the average MLB payroll was about 3.2M in 2022 it's about 4.41.
That's with an extra active roster spot too. So the average team would be something like 80M vs. 114. But the real tale of the tape is that MLB revenue went from something like 6.8billion to 11 billion so like a 38% increase in salary and a 42% increase in revenue.
Stockholm, more densely populated than NYC - sturg
Or they have seen time and time again where a team can't afford to fill roster holes because of an older dead weight player taking up too much payroll space.
Your argument isn't wrong, but there is also value in matching cost to production.
But in a lot of cases that's the next GM's problem if things go awry. From a pure financial standpoint (which is what the owners care about) it's better to pay the bigger money at the end.
It just feels like the way the government finances itself with deficit spending. Kick the can down the road and let it be someone else's problem. It's not as simple as using the time value of money. If paying too many unproductive players in 2028 causes your team to not be able to afford to compete that year, attendance and other related revenues could plummet, and the value of the asset could decline (or appreciate slower than it would have otherwise). We are kind of seeing that with the Nationals right now with all their deferred money and large contracts.
Now if the money is truly deferred and not counted against current year payroll (for competitive purposes - not luxury tax) then it's a no-brainer to push the cost to the future. Perhaps I'm jaded because of the Time Warner AOL years, but I'm not sure I trust the team to treat their finances that way in the future.
Just to put these contract extensions in perspective a bit, Google tells me the average cost per WAR this FA season is about $5.5 million.
Riley, 6.5 WAR in 2022 has an AAV of $21.2m. Based upon FA cost per WAR, he needs 3.85 WAR per season to match his salary.
Olson, 3.4 WAR - $21m - 3.8 WAR
Acuna, 2.8 WAR - $12.5m - 2.3 WAR
Strider, 3.7 WAR - $12.5m - 2.3 WAR
Murphy, 3.7 WAR - $12.17m - 2.2 WAR
Harris, 5.3 WAR - $9m - 1.6 WAR
Albies, .8 WAR - $5m - .9 WAR
Barring injury (like Albies and Acuna have already had) it is hard to imagine these guys not living up to the expected WAR.
If this thing has to be blown up at some point in the future, hard to see these contracts not bringing back high end prospects.
This also sort of cries out for considering giving Albies a new extension.
Wouldn't it be around 9M per war?
Ivermectin Man
Google brought me $5.5m. At $9 million they are an even bigger steal.
Riley has back to back seasons of over 6 WAR. Maybe he falls completely off a cliff before turning 30, but the odds are against it. Olson had to adjust to a new league and had an admittedly down season, but he came damn near hitting his number. Acuna was a shell of his former self and surpassed his. Harris could probably get his number based upon defense alone.
Tromp had .2 WAR in one game last year. I think you can pencil him in for a 20 WAR season
Everyone with even a small bit of knowledge about player value understands these contracts are good/great. Literally nobody is claiming they are bad value.
The fact remains that AA has traded all roster flexibility to keep this championship core together 2-3 years longer. That’s only a good thing if it remains a championship caliber core. In the event a few guys bomb and AA is forced to trade away the deals that still have value, he still has to ride out the long extensions remaining before the team can compete again.
So hopefully these extensions give us 2-3 more exciting octobers than letting these players go through arb, because the rebuild is now guaranteed to be painful. Enjoy it now, and don’t take any playoff runs for granted.
Last edited by Enscheff; 12-29-2022 at 06:27 PM.
AA is making sure we’re not the Cubs and trying to keep us on pace with the Dodgers.
The key will be how well he builds the farm up which should see a large portion of our resources while we have a core in place.
So you take up too much space up front? In your contention window where you should be trying to maximize value?
6 of our position players are signed for the next 5 years. Grissom has 5 more years of team control. That "should" give him more than enough time to build up the farm system by then. Who knows, maybe he re-does the Albies/Acuna contracts once there's 2-3 years left on them.
Grissom should have 6 years of control left
Assume Olson repeats his "down" year. He's not Ozuna. He could be dealt to provide flexibility. AA has what $30 plus million coming off the books next year and $20 plus the year after? How much more flexibility do you want?
Yeah, our worst contracts are Ozuna who is off the books in 2 years, and Rosario who is clear next year. Other guys like Yates, McHugh, TDA, Morton have team options we can decline or pickup next winter. We have as good of roster flexibility as any team in the game.
mfree80 (12-29-2022)
It depends on how much room you have in your current budget obviously. If you are fairly well stacked and still have some room in your budget it could make sense to spend more now than later.
If you're going to use that extra money to acquire more talent to help now, you defer the salary. If not, spend up to your budget this year and keep more money available for the future season.
My whole point is that it's not a simple choice. There are instances where it makes sense to choose either option.
Anyone who throws out an Econ 101 term as fact doesn’t understand finances. I mean what economist would recommend getting a depreciating asset for appreciating costs. However baseball finances are not that simple either. Like you said circumstances dictate different strategies. When a small salary triggers a higher tax then you probably should consider just increasing that salary to close the gap. Otherwise you are paying tax on money not spent. Basically wasted money. By front loading you close that gap and you make that depreciated asset more valuable later due to lower cost. This only makes sense of course if you have the budget to do this. I think the Braves are at their limit on their actual budget. Probably have some tucked for mid season upgrades.
Coppy
I’m going to ignore the “$X coming off the books means they have $X to spend” nonsense, as if that money isn’t already taken up by raises in other contracts.
Olson is just as likely as every other bat-only player to turn into the next Ozuna. I’m unsure why folks think AA can just trade away bad contracts whenever he wants. It’s almost like some folks never learn, even when Ozuna and Rosario are literally sitting on the payroll as proof of how impossible bad contracts are to move.
We will see how the Olson contract ages. I’ll be posting a lot of quotes in a few years I think.
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