Shark Signs w/ Giants - 5/$90M (Happy Derwood?)

[seanimal]

If you are willing to sign a guy to a 7/210 deal you should be willing to pay 3/90 and risk letting him walk for more money.

 

That's ... just *so* wrong.

 

why?

[Guest]

Opt outs offer zero protection to the team. They aren't some terrible evil to be avoided, but they're exclusively a player perk. Maybe it would be more clear if they were called multi-year player options.

They are a negotiating tactic that teams can and should offer to players to get them to sign with them and not another team without spending significantly more money.

 

This paragraph reminded me of all the crap the Ricketts family agreed to in the sale of the Cubs.

 

Purposefully tying your hands behind your back* is not close to the same thing.

 

*allegedly

 

I didn't mean it to take away from your argument.

 

I think they were smart to do it if it's what it took to get them the team.

[KingCubsFan]

Opt outs offer zero protection to the team. They aren't some terrible evil to be avoided, but they're exclusively a player perk. Maybe it would be more clear if they were called multi-year player options.

They are a negotiating tactic that teams can and should offer to players to get them to sign with them and not another team without spending significantly more money

 

Yes. But in practice it never seems to work that way. The Red Sox didn't seem to get any appreciable discount for Price in exchange for that opt-out.

 

If you are willing to sign a guy to a 7/210 deal you should be willing to pay 3/90 and risk letting him walk for more money.

 

That's ... just *so* wrong.

 

You don't do it for the discount. You do it to get a guy without having to pay substantially more. Boston paid what everybody assumed, and not the $30m more than the market that was mentioned before. And they got him relatively early in the process.

If the Red Sox were giving Price a straight 7/217 deal, I doubt he'd get $90 million the first three years. It would probably be more backloaded. Instead, the Red Sox are essentially paying market rate for three years with little ability to gain any surplus value in the process. I don't blame them for doing it, and I wouldn't have opposed the Cubs doing the same thing, but it's a structure providing nothing but downside to the team.

[jersey cubs fan]

If the Red Sox were giving Price a straight 7/217 deal, I doubt he'd get $90 million the first three years. It would probably be more backloaded. Instead, the Red Sox are essentially paying market rate for three years with little ability to gain any surplus value in the process. I don't blame them for doing it, and I wouldn't have opposed the Cubs doing the same thing, but it's a structure providing nothing but downside to the team.

You don't sign free agents in the pursuit of surplus value.

 

Nor do you sign them to make sure they are on your team in 5-6 years.

 

You sign them because you want a really good player to play for your team today.

[KingCubsFan]

If the Red Sox were giving Price a straight 7/217 deal, I doubt he'd get $90 million the first three years. It would probably be more backloaded. Instead, the Red Sox are essentially paying market rate for three years with little ability to gain any surplus value in the process. I don't blame them for doing it, and I wouldn't have opposed the Cubs doing the same thing, but it's a structure providing nothing but downside to the team.

You don't sign free agents in the pursuit of surplus value.

 

Nor do you sign them to make sure they are on your team in 5-6 years.

 

You sign them because you want a really good player to play for your team today.

Well, I agree somewhat with that. But I also think you sign a guy hoping that he's not absolutely killing you by the end of the contract but knowing he won't be nearly as good. Basically Soriano. With Price, if he's still on the team in 5-6 years, it's because he's terrible or injured.

[SouthSideRyan]

Opt outs offer zero protection to the team. They aren't some terrible evil to be avoided, but they're exclusively a player perk. Maybe it would be more clear if they were called multi-year player options.

They are a negotiating tactic that teams can and should offer to players to get them to sign with them and not another team without spending significantly more money.

 

This paragraph reminded me of all the crap the Ricketts family agreed to in the sale of the Cubs.

 

Purposefully tying your hands behind your back* is not close to the same thing.

 

*allegedly

 

I didn't mean it to take away from your argument.

 

I think they were smart to do it if it's what it took to get them the team.

 

I'm twitching uncontrollably here, can we not do this again?

[SouthSideRyan]

Opt outs offer zero protection to the team. They aren't some terrible evil to be avoided, but they're exclusively a player perk. Maybe it would be more clear if they were called multi-year player options.

They are a negotiating tactic that teams can and should offer to players to get them to sign with them and not another team without spending significantly more money

 

Yes. But in practice it never seems to work that way. The Red Sox didn't seem to get any appreciable discount for Price in exchange for that opt-out.

 

If you are willing to sign a guy to a 7/210 deal you should be willing to pay 3/90 and risk letting him walk for more money.

 

That's ... just *so* wrong.

 

You don't do it for the discount. You do it to get a guy without having to pay substantially more. Boston paid what everybody assumed, and not the $30m more than the market that was mentioned before. And they got him relatively early in the process.

If the Red Sox were giving Price a straight 7/217 deal, I doubt he'd get $90 million the first three years. It would probably be more backloaded. Instead, the Red Sox are essentially paying market rate for three years with little ability to gain any surplus value in the process. I don't blame them for doing it, and I wouldn't have opposed the Cubs doing the same thing, but it's a structure providing nothing but downside to the team.

 

If Price opts out and gets a better contract, they've almost certainly attained stupid surplus value.

[Backtobanks]

If you're going to sign a FA pitcher, hurry up and do it because the way this market is going Leake, Chen, and Lackey are going to start asking for $100 million too.

http://www.21cpw.com/wp-content/uploads/2015/02/d1Z-thats-not-how-it-works-thats-not-how-any-of-this-works.jpg

 

It's starting to look like it. Every pitcher that signs seems to be jacking up the price the ones still out there.

 

whose price has gotten jacked up aside from a huge AAV rumor about greinke and a rumor about samardzija?

 

zimmerman and price both got what was expected.

 

Price & Zimmerman set the market price and it certainly jacked up Greinke and Samardzija (at least according to the rumors). Cueto looks like he's asking for more than most expected. If Samardzija gets $100 million, I would think Leake and Chen would try to get an extra few million.

[toonsterwu]

If you're going to sign a FA pitcher, hurry up and do it because the way this market is going Leake, Chen, and Lackey are going to start asking for $100 million too.

http://www.21cpw.com/wp-content/uploads/2015/02/d1Z-thats-not-how-it-works-thats-not-how-any-of-this-works.jpg

 

It's starting to look like it. Every pitcher that signs seems to be jacking up the price the ones still out there.

 

whose price has gotten jacked up aside from a huge AAV rumor about greinke and a rumor about samardzija?

 

zimmerman and price both got what was expected.

 

Price & Zimmerman set the market price and it certainly jacked up Greinke and Samardzija (at least according to the rumors). Cueto looks like he's asking for more than most expected. If Samardzija gets $100 million, I would think Leake and Chen would try to get an extra few million.

 

I tend to think the markets gone as expected so far, and thus, if boras is looking for 20 mil per year for chen, as some rumors indicated, then chen could be hanging around until spring.

[Hairyducked Idiot]

If you want to say that Boston would have had to pay $240m for him and the opt-out got it down to $210 and was thus worth it, fine. I think the numbers are off, but that's logically consistent.

 

But saying that if you want 7/$210 then you should want 3/$90 with a player option for 4/$120 just as much is just wrong.

[davell]

If I'm buying a pitcher for 7/210 and he's 30 years old at the outset......I'm happy to let the guy opt out after 3 years. 1)that means he's pitched his ass off for me and 2) odds are against him continuing to do so over the final 4 years. I'll take the 3 years of production(conceivably in win-now mode) and the financial flexibility afterwards to grab a younger good pitcher or whatever else may be my biggest need at that point.

[Hairyducked Idiot]

If I'm buying a pitcher for 7/210 and he's 30 years old at the outset......I'm happy to let the guy opt out after 3 years. 1)that means he's pitched his ass off for me and 2) odds are against him continuing to do so over the final 4 years. I'll take the 3 years of production(conceivably in win-now mode) and the financial flexibility afterwards to grab a younger good pitcher or whatever else may be my biggest need at that point.

 

The issue isn't whether you are "happy" to let him opt-out after the three years. The issue is whether that scenario is *good enough* to balance out the downside of being stuck with him if he isn't.

[davell]

If I'm buying a pitcher for 7/210 and he's 30 years old at the outset......I'm happy to let the guy opt out after 3 years. 1)that means he's pitched his ass off for me and 2) odds are against him continuing to do so over the final 4 years. I'll take the 3 years of production(conceivably in win-now mode) and the financial flexibility afterwards to grab a younger good pitcher or whatever else may be my biggest need at that point.

 

The issue isn't whether you are "happy" to let him opt-out after the three years. The issue is whether that scenario is *good enough* to balance out the downside of being stuck with him if he isn't.

 

Didn't Cameron or someone put a 20 mill value on it?

 

Edit- I guess for me, if its a player I feel I've got to have, I'd gladly give in to a deal like that in the end.

[imb]

If I'm buying a pitcher for 7/210 and he's 30 years old at the outset......I'm happy to let the guy opt out after 3 years. 1)that means he's pitched his ass off for me and 2) odds are against him continuing to do so over the final 4 years. I'll take the 3 years of production(conceivably in win-now mode) and the financial flexibility afterwards to grab a younger good pitcher or whatever else may be my biggest need at that point.

 

The issue isn't whether you are "happy" to let him opt-out after the three years. The issue is whether that scenario is *good enough* to balance out the downside of being stuck with him if he isn't.

 

Would you give 33-year-old David Price (coming off three straight healthy, productive years) 4/120?

[seanimal]

If I'm buying a pitcher for 7/210 and he's 30 years old at the outset......I'm happy to let the guy opt out after 3 years. 1)that means he's pitched his ass off for me and 2) odds are against him continuing to do so over the final 4 years. I'll take the 3 years of production(conceivably in win-now mode) and the financial flexibility afterwards to grab a younger good pitcher or whatever else may be my biggest need at that point.

 

The issue isn't whether you are "happy" to let him opt-out after the three years. The issue is whether that scenario is *good enough* to balance out the downside of being stuck with him if he isn't.

 

ok so i was open to the idea that maybe i was missing something but no this is just idiotic. the seven years is th.. i mean *is the incentive*, not the opt out. the player gets protection from the market, and the team GETS THE PLAYER. in any suboptimal scenario, you're saddled with the years of salary, and no realistic alternative allows you to escape from that while still also getting the player in the near term

[Hairyducked Idiot]

If I'm buying a pitcher for 7/210 and he's 30 years old at the outset......I'm happy to let the guy opt out after 3 years. 1)that means he's pitched his ass off for me and 2) odds are against him continuing to do so over the final 4 years. I'll take the 3 years of production(conceivably in win-now mode) and the financial flexibility afterwards to grab a younger good pitcher or whatever else may be my biggest need at that point.

 

The issue isn't whether you are "happy" to let him opt-out after the three years. The issue is whether that scenario is *good enough* to balance out the downside of being stuck with him if he isn't.

 

Would you give 33-year-old David Price (coming off three straight healthy, productive years) 4/120?

 

Maybe.

[Hairyducked Idiot]

If I'm buying a pitcher for 7/210 and he's 30 years old at the outset......I'm happy to let the guy opt out after 3 years. 1)that means he's pitched his ass off for me and 2) odds are against him continuing to do so over the final 4 years. I'll take the 3 years of production(conceivably in win-now mode) and the financial flexibility afterwards to grab a younger good pitcher or whatever else may be my biggest need at that point.

 

The issue isn't whether you are "happy" to let him opt-out after the three years. The issue is whether that scenario is *good enough* to balance out the downside of being stuck with him if he isn't.

 

ok so i was open to the idea that maybe i was missing something but no this is just idiotic. the seven years is th.. i mean *is the incentive*, not the opt out. the player gets protection from the market, and the team GETS THE PLAYER. in any suboptimal scenario, you're saddled with the years of salary, and no realistic alternative allows you to escape from that while still also getting the player in the near term

 

I honestly have no clue how what you just said is a response to what I said or what you meant by it.

 

Lemme start over with my original point and see how that goes.

 

I have never seen a contract with a player opt-out that I like because I think they tend to be undercosted on the market, but that's just my opinion and I have no problem if there are specific contracts with opt-outs that people did like, including Price's.

 

But if you take two contracts with identical years and money, and A has no player opt-out and B has a player opt-out, then the only correct belief is that A > B from a team's perspective. Every time. Every time this comes up, somebody finds a way to argue A = B or A < B, and they're wrong every time.

[seanimal]

maybe you're just using cost in a way that i'm not catching on to but, assuming we're operating on standard definitions of cost and price, no, a player opt out in an all-things-being-equal scenario doesn't cost a team more than a deal without one. i just don't see any solid reasoning behind the notion that there is some additional risk or penalty incurred by the team for including a player opt out in the deal

 

and your equation is incorrect, at least in the absolute way you define it; a is not greater than b every time. if i can take advantage of the next three years of david price and he does so well that seeking a positive market correction is the consequence of him delivering spectacular value to my team over those seasons, then I'm absolutely giddy because i still get to keep him if i want! all i need to do is pay the new market value. but if i don't want, then he's some other sucker's problem as his age curve attacks

 

net net: with the opt out i'm no worse off than the alternative in years 4-7, but i'm also potentially way better off than the alternative should he opt out and take his future stink elsewhere

[jumbo]

maybe you're just using cost in a way that i'm not catching on to but, assuming we're operating on standard definitions of cost and price, no, a player opt out in an all-things-being-equal scenario doesn't cost a team more than a deal without one. i just don't see any solid reasoning behind the notion that there is some additional risk or penalty incurred by the team for including a player opt out in the deal

 

and your equation is incorrect, at least in the absolute way you define it; a is not greater than b every time. if i can take advantage of the next three years of david price and he does so well that seeking a positive market correction is the consequence of him delivering spectacular value to my team over those seasons, then I'm absolutely giddy because i still get to keep him if i want! all i need to do is pay the new market value. but if i don't want, then he's some other sucker's problem as his age curve attacks

 

net net: with the opt out i'm no worse off than the alternative in years 4-7, but i'm also potentially way better off than the alternative should he opt out and take his future stink elsewhere

 

The point is that the opt out is a significant win for the player at the time of signing the contract. This is illustrated by the idea (not sure in this case) that the opt out helps a team win the bidding. There are certainly outcomes that would make the opt out not actually cost a team.

[Hairyducked Idiot]

Because the player gets to act with more information than we have now. It's theoretically possible that he gets diagnosed with fast-onset bonitis the day after opting out, but on average he will only opt out when he's worth more to the market than what he's under contract for, and by definition that's a scenario where losing him is bad for the team.

 

Just because you can imagine scenarios where a bet pays off doesn't make it not a bad bet. It's akin to saying "Betting $100k to win $75k on a coin flip isn't always a bad bet, because you might win the coin flip and be ahead $75k."

 

Giving the other side of a negotiation the option to act later against your interests with more information than you have now is *always* a bad bet on its own (absent any compensation you get in the deal for allowing it).

[ChiCubsFan]

I think everyone agrees that A is appoximately equal to B and there are some hypothetical scenarios in which A may be better than B and some in which B may be better than A. Except for Kyle who finds it impossible that Price may be awesome, but not necessarily worth 4/120 in 3 years, but still opts out in order to get more total dollars over a longer contract with a lower average yearly value.

[Hairyducked Idiot]

I think everyone agrees that A is appoximately equal to B and there are some hypothetical scenarios in which A may be better than B and some in which B may be better than A. Except for Kyle who finds it impossible that Price may be awesome, but not necessarily worth 4/120 in 3 years, but still opts out in order to get more total dollars over a longer contract with a lower average yearly value.

 

Results-oriented fallacy. You don't judge a decision after the fact, you judge it on the moment you make it. I'm not denying that it's theoretically possible the buyout could pay off, but that doesn't make it equal or better for the team.

 

Again, if I bet $100k to win $75k on a coin flip, it's *always a bad bet*, even though I might win money off it. Similarly, certeris parabis (I never spell that right and won't look it up, even though looking it up would have taken less time than typing this caveat), player opt-outs are always worse for the team than identical deals without the player opt-out.

 

Anyone who thinks that A is approximately equal to B because of the balance of possibilities is just a wrongy-wrong wrong head.

[ChiCubsFan]

And dammit I want Samardzija talk, not player opt-out talk.

[Hairyducked Idiot]

And dammit I want Samardzija talk, not player opt-out talk.

 

We shouldn't give Samardzija a player opt-out for the same price as a non-opt-out contract.

[ChiCubsFan]

I think everyone agrees that A is appoximately equal to B and there are some hypothetical scenarios in which A may be better than B and some in which B may be better than A. Except for Kyle who finds it impossible that Price may be awesome, but not necessarily worth 4/120 in 3 years, but still opts out in order to get more total dollars over a longer contract with a lower average yearly value.

 

Results-oriented fallacy. You don't judge a decision after the fact, you judge it on the moment you make it. I'm not denying that it's theoretically possible the buyout could pay off, but that doesn't make it equal or better for the team.

 

Again, if I bet $100k to win $75k on a coin flip, it's *always a bad bet*, even though I might win money off it. Similarly, certeris parabis (I never spell that right and won't look it up, even though looking it up would have taken less time than typing this caveat), player opt-outs are always worse for the team than identical deals without the player opt-out.

 

Anyone who thinks that A is approximately equal to B because of the balance of possibilities is just a wrongy-wrong wrong head.

 

Yes, no opt out clause is better than an opt out clause in 2 identical contracts. But how can you say the contract would be identical without the opt out? Maybe he would have taken an extra week or 2 to sign and some team would have drove up the price another $10M. The opt out is almost definitely going to be of no significance. Most likely he won't use it. But even if he does opt out in 3 years, they aren't losing "much" value. I would argue "much" is really "any", because I wouldn't want to sign a 33-34 year old David Price to a 4 year $124M contract no matter how good he is for the next 3 years.