Around Baseball 2014

[Sammy225]

They are in win now mode as well. I don't know what the details are on the contact in terms of no trade list, but what would stop them from trading him in 4 years from now and get prospects back? But if they are able to unload another pitcher for more prospects right now how can you not like the deal? Just trade Scherzer in 4-5 years for more prospects, there will always be a team willing to take him who will be in win now mode at that time. Apparently there are a lot of 'deferrals' as well.

 

His contract..... After 4 years if his play slips at all which in his mid 30's is very very possible that contract is going to look like an albatross and nobody is going to want to take it on. Pitchers are so volatile that huge contracts are so risky. I would say Scherzer goes similar path as Verlander and unless you eat a lot of the salary nobody in their right mind will take that contract.

[Laika]

Max Scherzer's deal is $210 million for seven year. Half is deferred: $105M from 2015-21, $105M from 2022-28.

 

Jesus Christ

 

Although deferring half of the money until 7-14 years down the road is actually pretty smart.

[xposbrad]

His contract..... After 4 years if his play slips at all which in his mid 30's is very very possible that contract is going to look like an albatross and nobody is going to want to take it on. Pitchers are so volatile that huge contracts are so risky. I would say Scherzer goes similar path as Verlander and unless you eat a lot of the salary nobody in their right mind will take that contract.

 

Well, there are people here who want Shields signed who is about in his mid 30s. It's all speculation on how he performs anyways. What I am seeing is the fact it gives Washington which already had a solid rotation another power arm and the ability to swap another pitcher for prospects. I also don't think they'd have a problem in 4 years trading him, at 34 years old he'll most likely still be performing at ace level. The way salaries are going, ~28m for him might not be so bad.

[xposbrad]

Jesus Christ

 

Although deferring half of the money until 7-14 years down the road is actually pretty smart.

 

Time value of money makes the contract worth less, depending on if they are paying him interest or not.

[GreekFatAss]

Nasty precedent to start. I expect them to close this down in the next CBA before it gets out of control with everyone in the league earning money beyond their play time.

[Boxcar]

Well, there are people here who want Shields signed who is about in his mid 30s. It's all speculation on how he performs anyways. What I am seeing is the fact it gives Washington which already had a solid rotation another power arm and the ability to swap another pitcher for prospects. I also don't think they'd have a problem in 4 years trading him, at 34 years old he'll most likely still be performing at ace level. The way salaries are going, ~28m for him might not be so bad.

 

I'm fairly confident this contract is an instant albatross.

[Laika]

Time value of money makes the contract worth less, depending on if they are paying him interest or not.

 

Yeah.

 

A lot less. 30M 14 years from now is worth, what.... 17M today? Something like that.

[Laika]

Nasty precedent to start. I expect them to close this down in the next CBA before it gets out of control with everyone in the league earning money beyond their play time.

 

I don't see why it really matters.

[GreekFatAss]

I don't see why it really matters.

 

Because then agents will demand it from teams so teams on small budgets will be eliminated from the practice and allow the bigger market teams to load up on future salary while taking the small guys even further out of the equation. Hell, they won't even be able to acquire players already signed by others due to the uber long term commitment years beyond the time they will ever play.

[Laika]

Because then agents will demand it from teams so teams on small budgets will be eliminated from the practice and allow the bigger market teams to load up on future salary while taking the small guys even further out of the equation. Hell, they won't even be able to acquire players already signed by others due to the uber long term commitment years beyond the time they will ever play.

 

Believe me, player agents wont be lining up to get lengthy contracts full of deferred money.

 

It's in the player's best interest to get as much as possible as soon as possible.

[xposbrad]

Yeah.

 

A lot less. 30M 14 years from now is worth, what.... 17M today? Something like that.

 

Depends on actual inflation + interest they are paying him. Assuming 0% interest and an average inflation of 3% which is what the US has averaged the last 100 years per year, then take a look at this chart:

 

http://1.bp.blogspot.com/-TLZYbwEh3cM/UQGqkSg-UrI/AAAAAAAABpQ/AqWlL0aKa50/s1600/What+Will+100+be+Worth+in+N+Years.jpg

 

100 dollars would be worth ~$65 in 15 years from now assuming those conditions, roughly a 35% decline. So, 30m would be worth about 19.5m or so in 14-15 years with no interest paid and if inflation was average.

[saskjayfan]

Believe me, player agents wont be lining up to get lengthy contracts full of deferred money.

 

It's in the player's best interest to get as much as possible as soon as possible.

 

Yeah..you're probably right, but you're probably going to find it tough to track someone down who's feeling sorry for Max and his 14 year 210 mil contract for 7 years of work.

[flafson]

Scherzer will receive $210MM for seven years of work, but the contract has an unusual structure, with Scherzer receiving $15MM per season for the next 14 years, Ken Rosenthal of FOX Sports tweets. That means the Nationals will be paying Scherzer through 2028. Also, Yahoo! Sports’ Jeff Passan tweets that the deal includes a $50MM signing bonus that will be paid out “over a portion of time” for tax reasons. That bonus would, presumably, be included in the $210MM total. As Passan notes, the deferral makes the contract worth about $185MM in present-day dollars. The structure of the contract and Washington DC tax laws could ultimately save Scherzer over $20MM, however, Passan reports. Scherzer’s deferral is, obviously, the largest one in MLB contract history, leaving Bobby Bonilla and the Mets’ lengthy $29.8MM deferral in the dust.

 

So, 7 years 210M while they get to pay it over 14 years period, nice.

[xposbrad]

You can get a LOT more than 1-3% by investing the money though and money is less valuable in the future even without considering interest.

 

There's some sort of signing bonus included, so any real-value evaluation of the $210M would have to consider that too.

 

I meant on if they are paying him interest on the deferred money. I think he would be stupid to have taken that much deferred without interest though. Ok there, they calculated it that it's worth 185m present value. So 7/185.

[flafson]

No wonder Boras closed the deal so quickly, it's an insane deal.

[GreekFatAss]

Believe me, player agents wont be lining up to get lengthy contracts full of deferred money.

 

It's in the player's best interest to get as much as possible as soon as possible.

But if you can do say a Trout deal with half deferred. You can sign another big deal on top of it allowing players to double dip on it. Look at governments to see the potential to abuse the future financial picture to borrow for gain now.

[Governator]

So I guess that's what its like to have a single owner who is worth 4Billion+, is a crafty real estate investor and cares about winning.

[BTS]

This seems really unnecessary if they just end up trading Zimmermann. Scherzer is like a 1-win upgrade.

[Governator]

This seems really unnecessary if they just end up trading Zimmermann. Scherzer is like a 1-win upgrade.

 

Doesn't this let them trade Zimmerman this summer? Isn't that the point to replace the win value for another 6 years?

[GreekFatAss]

But they'd be earning much less in the first contract, right? Earning money from two different teams/contracts isn't necessarily advantageous.

 

 

Good post. So Scherzer's contract is worth about the same as a flat-weighted 7/170, which seems reasonable. Cameron's economics degree pays off

 

He's not really earning less though. He wold get more money just spread out over a longer period of time.

 

Do you guys think he would take 7 years for 170 million or 210 spread over 14 years while still being a free agent in the same period of time?

 

All this does is let the Nats tie up 15 million a year for 7 years after he's gone which will hurt their financial flexibility then.

[BTS]

Doesn't this let them trade Zimmerman this summer? Isn't that the point to replace the win value for another 6 years?

 

Why now? Why not just let Zimmermann play out his contract and re-evaluate next year. You can always chase Price/Kuma/Cueto/Zimmermann/Samardzija/Greinke a year from now if you're inclined. A $200 M commitment to a pitcher just so you can move Zimmermann before he walk is pretty reckless IMO.

[Governator]

Why now? Why not just let Zimmermann play out his contract and re-evaluate next year. You can always chase Price/Kuma/Cueto/Zimmermann a year from now if you're inclined. A $200 M commitment to a pitcher just so you can move Zimmermann before he walk is pretty reckless IMO.

 

I don't disagree. I think from their perspective their top notch rotation is what makes them demolish their weak ass division and they want to own the top record in baseball for the next few years. It's only reckless if you have limited funds to work with.

[BTS]

My god the SP market is stacked next yer:

 

Aces = Price, Kuma, Cueto, Zimmermann, Samardzija, Greinke

solid 2/3 types = Porcello, Latos, Kennedy, Kazmir, Fister, Lackey

other interesting guys = Buehrle, Chen, Colon, Lohse, Leake

[GD]

My god the SP market is stacked next yer:

 

Aces = Price, Kuma, Cueto, Zimmermann, Samardzija, Greinke

solid 2/3 types = Porcello, Latos, Kennedy, Kazmir, Fister, Lackey

other interesting guys = Buehrle, Chen, Colon, Lohse, Leake

 

Greinke isn't a sure thing to opt out

[xposbrad]

Why now? Why not just let Zimmermann play out his contract and re-evaluate next year. You can always chase Price/Kuma/Cueto/Zimmermann/Samardzija/Greinke a year from now if you're inclined. A $200 M commitment to a pitcher just so you can move Zimmermann before he walk is pretty reckless IMO.

 

Because they can trade him for prospects or to fill another need. He should be able to net a really high upside player. They will still be able to chase him when he's a FA but look at their rotation now:

 

Scherzer/Stras/Jzim/Gio/Fister and Roark , granted it's unlikely Roark repeats 2014 but he's still a solid #5. They are stacked at pitching. They technically don't need to trade anyone, but it's better to get prospects back now then nothing later and I think the reason for signing him was to make a trade and get some young controllable players back.

[BTS]

Greinke isn't a sure thing to opt out

 

IMO it's a lock if he has a healthy season.

[xposbrad]

My god the SP market is stacked next yer:

 

Players the Jays won't sign = Price, Kuma, Cueto, Zimmermann, Samardzija, Greinke

solid 2/3 types = Porcello, Latos, Kennedy, Kazmir, Fister, Lackey

other interesting guys = Buehrle, Chen, Colon, Lohse, Leake

 

edited it for you

[GD]

IMO it's a lock if he has a healthy season.

 

Dodgers 98% still resign him, though. Or Price. Or both, lol.

[GD]

edited it for you

 

yo like we just signed Russell Martin and traded for Josh Donaldson

 

is that actually not enough or do we need to commit to a stupid long term deal or 5 for it to be enough

[BTS]

Because they can trade him for prospects or to fill another need. He should be able to net a really high upside player. They will still be able to chase him when he's a FA but look at their rotation now:

 

Scherzer/Stras/Jzim/Gio/Fister and Roark , granted it's unlikely Roark repeats 2014 but he's still a solid #5. They are stacked at pitching. They technically don't need to trade anyone, but it's better to get prospects back now then nothing later and I think the reason for signing him was to make a trade and get some young controllable players back.

 

Two options:

1.

Zimmermann @ 1/16.5

comp pick when he walks

their own first round pick in 2015

 

2.

Scherzer @ 7/210

Zimmermann trade return

 

How much more value will Zimemrmann return than the two picks they miss out on by keeping him and not signing Scherzer? I'd much prefer scenario 1 and re-evaluate in 2016 with a loaded SP market.