Offseason Contract Extension (CE) Discussion

Great work, Mike. Even marquee players are willing to forego the possibility of higher dollars on the first-time free agent market for the locked in, guaranteed dollars by extending early.

Love live CE+2!


JIm

I totally forgot that Strasburg did sign that extension. My bad on that. 7 years and 175 million. 25 million a year. Not much of a discount there. Maybe a few million. But he also has two different opt out years. They do those now, so we have to add them into our contracts too. That's your argument right? If they do it in real life we have to do it in this league.

I did ask for suggestions. You brought up the RFA system, so now it's being discussed. No one else was bringing it up. I wasn't going to. I haven't heard anyone else talk about bringing it up. So, thank you for bringing up a dead topic. It's given Connor's RFA system new life.

The more I think about your assessment of how it's going to hurt trade value for players, the more I think you either don't understand the system (which would explain your constant statements about losing players before their 6th year or weird idea about having to trade them in like year 3 or 4) or didn't fully examine it. I think it's actually going to give teams more negotiating power. Let me explain:

Your options under old system:
- player entering 5th year, so you can keep them and CE them for 3 years or let it go for one more year. CEing them gives them a NTC for the first year. So if you CE them, you have to wait a season to trade, then you can only trade away 2 seasons of team control. That can usually get you good value.
- player entering 6th year, so again you can either keep them, CE them for Y6 and Y7, or let them play out their 6th year and use the 10% discount and hope that you can get a high bid on Day 1 or 2. If you CE them, they have a NTC for Y6, so after that you'll only be able to trade away one year of use, Y7. The market usually goes down for those players. Their salary isn't that low because you waited until Y6 to CE them. Sure a team that trades for them gets a full 10% discount if they trade before the year, but if they miss out on a D1 or D2 bid, that discount is meaningless. And if you didn't CE them and try trading them midseason for whatever reason, the acquiring team only gets a 5% discount and no assurance they win the D1 or D2 bid. The market for players in that situation is lower than any other situation.

Now, your options under the RFA system:
- A player entering their 5th year... your options are like any players. Trade or keep. A team acquiring that player knows they're getting at least 2 years, and maybe more depending on how the RFA goes. Value for players with 2 years seems pretty much the same, although pre-FA years are cheaper so a 5th year guy has more trade value than a V contract with 2 years left. Plus you'll automatically be in the bidding war with a 10% discount.
- a player entering 6th year. Again, two options are trade or keep. If you keep the player, you can then take them to RFA after the year where you'll have a full 10% discount and be assured of being in the bidding war. No more wasted discount rights because you were the 2nd highest bidder on each day. Or, you can trade them away. Sure, with no CE system a team isn't assured of 2 years anymore. They are only assured of one. But now they are assured of being able to go into RFA with a full 10% discount. Do you realize how valuable the idea of assured bidding war is? How much would you give up for Machado or Arenado entering their 6th year if you are going to CE them and get them for Y6 and Y7, and then the 10% discount if you can get into a bidding war after that? Now how much are you going to give in the same situation but you get them for Y6 and then are absolutely guaranteed to get into the bidding war for them with a 10% discount? And, the third option is trading away the player mid-6th year. Under the current system the acquiring team only gets a 5% discount. And if they miss out on a D1 or D2 bid, they're hosed. But under RFA, they're trading for 5% discount and an assurance of being in the bidding war. The trading team has just gained a ton of value on the trade market. Say Michael goes into 2018 with Machado trying to contend. Things go poorly and he is 15 games out in early July. Under the current system he can trade a half season of Machado to a team that now gets 5% discout if they can be a D1 or D2 high bidder. But now, not only is he trading a half season of Machado and 5% discount, he's trading away 100% assurance of being in the bidding war. I personally love the idea of that new wrinkle and teams fighting for that assurance. It's giving expiring arbitration players tons more value than they've ever had.

(I typed this on my phone, so sorry for any typos. I'll fix later when everyone in the room is awake)