MLB guaranteed contracts

[Boris]

"Yeah, but the problem is if they could've just thrown $20 mil for 2 years..."

No. This was never an option. They would have had to offer significantly more than $20m over 2 years.

"or even $15 mil for 1 year it's a much better deal than $50 over 5 where you're tied down into a deal with a guy who's 32 and just had a banner year in a contract year."

Maybe, maybe not. You have to look at the NPV of GMJ's 5 year contract compared to the NPV of what you will likely have to pay a CF for the next 4 years after GMJ's contract expires. Then you have to compare GMJ's expected production v. what you will get in the open market. Using a 6% discount rate, GMJ's contract is only worth about $42m. It might very well be the case, given MLB's astonishing revenue growth, that 6% is too low of a discount rate. In which case, GMJ's contract starts looking better and better for the Angels.

Now, based simply on an eyeball analysis, and based on GMJ's past numbers, I agree with you that GMJ's contract is probably not a good one for the Angels. But that fact is you can't just make a blanket statement that GMJ's contract sucks because "the Angels are tied down to $50m over 5 years." The analysis is much more complicated than that.

Given GMJ

[Jack of Arcades]

[ QUOTE ]
No. This was never an option. They would have had to offer significantly more than $20m over 2 years.

[/ QUOTE ]

Boris, I never said that's what they should have done, I said it would have been much better because the problem isn't money, it's the amount of money they're paying him over the amount of time they're paying it to him, when he will be 37 at the end of his contract.

It is quite possible - in fact, it is likely that $10m will be seen as a lot less in 5 years. However, how good will GMJ be in 5 years? He probably won't be worth $10m then. Plus, we may see a reversal or revenue like in the last few years and we'll find that in 5 years it'll be a colossal waste.

All of this for - what BP projected - as a 1 win improvement over a readily available player?

[Boris]

Jack - So what you are saying is that if the Angels paid him less money it would have been a better contract?

[rwperu34]

[ QUOTE ]
All of this for - what BP projected - as a 1 win improvement over a readily available player?


[/ QUOTE ]

The actual disparity is 1.2, and Willits is 1.4 better than the next candidate for a fourth outfielder job that figures to get a decent amount of PT.

[kolotoure]

What is Aybars WARP?

[Jack of Arcades]

so bump it up to two wins. Point still stands - and given that Wiltis is likely to get better or, at the very least, not get worse, that difference will decrease as time goes on.

I understand the concept - you have money, might as well spend it, especially if it could put you over the hump and get you into the playoffs. But you're still paying $50 million to a 32-year-old CF who's done little but have one good (not great) year and make one spectacular catch.