Sunday, December 25, 2011

Calling it now

Mavs are one and done champs. OKC edges them in the West.

Bulls use their depth in a compressed schedule with lots of back to backs to build the best record in the East. They may not can beat the Heat in a series, but they will win more regular season games on depth alone. They meet the Heat in the Eastern Conf Finals, and they win it in 7 with home court advantage.

Tuesday, December 20, 2011

The Chicago Bulls Have Locked Up Derrick Rose for the Next Five Years: Money Buys My Happiness

Holy balls, a basketball post!

Okay, first, let's just recap that title: The Chicago Bulls have locked up reigning MVP Derrick Rose for the next five years with a contract worth roughly $94 million. I'm happy enough with this; I'm a Bulls fan, and Rose is fun to watch. I wish he had another move besides "drive the line, float the ball over everyone's head", but hey, so far, can't argue with results.

I bring this up solely because it illustrates a interesting, but misunderstood aspect of wealthy, large market teams: that their money even buys stability with their current roster.

You've probably heard some of what I'm talking about before: fans saying their team didn't BUY their success because Player X, Y, or Z is home grown. And it's not even usually some ridiculous third-stringer; Yankees fans, for example, always point to Jeter and Rivera. And that's true! But last time out, the Yankees spent $50 million for the last three years of Jeter's career (oh, crap, spoilers!) and $30 million for two more years of 'Mo.

The thing is, everyone is home grown somewhere. Starting your career with a team doesn't mean much; Shaq started with the Magic. Pujols ack erk sob sob sob. But they moved, because someone else was willing to pay up. It's not just about finding talent, it's about keeping talent, and if you've got money, you've got one more tool to help you do that.

Which brings us back to the Bulls and Rose. The Bulls are a wealthy franchise, and so they can afford to lock up their top player. The NBA complicates this a little, in that it has max contracts, but still, the Bulls can afford to hand out more max contracts than other teams. And anyway, the NBA's olive branch to "home growing" its players is that a player's first team can actually offer him MORE money.

My point is, money doesn't just give a team free agency options. It lets it avoid free agency just as much.

UPDATE: Friend of the blog Chip adds in some details on the NBA's max salary rules under the new collective bargaining agreement: "The new CbA allows teams lucky enough to draft the MVP (or other qualified examples I can't remember just now) to give Them something like 30% of the salary cap as a max, and an extra year. It's rare to have an MVP so young and it is great luck for the bulls. But also very interesting from the contract / CBS standpoint."

I'd heard about this, but didn't think about including it because, y'know, shitty blogger. But it's real, and some people have even taken to calling it the Derrick Rose Rule. My theory above holds true, though- a wealthy team still has more of an ability to exercise this option, even if all teams would be allowed to do so.

Wednesday, December 7, 2011

The Economics of Albert Pujols

I was in St. Louis this weekend, accompanied by a bunch of people who couldn't give a baker's shit about the Cardinals (and one guy who would pay good money to see Busch Stadium burn to cinders in a tire fire, but we'll set him aside for now). The subject of Pujols' free agency of course came up.*

*-And while I've got you here, let's just clear up that that's exactly WHY pro athletes get away with outrageous contracts- because we all secretly LOVE them. Here we were, in the city that just won the World Series, talking about the TEAM that just won the World Series, and we're talking contract negotiations. We can bitch all we want about greed and money and how we'd play for free if someone would let us, but it's all horseshit. We LOVE talking and thinking about this stuff.

Anyway. Pujols. My companions asked me where he was going, and given the latest news about the Marlins and the MYSTERY TEAM, it's obviously a good question. Too bad my answer is so shitty- I JUST DON'T KNOW.

It all comes down to this: Will someone significantly outbid the Cardinals? The Cardinals' latest offer is HUGE- 10 years, $220 mildos. And by all accounts, Pujols likes the Cardinals, likes St. Louis, likes toasted ravioli, etc. So, is some other team going to go significantly above and beyond that?

There's significant evidence that they'd be pretty dumb to do so. In 2011, Albert Pujols started to look vaguely human, which is to say he merely hit the shit out of the ball with a baseball bat, as opposed to raping the psyches of opposing pitchers with his terror (Albert Pujols led the league in RPs in 2004, 2005, and 2007. Tim McCarver won the award in other years, but for other reasons.) He had nagging injuries. His production was noticeably down. He had some mental lapses. And of course, he's 31 years old (or 57 years old, if you believe every baseball pundit out there, though they have absolutely nothing to prove it).

So, essentially, if you pay out more than 10 years for Pujols, you're probably buying at least 4 shitty years, and spending hundreds of millions of dollars to do so. Why in god's name would you do that?

See, there's this thing in economics called the "Efficient Market Hypothesis", which is essentially that if the free market has all the proper information, it will correctly value something- y'know, put it at the exact right price point to balance out supply and demand, or whatever.

But if you think that smells like bullshit, your nose is in fine working order. I'm a big fan of what Larry Summers said about that: "THERE ARE IDIOTS. Look around." Markets are all just made of people, and people are dumb. We get distracted, we get emotional, we get suckered, we don't do proper research. We basically suck, it's just that we've got the thumbs, so the rest of the planet can sit the fuck down.

That brings us to the Miami Marlins. It is almost certainly NOT in their best interest to offer Albert Pujols more money than the Cardinals are offering him. They've already overpaid for Heath Bell, and maybe Jose Reyes. And Friend of the Blog Ozzie Guillen will make them pay out a lot more, either in league fines or player blood. And Pujols has all of those downsides listed above.

BUT...that doesn't mean the Marlins won't do it anyway. They want to make a big splash in the free agent market, to go along with their shiny new stadium, fiery new manager, uniforms. So, just 'cause they SHOULDN'T offer Pujols more money than the Cards, doesn't mean they won't.

Stay tuned. Look around.