Axel wrote:
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DanH wrote: View PostEven if the 5th year is a player option, if it buys you a lower annual rate it is probably a good idea.Heir, Prince of Cambridge
If you see KeonClark in the wasteland, please share your food and water with him.
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Axel wrote: View PostYes but for Demar's point of view, is getting that 5th year all that valuable? I don't necessarily see that 5th year as a huge negotiation advantage for us, since DD should be happy to be a UFA at 31.
I know I would take 5 years 100+ mil instead of 4 years 80+ mil.... But i'm just a regular guy.
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special1 wrote: View PostI dunno.... Isn't it guaranteed $$$ though?
I know I would take 5 years 100+ mil instead of 4 years 80+ mil.... But i'm just a regular guy.
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That said, I agree. That PO is insurance for a player, and carries value.
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special1 wrote: View PostI dunno.... Isn't it guaranteed $$$ though?
I know I would take 5 years 100+ mil instead of 4 years 80+ mil.... But i'm just a regular guy.
The 5th year is designed so teams have an advantage to retain players but it doesn't seem to go as far as to give the team a negotiation tool to lower the annual rate which some have predicted to be around $5M per (from our team max).Heir, Prince of Cambridge
If you see KeonClark in the wasteland, please share your food and water with him.
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DanH wrote: View PostFirst off, we should set our expectations at 5/137 vs 4/107 or so.
That said, I agree. That PO is insurance for a player, and carries value.Heir, Prince of Cambridge
If you see KeonClark in the wasteland, please share your food and water with him.
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Axel wrote: View PostBut wouldn't you expect Demar to want to get another long term deal done after the cap moves again. Next year is just a stepping stone for the cap, the final numbers will be higher, so it doesn't make a ton of sense for DD to lock himself in at a lower %. He will likely have a ETO built in so that he can get another long term deal. Hence, that 5th year isn't likely to exist in terms of what hits his bank account. Yes, there is the injury risk, but that is why DD would want it as a player option.
The 5th year is designed so teams have an advantage to retain players but it doesn't seem to go as far as to give the team a negotiation tool to lower the annual rate which some have predicted to be around $5M per (from our team max).
If another team offers him the max, they are offering a deal like this: 25.1M, 26.3M, 27.4M, 28.5M.
What if we offered: 25.1M, 26.3M, 27.4M, 28.5M, 29.7M (ETO).
That gives him exactly what he is being offered by the other team, PLUS 30M in insurance, with the option to hit free agency at the same time he would with their offer.
Meanwhile, our max is actually this:
25.1M, 27.0M, 28.9M, 30.8M, 32.7M.
So, annually, about 1.6M less than our max, assuming the full 5 years.
But that assumes that the 30M in insurance is not really worth anything in negotiations. Since if he liked it here, he in theory would simply accept a 4 year offer identical to what the other team was offering (and all signs point to him liking it here).
But how much is 30M in insurance worth? Surely more than nothing.
For example, we could offer a deal that looks like this:
22.8M, 24.5M, 26.2M, 27.9M, 30M (ETO) -> 5 years, 131M, 26.2M per year. The first 4 years work out to 25.3M per year (a 1.5M per year pay cut from the market max, and a 3.6M per year cut from our true max). That still seems like a far better offer than the opposition can make, with 24M more guaranteed dollars.
There is some tipping point where the value of the ETO is offset by the lost value in the first 4 years, but it's not at 0 dollars and I imagine it is some point lower than what I've outlined here.
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Yes I understand all of that, but my point is that many people seem to be predicting even less than the $1.6M annual. It is to them that I am asking why would Demar take that? People starting at $20M and $22M.
Opposing teams Max is likely the minimum he takes unless it is somehow related to Durant signing here.Heir, Prince of Cambridge
If you see KeonClark in the wasteland, please share your food and water with him.
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Axel wrote: View PostYes I understand all of that, but my point is that many people seem to be predicting even less than the $1.6M annual. It is to them that I am asking why would Demar take that? People starting at $20M and $22M.
Opposing teams Max is likely the minimum he takes unless it is somehow related to Durant signing here.
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DanH wrote: View Post
But how much is 30M in insurance worth? Surely more than nothing.
There is some tipping point where the value of the ETO is offset by the lost value in the first 4 years, but it's not at 0 dollars and I imagine it is some point lower than what I've outlined here.Heir, Prince of Cambridge
If you see KeonClark in the wasteland, please share your food and water with him.
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Axel wrote: View PostYes I understand all of that, but my point is that many people seem to be predicting even less than the $1.6M annual. It is to them that I am asking why would Demar take that? People starting at $20M and $22M.
Opposing teams Max is likely the minimum he takes unless it is somehow related to Durant signing here.
It is related to, predominantly, DeRozan's hardcore fans continuing with the narrative over the years (before he changed his game because now you don't need to spin any tales) that strongly relied upon his work ethic, loyalty, and public declarations of adoration for Toronto as to his value to the team.
If DeRozan keeps playing as he has for most of this season for the rest of the season AND, more importantly, the playoffs then I really don't believe he is settling for anything less than max - nor should he, and we can finally focus on his value to the team based on what matters most - on court production.Last edited by mcHAPPY; Sat Jan 2, 2016, 11:36 AM.
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Axel wrote: View PostThis is the driver here. $30M insurance - the value of which is impossible to predict. Is $1.5M enough? If the new cap numbers are high enough, probably not. A new deal, even with the risk of injury, is likely substantially higher reward.
But players almost never do that. Even when they do, they tack on a player option year for insurance.
And here's the thing - that's true of the entire concept of insurance. Insurance companies make money because people, on average, spend more on insurance than they claim. And yet having insurance is quite valuable.
Insurance aside, even, the control is awfully tempting for a player. To be able to decide, in your early thirties, to cash in on a good recent year with a big offer, or if your most recent year was disappointing or you suffered an injury, or even if there's another predicted cap jump (the cap is always rising to some degree, just a matter of how much) or a better SG market one year over the other, to opt in and try again the year after - that's very enticing to players who in general are locked into contracts.
And the best part is - DeRozan wouldn't lose the ability to chase that new deal! If he thought he could get a big deal that summer, he could go after it, just opt out. He's not losing the ability to go after the big new deal - in fact he's buying himself the ability to choose which summer he chases it.
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DanH wrote: View PostAnd the best part is - DeRozan wouldn't lose the ability to chase that new deal! If he thought he could get a big deal that summer, he could go after it, just opt out. He's not losing the ability to go after the big new deal - in fact he's buying himself the ability to choose which summer he chases it.
Am I right in assuming that the player option can only be tacked onto the final year of the deal, or can he take a 3 yr deal with a PO for the final 2 years?Heir, Prince of Cambridge
If you see KeonClark in the wasteland, please share your food and water with him.
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