Thunder acquire Eric Maynor and Matt Harpring for PETER FEHSE
I have only 48 things to say about this deal.
1) As his profile suggests, I have long regarded Peter Fehse as a yardstick for a person's NBA knowledge. If a fan knows who Peter Fehse is, they are freaking hardcore and deserve your respect.
Short story short, Peter Fehse is a lanky German with lots of hair, who was drafted in the second round in 2002 as an absolute longshot based on his combination of height and athleticism. He never amounted to anything NBA calibre, partly because he never had NBA calibre to begin with, but also because of constant injuries.
It has been over seven years since Peter Fehse was last heard of in NBA circles; indeed, he's barely even heard in German basketball cirles either. Fehse has not played this season, played in only two games last season, and did not play in 2007/08, all of which is due to injury. As long shot projects go, he was about as fail as a 49th pick can be, and is even more of a throw-in than Andy Betts was when he was traded for Peja Stojakovic in July 2006. Gotta love that.
2) Google the term "peter fehse" and see who's got the second result. This is partly why he's awesome.
3) Oklahoma City were able to make this trade because they had roughly $9 million's worth of cap room. As documented here, Oklahoma City had about as much cap room as anyone this summer, and could have bid on a number of quality players that filled a need (including Utah's very own Paul Millsap, whose new contract is ironically the reason for the need to salary dump in the first place.) They didn't do this, though, instead choosing to sign two of the worst players to have ever had ten or more year careers; Kevin Ollie and Ryan Bowen. Reasons like this are partly why; they maintain their cap flexibility for next summer, while using their untouched space to acquire talent during the season. Just like Memphis did in 2008/09. But more on that later.
It's interesting that they moved so early, too. With so many teams destined to be tax payers this year (14, at last count), you would think it'd be inevitable that, come trade deadline time, teams would be bending over in front of the Thunder, offering up penetration or whatever Sam Presti wanted if it meant that they could use some of the Thunder's cap space to save some of their excess salary. Yet instead of waiting for the deadline, Presti has acted two months early, and used it up on a projected backup. Maybe that was the best deal they can get. Maybe they have further plans for Harpring's expiring, and needed to get it while they still could. But it seems unlikely that Maynor and Harpring would have been the best available assets had they waited it out.
I guess they just really like Maynor. Perhaps a little too much so. We'll see how this works out come deadline day.
4) Fans of NBA teams never like salary dumps. They don't like seeing good basketball assets - particularly in the form of young players - being traded purely to save money, money that has been otherwise misspent in previous bad personnel moves. And that's good. They shouldn't.
But sometimes, it's the right thing to do. And this seems to be one such moment. With a payroll of $82,180,677 against a luxury tax figure of $69,920,000, the Jazz were on the hook for about $94.5 million in salary this season, their highest amount ever by over $20 million. Naturally, they're kind of not cool with that idea, especially since they're not off to the greatest start this season. So by dumping these two guaranteed salaries for no returning salary, the Jazz save oodles of cash.
(Can't be bothered to work it out exactly, but take away Harpring's salary and Maynor's salary from Utah's cap number, then take it away again in saved tax dollars, then add back on the replacement cost of the 13th player Utah is going to have to sign, and add back on whatever portion of Harpring's contract Utah was able to save on in insurance. That's your total saving. It's in the 8 figures worth. And for 8 figures worth of money, you can buy multiple replacement Maynors.
(By the way, this move brings the Jazz down to roughly $74 million in salary for this season. One more salary dumping move - potentially one involving Kyle Korver - then the Jazz might yet get under the tax threshold. If they do, then once tax rebates are included, their payroll will be nearer $64 million than $94 million. Are you really going to pay $30 million for two backup guards when you don't have to?)
(Don't ask who's going to take on Kyle Korver for no outgoing salary. Details, details.)
5) When Sam Presti uses cap space to acquire Eric Maynor for essentially nothing, he's deemed (in the early going) to be a genius. When Ed Stefanski uses a trade exception to get Rodney Carney and Jason Smith for essentially nothing, no one says anything. When Chris Wallace uses cap space to get Sam Young for essentially nothing, he's an idiot. It's all a matter of your perspective, I guess. (Or rather; it's all about what other people told you to think. Since Sam Presti is currently regarded as Golden Bollocks, in spite of the fact that he gave away Carl Landry for Sasha Kaun, then that's going to be the popular viewpoint of this deal. Which is fine. But so were the others, and yet no one listened then.)
6) The Thunder had to waive two players to accommodate the two incomers, and inevitably the settle upon Mike Wilks and Shaun Livingston. It's another setback for Livingston, who was playing reasonably well now that he's finally healthy again, but he should be able to get more work soon, particularly when 10 day contracts become available in a couple of weeks times.
Wilks is kind of used to this, but it must suck for him too.
7) The Jazz have only 12 players after this deal, so they have to sign someone. You can only have 12 players for two weeks at a time. They also now need a point guard. How about Shaun Livingston?
The NBA's luxury tax first came into existence in 2001, the year in which the league's funky new escrow system debuted. The escrow system, in layman's terms, is a system that withholds a certain amount of player's salaries and puts it into a separate account until the end of the following season's moratorium. At that point, when the league's annual audit is done (that's what the moratorium is for; calculating the numbers and stuff), then if the league-wide player salaries exceed a certain percentage of the league's overall revenue, that account is divvied up amongst the owners and the players never see it. Similarly, if the league wide salaries do not exceed that percentage, the players get it back. Essentially, it's a failsafe measure to prevent players from getting paid too much. Luxury tax is an extension of the escrow system, designed to put more money back into the owner's pockets if they feel the players are getting too much of it.
If that sounds like something that might excite you sexually, a longer description with all the relevant numbers and stuff was written by the seminal Larry Coon, and can be found here:
As you might presently yourself fully be aware of, the luxury tax is an owner-friendly system also designed to prevent rich teams from simply outspending the rest of the competition. It is calculated by using a projection of the following year's Basketball Related Income (roughly 61% of it; a more detailed description of the calculation can be found here), and the idea behind it is simple - you can have a payroll of as much as you like, but if you cross that tax threshold, it starts costing you more. It's designed to be a deterrent, and to emphasise parity amongst the league's payrolls, thus tying in nicely with David Stern's slightly communist idea of all teams having a chance to compete.
Does it work? Let's find out.
The escrow system and luxury tax have now been around for 8 years, from 2001/02 through to the present day. In that 8 year period, there has been a luxury tax in 6 seasons. During the previous collective bargaining agreement (from 1999 to 2005), the luxury tax was not applicable in every season; the tax was only initiated in seasons where league-wide salaries and benefits exceeded 61.1% (recurring) of the actual BRI that year, and not projected BRI. Since that didn't always happen - salary spending in 2001/02 was only 59.8% of all BRI, thus there was no tax that year, nor was there one in 2004/05 when it totalled only 60.4% of BRI - in the years when there was no tax, teams could spend as much on payroll as they wanted without fear of reprisal.
Of course, they didn't know that at the time. Since the actual BRI was not calculated until the moratorium following the season's end, teams didn't actually know where the tax threshold was going to be until it was too late. They could project it, of course, but they had to make their roster moves around that projection, and that was never going to be an exact science. As such, teams would sometimes be caught out by their own guesswork, and become taxpayers when they didn't want to be.
The 2005 extension of the CBA changed that system to a more sensible one, where the tax threshold was calculated before the season's start based on a projection of that year's BRI. The tax was also no longer implemented based on whether a percentage of BRI was exceeded; from 2005 onwards, it become enforced every year, regardless of what happened with the escrow system.
Those changes gave us the system that we have now, where the salary cap and luxury tax are projected for the following year based on projected BRI, minus benefits, adjusted slightly for the accuracy of the previous season's projections, and finally divided by the number of teams in the league. The salary cap is calculated at 51% of that projected amount, and the luxury tax threshold is set at 61% of it; for this season, that leads to figures of $57,700,000 and $69,920,000 respectively.
(Again, all of the above save for the Family Guy and Wu-Tang references can be found at Larry Coon's CBA FAQ. It's a great resource for those of us really into forgoing social lives in pursuit of a finite understanding of the NBA's finances. For those more into full frontal nerdity, try the actual CBA itself, and see how long you can tolerate its excessive verbiage for before you are tempted to experiment with carbon monoxide. My record is about seven minutes.)
As mentioned earlier, there has been a luxury tax enforced in six out of the last eight seasons. There follows the amounts paid league-wide each season, and the teams that did it.
(Note: for the most part, calculating a team's tax figure is essentially just looking at their team salary figure, and comparing it to the tax threshold. But there are a few subtle differences, the details of which can be found here. The most relevant one is the one that says "For players who signed as free agents (i.e. not draft picks), and make less than the two-year minimum salary, the minimum salary for a two-year veteran is used in place of their actual salary," a stipulation that affect Marcus Landry, Coby Karl, and others on this list. Also, the suspensions for Rashard Lewis and Jamaal Magloire have to be accounted for; teams are billed for only 50% of the money players lose when suspended by the league. God bless that Mr Coon.)
The most obvious thing that will stand out there is the sheer number of teams paying it. It's an unprecedented amount of them, and the tough economic climate is the reason why. League revenues were supposed to go up, taking the cap and tax thresholds with them, and teams had budgeted accordingly in previous years. But then the credit crunch hit, revenues went down, and so did the cap. As a result, a lot of teams that weren't expecting to be taxpayers now are. And that's why that list is so long.
Of course, this list is still subject to change. For tax calculations, a team's salary figure from the last day of the regular season is used, and there will be a lot of changes before then. Some players will be traded, others signed, several more cut, and some players will have this year's salary number retroactively altered if they meet (or miss) their performance bonuses. Since all this is in the future and hasn't yet happened, an accurate figure is incredibly hard to predict, and therefore an accurate assessment cannot be made until the season's end.
But as things stand, that's where we are. It's still pretty impressive.
Were the above numbers to be a static exhibit, the amount of tax that would be paid is the staggering $144,365,846, and it won't go down a huge amount. There's many a month left until the trade deadline, and even though there aren't a huge number of cost-cutting options available for over-the-tax teams out there, the few that there are will almost certainly be utilised. Nevertheless, any inroads that can be made into that figure will be comparatively small. There just simply aren't the means to cut much salary right now.
The teams below the tax stand to gain a tidy rebate this year. Teams that do not pay the tax are eligible for a payment of 1/30th of all the money collected as tax, whereas the teams that pay it get none. The rest of the money collected is reserved by the league for "league purposes"; that could mean many things, but a lot of it goes to the league's revenue assistance plan.
In the 2008/09 season, $87,352,665 was paid in luxury tax (see the breakdown above). 23 teams did not pay it, and 7 teams did. Each non-taxpaying team was therefore eligible for a rebate of $2,911,756 - one thirtieth of the overall tax kitty - and the league kept the remaining undistributed $20,382,277 - seven thirtieths of the overall tax kitty, i.e. the shares of the taxpaying teams that won't get it - for themselves.
This year, as you can see from all the tax that's projected to be paid, that rebate's going to be a lot higher. If the $144,365,846 figure above is all paid as tax, that will mean each non-taxpaying team is eligible for a significant rebate of $4,812,195. And no matter how rich you are, $5 million is quite a lot of money. That rebate, plus the rebate teams get from the escrow system, can go some ways to offsetting a team's salary commitment.
For example, last year, the New Orleans Hornets had a payroll of $66,858,141; to offset that, they gained a $2,911,756 luxury tax rebate, as well as a $6,467,847 escrow rebate (the players got none of their escrow back due to league wide salaries being so far in excess of the designated BRI percentage for them, so it was returned to the owners). That combined $9,379,603 made for a tidy 14% refund on their player salary expenses, and lessened their overall salary commitment to $57,478,528.
In contrast, the Dallas Mavericks had a player payroll of $94,646,833 last year. That meant a luxury tax payment of $23,611,661 (when things such as Dirk Nowitzki's one game suspension and Devean George's retroactive bonus were included), boosting their overall salary commitment to $118,258,494. As a taxpayer, they didn't get a luxury tax rebate, and the escrow rebate brought their overall payroll commitment down to only $111,790,647, roughly double what the Hornets paid.
Such is the advantage of not being a taxpayer.
So, if you want to team to cross over into tax territory in order to make your desired transaction, ask yourself if it's worth both the extra tax payments and the loss of that rebate to the owners. Because it probably isn't.
The Purpose Of Waiving Deron Washington Was....I Don't Know.
Yesterday, the Detroit Pistons waived 2008 second draft pick and flopper extraordinaire, Deron Washington. They had initially signed him back in August to be their 14th and last man, giving him a two year minimum salary deal with $250,000 guaranteed in the first season. Yet after bringing in Chucky Atkins on an unguaranteed one year deal for training camp (a move that they won't have foreseen prior to the Washington signing), the Pistons began to feel that Atkins was more deserving of the 14th man spot, and so they waived Washington to allow them to keep Chucky.
That's the official line, at least. It doesn't really make a lot of sense though.
Disregarding the respective talent levels and fits on the roster of the two players, the finances of the situation seemed to dictate that Deron stayed on. Washington's large amount of guaranteed money (over 50% of his overall contract for this year) meant that the Pistons could have kept him on until the league-wide contract guarantee date of January 10th, without having to pay him a single extra penny outside of meal stipends. Waive him yesterday, and he'll cost $250,000; waive him on January 6th, and he'll still only cost $250,000.
Therefore, why waive him?
The Pistons aren't pressed for cash - after a summer of cap room, they rock a payroll of only $58,597,137, 25th in the league. They've run out of cap room and exceptions, hence the need for all the minimum salary deals, but they'll spend what they can anyway. They can afford to swallow Washington (giggidy) without any repercussions coming from it; they'll lose very little from it. They've lost a player that wasn't in the rotation, and no extra money than what they had already committed. But they'll also gain absolutely nothing from it. Even if Washington only played about 14 minutes between now and the guarantee date, it's 14 minutes more than an empty roster spot will fill.
Yet for some reason, they really want that extra spot.
Detroit said from the start, even before bringing in Atkins, that they only wanted to keep 14 players on the roster this year. They signed Washington with that in mind, and signed Atkins more in hope than expectation. Yet after Atkins (seemingly) showed that he had enough left in the tank at age 35 to be a more worthwhile investment than the 23 year old athletic project, they switched the two while sticking to that plan of keeping 14.
Why they're so staunch about keeping the fifteenth spot clear remains a mystery; even if they're planning to accommodate a midseason pick-up at some point, they don't need the spot until they need it, and they don't need it right now. (They don't need Washington, either. But he's a free player. How bad can that be?) So what they've done is open a roster spot for a possible move that isn't even scheduled, without saving any money in doing so.
I don't see it. Even if you really need Chucky Atkins - and they don't - why not keep Washington as well?
The only risk to keeping Washington would be if he were to get seriously injured, at which point Detroit is bound to keep paying him until he's healthy again. This annoying if justified stipulation caught out Miami and Orlando last year, who became stuck with paying fully guaranteed contracts to Jason Richards and Mike Wilks respectively after they both suffered bad knee injuries in training camp. But that risk is minimal, and it's even smaller if you consider that Washington was only scheduled to be an inactive list talent.
Now, since Washington has been waived, he can't be traded. He can't play for the team. They no longer have any rights on him of any sort. And they still have to pay him $250,000.
Maybe this could be a similar situation to the one that the San Antonio Spurs have going on with Malik Hairston and Marcus E. Williams. (Wink wink.) Maybe it's a precursor to a two-for-one trade in the next few days, as unlikely as that seems. Maybe Washington asked for his release for some reason, and the Pistons were feeling remarkably generous. Or maybe it's just not something that's been thought through.
Detroit used a draft pick on Washington, stashed him for a year, let him develop, then gave him some guaranteed money, yet now they've cut him before they see a single minute's return on that. They've not cut him for a salary saving, and they've not even cut him for Chucky Atkins; they've cut him for a roster spot that they don't need yet, and may never need.
It may have only been a 59th pick and $250,000, but it's all now gone to waste. And it needn't have done. Just think of what Deron Washington could achieved between now and early January.
(As always, if there's some logic or crucial information point here that I've missed, do please let me know. But if there is, I don't see it right now.)
Sam Presti's Survival Strategy In A Post-Apocalpytic Dystopian Nightmare
Simple question: Did the tough economic climate affect NBA team's spending plans as much as MSM scaremongerers would have you believe?
Not-so-simple answer: Kind of.
This summer saw a team that could have had nearly 8 figures of cap room opt not to use any of it. The Oklahoma City Thunder did pretty much nothing with their offseason once draft day was completed, and having won a total of 23 games last year, it's justifiable to ask why that was. There follows some exploratory maths, which get a bit dull and confusing.
To that total, add the cap holds of $3,336,800 for Harden and $933,500 for both Mullens and Ibaka, take away all the cap holds linked to above (which at the start of the offseason also included cap holds for unwanted players such as Desmond Mason and Mickael Gelabale) and the Thunder would have had themselves a total team salary of $41,845,259. Against a salary cap of $57,700,000, that would have meant cap room of $15,854,741. And that's pretty much the max.
(If bits of that don't make sense to you, such as the talk of cap holds for draft picks and free agents, don't worry about that for now.)
Had they done this, the Thunder would have the second biggest free agent player this past offseason, second only to the Pistons. However, the Thunder didn't use their 8 figures of possible cap room. They didn't use any of it, in fact. They didn't make a single move this offseason that required any cap space, which is why they continue to rock massive cap holds on such seminal names as Danny Fortson and Malik Rose (over $21 million added to the cap in those two alone).
What they did instead was trade Wilkins and Atkins to Minnesota for Etan Thomas, taking on an extra $3,846,088 of salary this season just for the joy of getting future second round picks. They then followed tradition by signing their three first rounders to 120% of the scale, boosting those earlier figures of $3,336,800 and $933,500 to $4,004,160 and $1,120,200 respectively. Finally, they made their only two free agency signings of the summer:
They could have had as-near-as-is max cap room. Instead, they got the two least talented players in the league. No offense. (They tried to make it three when they also signed Michael Ruffin, but roster numbers got the better of him. Sadly.)
The Thunder still have the lowest payroll in the league, a modest $48,383,101, and could have nearly $9.5 million in cap room tomorrow if they can bear to parted from The Fortson and friends. But they still haven't done so. They've shown no intention of doing so all summer. And until over-the-tax teams starting waggling cash and picks incentives towards the Thunder for them to take on their bad contracts when the trade deadline comes around - just like teams did with Memphis all of last year - then they're not going to use their cap room any time soon either.
The obvious question is why. Why would the Thunder not use this massive potential asset? Why would they turn down the opportunity to be one of the few buyers in such a seller's market? Why weren't they in there soliciting players like David Lee, Paul Millsap and Ben Gordon, using this prime opportunity to add one more significant piece to an already impressive young core? Did they whiff on an opportunity? Were they mismanaged?
No, I don't think so. As far as I see it, it was a combination of two things;
1. Truly quite a crap free agency class. The three aforementioned players were probably the pickings of the market, and two of them were restricted, which would have made the Thunder heavily overpaying to get them. They also would have had to bid outrageously to outbid the Pistons for Gordon, since Detroit themselves overpaid him, and while there's no real evidence to suggest that Oklahoma City attempted to get Gordon, there's also no real evidence that they should have done.
2. They don't have a whole lot of money. Having cap space and having money are not really the same thing.
Oklahoma City aren't a big budgeted franchise. As mentioned above, they have the league's smallest payroll, and spent all of last year trimming the remnants of Seattle's payroll. Attendance for the new franchise has been impressive in the early going, but the $75 million that it cost to move the team - combined with the $325 million that it cost to buy it - seems to have stymied the Thunder's spending on players. They've signed Nenad Krstic for three years and unsuccessfully tried to trade for Tyson Chandler's big contract, but that's been about it. And it isn't long until they're going to have to pony up for Kevin Durant's max contract. (That is, unless they trade his plus/minus-killing arse away before then. Although that might be hard to do, since apparently he's difficult to give way for free.)
But is this unwillingness to spend limited to the Thunder only? Quite what is the difference between spending during this summer's recession and during last summer's honeymoon period? Let's look at some more numbers.
Listed below are the future salary commitments for all NBA teams, including this season, but not including luxury tax payments. Note: for the purposes of consistency, all options and partially guaranteed contracts are assumed to be being paid in full. Even those that won't be.
Total = $5,565,152,517. Or, to put it in words: five billion, five hundred and sixty five million, one hundred and fifty two thousand, five hundred and seventeen dollars.
(Makes you feel a bit weird to see it all totalled up like that, doesn't it?)
And now, the same statistic, but from this time last year. The following is the future salary commitments for all NBA teams as of October 26th 2008;
Difference between 2008/09 and 2009/10: $825,069,298
[Note: none of these figures are guaranteed to be 100% accurate, because I've reverse-engineered them, but at worst it's 98.5%. Also note: the $158,312,000's worth of extensions given to Danny Granger, Jason Maxiell, Martell Webster and Andrew Bynum were signed after October 26th 2008, and therefore weren't counted towards their team's totals above. Nor is the $18 million that reappeared on Portlands's cap for Darius Miles. Similarly, LaMarcus Aldridge's extension from last week is not included, because I don't know what it is yet.]
$825 million is a lot of freaking money, even when split over 30 big money franchises. That figure alone highlights the difference in spending between this year and last. But here's another way of looking at it.
This summer, $1,275,302,921 of new player salary was given out. That total includes minimum salary deals, rookie scale contract, extensions......everything.
Last summer, however, $1,885,122,482 of new player salary was given out. That's an decrease of $609,819,561 in new expenditure from one summer to the next. And that's a lot.
Of course, there are mitigating factors for that. The crappy 2006 draft class has had something to do with it; as I mentioned here, only three players have gotten extensions from that draft class, and only a couple more have a chance of getting one. The 2010 free agency market is another huge factor (one that you may not have heard of, due to the minimal press coverage its received), and many teams are trying to avoid clogging their cap in eager anticipation of the impending free agency anti-climax coming up next offseason. When that day comes, spending should ramp up again, and the current contingency plans for it may well explain some of the decline in salary expenditure.
But more than anything, it appears that the economy's affect on player spending has not been overstated. Working purely on averages, NBA teams have $20 million less on players this summer than they did last summer, a large amount of money regardless of the number of years that it is spread over. Times are tough, and we're all having to make small sacrifices right now. (Personally, I'm forgoing all haircuts. They're too expensive anyway.) The NBA is no different; as we've now seen, it's stopped spending like it used to as well.
And so that might explain why the Thunder picked Ryan Bowen over Paul Millsap.
(The picture that opened this post had literally nothing to do with the rest of it.)
Sham is a miserable and self-effacing little bastard, whose basketball opinions are often riddled with bias, insecurity, and rank immaturity. He has also never played the sport, and the only game he has ever been to see was a Ware Rebels game back in 2001. The night bus didn't show up and he had to walk the 9 miles home. It was after this that his passion for basketball really took off.
He considers himself to be Britain's foremost NBA expert, an arbitrary title that carries with it no basis in fact, or any worldly significance. He also wrote this section of the website in third person narrative, purely for reasons of arrogance.
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the really stupid ones that I wish I'd never written.
