Biggest "proof" yet of RLEC value around the L

[BrianFromWA]

Amare Stoudemire. Tyson Chandler.

Elite young big men who have won some games.

And both available, according to my sources and a thousand published reports, for packages that star, more than anything, cap space.

Obviously, such deals would have nothing to do with basketball. Sure, you can find flaws in andy NBA player, but ask any coach in the world: Would you rather play with an empty seat, or with Amare Stoudemire or Tyson Chandler?

Every basketball person wants a big man.

Unless you have Michael Jordan, talented big men are the one and only must-have ingredient of every championship recipe, and there simply are not as many of them as there are NBA teams.

The few that have top-shelf NBA big men tend to last deep into the playoffs.

So historically teams don't give them up, really for anything.

And now they're talking about giving them up in the name of saving money.

(Read Marc Stein's excellent rundown of trade conversations.)

This year, analyzing trades is totally different. It's not about basketball talent for basketball talent. It's about accountants describing to GMs that they can't spend money they don't have.

So, it is a non-trivial factor, as the trade deadline approaches, that the NBA has recently found some credit for the League's cash-starved teams. Sports Business Journal's Daniel Kaplan and John Lombardo report:

The NBA is set to borrow $175 million Feb. 26, marking one of the first league financings since the implosion of the credit markets last fall.

The money, which will be available to 15 teams, supplements an existing $1.7 billion leaguewide credit facility that uses the NBA's media contracts as collateral to secure loans for the clubs. The NBA surveyed its teams, and 15 responded they would like to tap into the new borrowing.

While the league said it is pleased to borrow in an extremely illiquid credit market, the deal came at a cost, with interest rates up to 8.27 percent, hammering home the notion that the era of cheap money in sports is over. The 15 teams can use the money for any purpose, but covering operating losses may be high on the list.

Will that make a difference? Might a little extra credit inspire an owner or two to make a splash in this buyer's market? With the trade deadline on Thursday, we'll find out soon enough.

http://myespn.go.com/blogs/truehoop/0-38-184/Money-for-NBA-Teams.html

If 15 teams want to borrow at 8.27%, how valuable is 8M or so cash in your pocket and, say, the prospect of not paying Agent Zero another 100M or so? Or, :stirpot: Peja and CP3?

 

[<-=*PdX*=->]

Very interesting stuff.

 

[Iwatas]

The value to the Wizz of dumping Arenas and losing Butler for Raef + .....

 

[hasoos]

Maybe they ought to just lower the salary cap...seems like they are in a death spiral financially looking at that.

 

[Karl Malone's Elbows]

Good call. They are lowering the salary cap next season.

 

[Boob-No-More]

Lowering the cap may help in the future, but it doesn't help teams like the Bucks, Wizards and Pacers who all have payrolls >$70 million have multiple big long term contracts and not a chance of making the play-offs. In the case of the Wiz and the Bucks, their highest paid players also have injury issues. These teams need to dump salary and they need to dump it now. They can't wait for a lower cap to help them out. All a lower cap means is they'll be even further over the cap. Next year the Wizard's payroll balloons to almost $76 million. With a lower cap, unless they dump some contracts, they'll be $20 million over the cap.

The Bulls and Kings are also in similar situations (although not quite as bad), and we all know the Suns and Grizz both have tighwad owners.

Raef's super expiring contract has to look awful tempting to the owners of these teams.

BNM

 

[alex42083]

Looks like there's more and more of a chance that we will make a big splash, and get a Gasol-like trade here. Let the ripoff trade proposals come our way!

 

[LittleAlex]

Lowering the cap is what will sink teams. Most of the salary predictions had the cap at 72 million. Now it will be around 65 million. Teams that go over the cap get screwed twice. Once because they loose there share of the cap payments from other teams. The second is the dollar for dollar tax on the payroll total over the cap.

There is a slight to fair chance this will bankrupt a team or two.

I read about this somewhere, but I don't have the link

 

[Boob-No-More]

Lowering the cap is what will sink teams. Most of the salary predictions had the cap at 72 million. Now it will be around 65 million. Teams that go over the cap get screwed twice. Once because they loose there share of the cap payments from other teams. The second is the dollar for dollar tax on the payroll total over the cap.

There is a slight to fair chance this will bankrupt a team or two.

I read about this somewhere, but I don't have the link

Not quite true. A team can be over the cap and not pay luxury tax. The salary cap is based on 51% of total BRI (Basketball Related Income). The luxury tax kicks in at 61% of BRI. So, for the 2008-09 season, the Salary cap is $58.68 million and the luxury tax threshold is $71.15 million. That's one reason you see so many teams with a payroll of $65 - $71.5 million (15 of the 30 teams have payrolls in this range). They have made cuts and trades to get their total payroll under the luxury tax threshold.

The best link I know for these details is Larry Coon's Salary Cap FAQ.

BNM

 

[Natebishop3]

There's no way the Hornets trade CP3.... I don't just see it.... I don't care what the economy looks like, he aint going anywhere.

Now a guy like Butler, maybe....

 

[Kaydow]

There's no way the Hornets trade CP3.... I don't just see it.... I don't care what the economy looks like, he aint going anywhere.

Now a guy like Butler, maybe....

I know it. It's not even worth dreaming about.

CP3 is one of the top players in the league. I'd rather go bankrupt than give him away (if I was an owner)

 

[Natebishop3]

I know it. It's not even worth dreaming about.

CP3 is one of the top players in the league. I'd rather go bankrupt than give him away (if I was an owner)

Exactly. It would be like giving up Roy because we lost Paul Allen and the new owner doesn't want to pay the luxury tax in a year... only worse.