I think that what SKA is implying (perhaps not intentionally) is that one reason that Utah was not willing to offer more than the QO to Fesenko is that if the trade goes down, anything more than the QO might still keep the Jazz inluxury tax territory.
I wasn't stating that directly, but in running these numbers it occurred to me.
InGameStrategy said:
As for Gaines, his salary is probably relatively negligible.
At the margins we're talking about, his salary could very well be the difference between getting an LT payout or not. Locke is basing a large percentage of his claim on that LT payout. That's one of the reasons the claim is very suspect.
And we aren't even stakeholders (except fans).
I understand, I was pointing it out it would be fraud for a public company to do so to illuminate just how sketchy the claim was. I stand by that statement. In a 10-K or 10-Q that gets a complaint filed for fraud on the market because it's an indefensibly misleading statement of cost savings.
I still think that this is much ado about accounting, because $5 million to $9 million savings is still a big chunk of cheese--even if you lose a multi-year starter in the process.
If the issue is financial viability (which I call BS on anyway given the Jazz long-standing profitability and the huge capital gain the Millers would realize if they ever sold the team, particularly with respect to the asset's "basis" now that Miller passed it on after death), then inflating the number dramatically is rhetorically repugnant.
Don't try to sell me a line of crap about how trading AK is necessary to keep the team. It isn't true.
One argument is that a team could step up and offer Diaw the MLE for 5 years. Do you think he'd opt out of $9M for 1 season if he could get, say, $35M for 5 years?
As I mentioned to you in another thread, that would violate all versions of the CBA that have existed in the NBA or that have been contemplated. That's the definition of tampering. Another team couldn't offer him that money until he'd already opted out. As a result, the likelihood that Diaw would opt out of $9 million guaranteed is very low.
In any event, even if you assign it as a 10% probability that he might opt out that would only change the expected value by $900,000.
sirkicky likes to toss around the fact he's a lawyer and the Jazz are committing fraud by "throwing costs forward." Well, I'm in finance and you also have to consider "replacement cost."
You're speculating heavily on the issue of the replacement cost. PF is a position where the Jazz are relatively glutted. It's just as, if not more, likely that instead of spending $3-5 million on that position that the team would use a draft pick to fill a "need" or sign a minimum or low cost veteran. I sincerely doubt we'd use a large chunk of the MLE on a backup power forward when other needs are more pressing.
In any event even if I accepted your assertions regarding the full value of replacement cost, the $18 million number is still BS. Anyone who throws it around is being disingenuous, doesn't understand what's actually happening, or both.
Minor correction here. We can keep all of our non-guaranteed players to START the season, we just have to cut them before January 8, otherwise their contracts stay on the books until the end of the season, and the END of the season is when the LT is calculated. But yes, we would have to cut Gaines, Jeffers, Evans and Thompson, regardless of how well they are playing, and after that point our roster would be at the bare minimum number of players, we'd have to cover any injuries with a series of 10-day contract players. And if we match a contract offer to Fes that is any more than the current QO, then it's all moot.
Excellent point, but as you note it doesn't change the analysis much.
