Tuesday, December 22, 2009

Christmas and Kovalchuk

So, according to Vivs, the official word is contract talks have hit a "snag". Looks like the Kovy camp wants a long term deal with the same dollar amount every year, and the Thrashers want a sliding scale, much like other long term contracts you see these days. If this is the case, I hope Waddell holds his ground and I would think in Jan the Kovy camp would back off. I think. I hate this, all of it.

I hope they can look past this and come to an agreement. After all, it's Christmas, and the holiday season often makes even the biggest of enemies come together:

This is my last post before Christmas. I sincerely hope all of you have the best Christmas ever and that it is spent with the ones you love. Please also do not forget the reason we celebrate CHRISTmas. That's what it's all about.

This here blog has been a blast over the years (coming up on 2 years believe it or not!) and our readers are what make it so fun. Keep up the great work, folks. Merry Christmas and God Bless!

-Big Shooter


j_barty_party said...

Biggie - Merry Christmas to you as well! Hope you and your family have a blessed and fun holiday together.

As for the contract situation, something called the time value of money says that the ASG would be better off giving Kovy a fixed amt deal in which the amount didn't fluctuate. Those new-fangled deals whereby the amount starts high and then tapers off is bad for the player as money now is worth a lot more than money 10 years from now.

Kovy & Grossman would be doing the ASG a favor by accepting a fixed amt deal assuming the amount is fair and reasonable every year (such as 10 years / $9.5 M). Unless Kovy wants more money in years 6-10 than what he'd be getting in years 1-5, but that doesn't really make much sense from an investing standpoint.

Fire Waddell! Let Dudley do the deal...he's a straight SHOOTER!!

Sorry, couldn't resist.

j_barty_party said...

Oooops, I meant to type that those "new fangled deals whereby the amount starts high etc..." is GOOD for the player.

Big Shooter said...

I could be wrong (gasp!), but isn't the reason for the front loaded deal that the cap hit won't be as bad at the end of the deal when they are not producing as much (thus better for the team and player)? Or does it even out throughout the deal? I don't bother with stats and contract stuff... where is the Falconer when you need him?!?!?!

I guess Kovy is saying he is going to be just as good at 38 and deserves to make the same amount throughout.

GoPuckYourself said...

I have to agree with the sentiment of him getting more money up front and less at the end of the deal. Unless The Czar starts Barry Bonds'ing it, there will be an eventual drop-off in production as a byproduct of getting older, injuries, etc.

Also, I think part of the anti-Czar resentment that seems to be going around right now can absolutely be a result of our crappy economy. Nevermind the fact that The Czar deserves every f'n dollar he can get and has done everything the Thrashers have ever asked him to do. It's coming off in the press that Kovy's sitting back, demanding top dollar, and isn't willing to come down from that. When most of your fan base may be unemployed (anybody know of any jobs!?!) or forced to cut back on work, it's hard to be sympathetic towards your franchise player because he's been offered 9.5 million instead of 11 million.

j_barty_party said...

Shooter & GPY - as I understand it, the Cap hit is equal to the avg of the amount spread evenly over the life of the deal. So the total value of the deal is of most importance in determing the Cap #.

Beyond that, it makes more sense, if Kovy has good financial representation or an agent who knows how to plan for the future, for Kovy to get his money up front in buttloads so what he invests now can work for him the rest of his life. I would be much better off if the govt would allow me to have my full salary without withholding because I could invest that other 30% and make money with which to pay my taxes later.

Anyway, let's say the Cap # ends up being $10 M in a $100 M deal for 10 years. Kovy would be better off getting $15 M in year one, $10 M in each of the next 8 yrs and then $5 M in the last year. Problem is the Cap rules probably prohibit any player from making more than 20% of the Cap # in any given year. So perhaps the sticking point is that Kovy wants $10 M every single year where as the ASG & Don would prefer something like this:

$11.5 M - yr 1
$10.5 M - yr 2
$7.5 M - yr 3 (to sign Kane & Bogo)
$7.5 M - yr 4 (to re-up Antro etc)
$10.0 M - yr 5
$10.0 M - yr 6
$10.75 M - yr 7 thru yr 10

The good news about such a large Cap number is that the spread shouldn't matter as much when it comes to squeezing a larger contract under a smaller Cap like the Red Wings and Blackhawks had to do to get those big deals to fit their cap structure.

I think for the ASG, they are more concerned about having ACTUAL cash dollars available in the years they need to pay up for guys like Kane, Bogosian, Little, Pavelec and so on. If that's the case, perhaps they are closer to a deal than we think and it's just a matter of agreeing on a Cap spread that makes fiscal sense for both parties involved.

We shall see.

krisabelle said...

Merry Christmas to all of you dishy fellows! XOXO (o';'o)

Razor Catch Prey said...

Shooter- The purpose of those tapered deals is keeping the cap hit low for the entire time.

The CBA measures a cap hit by dividing the entire value of the deal (for a 10 year deal at 9.5 million per year, that'd be 950 million dollars total) by the total number of years.

Now, in a deal like Hossa's, with changing yearly values, he can get paid 10 million this year, but the team's cap hit is only 7 million.

Let's say we want to sign a fictional player to a 10 year deal worth 50 million dollars total. That's a cap hit of 5 million in each year of the contract. In this scenario, let's assume he's 26 like Kovy and we expect about 10 good years out of him. If you want the cap hit to go below that 5 million per year, you'll add some years on to make it a 14 year contract. Front load it so he's making more money for the first six years, then a little less for the next four, then just over league minimum for years 11-14. That means that the average per year is lower, so the cap hit is lower, even though everyone knows he's really going to retire at 36 instead of keep playing for league minimum for those final four years.

Razor Catch Prey said...

GPY- I think that the economy is part of it, and I think part of it is people trying to emotionally distance themselves from Kovy so that it hurts less if he leaves.

DW should make the deal now and structure it like Hossa's deal so the cap hit is low enough to let us sign our other young studs. If he can't do that, then he should trade Kovy for Patrick Kane, Patrick Sharp, a first and second round pick, and the Blackhawks Ice Girls.

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