Kerry Wood Dealt to New York
Both Buster Olney and Ken Rosenthal are reporting the Yankees are closing in on Kerry Wood.
UPDATE: The deal is done; the Indians are receiving a PTBNL or Cash. They will be paying roughly half of Wood's remaining salary.
UPDATE: Per Castrovince, the Indians have until October 15th to choose a player or cash. I wouldn't expect much...this looks like a salary dump.
UPDATE: What did we ever do before Twitter? Ken Rosenthal tweets that the Yankees are paying $1.5M of Wood's remaining salary, leaving the Indians on the hook for $2.1M, though the Yankees could pay more, up to 50% of his remaining salary, if he stays healthy.
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Because the conversation doesn’t even get started if we’re not covering the salary.
The Indians’ whole posture this trade season has been, “We’re paying the salaries regardless, so wants these guys, and what are you willing to give us for them?”
Wood is a pretty marginal, risky acquisition if he isn’t basically free.
The Indians’ whole posture this trade season has been, "We’re paying the salaries regardless, so wants these guys, and what are you willing to give us for them?"
Also known as the correct way of trading veterans.
"sometimes the internet is hard for me." - ClemsonGirl
by world dictator on Jul 31, 2010 3:57 PM EDT up reply actions
I don’t think there’s anything wrong with accepting some payroll relief, especially in a situation like last season where they clearly had overspent the budget. It certainly seems clear, however, that you get good value on the dollar by paying the vets.
Do you think there is any notable difference in the prospect we obtain if we had been willing to pay the whole salary? I’m not saying the Indians should have – just asking.
I’m guessing it probably wouldn’t have made much difference since Wood has been erratic for the most part. And that was a good deal of money, and we are paying over half of it ($2.1M as compared to $1.5M).
The "cream of the crop" doesn't always rise to the top.
Wood has been erratic
And here I thought he was inconsistent. Nice euphemism.
Resident LGT results-oriented boob.
by mauichuck on Jul 31, 2010 7:11 PM EDT up reply actions 2 recs
Wood has been awful — that’s what you mean to say.
I don’t think anyone was going to give up a real prospect for him. As I see it, the Yankees agreed to pay him as if he were making a $4.5 million salary, and we’re covering the rest. That $4.5 million is still more than Wood is worth — per the FanGraphs formula, for example, he was worth $1.9 million for all of 2009, and he’s been worth negative 1.0 million this season so far. It’s conceivable, in fact, that he’ll pitch badly enough to be DFA’ed by the Yankees by the end of August.
I just can’t see a player like that being worth anything at all in terms of talent coming back, unless you fall into a full-on Bavasi bilking situation. Wood was not an asset; he was a liability. Pay half his salary, and he’s still a liability to another club, i.e., still not really worth anything. Pay all of his salary, and is he now a liability or an asset? That’s the really the question.
At zero salary, maybe he’s an asset to another club at that point, because he’s still got the power stuff, and maybe he goes on a run for a month. So he’s a high risk/reward type of asset. Is that really worth the $1.5+ million the Yankees will pay? Not really, probably more like half that amount.
So you have to say, what kind of prospect is only worth 750K in cash to acquire? Because that’s about the kind of prospect we could expect to get for Wood, if we covered all of his salary.
by Jay on Aug 1, 2010 9:22 AM EDT up reply actions
I can’t believe Shapiro traded Wood,Westbrook,Kearns, Braynan and Jhonny before the trade deadline
"sometimes the internet is hard for me." - ClemsonGirl
Agreed. Westbrook was the one with obvious value to just about any team, including us. It isn’t really that impressive to get someone to take him on, especially if we are going to pay most of his salary.
Depending on who all the Ps TBNL turn out to be, dealing the rest of this crew could be a masterstroke. Is it too much to ask that at least one or two of these new guys be ready to contribute next year, ala Talbot?
Every pessimist thinks himself a realist. In the case of Cleveland sports fans, they are probably right.
I think you’re missing the point: It’s pretty impressive Shapiro was able to unload all five, and get something in return.
My back of the envelope guestimate is we’ve shaved $4M+ offa this years payroll, good enough for 125 Hafner ABs.
Resident LGT results-oriented boob.
Sunk cost, my friend. It’s your sick Sheila thing.
by Jay on Aug 1, 2010 9:23 AM EDT up reply actions
You keep sayin’ “sunk costs” like it’s true. It’s not, All of these trades have relieved the Indians from a portion of their contract commitments – what you’re calling"sunk costs". As you know, you cannot, by definition, recover “sunk costs”.
Say I owned the Indians and woke up one morning with a hard-on for Selig and the current economic structure of MLB and wanted to demonstrate just how unfair it is. I might consider doing this: package up some of my over priced stiffs with my young cheap talent and trade them. For instance, Santana and Hafner to the Yankees – they’ll be needing a catcher real soon – for a coupla executive suites at the New Yankee Stadium. Voila! one huge albatross gone. But this might hurt attendance. But so what? I could run the whole organization offa revenue sharing and still make money – big money.
The only real “sunk cost” with a ML franchise is 25X the minimum pre-arb salary. And what’s that? $1-2M a year total? So I take my $25M from MLB, pay the serfs and pocket $20M. It’d be like stealin’! And if Selig screams, I’d tell him to get back to me when we’ve got a salary cap, otherwise I got Jones Day on speed dial any time he wants to do something about it.
Resident LGT results-oriented boob.
by mauichuck on Aug 1, 2010 4:25 PM EDT up reply actions 1 recs
All of these trades have relieved the Indians from a portion of their contract commitments – what you’re calling"sunk costs". As you know, you cannot, by definition, recover "sunk costs".
I think any reasonable accounting of those transactions would show that the original contract was a sunk cost, and we semi-miraculously sold Kerry Wood’s contract to the Yankees for a net gain of $1.5M on the balance sheet.
Note that the cost of Kerry Wood’s purchase, and an increasing number of traded players among all teams, has less and less to do with their contractual salary every year. This is because teams are realizing more every year that the appropriate price for the player has little to do with the salary he was promised.
This reinforces the idea that guaranteed salary is a sunk cost, and if you can sell a player for money later on, more power to you. I admit that there are other ways to look at it, but from a business decision-making and balance-sheet perspective, I think this is the most appropriate view.
by Jay on Aug 1, 2010 6:05 PM EDT up reply actions
The accounting definitions are actually ridiculously open to interpretation for these sorts of things. In this case, I think we can all agree trading Hafner would be classified as “remote” (the next closest is reasonably possible) and we would classify it as a sunk cost.
"I spoil a lot of people with my play." -Lebron James
See when you value a company sunk costs are irrecoverable. So if you call Hafner’s contract a “sunk cost” it would be subtracted from the net worth of the firm. So how would you value Santana’s contract? Is he worth more than the Indians are paying him? Sure as hell is – especially if you use one of cockamamy systems Jay does. So how do you “value” the Cleveland Indians in toto? Hard to do, no?
Resident LGT results-oriented boob.
They can be marked as irrecoverable, but there is still a remote chance they can be sold off for pennies on the dollar. In baseball sense, there is actually a small likelihood we can trade Hafner in the last year of his contract if we are picking up the majority of his remaining salary, similar to how we did with Jake and Wood. I think we are debating semantics though, since we are really just debating usage of the term “sunk cost.”
"I spoil a lot of people with my play." -Lebron James
Right. Hafner’s contract is recoverable in the same sense that Nix can win the MVP. They’re eligible, and really crazy things do happen from time to time. This devolves into an argument where we’re never allowed to call anything anything, for lack of 100% certainty. The lack of working assumptions will lead to a lot more dumb decisions than smart ones.
This also is known as denialism. Hafner’s contract isn’t a sunk cost? Hey, maybe we can “teach the controversy.”
by Jay on Aug 2, 2010 9:06 AM EDT up reply actions
Easy to do, hard to do well.
Back when we had that guy trying to talk trade for Sizemore, I valued his contract at around $180 million, if I recall correctly. Obviously, that asset has not done well.
Anyway, it’s really not that hard. You figure out how much a player is likely to produce on the field over the life of the contract. You factor in risk of course. (You may, if you choose, attempt to project whether the team will be contending in each year, which would allow you to factor in a degree of “contending leverage,” but that gives you a value very specific to your team, not just the player’s contract in the abstract.)
Then you figure out how much you’ll actually have to pay the guy over the life of the deal, since that has not been predetermined precisely in the case of a rookie (except for Longoria and Strasburg). Then you figure out what the market value is of the player’s projected production, so that you can subtract his projected salary. This gives you an idea of how much of a “bargain” his contract is.
So the value of his contract is A (his on-field production) + B (how much of a bargain he’s going to be in terms of salary). That’s basically it.
by Jay on Aug 2, 2010 9:04 AM EDT up reply actions
aren’t all contracts sunk costs really? I mean we are talking now about guaranteed contracts with guaranteed money. So, no matter what, that money will be going to that player and nothing can change that and in that sense, it is a ‘sunk cost’. However, because of the nature of the market that is baseball, you can trade ‘assets’ much more freely than in other markets. Therefore, if we were able to trade hafner and a team picked up most of his salary, he would still be a sunk cost, but not our sunk cost. he would be a much larger sunk cost to the team that picked him up.
I teach good life choices. That’s why I almost didn’t graduate High School.
I appreciate Male Beauty
Intensive Purposes? I could care less...
From a baseball perspective, a contract is not a sunk cost if you can avoid paying its entirety by trading the player or by some other means.
"I spoil a lot of people with my play." -Lebron James
Its not a sunk cost to you, but if you trade that contract to another team and they take it on, in a way the sunk cost has just transferred over to them. the way I see it, guaranteed contracts are guaranteed and will be paid. If a contract is traded, that team does not have to pay it and it is not a ‘sunk cost’. But like when the yankees traded for A-Rod after signing a deal, his contract was a sunk cost for the next few years.
I teach good life choices. That’s why I almost didn’t graduate High School.
I appreciate Male Beauty
Intensive Purposes? I could care less...
However, because of the nature of the market that is baseball, you can trade ‘assets’ much more freely than in other markets.
Do you mean much less freely, because there aren’t clearinghouses in baseball, and typically there are fewer buyers and sellers and the trading frequencies are so much less.
I’ve been thinking about the parallels to the baseball market and securities markets a little recently, just for my own amusement. There isn’t much of a derivatives market in baseball, although sometimes unique situations that arise that do resemble derivatives (like the PTBNL in the CC trade, which turned out to be Brantley; that was kind of like us buying a collar).
I was thinking of the idea of a sunk cost. Yes, there aren’t baseball clearinghouses, but I was merely addressing the issue of ‘sunk costs’ in that you don’t see ‘sunk costs’ in other industries moved like this. then again, much of those sunk costs can’t be moved and/or are intangible.
I teach good life choices. That’s why I almost didn’t graduate High School.
I appreciate Male Beauty
Intensive Purposes? I could care less...
Can I buy a put on Crowe?
Though I look right at home, I still feel like an exile
by Manhattan Tribe Fan on Aug 2, 2010 7:15 PM EDT up reply actions
To fund the puts, that is. Money today is nice though. The Yankees basically bought a call on Kerry Wood. That’s what happened here.
by jhon on Aug 2, 2010 7:53 PM EDT via mobile up reply actions
Especially before the July 31 deadline; I think many thought they would be gone by the end of August, except maybe Peralta (that might have been the most impressive, and Inge’s injury occurring being fortuitous for us because that increased the slim market for Peralta), but to do it before July 31 was certainly impressive indeed, and 3 of them going in the last 18 hours or so before the deadline.
The "cream of the crop" doesn't always rise to the top.
I agree; the big Shapiro luck this year was getting anything of any value for Peralta.
The biggest return, I’m confident, will be the PTBN for Kearns. Oh, the suspense!
by Jay on Aug 1, 2010 9:24 AM EDT up reply actions
The age of the player in relation to minor league level will be more favorable than Kluber, and likely a bit more projection-able skill wise.
I would add, I think Kluber is a fairly marginal big-league prospect, but at least he is one.
by Jay on Aug 1, 2010 6:07 PM EDT up reply actions
Did Westbrook have those K rates? For that matter, was he still in Double-A at 24?
by Jay on Aug 1, 2010 9:27 PM EDT up reply actions
We could be the Royals, hold onto our crummy vets, and scrap for every last win on our way to 75.
"I spoil a lot of people with my play." -Lebron James
The Royals at least managed to move Farnsworth and Ankiel today and Podsednik earlier in the week, so at least Dayton Moore is showing a small modicum of competence.
"If Brown is the answer, then you’re asking the wrong question." - Ryan
by woodsmeister on Jul 31, 2010 6:53 PM EDT up reply actions
Let’s see how the next coupla seasons play out before we start handing out the next EofY awards.
Resident LGT results-oriented boob.
I think they have to hand those out every year, Chuck.
Though I look right at home, I still feel like an exile
by Manhattan Tribe Fan on Jul 31, 2010 8:06 PM EDT up reply actions
Any confirmation that the Yankees will pick up more money on Wood’s salary if he stays healthy or is Hart (on MLB Network) just saying stuff to say stuff?
He said something like they would pick up an extra $200,000.
The Once and Future King
Jon Heyman saying something similar: could be as much as $2 million if Wood stays healthy (consider the source, of course).
http://sportsillustrated.cnn.com/2010/baseball/mlb/07/31/deadline.day/index.html/
'If I'm not here, 'I'll be somewhere else.'' Andy Marte
My favorite comment about this trade
So…the Rays get Qualls, the Yankees get Wood, and the Red Sox automatically gain four wins because of both deals. I like this.
"sometimes the internet is hard for me." - ClemsonGirl
by world dictator on Jul 31, 2010 4:12 PM EDT reply actions 1 recs
In what world is Octavio Dotel worth James McDonald AND Andrew Lambo? I wouldv’ve traded Westbrook and Wood for that deal in a heart beat
"sometimes the internet is hard for me." - ClemsonGirl
BA had McDonald and Lambo as the 1 and 2 prospects in the Dodgers system heading into 2009
"sometimes the internet is hard for me." - ClemsonGirl
by world dictator on Jul 31, 2010 4:27 PM EDT up reply actions
I don’t think it’s that big a deal. Prospects have to constantly perform to stay well-regarded. Lambo and McDonald are on reputation right now.
Not to say it won’t work out but that it’s not a decent deal, I just don’t think it’s robbery.
That’s an awful lot of potential upside to give up for Octavio Freaking Dotel. Both McDonald and Lambo are putting up decent numbers in AAA and AA right now.I know they have their flaws but seriously…
"sometimes the internet is hard for me." - ClemsonGirl
by world dictator on Jul 31, 2010 4:57 PM EDT up reply actions
Not the first time Huntington has traded for guys out of favor with their organization (See Milledge, Lastings).
"If Brown is the answer, then you’re asking the wrong question." - Ryan
by woodsmeister on Jul 31, 2010 6:55 PM EDT up reply actions
Interesting, that isn’t something the Indians have done a lot. Meloan was the big example of that. Shapiro’s thing is slightly different, trading for guys who are under-valued because the other organization has other good pieces at the same position.
by Jay on Aug 1, 2010 9:26 AM EDT up reply actions
READ THIS SHAPIRO
The Red Sox designated outfielder Jeremy Hermida for assignment, tweets NESN’s Heidi Watney. The 26-year-old signed with the Sox as a free agent after being non-tendered by the Marlins, but hit just .203/.257/.348 in 171 plate appearances. He dealt with rib and forearm injuries from a collision with Adrian Beltre.
WANT.
I love him, but he’s a lefty. We need to get ourselves one decent righty hitting outfielder.
by ken from alexandria on Jul 31, 2010 11:33 PM EDT up reply actions
Hot damn, do I love the trade season.
Also, I’ll add this here since it’s kind of buried on the homepage now, but I loved reading the quasi-squabbling over Jordan Brown. LGT needs CONTROVERSY.
I’ll bet your heart soared at the mere mention of the possibility of Sowers being called up.
--
"Most players will tell you that even when they're 100%, they're not really 100% ... if that makes sense."
Tell you what, you can have your pick, I’ll take the other one.
by Jay on Aug 1, 2010 9:27 AM EDT up reply actions
I thought Wood would become our Eckersley.
My favorite memory of Wood in Cleveland has to be the report of him shopping at a suburban Kolhs (or was it the Maxx?) for a jacket right after signing with us.
That was the highlight of his career as an Indian.
by Jay on Aug 1, 2010 9:28 AM EDT up reply actions
Major props to Shap-onetti for moving Kerry Wood and actually getting a major league team to pay some of his salary and get a real life, flesh-and-blood player in return. Now, time to convince the Mariners that they desperately need Travis Hafner…
You mean Cheaponetti?
Too soon?
In the new Geico commercial, Marte sings "Let me be myself" on Wedge's front lawn (with the cavemen).
by V-Mart Shopper on Aug 2, 2010 11:39 AM EDT up reply actions
So we will make the ALCS at some point?
"I spoil a lot of people with my play." -Lebron James
by Roger Dorn on Aug 1, 2010 9:31 PM EDT up reply actions 1 recs
By my count, there are now two spots left on the major league roster — they haven’t replaced either Westbrook or Wood (Kearns was replaced by Brown), Talbot on the DL was replaced by Germano, Lewis replaces Todd, who was sent to Columbus. If that’s right, who gets called up? I’m hoping we see Carrasco, but I fear it will be Huff. No idea about the bullpen slot … theories?
'If I'm not here, 'I'll be somewhere else.'' Andy Marte
Gomez gets the start tomorrow, also on short rest.
by Pa tribefan on Jul 31, 2010 10:25 PM EDT up reply actions
But he’s only the fourth starter, right? Carmona, Masterson, Tomlin, Gomez… Huff?
Are you still in China?
by Logodaedalus on Aug 1, 2010 12:53 AM EDT up reply actions
Or Carrasco. I’m just loving that Tomlin and Gomez both put themselves in the picture.
And where the hell is Rondon?
by Jay on Aug 1, 2010 9:29 AM EDT up reply actions
I’m not sure if Germano will get a start or if someone else will be called up to fill out the rotation. If so, it will likely be either Huff or Pino. Carrasco had that injury not too far back and is still working his way back (I think he’s had 1 start since then, and it wasn’t too good, nor that long of an outing – 3 to 3.1 IP, I think – he’ll likely get a few more starts before he is considered, I would think).
The "cream of the crop" doesn't always rise to the top.
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