JDM is signed-5 years, 110 mil

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BornToRun

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Not accusing you of gamethreading, it’s just a permeating sentiment around here lately. Twelve months ago, the Yankee fans here were talking long term and now they’re juggernauts? There’s a handful of guys that could have just have had their career years and come back down; just like ours guys did this season, yet still won 93 games. It’s not time to lament that some kind of window is closing. They need to figure out the financials, but the Sox don’t have a bunch of aging linchpins and they have salary space freeing up soon.
I agree with this sentiment. I never understood the talk about our window closing in 2 years. While we have too many key pieces hitting FA soon to realistically think we’re going to be able to re-up with all of them I have no doubt that the front office will be able to pay up and hold on to a few of those guys.

The Red Sox are a large market franchise that’s never been afraid to spend money and there’s some extra financial flexibility on the horizon.
 

MikeM

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"In an isolated context" while taking not-so-subtle swipes at the budget. What a dodgy bullshit response, as per usual. How about you save it and actually answer the question I originally presented that you so pleasantly stepped around while going full passive-aggressive: what, exactly, would you have done differently? Be a productive poster and come up with reasonable alternative solutions while remaining competitive instead of constant nitpicking and criticism.
Who's being dodgy? You've literally spent the winter reading and posting in the same threads I have, where I've already gone on record countless times and with lengthy speculation on those questions and answers. To a point it's already been pointed to me that a few people were getting tired of hearing them, hence any reluctance to go over them once again here in the direct aftermath of something that isn't going to be undone and I don't actually have a direct problem with (again and speaking as the guy who valued Martinez a lot higher then most going in to this off-season, it's hard not to like this contract in itself)

But if you want to talk being dodgy and productive posting, how about you try getting past this fairly silly (imo) outrage that not everybody sees only sunshine/rainbows in this, and simply own the fact that you don't have or see a concern in the surrounding financials initially quoted. Then we can simply agree to disagree on that, and at least pick this conversation up again the next time I'm less then thrilled with a FO decision and the bat signal goes out for a white knight.
 
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snowmanny

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Well regarding the window...
Price can opt out after 2018
JDM can opt out after 2019
Porcello FA after 2019
Kimbrel FA after 2018
Bogaerts FA after 2019

Yes some of those guys can and will be replaced by re-budgeting their salaries, although shortstop may be tricky and expensive.

But the biggest factor in the two-year window is Sale, who is probably not replaceable, and certainly not at that price, and cost significant assets to acquire.
 

Hank Scorpio

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Well regarding the window...
Price can opt out after 2018
JDM can opt out after 2019
Porcello FA after 2019
Kimbrel FA after 2018
Bogaerts FA after 2019

Yes some of those guys can and will be replaced by re-budgeting their salaries, although shortstop may be tricky and expensive.

But the biggest factor in the two-year window is Sale, who is probably not replaceable, and certainly not at that price, and cost significant assets to acquire.
Pomeranz is a free agent soon as well.
 

chawson

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Well regarding the window...
Price can opt out after 2018
JDM can opt out after 2019
Porcello FA after 2019
Kimbrel FA after 2018
Bogaerts FA after 2019

Yes some of those guys can and will be replaced by re-budgeting their salaries, although shortstop may be tricky and expensive.

But the biggest factor in the two-year window is Sale, who is probably not replaceable, and certainly not at that price, and cost significant assets to acquire.
Extending Sale now seems like the next priority, even though it'd mess with his very low AAV to do so. I've moved from being perpetually concerned that he's one pitch away from Tommy John and now believe he may be a freakishly indefatigable Randy Johnson-type. We got no shot at Kershaw.
 

joe dokes

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Not accusing you of gamethreading, it’s just a permeating sentiment around here lately. Twelve months ago, the Yankee fans here were talking long term and now they’re juggernauts? There’s a handful of guys that could have just have had their career years and come back down; just like ours guys did this season, yet still won 93 games. It’s not time to lament that some kind of window is closing. They need to figure out the financials, but the Sox don’t have a bunch of aging linchpins and they have salary space freeing up soon.

Bingo. I don't want to stifle the often interesting discussion of the future; and maybe these dog days just lend itself to that. But I'm just trying to enjoy the present.
 

Snodgrass'Muff

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Bingo. I don't want to stifle the often interesting discussion of the future; and maybe these dog days just lend itself to that. But I'm just trying to enjoy the present.
Yep. I'm firmly in the 2 year window before they need to get really lucky with player development or make the decision to live over the threshold for a while camp, but I just don't care right now. This is an awesome team to go into the season with and JD Martinez is the best hitter this team has brought in through free agency since Papi was DFA'd by the Twins.

Bring on the season!
 

Jerry’s Curl

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Extending Sale now seems like the next priority, even though it'd mess with his very low AAV to do so. I've moved from being perpetually concerned that he's one pitch away from Tommy John and now believe he may be a freakishly indefatigable Randy Johnson-type. We got no shot at Kershaw.
Sale was on WEEI this morning and was asked about extending his contract. While he didn’t give a Bryce Harper-like answer, he clearly didn’t want to talk about it. Seems like the standard answer for most players but I noticed he didn’t say anything (at least I didn’t hear it) about preferring to stay in Boston either.
 

Adrian's Dome

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Who's being dodgy? You've literally spent the winter reading and posting in the same threads I have, where I've already gone on record countless times and with lengthy speculation on those questions and answers. To a point it's already been pointed to me that a few people were getting tired of hearing them, hence any reluctance to go over them once again here in the direct aftermath of something that isn't going to be undone and I don't actually have a direct problem with (again and speaking as the guy who valued Martinez a lot higher then most going in to this off-season, it's hard not to like this contract in itself)

But if you want to talk being dodgy and productive posting, how about you try getting past this fairly silly (imo) outrage that not everybody sees only sunshine/rainbows in this, and simply own the fact that you don't have or see a concern in the surrounding financials initially quoted. Then we can simply agree to disagree on that, and at least pick this conversation up again the next time I'm less then thrilled with a FO decision and the bat signal goes out for a white knight.
Dodge, dip, duck, dive, and...dodge.

Own the fact that I don't see a concern in the financials? Sure. Gladly. Well, by DD's doing, anyway. We have financial concerns, but they're entirely 100% Ben Cherington's fault.

I look forward to your next overly wordy, borderline incomprehensible, passive-aggressive essay on deflection. Carry on.
 

EricFeczko

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Extending Sale now seems like the next priority, even though it'd mess with his very low AAV to do so. I've moved from being perpetually concerned that he's one pitch away from Tommy John and now believe he may be a freakishly indefatigable Randy Johnson-type. We got no shot at Kershaw.
This is a horrible, almost cafardo like notion. Pitchers are notoriously unreliable, and Chris Sale is on team options in this and next year. Right now, he's probably a 7/200 on the market, and I'd doubt you could talk him under 7 years.

Well regarding the window...
Price can opt out after 2018
JDM can opt out after 2019
Porcello FA after 2019
Kimbrel FA after 2018
Bogaerts FA after 2019

Yes some of those guys can and will be replaced by re-budgeting their salaries, although shortstop may be tricky and expensive.

But the biggest factor in the two-year window is Sale, who is probably not replaceable, and certainly not at that price, and cost significant assets to acquire.
What we need to do is focus on rebuilding the farm; something DD demonstrated nicely when building the Marlins from the ground up. I see 2020/21 as potential rebuilding years for the entire pitching staff (depending on what happens with rookies,etc.).

Out of those above, the only one I'd be interested in is Xander. Unless the others are willing to come back on short-term deals. Porcello will be 32, Price will be 33, JDM will be 32, and Kimbrel will be 30.
 

chawson

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This is a horrible, almost cafardo like notion. Pitchers are notoriously unreliable, and Chris Sale is on team options in this and next year. Right now, he's probably a 7/200 on the market, and I'd doubt you could talk him under 7 years.
You're not interested in extending Chris Sale?

It'll take some serious luck for just one of Groome, Houck, Scherff, Mata, Shawaryn, or Hernandez to stick as a #3, and we won't know if we've hit on any of them until 2020 at the earliest. Unless you make a case for Pomeranz, there's really no front of the rotation starters available until Bumgarner, and I don't know why we'd prefer him to Sale.
 

EricFeczko

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You're not interested in extending Chris Sale?

It'll take some serious luck for just one of Groome, Houck, Scherff, Mata, Shawaryn, or Hernandez to stick as a #3, and we won't know if we've hit on any of them until 2020 at the earliest. Unless you make a case for Pomeranz, there's really no front of the rotation starters available until Bumgarner, and I don't know why we'd prefer him to Sale.
No, not now. Right now you have sale at 26 million over the next two years. Assuming a 7/200 -ish extension, you're talking about paying him an extra 30-34 million over the next two years, just so that you can have him for 2020/2021 at 25+ million a year. I feel more confident about Sale in 2018-2021 than I do about Sale 2022+. Furthermore, such an extension would reduce the financial flexibility needed to replace the other 60 percent of our starting rotation.

The point at which the starting pitching becomes competitive again is likely
Doesn't matter, anyways. In 2022, Sale's contract becomes more of an albatross than a benefit.

Perhaps if Price opts out, extending Sale makes sense, somehow. However, there's little point in exploring that avenue, until we can be sure that Price opts out (I hope he does, because that left elbow is a ticking time bomb).
 

Average Reds

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Perhaps if Price opts out, extending Sale makes sense, somehow. However, there's little point in exploring that avenue, until we can be sure that Price opts out (I hope he does, because that left elbow is a ticking time bomb).
After Price inevitably declines his option, my hope is that the Linsecum-like shadow he casts over the team will serve as a constant reminder as to why you should never backload (in terms of absolute $$$) a contract that includes a player option.

I’m not in love with the deal for JDM, but the contract is structured properly to either incentivize an opt-out or minimize the long-term damage to the franchise. (The contrast to Stanton’s deal is telling. If Stanton is injured or his play declines, that contract will be very painful for a very, very long time.)
 

gryoung

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No, not now. Right now you have sale at 26 million over the next two years. Assuming a 7/200 -ish extension, you're talking about paying him an extra 30-34 million over the next two years, just so that you can have him for 2020/2021 at 25+ million a year. I feel more confident about Sale in 2018-2021 than I do about Sale 2022+. Furthermore, such an extension would reduce the financial flexibility needed to replace the other 60 percent of our starting rotation.

The point at which the starting pitching becomes competitive again is likely
Doesn't matter, anyways. In 2022, Sale's contract becomes more of an albatross than a benefit.

Perhaps if Price opts out, extending Sale makes sense, somehow. However, there's little point in exploring that avenue, until we can be sure that Price opts out (I hope he does, because that left elbow is a ticking time bomb).
I’d sure Iike to see Sale pitch effectively beyond August before I sign him to a gigantic extension.
 

Byrdbrain

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Here are the specific contract details:


J.D. Martinez contract breakdown. Year 1: $23.75 m Year 2: $23.75 m Buyout if he opts out after Year 2: $2.5 million, bringing total to $50 m if he leaves Year 3: $23.75 m (No buyout if opts out after Y3) Year 4: $19.35 m Year 5: $19.35 m
 

Van Everyman

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What is the argument for those that “do not love this deal”? Did they overpay for him? Is 2/5-years too long? Is it that he’s signed to play DH? Are his numbers not what they seem? Was his acquisition unnecessary in light of the roster-wide offensive underperformance last year?

I’m not saying I *love* this deal, per se. There’s always a certain amount of risk paying big dollars for more than 3 years to somebody on the wrong side of 30. But I’m having a hard time figuring out the logic behind some of the “meh” reactions here.
 

Pozo the Clown

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What is the argument for those that “do not love this deal”?
I’m not saying I *love* this deal, per se. There’s always a certain amount of risk paying big dollars for more than 3 years to somebody on the wrong side of 30. But I’m having a hard time figuring out the logic behind some of the “meh” reactions here.
It's a time-honored SoSH tradition. A Sox GM could assemble a roster capable of 120 wins and there will still be posters questioning/bemoaning the moves on a variety of levels.
 

Boggs26

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Here are the specific contract details:


J.D. Martinez contract breakdown. Year 1: $23.75 m Year 2: $23.75 m Buyout if he opts out after Year 2: $2.5 million, bringing total to $50 m if he leaves Year 3: $23.75 m (No buyout if opts out after Y3) Year 4: $19.35 m Year 5: $19.35 m
There's a buyout if he opts out? Is that normal? I don't think I've ever seen a team agree to pay a player if the player decides to terminate the contract... Have I just never noticed before or is that actually very odd.
 

EricFeczko

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After Price inevitably declines his option, my hope is that the Linsecum-like shadow he casts over the team will serve as a constant reminder as to why you should never backload (in terms of absolute $$$) a contract that includes a player option.

I’m not in love with the deal for JDM, but the contract is structured properly to either incentivize an opt-out or minimize the long-term damage to the franchise. (The contrast to Stanton’s deal is telling. If Stanton is injured or his play declines, that contract will be very painful for a very, very long time.)
I'm not as optimistic that Price declines his option. He pitched all of 74 innings last year and has been avoiding the inevitable (i.e. replacing the elbow). If his elbow blows out or he fails to pitch effectively, I could see him not opting out; a 33 year old starter who was last effective when he was 30, likely, does not beat a 5/150-ish deal (probably more like 5-100 or 110). With an elbow injury, he may have to take a short-term deal to establish value.

EDIT: If he does not opt-out, I suspect he goes in for surgery the next year; no incentive not to.

DOUBLE EDIT: I completely misread your post, my apologies. You meant when JD declines the player option. Yes, I entirely agree.
 
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PayrodsFirstClutchHit

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The "meh" is more the result of the recent history of free agency signings not turning out so well. No need to for an exhaustive list of fail as we are all familiar with those that have not panned out.

Excluding the lunatic ravings of talk radio callers and other local mediots, most Sox fans are going to wait and see before turning cartwheels or being critical. Count me in that category.
 

Byrdbrain

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There's a buyout if he opts out? Is that normal? I don't think I've ever seen a team agree to pay a player if the player decides to terminate the contract... Have I just never noticed before or is that actually very odd.
It is odd, I think it is just to manipulate the average value of the contract for luxury tax purposes.
 

Pozo the Clown

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There's a buyout if he opts out? Is that normal? I don't think I've ever seen a team agree to pay a player if the player decides to terminate the contract... Have I just never noticed before or is that actually very odd.
[HEAVY SARCASM] This buyout is just another blatant example of DD's willingness to overpay. Boras honed in on DD's ill-conceived, desperation to add this slow-footed, injury-prone, wrong-side-of-thirty, defensively-deficient, one-dimensional DH at all cost. When JDM inevitably opts out (face it, he NEVER wanted to sign here), I'll be reminding you of how that unprecedented, opt-out buyout hampers the clubs ability to extend the young core!!! [/HEAVY SARCASM]
 

Minneapolis Millers

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It is odd, I think it is just to manipulate the average value of the contract for luxury tax purposes.
That's what would make sense, but I don't see how. How does it work differently, for LT purposes, than a more simple 25/25/21.25/19.375/19.375 deal? (Note: I've modified the salaries in yrs 3-5 to allow the same total value/payments after years 2 and 3). Maybe I'm missing something. The only difference seems to be how much they're paying him in yearly salaries.
 

Byrdbrain

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That's what would make sense, but I don't see how. How does it work differently, for LT purposes, than a more simple 25/25/21.25/19.375/19.375 deal? (Note: I've modified the salaries in yrs 3-5 to allow the same total value/payments after years 2 and 3). Maybe I'm missing something. The only difference seems to be how much they're paying him in yearly salaries.
I assume the buyout is counted as salary in 2020 so that $1.25M/year won't get added back in to their salary for 2018 and 2019.
That is only an assumption but I can't see anything else that makes sense.
 

Bigpupp

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There's a buyout if he opts out? Is that normal? I don't think I've ever seen a team agree to pay a player if the player decides to terminate the contract... Have I just never noticed before or is that actually very odd.
Didn't this basically happen just last week with Nunez? He has a 2019 player option for $4M, but can decline the option and take $2M instead.
 

Red(s)HawksFan

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I assume the buyout is counted as salary in 2020 so that $1.25M/year won't get added back in to their salary for 2018 and 2019.
That is only an assumption but I can't see anything else that makes sense.
For the purposes of luxury tax calculation, the buyout is included on 2018 and 2019 and not 2020. It works that way for buyouts of team and player options as well. If Martinez opts out after year two, his deal is essentially a 2/50 deal meaning it's a $25M hit for luxury tax calculation per year. Same as if Nunez's option for 2019 is declined, he gets the buyout of $2M and his 2018 AAV is considered $6M ($4M salary + $2M buyout).
 

BigPapiMPD34

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I assume the buyout is counted as salary in 2020 so that $1.25M/year won't get added back in to their salary for 2018 and 2019.
That is only an assumption but I can't see anything else that makes sense.
Agree, this is the only reason that would make sense to me. The very specific design of this contract and the Nunez contract has me convinced there is some loophole we are unaware of. The buyouts that we typically see are linked to team options. Maybe the CBA has some language that specifies that buyouts get included as its own AAV in the following year in the case of player options / opt-outs. This could potentially save 2M (6M vs 4M) in AAV on Nunez and 1.25M (25M vs 23.75M) in AAV on JDM. Hopefully we can get clear confirmation on this from one of the writers.

Assuming this theory is true:
~~~~~~
His AAV would recalculate to 23.75M if he opts out after year 2 or 3. In the case of opting out after year 2, there would be a AAV hit of 2.5M in 2020. The Sox would essentially plan room in their budget as if his AAV is 23.75M.

If the theory is not true:
~~~~~~
His AAV would recalculate to 25M if he opts out after year 2. It would recalculate to 23.75M if he opts out after year 3. The Sox would essentially plan room in their budget as if his AAV is 25M.
 

MikeM

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It is odd, I think it is just to manipulate the average value of the contract for luxury tax purposes.
Or it's just a little detail concession Boras was forced into making (basically functioning as a built in incentive clause) while trying to both preserve and maximize his client's per/year earning potential, and with the Sox still insisting on keeping the actual guaranteed money involved as low as possible.
 

shaggydog2000

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Holy hopping fuckballs on fire, let's get out there and play some fucking baseball already.
I'm excited for the Sox to play Northeastern and BC just so we can stop talking about this damn contract already. Not that we will. But something else to talk about will be nice.
 

DennyDoyle'sBoil

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What is the argument for those that “do not love this deal”? Did they overpay for him? Is 2/5-years too long? Is it that he’s signed to play DH? Are his numbers not what they seem? Was his acquisition unnecessary in light of the roster-wide offensive underperformance last year?

I’m not saying I *love* this deal, per se. There’s always a certain amount of risk paying big dollars for more than 3 years to somebody on the wrong side of 30. But I’m having a hard time figuring out the logic behind some of the “meh” reactions here.
The premise behind not loving the deal depends on one's understanding of player opt-outs, which, for whatever reason, seems to be a very contentious subject on this board.

When you give a player an opt out, you're hoping that he will exercise it. In other words, the Red Sox are hoping that this is a 2/50 contract. If a player does not take the opt out, then it means it was, by definition, a bad deal. This last sentence is the controversial part. For my part, I don't know how it's debatable, but I understand that there are many (many many) on SOSH who disagree with me. (Is it possible that 3/60 will, in 2 years, seem "just about right" such that JDM just takes it and we think, "well, that's about right"? Sure. But looking forward, not in hindsight, the fundamental premise of an opt out is that you're giving the player a guarantee that he will only take if it's good for him, which necessarily means bad for you. At this moment in time, the value proposition is the sum of all possible results multiplied by their expected incidences.)

So, when one says it's a "bad" deal, it's not because one thinks that 2/50 is bad. It's not. 2/50 is great. Heck, 2/60 would have been great. Nor is it that one thinks 5/110 is a "bad" deal. It's not. I would have been delighted with a straight 5/110. Heck, I would have been delighted with a straight 5/120. Because both of those give the team the upside, which is what it's buying for the $110 million or $120 million guarantee. The part that's "bad" about this deal is guaranteeing a guy $110, which is an additional $60 million against injury or being sucky in years 3-5, with no commensurate upside -- other than the upside of thinking he'll be worth more than $50 million over the next two years. If there's upside in years 3-5, or if it looks like there will be at the end of year 2, the Red Sox will not get it. They'll either pay market for it, or some other team will.

What's the upside of getting 2 years for $50 million? Let's say that a very well-constructed valuation of JDM over the next two years puts his value at $65 million, even baking in injury potential. Seems a bit high to me, but whatever. Let's just use it. The question then becomes is the expectation of $15 million in added value over the next two years worth the $60 million guarantee. Reasonable minds can differ over that question, surely. There's a small back and forth earlier in this thread where I think syd and I are basically having an abbreviated version of that discussion. But I don't think it's crazy for someone to say no, it's not worth it. Does that make the deal "bad"? I dunno. I don't want to use a simple word for a non-simple answer. I'm glad the Sox got JDM. I don't think they could have been competitive without him in this division in the next two years. Having stared down what contracts like Panda's, Castillo's, Allen Craig's, and, soon, Price's can do to you, I have some concerns about the opt out portion.
 

Cesar Crespo

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What is the argument for those that “do not love this deal”? Did they overpay for him? Is 2/5-years too long? Is it that he’s signed to play DH? Are his numbers not what they seem? Was his acquisition unnecessary in light of the roster-wide offensive underperformance last year?

I’m not saying I *love* this deal, per se. There’s always a certain amount of risk paying big dollars for more than 3 years to somebody on the wrong side of 30. But I’m having a hard time figuring out the logic behind some of the “meh” reactions here.
I like the deal but I'd guess the argument against it would be all the opt outs. If 5/110 was the best deal, why cave in and offer the opt outs? Plus, if he opts out after 2 years, it meant he was really good and the Redsox lost out. If he is bad, they are stuck with him for 5 years. I think those 2 seasons have tremendous value but others tend to disagree.

Most people on this board come on this side of "an opt out favors the player and never the team."

edit: Where this contract is front loaded, it offers even less value to the Redsox. If he does really well, they didn't get it at a discounted rate. They paid the premium.
 

effectivelywild

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I like the deal but I'd guess the argument against it would be all the opt outs. If 5/110 was the best deal, why cave in and offer the opt outs? Plus, if he opts out after 2 years, it meant he was really good and the Redsox lost out. If he is bad, they are stuck with him for 5 years. I think those 2 seasons have tremendous value but others tend to disagree.

Most people on this board come on this side of "an opt out favors the player and never the team."

edit: Where this contract is front loaded, it offers even less value to the Redsox. If he does really well, they didn't get it at a discounted rate. They paid the premium.

Yes, but front-loading a contract with an opt-out also increases the chance that the player will opt-out, since it means then that the later years come with a lower salary. And, as we've established, the theoretical optimal goal is to have the player exercise the opt-out.
 

MikeM

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I think the whole "it's a win if he opts out and a lose if he doesn'"t summary is a little extreme. Every contract doesn't need to be a clear cut home run from the perceived paper perspective.

There is definitely a middle ground reality here where JDM doesn't continue to King Kong it up enough to warrant the opt out in a trending down market, but the Sox still end up with their guy they can be content plugging into the lineup for 5 years without cringing or having Panda/Hanley type regrets over in the process.
 

Cesar Crespo

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Yes, but front-loading a contract with an opt-out also increases the chance that the player will opt-out, since it means then that the later years come with a lower salary. And, as we've established, the theoretical optimal goal is to have the player exercise the opt-out.
It would make him easier to move via trade too.
 

Murderer's Crow

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I think the whole "it's a win if he opts out and a lose if he doesn'"t summary is a little extreme. Every contract doesn't need to be a clear cut home run from the perceived paper perspective.

There is definitely a middle ground reality here where JDM doesn't continue to King Kong it up enough to warrant the opt out in a trending down market, but the Sox still end up with their guy they can be content plugging into the lineup for 5 years without cringing or having Panda/Hanley type regrets over in the process.
Or the market dictates that he won't get a considerably better deal, regardless of performance. You can look at Tanaka for a similar comparison.
 

pinkunicornsox

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I am not exactly sure what kind of market will be available for a 32 year old DH. Three years sixty million sounds about right. So I think there is a very good chance that JDM continues to rake, but decides not to opt out after two or three seasons due to unfavorable conditions in the market.
 

Jerry’s Curl

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I feel pretty good about JDM living up to 2/50 over the next two seasons. If he opts out, it shouldn’t be too difficult to allocate that money for another good DH/1B. Worse case is he stays for three more years and puts up Hanley type numbers which while not ideal, would still be a useful player. I’m much more concerned about our rotation beyond 2019.
 

Drek717

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SoSH Member
Dec 23, 2003
2,542
The premise behind not loving the deal depends on one's understanding of player opt-outs, which, for whatever reason, seems to be a very contentious subject on this board.
J.D. Martinez contract breakdown. Year 1: $23.75 m Year 2: $23.75 m Buyout if he opts out after Year 2: $2.5 million, bringing total to $50 m if he leaves Year 3: $23.75 m (No buyout if opts out after Y3) Year 4: $19.35 m Year 5: $19.35 m

I would say that you aren't giving the player opt out the full scope of value, and that is where the debate you aren't seeing comes in. You see it as something that only takes value away from the team. I'm not one to argue that the option itself is ever beneficial to the team, but it can bring other benefits.

For example, you said you'd have been delighted with a 5/$120M deal. He signed for, at maximum, a 5/$110M deal. That's $10M saved. Are the opt outs worth $10M? Debatable, but that's value gained by your own definition of what you would see as a "good" deal.

The opt. out also lets the team stagger AAV. The deal currently reads as a $22M AAV. If he opts out after year 2 it retroactively jumps, but future money is worth less than current money by most economic models, so a win for Henry and co.'s pocket book and more room for Dombrowski to work in during this current window.

Third, I'd argue that viewing the opt. out as something that prevents any kind of surplus value going to the team as a bit of a misnomer. We aren't talking about JDM getting peanuts in years 4 and 5. $19.35M per year for an elite DH was probably only a mildly good deal compared to market rate before this off-season correction. If this correction persists however JDM is likely sticking with the Sox if he's anything short of the best hitter in baseball.

You're also ignoring the ups and downs of a player's career. Lets say Martinez is a >140 OPS+ guy in 2018, then a ~125 OPS+ guy in 2019. Still valuable to a likely still competitive Red Sox team, but does he bail on the remaining 3/$60M when he has an opt out after the next year? Likely not. So then he's back with another option where he can try to pump his value up further.

Lastly, lets say he does opt out after years 2 or 3 and is still an elite power hitter. The Sox can then slap a QO on him and get much needed draft pick compensation from him while being able to reallocate his money as their needs then dictate.

Personally I like most everything about the deal. I hate opt. outs as an excuse to justify a 7 year deal not really being a 7 year because 1. it's only a 7 year deal if the player isn't outplaying the deal and 2. 7 year deals are rarely a good bet, your all the protection is reversed. These are the same concerns you've cited with this deal. They're valid, but I think they're less valid on a 5 year. The 3rd year opt out also dangles an incentive in front of Martinez to stay to further increase value if 2019 is anything short of all-world.

Unless JDM instantly collapses as a player the worst likely scenarios here aren't particularly more harmful to the team than a straight 5 year deal at an equal or higher total dollar amount. JDM is exactly what the team needs now but he isn't an elite SP or up the middle star. He's a power hitter who should basically be a full time DH. Guys like him come around fairly often. They're valuable but not irreplaceable.
 

dhappy42

Straw Man
Oct 27, 2013
15,770
Michigan
I think the whole "it's a win if he opts out and a lose if he doesn'"t summary is a little extreme. Every contract doesn't need to be a clear cut home run from the perceived paper perspective.

There is definitely a middle ground reality here where JDM doesn't continue to King Kong it up enough to warrant the opt out in a trending down market, but the Sox still end up with their guy they can be content plugging into the lineup for 5 years without cringing or having Panda/Hanley type regrets over in the process.
Yes, and a lot of the option discussion here assumes that the player makes a rational, value-optimizing decision on option-exercise day. That’s a big assumption. It’s not difficult to imagine a situation where JDM has a great two years and decides to not exercise his option and reenter free agency to seek more money. Or where he has a mediocre two years and decides to leave Boston anyway, forgoing guaranteed money.
 

Oil Can Dan

Well-Known Member
Lifetime Member
SoSH Member
Jul 31, 2003
8,037
0-3 to 4-3
The premise behind not loving the deal depends on one's understanding of player opt-outs, which, for whatever reason, seems to be a very contentious subject on this board.

When you give a player an opt out, you're hoping that he will exercise it. In other words, the Red Sox are hoping that this is a 2/50 contract. If a player does not take the opt out, then it means it was, by definition, a bad deal. This last sentence is the controversial part. For my part, I don't know how it's debatable, but I understand that there are many (many many) on SOSH who disagree with me. (Is it possible that 3/60 will, in 2 years, seem "just about right" such that JDM just takes it and we think, "well, that's about right"? Sure. But looking forward, not in hindsight, the fundamental premise of an opt out is that you're giving the player a guarantee that he will only take if it's good for him, which necessarily means bad for you. At this moment in time, the value proposition is the sum of all possible results multiplied by their expected incidences.)

So, when one says it's a "bad" deal, it's not because one thinks that 2/50 is bad. It's not. 2/50 is great. Heck, 2/60 would have been great. Nor is it that one thinks 5/110 is a "bad" deal. It's not. I would have been delighted with a straight 5/110. Heck, I would have been delighted with a straight 5/120. Because both of those give the team the upside, which is what it's buying for the $110 million or $120 million guarantee. The part that's "bad" about this deal is guaranteeing a guy $110, which is an additional $60 million against injury or being sucky in years 3-5, with no commensurate upside -- other than the upside of thinking he'll be worth more than $50 million over the next two years. If there's upside in years 3-5, or if it looks like there will be at the end of year 2, the Red Sox will not get it. They'll either pay market for it, or some other team will.

What's the upside of getting 2 years for $50 million? Let's say that a very well-constructed valuation of JDM over the next two years puts his value at $65 million, even baking in injury potential. Seems a bit high to me, but whatever. Let's just use it. The question then becomes is the expectation of $15 million in added value over the next two years worth the $60 million guarantee. Reasonable minds can differ over that question, surely. There's a small back and forth earlier in this thread where I think syd and I are basically having an abbreviated version of that discussion. But I don't think it's crazy for someone to say no, it's not worth it. Does that make the deal "bad"? I dunno. I don't want to use a simple word for a non-simple answer. I'm glad the Sox got JDM. I don't think they could have been competitive without him in this division in the next two years. Having stared down what contracts like Panda's, Castillo's, Allen Craig's, and, soon, Price's can do to you, I have some concerns about the opt out portion.
I think you're looking at it incorrectly. The question isn't opt-out vs no opt-out. The question is JDM with an opt-out or no JDM. Which do you prefer?

The opt-out has value, and it was (seemingly) part of the cost of getting him to sign on the line which is dotted. It's in the same category of the $110m.
 

dhappy42

Straw Man
Oct 27, 2013
15,770
Michigan
... Having stared down what contracts like Panda's, Castillo's, Allen Craig's, and, soon, Price's can do to you, I have some concerns about the opt out portion.
Not trying to pick a fight or belabor an argument, but I don’t understand this.

If the Sox signed JDM to a straight, 5-year, $110-million, no-option contract, and then JDM goes full-panda in years one or two, they’d be on the hook for years 3, 4 and 5.

With the year-two player option, if he goes full-panda in years one or two, there’s at least a small chance he exercises the option to leave. Worst case is he doesn’t, and the Sox are no worse off than in the above no-option contract.

So what’s the downside? I suppose it is a healthy JDM mashing in years 1-2, then exercising the option to leave. Two years of good/very good JDM For 2/50 doesn’t seem like much of a downside to me.
 
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