it's not as clear cut as that, though. part of being a ballclub means being open to the serendipitous small chance. what if that one-in-ten shot comes in? after all, they sometimes do. with the club having won a bunch of games in june, the optimists have a case.
i'd personally argue that, in so doing, they too easily forget that virtually every other year seems to produce a similar run sometime in june or july that can be turned into an excuse to hold losing cards easily enough -- and that a propensity for holding losing cards can turn even a wealthy franchise into a century-old loser. an optimist might counter that, though they went five out ominously early, this club has managed to get through 80 games without going ten games back. and i'd argue back that that isn't really much of an achievement -- so did the clubs in 1980, 1987 and 1999, none of which ended better than .500. but, argues the optimist, you don't know what will happen -- which is true. but neither do the optimists, and that doesn't change the fact that the odds going forward are poor on the whole.
all that aside -- even conceding that remaining open to even piteously small windows of serendipity is part of being a ballclub (though perhaps most of all of a perpetually bad one) -- what is likely to annoy me most about the next month is the horrifyingly shallow understanding of the concept of value among fans who talk trade. consider what follows the 1060west primer on what constitutes reasonable trade talk.
start with three words that have very, very different meanings but which are confounded constantly -- price, worth, and value. price (also cost) is what a player fetches per year on the terms of his contract. worth is what that player's likely services -- in terms of warp or vorp or win percentage added or whatever your favored metric is -- would be generically priced at on the market. (baseball prospectus keeps track of something called morp that tries to approximate this in dollars.) value is the difference between the two.
many people i hear seem to equate price and value -- ie, "if it costs a lot, it must be valuable!" few things irritate me more than this all-too-common conflation. the more something costs, the less valuable it is -- precisely because the price reflects more (or all or more than all) of the worth of the player. without understanding this concept, the majority of major league trades will make no sense -- nor will the real function of the reserve clause -- nor will one be able to see how good teams are really built.
i did a study some time ago about vorp efficiency, which is really just a made-up term for getting good production on the cheap -- that is, maximizing value. i've often complained here that the cubs don't spend nearly so high a proportion of their revenues on player payroll as they should under tribune company ownership. and that's true -- they don't, instead treating the team as a cash flow generator that can be used to service corporate debt. this, and not profit growth, is what has kept the cubs in tribco for so long.
but that argument also misses an important part of the point. paying high prices for players cannot make a team valuable. the market of free agents is designed, as every market is, to give price a chance to equal (and sometimes exceed) worth. when that happens, it is impossible to build a team with enough worth to be a winner. most playoff clubs put together a team warp of at least 45. run that through bp's morp equation, and you get a payroll of $362 million -- more than three times the cubs' 2007 payroll. the market mechanism makes assembling a serious winning club by free agency alone impossible. this is so because value makes winners, and the market rarely affords a buyer value.
if it is only by accumulating value that a club can become a winner -- and the more value you assemble, the better off you are because the less you have to purchase at market prices to get sufficient worth together to win -- the essential question to ask is how can a club accumulate value? taking advantage of market mispricing might be one way -- mark derosa, for example, was projected to post something like 6.6 warp over the coming three years even in limited playing time. a morp calculation values that at $13mm in today's dollars; jim hendry signed derosa for $13mm spread over three years, representing a savings against morp when considering the time value of money if derosa only meets mild expectations. such mispricings, however, tend to be minor.
by far the most productive way to collect value is through the reserve clause, a baseball archaism by which teams are allowed to treat major league players as property until they've accrued six years of major league service time and become free agents. players generally make league minimum for the first three, then ramp up in the final three according to an arbitration-based system of salary suppression. take rich hill, who compiled 2.7 warp in 99.1 innings in 2006. that's worth an estimated $5.7mm by morp, but hill was paid less than a tenth of that. he's already accrued 2.6 warp this season, making no more money than he did last year. he still has five more seasons of controlled contract status ahead of him. hill is, therefore, very valuable.
the following maxims might also apply to trades, though this is certainly an incomplete list:
risk dilutes worth -- players with long injury histories are not well paid for a reason; their worth is diluted by "injury risk". if you have a veteran player who is generally thought to be at elevated risk of injury, he is not as valuable as one might think. conversely, even high-ceiling prospects come at a discount as there is some considerable risk that they will not become the player they are projected to be -- that is, "player development risk". other kinds of risk exist.
future worth is not equal to current worth projected into the distant future -- players tend to get better as they approach age 27 or 28, then generally decline through the end of their career. most player projection systems (like bp's pecota) take this into account, but one too often hears fans talking about trading for a player like randy johnson -- who has no future value at all -- with good prospects that might be valuable parts of the club for six years. there's more than what a player is today to consider.
short-term assessments of worth can be distorted -- players that have put up career seasons recently tend to have their worth overestimated. any player whose value is artificially and temporarily inflated through misperception of a recent abnormally good season can be excellent trade bait. conversely, any player whose perceived worth is suppressed by a recent abnormally bad year represents a potentially valuable acquisition opportunity.
high worth commands a premium -- the premium may be variable, but because there are only eight positions in the field and five spots in the pitching rotation a player that can concentrate a lot of worth in one of them is much more desirable than two that can compile the equivalent worth.
let's take an extended example.
there was a debate in the comments recently here regarding carlos zambrano and melky cabrera that provides a decent example of what i mean. i said that, in the event of a zambrano trade to new york, a decent return might look something like melky cabrera. this shocked a few people, leading to an extended (though very civil) disagreement with at least one commenter who, i think, is confused.
zambrano is making $12mm this year and is set to become the most sought-after free agent in baseball this offseason, one whose price is almost certain to exceed his value. he is projected by pecota to be worth 20.9 warp and about $52mm over the next five years; yet it would seem that he would be in line to receive at least $80mm over that period, not to mention additional years beyond that. anyone who signs zambrano to that contract is potentially taking a hit to their team value of something like $30mm. this is a particularly acute possibility if one considers the elevated risk of injury that goes with being one of the hardest-used young starters in the game. however, because zambrano has compiled an 8+ warp season in the recent past and because he represents the kind of player that concentrates worth, his trade value is not negligible.
none of this is a state secret, so many cub fans -- including some who think the cubs still have a decent chance in 2007 -- have discussed the idea of trading zambrano before the deadline. what should he reasonably net in return? if trades center on at least a plausible equality of value changing hands, what is zambrano's value?
recall that zambrano is only under contract for another three months. in that time, he is owed about $6mm and should produce about 3-4 warp. that could (again using morp) represent as much as $4mm of value. (after that, as i said above, big z will probably represent a significant negative value over his next contract, one which was perhaps mercifully backburnered for the cubs.)
now posit a counterweight -- melky cabrera. this is a 22-year-old switch-hitting outfielder with less than a year of service time accrued -- he will be a controlled contract for the next five years. in 2006, cabrera put up 3.5 warp in 128 games while making league minimum. his five-year pecota projection has him accumulating 23.9 warp, which is valued at $62mm. in that span, cabrera will probably make less than a third of that sum -- meaning that he represents a probable value of something like $40mm, or about $8mm a season. even if we discount cabrera with an exaggerated player development failure rate of 30%, his probable value is still nearly $6mm a year over the next five years. with 203 major league games already to his name, the probable risk rate is nothing nearly so high.
it seems to me -- on this analysis, understanding that a player like cabrera may not be all the cubs would get from a playoff contender for zambrano -- that the cubs would be somewhat mad not to move zambrano now. the kind of value he might bring in could help vitalize the chances of the club in coming years. to hold onto him in hopes of a longshot playoff chance materializing for a club that is, after all, approaching the all star break as a .500 club and 6.5 back of the division leader in spite of coming off a june stretch in which the team won a couple more games than it should have seems to be little more than perpetuating the mistakes of the past.
of course the hope of serendipity is, as usual in cubdom, more likely to triumph than not.
in any case, the following is a table i assembled from bp's pecota and morp projections (follow the links) as well as salary data at hardball dollars and mlb4u. sorted by contract value, it looks out at most five years; there are approximations; feel free to hector me with corrections if you find something egregious. the hope isn't so much to be very accurate -- these are projections, after all -- as to provide an anchor for folks who aren't used to thinking in terms of value.
|Player||Proj WARP||Proj Worth||Seasons||Price||Value||WARP/Year||Value/Year||Notes|
|Eric Patterson||26.0||$71.5||5||$5.0||$66.1||5.2||$13.2||min 6 years|
|Felix Pie||26.0||$71.1||5||$6.0||$65.1||5.2||$13.0||min 6 years|
|Mike Fontenot||12.4||$23.4||5||$2.5||$20.9||2.5||$4.2||min 6 years|
|Rich Hill||12.4||$24.1||5||$4.4||$19.7||2.5||$3.9||min 6 years|
|Sean Gallagher||10.4||$18.1||5||$2.0||$16.1||2.1||$3.2||min 6 years|
|Ryan Theriot||10.8||$19.0||5||$4.0||$15.0||2.2||$3.0||min 6 years|
|Angel Guzman||7.7||$11.6||5||$2.0||$9.6||1.5||$1.9||min 6 years|
|Carlos Marmol||5.4||$6.8||5||$2.0||$4.8||1.1||$1.0||min 6 years|
|Alfonso Soriano||23.2||$61.3||5||$82.0||($20.7)||4.6||($4.1)||8 years|
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