Wednesday, December 02, 2015

2015 Hot Stove: Setting the Table

There has been some recent deals that I think provides some market parameters for Leake and Lincecum.  In addition, I provide some free agent contract projections from:
And that's what I get for taking so long to finish this up, Price just signed.  I'll update some of the text to account for this and hopefully get it out before Greinke signs (rumors say it's LA vs. SF, 5-6 years, that he wants more than Price's AAV; plus Magic Johnson said that Greinke is their #1 priority; Greinke's camp says the decision will be made within the week, perhaps as soon as in the next few days).

ogc thoughts

For Leake, the recent deals for Happ and Zimmerman helps set some boundaries for Leake (plus Estrada and now Price), though still not enough for a deal to come to fruition yet.  But it should be close, only Cueto and Greinke are clearly better starters, and Greinke says he's deciding within a week.  It is my belief that the reason the Giants and Leake could not come to a deal beforehand is because they felt the market was lower, whereas Leake's agent thought that it should be higher, perhaps because of the money hitting the MLB in the coming years from TV deals.

The deals that has been predicted for Leake shows some of that range, as well:  MLBTR predicted $16M AAV for 5 years as did FG, and FG's crowdsourcing had him at $14M AAV for 4 years, which is similar to CBS' $14M AAV but for 5 years.  So the projections has him at 5 years for $14-16M AAV or $70-80M total contract value.


Beyond the Box Score had a recent post that compared Happ to Leake and found that they were similar in performance over the past couple of years, and that Happ was slightly better by fWAR (BB-Reference bWAR had them equal at 4.4).   Key differences I would note is that Happ is 33 YO next season while Leake is only 28 YO, and that Happ only has the two years of good performance (unless you want to count his good first full-ish season in 2006, and ignore all his struggles in-between), whereas Leake has been about average or better in 4 of his past 5 seasons.   Thus, in my view, while Happ has been roughly equal to Leake in the past two years, Leake will get more years as well as more AAV.

Per the projections, the experts viewed Happ to be a much lesser pitcher, as MLBTR predicted only $10M AAV for 3 years and FG only $8M AAV for 3 years.  They both missed badly as Happ signed for $12M AAV for 3 years, which is basically what the FG Crowdsourcing project saw, predicting $11M AAV for 3 years, while the CBS prediction was the closest AAV at $12.5M (but only predicted 2 years).

Estrada Estrange

I found his deal to be strange:  Marco Estrada got the QO, which is a guaranteed $15.8M for 2016, but he signed a 2 year, $26M contract, which gets him only $10.2M for 2017.  I guess the security of that 2017 money - which, after all, equals the amount of money he has earned so far in baseball - was worth it to him.  But unless he knows something about his health that suggests that, besides age (he's 32 for next season), he will decline, not sure why he would do that and not take a risk by accepting the QO, as he has basically been around average over the past four seasons, and pitchers like that are in the next tier and getting $14-16M AAV predictions.   But everyone has their financial security threshold, congrats to him on attaining it.

Had he not had a bad season in 2014 and then regressed to the mean by having a great 2015, he most likely would be put in the same grouping as Leake et al, or just short thereof.  One more year to prove that he's closer to 2015 and not to his career would get him into that grouping of 4-5 years, $13-16M AAV contracts.  Perhaps he really likes it there, having made some friends there, or appreciate that the Blue Jays are going to be battling for the playoffs, or maybe the coaches there got him to take that next step up in production.   Also, perhaps the QO loss of draft pick made the choice easier, as lower range guys like him could end up looking for a job on the cheap in Jan/Feb, and the security of 2 years and not having to look for a job had he took the QO appealed to him.  In any case, between these two deals, clearly $14M is the floor for the tier of pitchers that Leake is in.


Anytime I hear the word "zimmer", I'll always think of the classic routine with Peter Sellers as Inspector Clouseau, when he's trying to get a "ruem".  Anyway, Zimmerman is clearly better starter than Leake (career ERA of 3.32, better K/9, much better K/BB), so it's not surprising that he got a 5 year contract at $22M AAV.  The predictions were much closer, with MLBTR at 6 years at $21M AAV, FG at 7 years at $20M AAV, FG Crowdsourcing at 6 years at $21M AAV, and CBS at 5 years at $23M AAV.  CBS was the closest guess, as Heyman got the number of years right, as well as being within $1M of the AAV.

The Price is Wealthy

David Price signed for a reported 7 years and $217M or $31M AAV.  Greinke wants more than that, reportedly.  This was exactly what MLBTR predicted, and pretty close to what FG predicted ($215M/7 years/$30.7M AAV).  CBS was off some, $210M/7 years/$30M AAV, and the Crowdsourcing was the most off at $196M/7 years/$28M.  Still, all got the years right and most were pretty close to the final AAV.

Free Agent Pricing Conclusion:  Leake

Here is what I get out of these deals for Leake:
  • From the Happ-Estrada deals, looks like the floor for Leake is roughly $12-14M.  By some measures, Leake looks similar to them, by other, above.  Plus, he's much younger, as next season is only his 28 YO season, which means that he can get a longer deal.
  • From the Zimmerman deal, while that is not a ceiling for Leake, given that the predictions for Zimmerman is pretty close to the final 5 year, $22M AAV, that suggests that the predictions were in the ballpark.  Estrada's predictions where also in the ballpark as well.   
  • From the Price deal, while that is definitely not a ceiling for Leake, most of the predictions were pretty close, spot on for years, pretty close to AAV.  
  • Looking at the predictions for Leake, the predictions coalesce around 5 years, and $14-16M AAV, from $70-80M total contract value. 
Looking at it sabermetrically, he's been around 2 WAR over his career per FG, but BB-Ref had him at 3.0, 1.5, and 2.9 WAR in the past three seasons, or 2.5 WAR average.  Either way, around average, but one a bit higher, which at $8M per WAR, adds up to $4M extra per year, and for a 5 year contract, $20M difference.   Given his youth, the anticipation should be that he maintains this rate for 3-4 of the 5 years, perhaps all 5 years, if not perhaps increase some still.   At the current $8M/WAR that I see being used in various analysis around the saber websites, that's $20-24M in market value produced.

The way I'm seeing the situation, given that both sides claim to want to sign a contract, and the Giants generally can close the deal then, as I noted above, there must be a significant difference between bid and ask.  I would guess that the Giants are trying to get a contract in the $14-15M AAV range, whereas his agent is probably trying to get something in the $16M plus range.  For a five year contract, that could be $10M+ difference in total contract size.

Given the Giants tend to meet in the middle, I think a 5 year contract around $15M AAV or roughly $75M is what he will end up with, if no bidding war starts up and the bids are in line with the market pricing set above so far.  And given how the Giants tend to throw a little more money on top, I would not be surprised if the $80M/5 year prediction turns out to be right.

But with the expectations of big money coming in and lots of teams looking for aces but might be willing to settle for Leake, plus the fact that he won't cost the signing team a draft pick, that could push contracts offers for him upward.  However, the fact that there are so many pitchers considered above him (Price, Greinke, Cueto, and Zimmerman) as well as in his tier (Samardzija, Chen, Kazmir, Gallardo, Lackey - whom rumors have tied to Giants interest - and Iwakuma) plus guys who were near or near-enough (like Happ, Latos, and Fister), could dilute interest in his services, particularly if teams are looking at him as a backup should the team fail to sign one of the top tier pitchers.   So there are strong market forces going both ways.  And it could have been worse if a couple of QO's didn't sign and stayed with their team (Anderson, Estrada).

Given he wants to sign early, and the Giants like to sign early, I think he's just doing the Sabean thing of "kicking tires" and getting bids from teams, then, unless he's blown out, negotiate with the Giants as to the final terms, as I have to think that his preference is to return to the Giants as long as he gets a fair market value contract.

Grinding Greinke

Rumors are swirling.  Supposedly down to Giants and Dodgers.   Rumor says that he want 6 years but will take 5 years if AAV is upped, plus he wants more than Price's $31M AAV.   So it looks like he's getting at least 5 years and $32M AAV, for a $160M contract, and probably closer to $175M for 5 years ($35M AAV), and if its 6 years, at least $192M ($32M AAV) and probably in the close vicinity of $200M ($33.3M AAV).

These numbers are around the high end of the estimates for Greinke.  FG predicted 5 years at $32M AAV ($160M) and CBS 5 years at $33M AAV.  The others were way off, at around $26M AAV, but, because it was low (relatively), had him at 6 years.  If he does end up with the above ranges, he would be getting the high end of his estimates, and Leake's high end was $16M, which at 5 years would be an $80M contract, right in line with the high end of his estimates.

Also, it seems like the Dodgers will not let him go easily, their owner is now involved with the negotiations, showing how important this signing is to them.  That to me is a sign that there is no way the Giants can win the negotiations, because if the owner is involved, it means that he really wants the deal to happen, for it would be easy for him to tell his GM or VP what the spending parameters he's comfortable with, and let them go to work.  He's not going to waste time negotiating if he's going into this OK with losing Greinke, he has to be pursuing Greinke hard and usually that wins the free agent.

And I'm fine with that.  As much as I would salivate about having Greinke and Bumgarner, signing him would pretty much exhaust all the payroll money available if the Giants do end up not paying the luxury tax, per my calculations.   That means no money left for anyone else, just Greinke, at best cheap free agents in the $1-2M range, even Vogelsong's 2015 contract would push them into the luxury tax, so that means any deals made mid-season 2016 would have to be huge prospect overpays to get the other team to pay for that player's salary (and that's assuming that the CBA rules allows a team to skirt the luxury tax in this fashion;  the rules are in legalese and I've never seen a good explanation of the tax regarding this situation;  but I do know enough that backloading will not help with the penalty tax, only with the payroll budget for 2016).  

Hopefully, if the Giants do end up signing Greinke, they make the decision that it's better to go over than to hold back, as signing Greinke would be a huge statement and to blunt that statement by not going after other players you need would just be a huge let down after such a big win as signing Greinke away from the Dodgers.  Or perhaps they pull off some trades (Pagan?) to clear off salary off the roster for other moves.  But they cannot let Greinke be the only significant pick up during the off-season, ideally, they also get Leake in addition, for a great 1-2 signing punch.  

Bud-ding Contract for Lincecum

Bud Norris signed with the Braves for $2.5M.  His numbers since 2012 are very similar to Lincecum, and better in some key aspects:
  • Bud:  4.52 ERA, 1.392 WHIP, 1.1 HR/9, 3.3 BB/9, 7.9 BB/9, 2.42 K/BB, 127 games, 593.1 IP
  • Tim:  4.68 ERA, 1.402 WHIP, 1.0 HR/9, 3.9 BB/9, 8.6 BB/9, 2.15 K/BB, 113 games, 615.2 IP
But, of course, Big Time Jimmy Tim has some things that Norris doesn't:  two Cy Youngs, three championship teams, four All-Star teams, and about $80M more in paychecks over his career.  And the public pronouncement from his hip surgeon that the Dr fixed what was causing Tim to lose his velocity, and that he should be back to normal with this procedure.

Ay, dar be the rub, Lincecum is fresh from hip surgery.  He plans to have a showcase in January to show off what he can do, and see what offers he gets from teams.  Sounds like he wants to start, and, based on the predictions by the FG Crowdsourcing and CBS ($6M and $5M+ incentives, respectively), seems like people think that some team somewhere will offer him #5 starter type money to either start for them or to battle for the #5 starter's spot.  So this showcase is very important to his free agency, obviously, as the velocity he shows there will greatly affect his offers.

Wheel of Velocity

If he can show that he has the velocity that he had before, as some interpreted from the surgeon's statement, I would not be surprised to see deals double those predictions (no way he's getting more than one year, no way he will take more than one year, as he would like a season to build on his value, healthy) with a clear starting spot offered.

If his velocity is closer to 2015's version of Tim than the 2011 version of Timmy implied by the Doctor, then $5-6M seems reasonable as well, with offers to compete for a rotation spot, and perhaps one team will pull the trigger and even give him a spot.  The Giants may or may not get him in this case, this is where he'll be taking the Vogelsong 2015 role.

And if there is no improvement in velocity, I don't see him getting much more than Norris got, and given the timing in January for his showcase, probably would have to take a spring training invite as part of a minor league deal, and probably ends up with SF, as I think they would definitely take him back under those terms.

Lincecum Line:  Giants

Lincecum has probably the widest dichotomy of feelings towards retaining any Giants free agent as I can remember.  There are those who still fawn over him like he's still the same goofy guy who won two Cy Youngs.  Then there are those who only look at the overall results for the past four seasons and bitch and moan about money down the drain.  As usual, I see both sides of the argument, but, as always, am focused on whether he can help the Giants going forward or not.

There are parallels here to what Zito went through, in that many fans only focus on the negatives and did not realize the positives that were there in the situation.  In Zito's case, the contract was done, the money gone in monthly payments every season for seven seasons plus a buyout, so jettisoning him away was a foolish reaction by many fans, unable to understand that Zito provided value by throwing a lot of innings at a roughly average rate.  Yes, wildly overpaid for that averageness, but better to keep that average production at zero net additional dollars to the payroll than foolishly DFA him and replace him with either a veteran who will cost more money (which just more than doubles the money going out) or a rookie prospect who is not ready, because during that period, we had nobody ready to take over even a #5 starter's role.

Lincecum has actually been dominant over long periods of time the past two seasons.  From mid-April to his save in August in 2014, for the first 6-8 weeks in the 2015 season, he had the best ERA on the staff and kept the team afloat when others (like Bumgarner, among others) were not doing all that well.  It is clear now that his effectiveness ended because of his hip issue, which a noted hip surgeon declared that he should be as good as new.

Now the fans will read that and think that he's back to Cy Young goodness.  I acknowledge that such an outcome is possible, with time, but I think the more realistic route is to see what he had done in 2013 and 2014, and extrapolate that out under the assumption that the downturn in production was due to his hip condition worsening.  He was relatively healthy for parts of each season, and yet still did not have a lot of velocity.  Perhaps he was dealing with the pain and thus, would gain some velocity back after this surgery.  But right now, I think it is better to assume not much velocity returned, as that sets up the scenarios where his velocity did return.

Because he was actually pretty good the past two seasons during extended stretches of time.  In 2014, he was able to keep his ERA below 4 until late in July, roughly 4 months, on the back of an 18 game stretch where he had a 3.11 ERA.  And as badly overall that he did, the Giants were still over able to go 15-11 in his starts, he contributed to their being able to make the playoffs.  In 2015, he was able to keep his ERA under 4.00 until his next to last start before he was placed on the DL and eventually had to get surgery.  In his first 13 starts, he had a 3.31 ERA, and the team went 8-7 in his starts overall.  Of course, he can't be good all the time, but you have to believe that the down times won't be as bad now that he's healthy.

So when he's relatively healthy, he's been a pretty good starting pitcher, even with diminished velocity.  That's not Cy Young good, but that's pretty good to get out of the #5 starter position, which is what he would hold if he rejoined the Giants healthy.   Then, in the scenarios where he has some velocity returned, I think there can be some hope that he can 1) be a regularly good starting pitcher and 2) might even be a co-ace if he can get his velocity up higher, as the doctor predicted.

I would not pay him based on these hopes, but if he's healthy and throwing OK in his January showcase, I would match any deal up to $8M, as I think that he should be able to produce 1 WAR, if not as a starter, then certainly as a reliever, if he's healthy.  This is a potential high reward (ERA in the 3's for the 5th starter is gold) for relatively low risk.  I'm not paying him because of his past triumphs, I'm paying him because his recent performance and improved hip health should allow him to be relatively productive as a pitcher.

But, of course, with this said, I'm sure someone will accuse me of homerism.   Sigh...


  1. My worry is worse than it was with Matt Cain. I thought a healthy Cain in 2015 would be a very productive pitcher. As he was not, we are not sure what he will give the giants in 2016. Would Lincecum follow in cain's footsteps or will Timmy be the comeback player of the year?

    1. Thanks for your thought provoking comment.

      The good news, assuming Cain's telling the truth, is that he says that in the last game of the season, it was the first time all season that he was throwing freely, and not thinking about his mechanics or of the various odd aches and pains that seem to be the aftermath of a surgery. He noted this in the Hot Stove interview that Ray Ray of KNBR did with him yesterday (every Thursday 7-8 PM; Tomlinson was on too, but I didn't catch that segment). And that start was very Cain-esque, whereas previously he was not, giving up a lot more hits than usual. Yes, to your point, it was tougher for him to regain his form than many of us (including me) thought.

      As I noted below, I prefer that the Giants sign Greinke and Leake and go from there, but as I tried to acknowledge in my next post, that's probably not going to happen, leaving the last rotation spot open. In that scenario, Lincecum looks like a better option than what the Giants are probably considering, unless they get both Leake and someone like Shark or Kazmir, as Fister and Latos are not that interesting options to me. But Shark would cost us our draft pick.

      I would rather the Giants risk on potential instead of steady options if they are sticking to not going over the luxury tax threshold AND intent on keeping the draft pick (which I would like to see too, unless we get Greinke, in which case, enjoy your supplemental pick, LA!). Samardzija and Leake are good risks, Shark that he reverts back to 2014 form and not the form he has had all his career (big if there, if you ask me), Leake that he will pitch superbly in a pitchers park given that he has pitched well on the road all his career, with the risk that a soft-tosser like him with no stuff to strikeout batters at the high volume that many pitchers today can do, can do that over a long 5-6 year contract. He's young, but at what point does velocity decline negates his soft-tossing ways?

      And there is all sort of risks. Other people come back from surgery fine, and don't miss a beat, like Hudson for us in 2014. He was our All-Star leader that first half, while the rest of the rotation stumbled for about a month before figuring things out, even Bumgarner. Cain was pitching well enough in spring training but then pulled something right at the end, and I don't know if that was related to his surgery or if it was just random bad stuff happening. The key thing now is that he's healthy, had a season to work on his recovery, and felt good in his last start of the season. At $20M, all you can do is hope, right?

      About Lincecum, he's a different guy, a different situation. The thing for me is that even hampered by his hip problems, he was able to throw well the last two seasons to start the season, until his hip apparently was too much to handle. I'm not saying that he's returned after this surgery or that he'll necessarily will be as good as he was the past two seasons. But in that $5-10M price range that he seems to be in, which is really a limbo area for SP, I believe in his possibility to break out more than I think Fister or Latos, both of whom also had down years (and really, no injuries, at least that I'm aware of, and still they performed way worse than Lincecum did the past two seasons, while he was bothered by his hip; those are huge risks too, can anyone help those pitchers regain what they had before? What if they have lost it?).

    2. It is kind of like the Huff signing (not exactly, but parallels). Huff really produced a lot in 2010, All-Star levels, near MVP. There was not enough money to go out and get equivalent production (and I don't recall but maybe no free agent could either, in which case the money problem was moot), so the Giants had to pay him the market price and hope he could produce. Unfortunately, he didn't (in fact, the pressure was too much for him and he eventually cracked; never heard an apology from him on that). But that was the signing the Giants had to do to have any hope of replacing his production, if they did nothing, the fans would have been even more upset at that time, as well as we did not know at that point whether Belt was even ready or not. Huge risk to take on repeating by relying on a top prospect who (as we know now) they had identified a number of mechanical issues that it took three seasons to get him on board to do all of them and to learn them.

      In this case, Lincecum did not produce that much, so that's not the parallel I'm talking about. But in looking at the marketplace for a replacement SP, if we are limited to Fister, Latos, and Lincecum as our last option, at roughly the same price (perhaps cheaper for Lincecum than Fister or Latos, as $10M seems to be the going market price for recently previously capable SP who had a bad year; Anderson got that last season from LAD), then Lincecum makes the most sense, don't it? Just like Huff made sense? Given how well he pitched even while hindered, while the other two performed pretty badly, at least he was productive while healthy enough to pitch (relatively speaking).

      And with Blackburn and Blach in the minors, chomping on the bit, plus Heston probably the long reliever, we have a lot of good options if it don't work, unlike 2014 or 2015 when the Giants had to keep Lincecum in there and improvise once he was not productive, it's like putting a chip on 00 on the roulette wheel and seeing if we hit, but knowing that we have other chips to play safer bets going forward. We had no other chips previously.

      So I think Lincecum is the best option if the Giants are trying to stay under budget/tax. If they are willing to go over, then I'm OK with letting him go, you have to say good-bye at some point, and I'll wish him all the luck with the Mariners or whomever he ends up with (unless it's the Dodgers or really, any of the NL West or the A's).

      For, as much money as there is available to spend, Leake will pull a large chunk of that (or Shark or Greinke), and if they are intent on getting a Soria-level closer, they will have to go on the cheaper side for their last starter, and Lincecum is the best option I see for fulfilling that role, especially considering that hopefully Blackburn is ready for the majors by mid-season, if not sooner.

    3. CSN did a run down of the transcript of the KNBR interview, for those who missed it:

  2. Here is a recent article that covers Greinke's current situation pretty nicely.

    Notes that it is believed that the Giants are willing to talk shorter deal (5 years) at higher AAV, but flexible on the years. Will be on needles and pins until this is resolved.

    I'm torn. I know the history that Baer speaks of, but I want so bad for the Giants to put their foot down to the industry that, yes, this is a dynasty, try and stop us. I know that the money would be hard on the payroll this season, but a lot more are dropping off next season (Pagan, all the older relievers, Peavy), so it'll likely be a one year penalty. Moreover, as I noted above, the tax is not that onerous, nothing like a playoff run to make up for the extra spending.

    Ultimately, I'm drawing parallels here now to the Vladimir Guerrero free agency situation. I wrote about this long ago, as there were a number of signs that he would come to us, but more importantly, it would be the Giants ownership stepping up and deciding to go with quality instead of quantity. They decided to go for quantity, which was plainly evident after it turned out that there was a slush fund rainy day budget category that they could dip into, which was revealed in the Greg Maddux pursuit. My analysis then showed that they could have gotten Guerrero and most of the middling players they instead picked up, had they just pivoted, used the fund to get Vlad.

    So barring a huge Dodger's overpay, the Giants need to go all in and try to secure Greinke. That would not only help us, it would hurt them, greatly. Then they need to double down on that and sign Leake also for a Greinke, Bumgarner, Leake, Peavy, Cain rotation, with Heston in long relief, spot starter, and first replacement starter. That would send a huge statement to the rest of the majors.

    Then picking up someone like Soria would be the whip cream on top, the extra tax on him is only 30% for only 2016, as there will be a new CBA negotiated, and that threshold will probably be bumped up a lot, as there was no inflation built into the prior CBA, which there should have been, so that the team should be under in 2017, especially with the great young infield, all the great young relievers coming on board, plus interesting prospect SP like Blackburn, Beede, Mejia, Bickford, Johnson, Coonrod, and interesting prospect position players like Arroyo, Williamson, Garcia, Cole, Slater, who could reach the majors in the next 1-3 years.

  3. Hmm, so Grienke is a Diamonback.

    Bummer that we didn't get him, awesome that the LADs didn't get him, either.

    Now things get really interesting. Time to act, hopefully not overreact.



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