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The salary cap and why the Parsons contract is the new normal

Discussion in 'Houston Rockets: Game Action & Roster Moves' started by Carl Herrera, Jul 10, 2014.

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  1. Carl Herrera

    Carl Herrera Contributing Member

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    Here is a chart that, I think, goes a long way to explain why the Parsons contract is not crazy even though it is higher than, say, Nic Batum's contract. The chart shows where the NBA's salary cap is during its entire history:

    [​IMG]

    Notice that the NBA's cap number stagnated at around $58M for the last 6 seasons before jumping to $63M this year. The stagnation was a result of 1) the recession beginning in around 2008 and 2) the new CBA lowering player share of the revenue from 57% to 50%-- note that there was an agreement that the cap wouldn't dip down below $58M or else it would have moved downward in 2011.

    What happens now is that the NBA's revenue has finally risen sufficiently that even a 50% share results in a $63M cap, $4.3M+ more than the cap ever was under a 57% share. The cap is projected to go up to $66M next season and to $80M or so in 2016-17 due to a new national TV deal.

    So, this means that many of the contracts currently on the teams' books were signed in a very different economic environment, some even under different rules.

    When the cap was expected to remain flat (and maybe even go downwards before the result qof the lockout was known) while many of the larger contracts on teams' books go up each year by 4.5% or even more (in the case of Bird free agents and deals signed under the old CBA), teams have a harder time getting cap room. Now, with a 7%+ jump in cap number this season and more expected to come in the next two, the rate of increase in the cap is outstripping the rate of increase in the larger salaries remaining on teams' books. Moreover, with the new CBA shortening the allowed length of contracts, a higher % of contracts expire each season resulting in more teams having higher cap room and needing to retain or replace free agents.

    So, comparing the Parsons contract (or those signed by Hayward, Frye, Tucker, Bradley, Collison this year) to those signed even 2 or 3 seasons ago may not be all that useful. We are seeing the price in the market as a whole go up because total available FA money has gone up and is expected to continue going up in the near future (that is, the duration of many contracts to be signed today). Those guys mentioned above already got paid. And more $ is still out there for Ariza, Deng and the like.
     
    #1 Carl Herrera, Jul 10, 2014
    Last edited: Jul 10, 2014
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  2. micah1j

    micah1j Member

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    Great post. I agree completely and posted similar (shorter) thoughts in Parsons related threads. 16 million for Parsons in the new norm in 2016. He might even opt out looking for more.
     
    #2 micah1j, Jul 10, 2014
  3. Spacemoth

    Spacemoth Contributing Member

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    So...we should match!
     
    #3 Spacemoth, Jul 10, 2014
  4. aelliott

    aelliott Contributing Member

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    There is no explanation for Parsons getting 25 percent of anyone's salary cap.
     
    #4 aelliott, Jul 10, 2014
  5. DaDakota

    DaDakota If you want to know, just ask!

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    Yep, and the cap is expected to rise to around 80m with the new TV deal.

    DD
     
    #5 DaDakota, Jul 10, 2014
  6. jordnnnn

    jordnnnn Member

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    Yeah with the cap jumps if you assume he stays the player he is right now then this year the number is not ideal. Next year it's more palatable and by the 3rd year I think it's right on the money.
     
    #6 jordnnnn, Jul 10, 2014
  7. Shaq2Yao

    Shaq2Yao Member

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    Would still rather pay Parson $1M/per instead of $15M/per.
     
    #7 Shaq2Yao, Jul 10, 2014
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  8. FTW Rockets FTW

    FTW Rockets FTW Contributing Member

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    I know the value of money even though it's not mine so would still not pay Parsons all star / superstar money for a glue guy / role player that he is
     
    #8 FTW Rockets FTW, Jul 10, 2014
  9. SmeggySmeg

    SmeggySmeg Contributing Member

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    handsome is the best i can come up with :rolleyes:
     
    #9 SmeggySmeg, Jul 10, 2014
  10. Dgn1

    Dgn1 Member

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    Carl has been on a roll lately, good post. The moons are perfectly aligned for Parson's. EVERYTHING has gone his way.
     
    #10 Dgn1, Jul 10, 2014
  11. heypartner

    heypartner Contributing Member

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    And there is no explanation for the player option, and trade kickers. Cuban added those purely to screws with us. We must reject per precedent
     
    #11 heypartner, Jul 10, 2014
  12. shastarocket

    shastarocket Contributing Member

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    I'm in the camp that if we sign Bosh, all will be forgiven.
     
    #12 shastarocket, Jul 10, 2014
  13. HighlightReel

    HighlightReel Member

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    It's crazy to even begin justifying why he's worth the max. Dude is overpaid.
     
    #13 HighlightReel, Jul 10, 2014
  14. Karolik

    Karolik Member

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    FIFY ;)
     
    #14 Karolik, Jul 10, 2014
  15. tycoonchip

    tycoonchip Member
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    Yes we will match the offer and you can bet your darn skippy he will wear a Houston uniform next season. Parsons deserves the money he gets. Has he slacked off defensively? Yes. But part of that has to do with Mchale's inability to draw up a proper defensive scheme. Our new assistant coach/ defensive coordinator will hopefully change all that. We got another superstar in Dwight and we were still first round exits. This team will find new blood to put in our mix but don't be surprised if alot of the other guys we have grown to love are gone. The trio of Parsons Harden and Howard is not broken. Everything else is though.
     
    #15 tycoonchip, Jul 10, 2014
  16. RockingRox

    RockingRox Member

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    Whatever the cap is, Parsons does not worth a max.

    He got a max because Cuban wants to screw the Rockets. That's exactly what the Knicks fans felt last year (Lin's contract).

    But Feigen just reported that should the Rockets get Bosh to sign max offer, Parsons would be matched.

    That would be 4 max contracts on a team roster. I salute Les for willing to do that.
     
    #16 RockingRox, Jul 10, 2014
  17. Karolik

    Karolik Member

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    [​IMG]
     
    #17 Karolik, Jul 10, 2014
  18. Deckard

    Deckard Blade Runner
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    That's a trippy chart, Carl. Thanks.
     
    #18 Deckard, Jul 10, 2014
  19. Nook

    Nook Member

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    Excellent thread, not the same recycled BS.

    The expected increase in the cap is certainly part of. I think a lot of it is that some teams fail to attract real star free agents and you do not draft or develop young players, you feel the need to over spend to get them. You see it in Sacramento with Evans, Dallas with Parsons and the Hayward offer.

    It isn't usually a good idea but sometimes you can overcome it. Batum WAS over paid and was a big part of Portland's success in the playoffs. If the Rockets match Parsons he could well have a huge playoff series.
     
    #19 Nook, Jul 10, 2014
  20. glimmertwins

    glimmertwins Member

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    This is the point I have been making that people seem to ignore. Thanks for spelling it out. A bad contract is one you can't move but Parsons contract is in line with what a player of his caliber will be making by the time his contract is ending.

    Also note because of the TV deal in two years, most stars will coincidentally be free agents that summer because no one wants to be locked in an "old salary cap" contract when there will be a bigger piece of the salary pie available to players. That's why guys like Parsons are willing to take 2 year deals with a 3rd year player option rather than a longer term deal.
     
    #20 glimmertwins, Jul 10, 2014
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