[ClutchFans] For Rockets, pushing Parsons to early free agency suddenly makes sense

I think it depends where you draw the line superstar, Bosh is an on the end of the top 20, possibly 15, which makes him comparable to players like Aldridge, and in past times Worthy, Parish, that sort of thing. Wade? depends how his knee turns up, i think writing him off already is a tad premature.

I agree that the synergy we have is quality, two players with basically no skillset overlap whatsoever, which is why I think a Gasol would be a completely different story to Harden. A lot of the value also comes from when the others sit, i'd be quite confident having Aldridge for example play the focal point of the offense with 4 backups for the 10-15 mins a game that Harden and Dwight sit (he'd take an extraordinary amount of the shots in that time in most cases).

 

Bosh is a superstar talent and would be an ideal fit for us. However, there are several factors we would need to consider IF he were attainable.

1. Would he forgoe his opt-out or agree to re-sign long-term? If he wouldn't, then it's not worth it.

2. We would undoubtedly have to give Miami Asik, plus either Lin or whatever talent we could get for Lin, plus one of DMO/TJones, plus draft picks. And then you have to beat them in the Finals. I don't know if Morey wants to try to face Miami with Lebron, Wade, Asik, Lin, and the rest. That trade could actually make both teams better but it might make Miami still better than us.


But as far as Bosh' status. He is a superstar, no doubt. He's a top-notch defensive player. And he may be the best midrange shooter in the NBA today...one of the precious few midrange shooters that we could accept taking that shot.

 

Ok. I took at look at these figures and did some math to see where the averages are at.

There are essentially 3 tiers to look at-

Starter PG's on their rookie deals - (no need to dissect their salaries. All about luck of the draft selection). From Rubio to Isiah Thomas.

Starting PG's paid to be their teams star player- 8 Total PG's averaging 14.22 million a year. (D-Will, CP3, Rondo, Rose, etc.)

Starting 2nd Tier PG's paid to be 2nd, 3rd, or 4th best player on the team- 17 total averaging 7.005 million a year. (Everyone from the over-paid PG's Lawson, Nelson, Holliday, Dragic, Lin, to the right paid or underpaid few)

....................................................................................................
-Now take this into consideration that there are very few teams without a long term signed PG, and do not have a long term PG on a rookie deal they should be looking to resign long term around the same time Lin will be a free agent. Think Minnesota, Portland, Cleveland, etc. with PG's still on rookie contracts that shouldn't be taken into consideration. Most of the other teams have someone locked up for the next couple of years like Phoenix with Dragic, Indiana with Hill, Dallas with Calderon, etc. etc.

-Also take into consideration that of the 8 superstar PG's in the league, the oldest and most likely to decline would be Tony Parker... who almost surely will be in the Spurs future in the Summer of 2015 one would think.

That leaves a market of just a handful of teams that-

A. Will not be locked into either a Star PG,
B. Will not have a Future Star PG that we know of now
C. Will not still be locked into a contract with a B or C Level PG on a long term 2nd contract deal.

Also if young rookies like Michael Carter Williams, Trey Burke, etc. have success, that will make the pool of teams interested in Lin that much less abundant.

......................................................................................................

So if the league average is 7.005 mil for starter 2nd tier PG's not on their rookie deal, and the market for starting PG's will most likely have even less demand in it... its safe to say that we could only count on Lin EXPECTING to get an offer of the average if not less. Unless Lin is to make the leap up to all-star level where those few 8 PG's in the league clearly are paid completely different.

So IMO, its not out of the question at all that the Rockets might very well keep Lin past his current contract, and re-sign him to either a similar or lesser deal in 2015.

 

FYI, for those looking purely at the numbers associated with how much the Rockets should be willing to pay Chandler Parsons in 2014, the following is a "simplified formula" for making this analysis:

[4x + 964,750] = [5y + 624,771]

Where:

"x" = the highest average annual salary the Rockets expect Parsons to be offered by any team in 2015 as an unrestricted free agent; and

"y" = the (roughly) maximum average annual salary (on a five-year deal) the Rockets should be willing to pay Parsons in 2014*

* Of course, the Rockets may be willing to increase this amount slightly in order to reward Parsons for his prior service and for forgoing fully testing the market

Parsons's currently slated 2014-15 salary is a paltry $964,750. However, so long as Parsons is not waived by January 1, 2014 (Hint: he won't be), $624,771 of that amount will become guaranteed. This means that, if the Rockets exercise their team option on Parsons for 2014-15, the MARGINAL team salary increase to have Parsons on the roster that season would only be $339,979. That's less than the rookie minimum!

By declining the option on Parsons, the Rockets would essentially be guaranteeing him [whatever he can get on the market/from the Rockets on his new deal], plus the $624,771 he was already guaranteed.

So, using the formula above, if the Rockets feel confident that Parsons could not do better on the open market in 2015 than a deal averaging $12 million per season (which, for the record, is far more than I believe Parsons is worth), then the Rockets should not be willing to offer him much more in 2014 than a five-year deal averaging $9,668,000.

If "x" = $12,000,000, then "y" = $9,668,000
If "x" = $11,000,000, then "y" = $8,868,000
If "x" = $10,000,000, then "y" = $8,068,000
If "x" = $9,000,000, then "y" = $7,268,000
And so on, and so forth.

AND BEFORE PEOPLE BLAST ME FOR OVER-SIMPLIFYING THE SITUATION . . . I fully realize that this entire situation is more delicate and involves a human element that applying a mathematical formula will not necessarily solve. There are egos in play, leverage involving other factors (such as the threat of Parsons leaving as an unrestricted free agent or Fegan's future negotiations with the Rockets with respect to his representation of other prominent NBA players), and countless other variables that cannot be accounted for in this calculation. Hence, my reference to it as a "simplified formula" above.

But, at the very least, this should help give a bit of perspective for those trying to wrap their minds around the cost-benefit analysis that the Rockets are facing with Chandler Parsons heading into the summer of 2014.

 

No

No. It was BR quality.

 

&&&&. I am in awe of your concise analysis. I cannot hold my thumbs up high enough for this post.

 

Rudy Gay was selected because that's who the team we traded the pick for wanted (Memphis). If we would have kept that draft pick the Rockets wouldnt have selected Rudy Gay.

 

There's several unique things about Parsons situation that we have to remember.

1. He has been severely underpaid for his first 2 seasons and likely this third season as well. He has performed well within the top 10 of his draft class.

2. He's in his prime or going into his prime.

3. We are a championship contending team with no cap space available to add free agents (other than exceptions) after next off season most likely.


With this in mind, I decided to run some contract scenarios using Coon's spreadsheet.


Let's assume that we make Parsons a restricted free agent this off-season. Let's assume that he gets an offer sheet faxed to him for 4/48 or $12 million per season. Remember Batum got a 4/46 offer sheet from the Twolves last year. So, here's a counter 5-yr deal. And remember these things that Morey can do with a contract.

1. 15% signing bonus.
2. 7.5% decreases every year
3. non-guaranteed 5th season.

Morey could counter with a 5/57 deal, 15% signing bonus, with 7.5% decreases, and 5th season non-guaranteed or team option.

YR 1 - $13.6 million guaranteed
YR 2 - $12.741 mill guaranteed
YR 3 - $11.882 mill guaranteed
YR 4 - $11.023 mill guaranteed
YR 5 - $ 8.017 mill non-guaranteed w/team option

This gives Parsons over $48 million guaranteed money over the 4 years. And it gives us a cheap non-guaranteed 5th season with flexibility to trade him as an expiring in YR 4 or as a non-guaranteed salary in YR 5.

Now...in my opinion...that probably represents the extreme of what Parsons might get offered on the open market. You can torque this down from here. If you think he's worth 4/45 on the open market then Morey could put this offer together (and this would probably be a good baseline offer to negotiate from).....5 years and $52,632 million with the last year non-guaranteed and team option. Here's what that looks like:

YR 1 - $12.5 million guaranteed
YR 2 - $11.711 mill guaranteed
YR 3 - $10.921 mill guaranteed
YR 4 - $10.132 mill guaranteed
YR 5 - $ 7.368 mill non-guaranteed w/team option

That's over $45 million in guaranteed money and a very palatable cap figure in the 4th and 5th seasons.

This type of deal could be negotiated and agreed to prior to July 1 with the understanding that the contract is signed the day the moratorium ends. The risk is Morey is trusting Fegan to do the right thing. That is somewhat of a risk. Fegan could possibly find a team to give Parsons a better offer. But gonna have to do it fast since they've agreed to sign the deal as soon as the moratorium is over. But that is highly unlikely. I asked another poster to name the team that would give Parsons more than 4/48. Still waiting to read who they come up with.

An additional benefit of the Parsons situation is it also helps Morey long-term in dealing with other second rounders and free agents. He can point right to Parsons as an example of a guy that he low-balled that proved his value and got paid more than enough to offset the low-ball contract he played under to start his career.

 

Rudy Gay at that time just simply resembles the value at that particular time for the 8th pick in the draft.... I would have assumed that was pretty clear what I was getting at.

8th pick in most drafts > Veteran role player/defensive leader

in terms of trade value.

 

A few thoughts:


1. A significant factor that should be in everyone's mind is what the salary cap will look after the year 2016. Specifically, (A) the NBA's national TV contract expires after the 2015-16 season, and (B) both the NBA and the Union can opt out of the current CBA after the 2016-17 season. Most expect that the next national TV deal to include significantly increased revenue-- and this is why the Union asked for the right to opt out right after the new TV deal is expected to be signed.

I think this means that a long-ish term deal signed under the current CBA and the current cap structure may look better in a few seasons.

2. Morey is most likely well aware of the Carlos Boozer situation and probably thinks that situation played out perfectly rationally. Cleveland might have done Boozer a favor by giving up a cheap option, but once Boozer became a (restricted) free agent, the other teams don't have an incentive to discount their offer to Boozer based on the favor that Cleveland did to him. I think Morey expects the same from Parsons-- Parsons and his agent should explore free agent options if Houston declines his option. The only "discount" that Houston should expect is based on the leverage they'd have in restricted free agency and not based on the "favor" they'd do to Parsons.

 

Except Battier was not most "veteran role player/defensive leader." At the time, he just came off of two seasons with RAPM of +3.6 and +4.3, which ranks him among the best 20-30 guys in the league.

His +/- with Houston were worse: +2.1, +1.8, +1.3, +1.2 and +2.0. However, these numbers are actually higher than the RAPM of Rudy Gay in any of these years, or in fact, during any year in his entire career so far.

Looking at the specific players available in the 2006 draft. The only guys picked at or after #8 (as far as I can see) that eventually had significantly better RAPM than Battier did during his Rockets career were Millsap, Rondo and Lowry; and this didn't happen with any of them until the 2009-10 season.

 

They could do that, but I'm not sure why they would offer him less, that would mean he hasn't gotten any better. That doesn't make any sense. They would just let him walk if that was the case. If they offer him similar I imagine that means he has improved, so in that case he might be able to get a little more from other teams. Even though teams have sign long-term PGs doesn't mean things can't change if it doesn't work out.

 

We didn't get enough for the 8th pick. It wouldn't have been that hard, because Memphis really wanted Gay. The Rockets could have offered Gay to another team, and put pressure on Jerry West. Getting Lowry if available plus Battier, would have improved our anemic PG problem. We were lucky to get Lowry in the future.

 

Geez... everyone flips out every time the name Rudy Gay and/or Shane Battier are ever mentioned. Just forget the names and re-read the point that I was making. There was never an argument about whose +/- was greater.

The fact is on a contending team, an established player might hold more value to that particular team given how they mold with their current core, their leadership on & off the court, and the timing that the team is currently in.

The point is Chandler Parsons probably has greater internal value to the Rockets right now than what he could net them in the trade market.... even if that player might be better, have higher upside, or better trade value. Hence why the Rockets might very-well overpay to keep Chandler Parsons just as other contending teams in the past have overpaid supporting players in the past cause of what they do to complement the core players.

If we absolutely have to use examples for everyone to understand we can look outside the Rockets organization and look at the value of Robert Horry to the 03/04 Spurs.... Was Horry really worth 4.5 million to every team in the league at that point in his career? Do you think the Spurs were willing to pay Horry a little bit more than a team like say... the Toronto Raptors who were in rebuild mode???

 

Its besides the point. It doesn't matter if he has gotten slightly better or not. The point is he's going to get what the market dictates... and if you do the math, and project out to 2015, its pretty obvious to me that the market will pay 2nd tier starting point guards around the same if not less than what they currently pay. In the NBA its not always the case where production = pay. Its about what the market is like for your talents when you become a free agent that dictates your pay.

 

Given how Morey operates, it is unlikely that the team with him on board did not explore all trade possibilities to squeeze all value out of each deal. But then again, it was early Morey and Dawson was still the GM at the point, so maybe they didn't do it how Morey has done it since.

 

It's okay everyone, I simulated the 2013-2014 season on 2k and we only need to pay him 32 million over 5 years.

Your welcome everyone, you can all relax now

 

I was the one who pointed out that there will be multiple poorly managed teams with max cap space next summer, and poorly managed teams make stupid, desperate decisions, like offering Chandler Parsons or a player of his caliber a max or near max deal. Any of these poorly managed teams on your list are liable to do this. I have no idea which specific teams will do it. I do know that stupid teams do stupid things, though. The contracts you are suggesting here are gross overpays, I do know that, too.

Can you pay more up front to Parsons, as you are suggesting? Is that even permissible? If Houston can offer him a declining scale deal, and other teams can't, this gives Houston an advantage, due to a) inflation and b) the ability to invest your money in stocks/bonds/etc.

 

Can someone point me in the direction of the source(s) that lead some people to hypothesize that LaMarcus Aldridge is pulling strings behind the scenes to land in Houston?