Explanation on why Lowry's offer to be matched is so high

Forgive me if I insult anyones intelligence on this site but I saw there was alot of confusion on this and I wanted to explain and give my take on why the Rockets are going to be shelling out a little bit more than they would have in the past few years to retain Kyle Lowry and Luis Scola. Just so you know Im not totally making this up and I have a little bit on knowledge in this situation, I work for a very large Financial company and am in the Market research department. So I do have a bit of experience and am a NBA nerd as well.

Restricted free agency allows for the Rockets to pay Market Value for their players by matching other offers teams give to the restricted free agent. This shows that this summers free agency bonanza has established a "players market" where the quality free agent is in higher demand than the supply.

The anomaly started with Lebron James. He alone created this disarray of spending. He advertised to the market that there was "true competition" in getting him and that led to a large amount of teams clearing cap space and contracts to make room for the potential to sign him. Now that Lebron signed with Miami, it left the remaining teams scrambling to find talent to fill their roster very quickly and they had a large budget to do so.

This market trend allowed for players to get paid more than they would have been worth last year or the year before. According to the market set the 24 Million dollar contract Lowry was offerred is probably a logical dollar amount to put on a quality player like Lowry that is highly sought after. For the players, if they are regarded as quality products, would be better off to wait even longer to maximize their earning potential when their demand is at their highest and supply is at the lowest.

For the Rockets sake, they should hope Scola gets a reasonable offer real soon or they could pay much higher than expected. The offer Lowry got is what Les Alexander or Morey should have expected to pay when they found out so many teams were making themselves players in an inflated marketplace. That, my friends, is why Lowry got offerred this overpriced contract and why the NBA will almost certainly have a lock-out next year.

 

Most of the people that posted on Lowry's offer thread seemed like they had no idea why the price was Lowry's cost was so high. I wanted to let you know that it is ok to blame Lebron when people are pissed off next year because we miss out on at least half of the season due to lock out.

 

definitely evidence to an inflated market.

 

When Lebron became a free agent he caused alot of teams to shed large amounts of salary with the hope that they could sign him. The teams that struck out in signing Lebron were left holding a large amount of cap space and not enough quality players to sign. Causing a frenzy of spending to sign the few good players left after Lebron, Wade, and Bosh were off the market.

 

ooohhhhh K... how long did it take you to come up with that one smart guy?