Rockets and LT

I think there is a deal in place, that is waiting until late September on Landry or another team's player, to go through, in which we will save some LT money, and send more players than we receive. Some of the additional players may being stockpiled to be fillers in a trade for a star-type player.

Otherwise, a number of Morey's moves would seem wasteful ... which I find highly doubtful.

 

I believe Morey said that because the payout from being under the cap this year is lower than usual, the Rockets won't mind being a bit over.

I think $5 mil over is a bit much. So they'll likely get rid of Barry and/or Cook if no significant trade happens.

 

Given that insurance is going to pay Yao's salary and a portion of McGrady's, my guess is that Morey has gotten Les to agree that going over the Cap isn't the end of the World this year.

 

Going over the cap won't kill Les - HOWEVER, Morey is smart enough to know that you can give another team a pick, stay under the cap and buy that pick back and save money in the end.

Give Cook + $3million to the Thunder.
Saves $0.5million, but costs a 2nd round pick.

Give Barry and $3million to the Grizzlies - costs 800k

The 2 moves combined puts the Rockets $887k UNDER the luxury tax level
In effect, the 2 moves have cost the Rockets 300k and a 2nd round pick.

However, by being under the luxury tax level, they would receive back an (estimated) $2.75 million as their share of the luxury tax payments.

So in effect, paying 2 teams to take expirings would net the Rockets $2.4 million dollars by years end.
And that's without even having to waive White!

Then factor in any insurance payments for Ming or McGrady - and the possibility of moving Battier to a contender at some point in the season - and there's reward enough to just dump and hide at the moment.


Scenario B might be to wait until closer to the trade deadline and then try and get some leverage out of the expiring contracts at that stage to bring back a star at an overall lower payrate.

 

Great explanation of the concept of salary dumps where a team has to spend money to save money. I completely agree that Morey will explore this avenue, at least with respect to Brian Cook. I also agree that the Rockets would probably need to get all the way under the luxury tax threshold (i.e., qualify for the shared luxury tax revenue payment) in order to afford to buy back a second rounder and a net cash gain. I actually see the Rockets hanging on to Brent Barry, given the leadership he can provide to this young 2009-10 Rockets team.

My guess is that the Rockets wait until closer to the February trade deadline to deal the Cook/cash/pick package to an under the cap team. This way, the cash payment may be closer to $2M instead of the full $3M.

 

I trust the investigation of Sherlock.

On a side note, I hope we keep our core of point guards (Brooks and Lowry).

 

Hey Bima how much does Yaos option cut into the cap next year? I think you had a thread explaining some of this stuff. Is a max contract impossible in 2010? Even with a Battier dump or something like that?

 

There is no way that Rockets will go over LT this season.

 

Yao is highly unlikely not to exercise his player option for 2010-11. So, I would base any assumptions on the Rockets' cap situation next summer on Yao counting against the cap with a figure of $17,686,100.

If the Rockets trade Battier for an expiring contract and renounce their rights to both Luis Scola and Kyle Lowry, THEN they'll be able to comfortably offer a max contract to a major free agent. Of course, I think Morey would never do this and would be an idiot if he did.

There are other smaller moves that would open up cap space, although on a smaller scale: (1) declining to pick up the $3M team option on Carl Landry and letting him walk; (2) declining to pick up the $2.3M team option on Chuck Hayes (perhaps re-signing him to the minimum); (3) waiving Joey Dorsey (and his partially guaranteed salary); or (4) trading away their 2010 first round pick for a future pick. Of course, the Rockets could also make cap-maximizing trades during this season as well.

Another factor to consider is whether the free agent will demand to come to the Rockets via sign-and-trade, in order to maximize his salary (including incremental raises). If so, then the Rockets would need to have even MORE cap room to absorb that contract.

At the end of the day, I doubt that the Rockets will end up signing a "full max" free agent. They will probably end up retaining at least one of Battier and Scola (if not both) and either signing a second-tier free agent to a deal in the $10-12M per year range or perhaps even re-signing McGrady if he comes back healthy.

 

I would assume,substituting Cook and Barry for Luis and Lowry would work too,money does talk but I feel a max agent would probably want to go elsewhere,with Yao being injured. I would rather go after a developing player and a 1st round pick or two in some kind of combination.

 

saleem, we're talking about NEXT summer. Cook and Barry will have already expired and been off the books. This is in addition to those salaries. Also, Yao and the Rockets will probably have fairly solid information on Yao's ability to continue his career where he left off by that point. Any major free agent will be made well aware of this point, I'm sure.

 

In regards to 2010 free agency, I highly doubt we will be targetting a top free agent. If you look at the pool of free agents, it will be much more cost effective to get a second tier superstar like Amare, Gay, Rondo, etc because their value will be diminished by the big three.

 

Thanks.

 

The Chronicle article has removed any reference to Pops's contract being non-guaranteed. It could be that that part of the article was factually inaccurate or at least not substantiated.

Also, where are you getting your salary figures?

Using salaries from www.DraftExpress.com (plus recent signings), the Rockets are $5,955,864 over the luxury tax (with White and Pops)

Using salaries from www.espn.com/nba, the Rockets are $5,565,191 over the luxury tax (with White and Pops)

As for the cash that Les has spent, he'll get that back (and then some) from the insurance payments on Tracy and Yao next year. Still, I agree that, for the total cash spent thus far this offseason, it would have been nice to see more immediate return on that investment.

But who knows? In five years, when Sergio Llull is taking the league by storm as the next Manu Ginobili, we may be singing Les's praises for spending that money.

 

Bima, that's why I think Battier and maybe landry are gone. Also, Tracy will be there no later than after the first week.