Why hasn’t extension for Phillips happened?

02/09/12 at 1:40am
Written by dclark

A couple of interesting links worth sharing about why the Reds still haven’t agreed with second baseman Brandon Phillips on a contract extension.

MLB.com’s Mark Sheldon reported on his blog that the Reds are no closer to an extension with Phillips.

From Sheldon:

Quote:“Not really,” Jocketty said. “We really haven’t had a chance to talk with them. Hopefully in the next few weeks, it’s something we can address.”

Jocketty said he did not believe Phillips’ side had set any deadline for talks ending before the season starts.

“I think this could go on for a while,” Jocketty said.

Redreporter.com insists it’s not a good sign.

From Charlie Scrabbles:

Quote: I’m of the opinion that if this extension were a go, it would have happened weeks ago. The Reds have to be diplomatic about this and say all the right things like “Hopefully soon” and “We are still in talks”, but the fact that it has dragged out so long gives me the impression that the team and BP are just too far apart. It’s gonna be tough to see ol’ BeePerino go, but ultimately I think it would be even tougher to see him struggle to stay above replacement level in his mid-30s.

What do you think? Much ado about nothing or should fans being reading into the fact that a deal still isn’t done?

http://cincinnati.com/blogs/sports/2012/...-happened/

BP wants too much money. And I think the market overall is changing, and unfortunately for him, he plays for a small market team that cannot afford him at that price in his 30's.

Unfortunate for the Reds..someone will pay Phillips if the Reds don't.

As good as BP has been for us, from a business perspective we've gotten the most out of him. It would be smart to let some other team overpay him while the Reds use the money elsewhere.

(02-09-2012 01:32 PM)Overrated Wrote:  As good as BP has been for us, from a business perspective we've gotten the most out of him. It would be smart to let some other team overpay him while the Reds use the money elsewhere.

The world is coming to an end because it's one of the only times we agree.

I like BP. Probably one of the best if not THE BEST defensive second basemen I've ever watched. But history tells us that players decline in their 30's, for the most part. He may still be good the next couple of years, but he won't be able to sustain it for 5 or 6 years, which is probably the contract length he wants.

Just looking at the market this offseason, and you see the superstars getting their money, and everyone else including good players only signing 1 or 2 year contracts (Madson, Kuroda, Beltran, etc.). I think the days of 5 to 10 year contracts are coming to an end for 95% of the players. It's been a weird offseason to me when you see so many players around age 35 to 37 calling it quits. And part of it seems that either they don't want to take a serious paycut or potential suitors don't want to insult them or bother dealing with them, or other reasons.

BP would be smart to take a decreasing contract. Something like 2012 - $12M, 2013 - $10M, 2014 - $8M, 2015 - $6M + incentives, 2016 - $5M + incentives. 5 years/$41M guaranteed. Might even ask for a no-trade clause.

I'd love to see him as a lifetime Red. But not if he thinks he's gonna get $10 to $12M per season for 5 years. Ain't happening in Cincinnati. Some other team might be dumb enough though.

No team wants to give a decreasing contract. You would rather defer money. Simple time value of money concept.

(02-09-2012 04:39 PM)Overrated Wrote:  No team wants to give a decreasing contract. You would rather defer money. Simple time value of money concept.

The time value of money isn't exactly a secret and (aside from being warped by a tax situation, etc.) goes both ways (i.e. BP would rather get paid earlier too) so both sides will factor it in to any negotiations. If you want to go down that sort of road though, I think a more relevant factor is the Reds' annual budget and trying to at least match up (if not exploit) production to expenses.

My point is if the money and years are right, there's no reason a decreasing contract can't be done with or without deferred money.

But like most, I doubt it will happen. Assuming we still have hope to sign Votto, signing BP would likely put that to bed period. But we still might face a similar issue with Jay Bruce (and/or possibly other position players) just down the road. Then there's the pitching staff where the Reds should be so lucky as to have one or two of their young starters (Latos, Cueto, Bailey, Leake, Chapman) develop into the kind of pitchers who demand big dollar, long term contracts. We've spent a long time to get one and it would be a shame if we couldn't keep him if/when it happens. Add in the Billy Hamilton factor and it just doesn't seem like BP is affordable for us unless he give a big Reds discount...

If you're a Sabermetric person (I am) you'd know that BP is a low OBP player. You also know his power has diminished since his 30-30 season. It's not that I don't think he's a great player but for a guy who's already OBP challenged I can't see giving him big money over five years. I'd do 3 yrs/ 35 mil and still be confident that because of his defense I'd get my money's worth out of the contract. I worry about how his bat will age though.

Fans might as well get ready for a different team in 2013 and then 2014. Votto, after 2013, will sign with Toronto if they offer. BP won't get how much he wants and walk too after next season.

Hopefully Neftali Soto arrives and maybe HRod does well enough to take over 2B.

(02-09-2012 05:44 PM)Bearhawkeye Wrote:  

(02-09-2012 04:39 PM)Overrated Wrote:  No team wants to give a decreasing contract. You would rather defer money. Simple time value of money concept.

The time value of money isn't exactly a secret and (aside from being warped by a tax situation, etc.) goes both ways (i.e. BP would rather get paid earlier too) so both sides will factor it in to any negotiations. If you want to go down that sort of road though, I think a more relevant factor is the Reds' annual budget and trying to at least match up (if not exploit) production to expenses.

My point is if the money and years are right, there's no reason a decreasing contract can't be done with or without deferred money.

But like most, I doubt it will happen. Assuming we still have hope to sign Votto, signing BP would likely put that to bed period. But we still might face a similar issue with Jay Bruce (and/or possibly other position players) just down the road. Then there's the pitching staff where the Reds should be so lucky as to have one or two of their young starters (Latos, Cueto, Bailey, Leake, Chapman) develop into the kind of pitchers who demand big dollar, long term contracts. We've spent a long time to get one and it would be a shame if we couldn't keep him if/when it happens. Add in the Billy Hamilton factor and it just doesn't seem like BP is affordable for us unless he give a big Reds discount...

I wasn't trying to suggest that time value of money was a secret. I just can't remember any reasonably high profile player accepting a deal with a declining value. I think a team has more interest in deferring money than a player has in getting the money up front, especially if the player has already been paid well up to this point.

Take a look at Arroyo's (terrible) contract. Everyone knew he was on the decline when he signed it. It was still back loaded and even deferred (without interest) for the Reds sake. And I don't think Arroyo really cared since he will eventually get all his money (plus he was overpaid, which always helps).

The Reds definitely have an issue with rising expenses though, as you mentioned. Billy Hamilton isn't one of those issues as he is 1.5-2 years away and then will make the league minimum for 3 years after that. But Votto is getting paid well this year and very, very well next year. Not sure if we have a legit chance to sign him, but if we do, that will be a lot of money.

And Bruce, Cueto and Latos won't be cheap for much longer.

Unfortunately this is the life of a small market club. Which is why it was smart for the Reds to go for it this year. You don't get very many opportunities.