A couple of assumptions challenges:

- If Phil Hughes isn’t contributing to making this team better, I bet he’s non-tenderede or traded for cents on the dollar instead of given a 20% raise.

- Obviously this assumes nothing from Pineda ever. I would say the range is ‘as projected’ Pineda (which should still be 3-4 wins) to nothing. Split the difference and call it 2 wins?

- How does Zombie Derek Jeter affect this projection trajectory? I’m guessing +0.5 wins relative to the corrent future projections is at least reasonable. He looks sustainably good - hitting balls hard, etc.

And a couple of points:

- I liked trading Montero because he was less valuable to the Yankees because he’d be a DH. Now with Pineda injured, this whole trade can look a lot worse if the Yankees end up without a catcher in 2013 and Montero is catching for the Mariners and doing an acceptable defensive job while hitting the snot out of the ball.

- The lunacy of Chamberlain in the bullpen continues to present itself.  If he was even a league average starter in 2013 he helps this situation immensely.

- All I’ve read about $189M in 2014 is that it’s a goal. If this team isn’t going to win, they’ll go above it.

- Can Gardner stop being a platoon player for chrissakes? It’d be nice to not *have to* resign Granderson, even though I want them to.

I’m going to have to side with SG on this one.  Loosing Pineda is a HUGE loss to their long term success.  They can get those 3-4 wins back but it’s going to cost them $15-$20M.  Looking at the extensions teams are handing out after the Dodger deal, maybe it will cost a lot more than that.  Either way that means $189 isn’t going to happen.  So that means management has to decide what is more important.  $189 or winning?

- If Phil Hughes isn’t contributing to making this team better, I bet he’s non-tenderede or traded for cents on the dollar instead of given a 20% raise.

Apply this to Joba, too.

- Can Gardner stop being a platoon player for chrissakes? It’d be nice to not *have to* resign Granderson, even though I want them to.

Hear, Hear. But unless Grandy is in serious decline, I think he’s a must-have anyway.

Also, that loathsome May-September pair of Rangers fans from the game the other night that poached the foul ball out of the mouth of the poor kid next to them have been getting excoriated on the national news. But get this - they are demanding an apology from the Yankees and YES for showing their bad behavior during the game and, presumably, for leaking the story to other outlets.

I say it will be a cold day in hell before this pair gets an apology, and in fact, YES should instead offer to feature the video in their pre-game montage for every NYY-TEX game from now on.

Fuckers.

Is it worth it (in profit terms) for the Yankees to make the playoffs rather than get under luxury tax? 

I have seen that getting to 189m is worth $50m savings on luxury tax.

So lets say spending 189m gets you to 86 win team.  Probability of making the playoffs is probably around 30%.  If you spend another 20m adding 5 wins that increases your probability to around 67% (SG am I off the wall there?)

Assuming regular season revenue unchanged at $300m(and appreciating it wouldnt be).(the 300 figure is just for illustration and whatevery number you use gets to the same answer.

Playoffs would need to generate about $215m in revenue to be worth the risk (assuming no risk aversion!)

answer found by solving for POR in below equation where hopefully all figures are self explanatory

300 + (.67 x POR) - (210 + 50) = 300 + (.33 x POR) - 189

There is no way (I think) the playoffs could be worth that (if they were we would have got Darvish)

Certainly the situation cannot be as bad as all this.

It has got to be worse.

If Phil Hughes isn’t contributing to making this team better, I bet he’s non-tenderede or traded for cents on the dollar instead of given a 20% raise.

True.

Obviously this assumes nothing from Pineda ever. I would say the range is ‘as projected’ Pineda (which should still be 3-4 wins) to nothing. Split the difference and call it 2 wins?

I think there’s a very good chance Pineda’s days of being a successful MLB pitcher are over and he will give you nothing.  I don’t think splitting the difference should be part of the Yankees’ planning.  If he comes back, great, but they shouldn’t plan for it.

- How does Zombie Derek Jeter affect this projection trajectory? I’m guessing +0.5 wins relative to the corrent future projections is at least reasonable.

Maybe, but health is going to continue to be an issue.  I am using very rough win estimates here, so there’s plenty of wiggle room based on specific assumptions.

So lets say spending 189m gets you to 86 win team.  Probability of making the playoffs is probably around 30%.  If you spend another 20m adding 5 wins that increases your probability to around 67% (SG am I off the wall there?)

If I run the Yankees as an 86 win team with this years’ projections for everyone else (removing all uncertainty) I get 19.3% Div, 12.8% WC1, 13.5% WC2, 45.6% total PS%.  If I make them a 91 win team I get 46.0% Div, 17.5% WC1, 14.9% WC2, 78.5% PS%.  That includes how teams have played to this point, so at the start of the season those would probably both be lower.  The difference should be about the same though.  Those five wins add about 30-35% to their overall postseason probability.  Pretty close to what you estimated.

[6] This may be a dumb question, but all of a sudden Boston is burdened terribly with awful contracts. Tampa Bay is it’s usualy scary self with young high end pitching and enough offense to get by. Detroit is a solid team in a weak division with some big contracts of it’s own, and Texas is downright scary but will be facing touch decisions on Hamilton and I think they’re also looking at Nelson Cruz as a FA in a couple of years. Are we sure the assumptions about how many wins it’ll take to make the playoffs are valid? It seems like all the major competitive teams have payroll management issues of their own.

As to how much the playoffs are worth, you’re talking at most 11 additional home games of revenue, if every series goes to the end and you have home field advantage and win every single series. 

According to this article teams made about $2M for each postseason home game.  That seems low to me, but even if you make that $10M that means you’re at best looking at $110M for the postseason, and that’s only if you win every series with HFA and they go to the final game.

It seems like all the major competitive teams have payroll management issues of their own.

The new CBA may increase parity and make those payroll issues more harmful, in which case you’re probably right.  I would rather go with what we know and have observed in the recent past for now, with the understanding that the landscape may change.

[8] And that’s only considering the actual playoff revenue in a vacuum and not any future impacts. If the Nationals win the World Series this year, they will see a lot more revenue down the road than the Yankees would. People are excited about baseball around here for the first time in a long time. If the Yankees win the world series, those 25 rows of seats in the lower levels will still be empty but likely paid for in the future.

[6] “I think there’s a very good chance Pineda’s days of being a successful MLB pitcher are over and he will give you nothing.  I don’t think splitting the difference should be part of the Yankees’ planning.  If he comes back, great, but they shouldn’t plan for it.”

I don’t know if anyone has linked this article before, but it puts Pineda’s labrum injury in context, concluding that his is less severe than most other mlb pitchers who have undergone labrum surgery and that it is reasonable to expect him to return as an effective pitcher:

http://www.baseballprospectus.com/article.php?articleid=16634

The key point is that Pineda does not have a “SLAP tear” or damage to his rotator cuff.  His labrum tear is isolated and doesn’t implicate those other areas.  Jose Valverde and Anibal Sanchez are discussed as other young pitchers who had similar labrum injuries and came back ultimately as valuable pitchers.  Wade Miller is a contrary example.

[9] The new CBA may increase parity and make those payroll issues more harmful, in which case you’re probably right.

Yeah - I was actually thinking that the league would just be worse. Those good teams would find it harder to keep their players and not be as good going forward, so we’d still see 95 win teams but just not as good as the 95 win teams from the years prior.

Of course the Yankees have been the only team consistently over what is now the new soft cap, so maybe it’s not necessarily correct to think that those other teams would get squeezed. We have by far the ugliest long term contracts.

[12] It’s all relative. Teams will find it easier to keep their talent because there won’t be as many places willing/able to pay more, so the market will not be there.

The other issue is we’re seeing teams lock up their best young players more frequently, buying out their prime years.  I’m sure the Yankees would be salivating at the opportunity to add Evan Longoria or Matt Kemp, but those are no longer options.  Now you’re stuck picking through Jayson Werth and Carl Crawford.

[14] So, Cano, Gardner, Granderson, Montero, Pineda, Hughes, Nova, Robertson (unless you think top tier RP is fungible).

Teaching Montero to be 1B would have made a lot of sense, if you could go back 3-4 years and not sign the stupid contracts that give you a glut of guys you need to hide at 1B/DH.

Cervelli ?

Nunez ?

[11] I know it’s the complaint thread, but I think counting Pineda out entirely is rather rash. Even for us. Heck, there is an equal chance that he pulls a Schilling and uses the rehab to come back stronger and better. But ultimately I expect neither to happen and the Yanks’ will probably end up with a back of the rotation starter who has control but not quite as much velocity. Which kinda sorta really stinks, but such is the risk inherent.

I love Grandy and would hate to see them let him walk—he’s turned into what they hoped he would, plus he’s just a great guy.

The Yankees should let Swisher, Cano and Granderson go and rebuild from the draft picks. I think that’s the best thing they can do given their spending limits. But I still don’t agree with spending under the 189 million mark because they could spend a lot more than that given their revenues.

[17] We will become the Kansas City Royals, East.

Seriously, if they are going to get the payroll down, they’ve got to be willing to suck for as long as it takes to get rid of the big contracts (including CC) and THEN start rebuilding. That’s 5-7 years from now before the franchise recovers. What happens to the gate and TV pulls during that time ?

That’s 5-7 years from now before the franchise recovers. What happens to the gate and TV pulls during that time ?

Ask the Mets maybe?  There was a time not that long ago that the Mets had higher attendance than the Yankees, but I guess that YES changes things significantly.

What happens depends on the boys and their insane henchman, Levine.  I don’t see a lot of evidence that they know what they’re doing.  They weren’t even the ones supposed to be running the team—it was the guy married to the daughter, only he got divorced from her.

My belief regarding the luxury tax threshold (based on nothing more than pure speculation) is that Hal would like to get under it just to reset the penalties. If they go over again in 2015 and/or 2016 while they wait for some of the big contracts to expire, that’s OK. In the future, if they could get below the threshold say, once every three years, they would avoid having to pay the max penalty. I don’t think they would avoid signing a big FA contract, even if they exceeded the threshold as long as they knew they could get back under in a year or two.

Steve “Aptly Named” Swindal

[21] - This was my understanding a well.

19 how about the CBS/Burke Yankees

I know this is a complaint thread, but as a frequent lurker and very infrequent poster, I feel like something of a response is needed:

1)  Clearly the Pineda injury is not the source of all of these problems.  Yes, obviously even a 3 WAR pitcher making the league minimum goes a long way to getting the payroll down to $189 million.  But at the end of the day, the long-term commitments to aging players over the next 5 years is going to hamstring the team’s budget and that’s going to be an issue, Pineda or no.  And yes, some of the contracts they’ve given out obviously have been war crimes (cough, A-Rod, Soriano), but it’s not like the Yanks knew that MLB would institute this asinine CBA.

2)  I thought the $189 million target was only for 2014?  I don’t see next year as being a payroll cap year, so I think maybe your concerns about next year’s team may be a bit overblown.  Of course, I recognize that it may be difficult to improve next year’s team without giving multi-year contracts that will affect 2014.  But I do think it’s possible to plug at least some of the holes somewhat cheaply (corner OF, bullpen) for next year.  SP is another story and yeah, losing Pineda obviously sucks big time in that regard.

3)  Is your five-win aging decline based on stats?  That seems maybe a little extreme to me, although I could be wrong.  Lots of wildcards there in terms of the aging process, whether guys (e.g. Tex) bounce back, etc.

4)  2014 is another story.  If they are serious about chopping the payroll down given their obligations, I think you’re correct that the management needs to be willing to miss the playoffs that year.  That said, it’s not impossible that the Yanks will have a healthy Pineda back in 2014, but I agree you have to plan for the worst case scenario.  Also, a lot can happen between now and then.  I’m not TOO worried about 2014 yet.

5)  Isn’t it the case that they only have to go under $189 for one season?  I frankly don’t understand the details of the CBA, so if anyone does, I’d love to hear how this all works.

Isn’t it the case that they only have to go under $189 for one season?  I frankly don’t understand the details of the CBA, so if anyone does, I’d love to hear how this all works.

The way things work is that so long as they get under $189 million in any year in a four year period, they will not be subject to the super-onerous luxury tax charges. So if they are over $189 in 2014 but under in 2015, they will pay the super-onerous (something like an extra $50 million plus no rebate - which is a shit ton of money) in 2014 but won’t pay in 2015, 2016, 2017 and…I think 2018 as well (I am honestly unsure about whether it is every four years or every five years), but then would need to get under for 2019.

They would then repeat as needed. Essentially, they have to begin staggering their big contracts.

Also, that loathsome May-September pair of Rangers fans from the game the other night that poached the foul ball out of the mouth of the poor kid next to them have been getting excoriated on the national news.

Eh, I’d say it was more July-September.