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  1. No offense Alex, but I stopped reading right here:

    “But I think a better translation is that the Yankees are tired of all their years of spending stupid money, paying the price through luxury tax and literally watching their dollars be spent by their 29 competitors.

    You might want to look up whether or not that’s actually true, and revise your article as necessary.

    Comment by gonfalon — January 5, 2012 @ 4:51 pm

  2. There’s no link for the IATMS quote.

    Comment by citation — January 5, 2012 @ 4:51 pm

  3. Fixed.

    Comment by Alex Remington — January 5, 2012 @ 4:56 pm

  4. Good point, Gonfalon. I have updated the story accordingly.

    Comment by Alex Remington — January 5, 2012 @ 4:57 pm

  5. “If they truly wanted to save money, they could stop giving massively above-market retirement extensions for Yankee icons in their late 30s, or stop Randy Levine from overpaying relievers.”

    The Empire’s self-inposed austerity started this year; the events to which you refer took place last off-season. While the rest of us knew that both of those moves were foolish – heck, Cashman did too – the front office had not yet decided to cinch the belts.

    Comment by rbt — January 5, 2012 @ 4:57 pm

  6. Unless the Yanks have a DeLorean, they can’t cut the fat the way you’re suggesting. While I’m as surprised as any that they won’t make one- or two-year commitments to players who wouldn’t cost them young talent to acquire, the fact remains that the stupid decisions have already been made, and they can’t unmake them, so they’re reacting by curtailing the spending they can still control.

    Sidebar: Opportunity costs sure are a bitch, aren’t they Dave?

    Comment by Kevin S. — January 5, 2012 @ 4:57 pm

  7. Thanks Alex.

    Comment by Jason @ IIATMS — January 5, 2012 @ 4:57 pm

  8. What do you mean by this? That the Yankees haven’t paid millions in luxury taxes? Or that that money hasn’t gone to fund the operations of the other 29 teams?

    If you’re referring to the fact that a number of low-payroll bottom-dwelling teams have been very profitable and have basically pocketed the revenue sharing money, that doesn’t render Alex’s sentence untrue. And it should make the Yankees even more (not less) frustrated about paying money to their competitors.

    Comment by Yirmiyahu — January 5, 2012 @ 4:58 pm

  9. Wow, thanks for the info. I somehow hadn’t seen this story before.

    So luxury taxes =/= revenue sharing. Good to know.

    Comment by Yirmiyahu — January 5, 2012 @ 5:04 pm

  10. Revenue sharing and luxury tax are not the same thing. Luxury tax payments are not disbursed to the other teams. Revenue sharing shares just that – revenue. The Yankees would have to consciously attempt to make less money if they were pissed about funding the rest of baseball.

    Comment by Kevin S. — January 5, 2012 @ 5:05 pm

  11. I see nothing wrong with what the Yankees are doing this offseason. Yeah, they could use improvements, yeah it’s a tough division, and yeah, they aren’t guaranteed to make the playoffs like in some years past. However, they still have a very good team that hasn’t changed much since last year, and they have a lot of solid high-floor low-ceiling guys waiting in AAA should any of their pitchers inevitably fall apart. I would much rather save up for a Cain or Hamels next year then overspend on a Kuroda or Jackson this year (that being said, I don’t think either of those last two guys would be a bad investment, but if I had to choose between getting one of them this year or wait and get Cain or Hamels better next year, I’m choosing the latter).

    Comment by Matt H — January 5, 2012 @ 5:11 pm

  12. I just think that it isn’t an either/or proposition, especially if Kuroda can be bought for just a year or two. It’s really hard for me to believe that spending $10-$20 million on pitching this offseason will constitute the difference between the Yankees being able to afford Hamels or Cain, and being too poor to do so.

    Comment by Alex Remington — January 5, 2012 @ 5:31 pm

  13. Yeah, but sunk costs are irrelevant. The way to save money is to stop yourself from spending huge amounts of it on stupid contracts, not to stop yourself from spending small amounts of it on defensible contracts.

    Comment by Alex Remington — January 5, 2012 @ 5:33 pm

  14. “If they truly wanted to save money, they could stop giving massively above-market retirement extensions for Yankee icons in their late 30s.”

    Signing Derek Jeter to his latest contract is hardly about his on-field value. In terms of Jeter’s presence in NYC, he has incredible value. Jeter puts butts in seats and makes casual fans gravitate towards the Yankees. You should understand the economics of the game better before taking shots like that.

    The Yankees’ push to get under the luxury tax threshold may be a gimmick. Yankees can afford to add to their payroll while still staying under the luxury tax because several contracts will be off their books by then. Burnett and Jeter’s deals will be up after 2013 and Mariano Rivera’s future is always uncertain. You also have to figure that Rafael Soriano won’t make a ton of sense unless Rivera is gone. The money will be there if the Yankees find the right players for it.

    Comment by hudsonbelinsky — January 5, 2012 @ 5:35 pm

  15. Especially with the addition of a second wild-card, the Yankees may well feel that additional spending would only negligibly increase their odds of making the post-season. And as much as it’s all about the rings in NY, the Steinbrenners may be starting to realize that the MLB playoffs are a crapshoot, and are likely to become more so with the second wild card. So it’s not as if additional spending would significantly increase their WS odds, either. At their position on the win curve, does it really make sense to pay double market value (luxury tax) for a high cost FA? Of course, you could argue that the answer is ‘yes’, but you haven’t done so here and it’s not a terribly easy argument to make.

    Comment by Jordan — January 5, 2012 @ 5:38 pm

  16. That may be a fair point, though I honestly haven’t seen the numbers run for how much money Jeter would generate the Yankees over the next few years compared to what he’ll make.

    I think the Posada deal was a lot harder to justify according to any logic, though. And of course they pretty much kicked Bernie Williams to the curb.

    Comment by Alex Remington — January 5, 2012 @ 5:41 pm

  17. A one year deal for Oswalt or Kuroda only makes sense if they provide you with a substantial upgrade over what you have. I have no doubt that Oswalt can outpitch anyone on the staff other than CC, but his back is a major issue. You could be paying 10 million plus for nothing. Kuroda’s age and the fact that he’s pitched exclusively for the Dodger’s in the NL West are concerns, I’m not convinced that he’s likely to be enough of an up-grade to justify the expenditure. If you make that move and end up with nothing because of injury or poor performance, now you have no financial flexibility down the stretch to make a move. The Yankees have money to spend, the question is whether it’s worthwhile to spend it this off-season on Kuroda, Oswalt or Jackson or have the ability to take on big salaries from out of contention teams at the dead line. Plus the Yankees have three major league ready back end arms that they like in Noesi, Phelps and Warren. Manny Banuelos and Dellin Betances are going to also start the season at AAA. That’s a lot of good young arms a drive away in Scranton. While I think the Yankees would love to have a legit second ace, they don’t want to pay for another 4 or 5 because they already have a lot of pitchers who could fill that roll.

    Comment by Preston — January 5, 2012 @ 5:52 pm

  18. This is true. They won 97 games last year. I’m sure they feel that their line-up will be improved with Montero in the black hole that was DH and hopefully an extra 30 games of A-rod. Their bull-pen was excellent a year ago and even though Robertson might regress a little bit, they’ll hope to get a better year from Soriano (and maybe even a healthy Joba). They accomplished priority one in keeping CC anchoring the staff, so even if the rest of the staff disappoints it’s hard to see this team slipping below 90 wins and not being in contention for the second wild card.

    Comment by Preston — January 5, 2012 @ 6:04 pm

  19. What this really comes down to is how much faith the Yankees have in Noesi, Phelps, Warren, Mitchell, etc. Those guys are next in line (putting aside Betances and Banuelos). If you feel that one or more of those guys is back end ready, then the only reason to spend money on a pitcher is if you’re sure he’s a #2. And frankly, none of the guys available meet that description. The problem is that as teams learn to tie up their young players early, who can you trade for? Or who can you sign as a FA? If the only guys who are available for trade or FA come with a big price tag (either in money or in players), then you’re stuck just developing your own.

    Comment by Greg — January 5, 2012 @ 6:13 pm

  20. Right, except they’ve already spent the sunk costs. It wasn’t “we don’t want to sign Kuroda because of Burnett and company,” it was “we don’t have the money to sign Kuroda.” They’re already backed themselves into that corner.

    Comment by Kevin S. — January 5, 2012 @ 6:14 pm

  21. It’s hard to take seriously the contention that “we don’t have the money to sign Kuroda.” Elsewhere, Randy Levine has said that the team has money, not to mention the fact that we all know that the Yankees are incredibly healthy financially. Their protestations are disingenuous.

    Comment by Alex Remington — January 5, 2012 @ 6:20 pm

  22. //hockey rink article’d

    Comment by Woodrum's UZR Article — January 5, 2012 @ 6:29 pm

  23. “I think a better translation is that the Yankees are tired of all their years of spending stupid money”.

    …stupid money. They have the most valuable franchise in the game, the biggest fan base, they win the most, etc. Perhaps the criterion you are using to determine their stupidity don’t actually apply to the Yankees, given their success.

    Comment by Jason — January 5, 2012 @ 6:42 pm

  24. Wait, I thought the Yankees were exempt from oppotunity cost!

    Comment by Brian S. — January 5, 2012 @ 6:43 pm

  25. Posada was coming off a fantastic year though.

    Comment by William — January 5, 2012 @ 6:47 pm

  26. Exactly. What the Yankees need is a #2, and I’m just not sure that’s available right now. I think the best option out there is Edwin Jackson, but he’s asking for 5 yrs, 60 mil at least, which, though not a bad deal imo, is money that would be better spent in a year on a much better pitcher. Their best course of action, in my opinion, is to wait it out with this team, which is good enough to make the playoffs, then spend big on a #1/2 guy next winter.

    Comment by Matt H — January 5, 2012 @ 6:49 pm

  27. I’m using “stupid money” as a term of art. The definition for “stupid money” that I have in mind is: a sum of money that is far above market value for a player who simply isn’t very good.

    Comment by Alex Remington — January 5, 2012 @ 6:54 pm

  28. haha, your definition of “stupid money” is the same as my definition of “Carl Crawford money”. Here’s an example:

    “Theo signed John Lackey to Carl Crawford money!!!”

    In all seriousness, I understood “stupid money” to mean they would have been much wiser to spend it in different ways or not at all. I think, despite the fact that they clearly have handed out poor contracts, is a tough argument to make given their success. How much more successful can they be?

    Comment by Jason — January 5, 2012 @ 7:04 pm

  29. Aside from Soriano, I don’t they really payed above market price at all in the last few years. Burnett was offered half a mil per year less from Atlanta. Posada got 4 years from the Mets and was off a monster year. A-rod, well, it was Hank, and he’s certainly not under the category of “not very good”. Jeter is Derek fucking Jeter.

    Comment by William — January 5, 2012 @ 7:07 pm

  30. There is an additional impact of being under 189mil in 2014 and that is the impact of the revenue sharing pool. I don’t have a link but I believe it is an estimated loss of ~40mil in the revenue sharing pool if they are over the 189mil threshold (in addition to the tax)

    This doesn’t explain the Yankees shying away from 1-2 year contract (that would expire pre-2014), but I think the loss in the revenue sharing pool is a more significant factor.

    Comment by Joe — January 5, 2012 @ 7:09 pm

  31. It doesn’t matter that Jeter might possibly be “worth” his contract through impossible to measure off-the-field contributions, it matters that the Yankees gave him a contract far larger than was necessary to keep him in NY.

    It’s simply bad economics for a team to pay far more than anyone else would have (in effect bidding against themselves), which I think is more the article’s point.

    As I believe was said by someone in the Yankees FO before they caved last offseason, “Where is he going to go, Cincinatti?”

    Comment by Flharfh — January 5, 2012 @ 8:30 pm

  32. You’re taking an extremely short term view to include Derek Jeter as “overpaid”. Probably the same type view that leads people to conclude the Soriano contract is one of the “worst” ever.

    Comment by Garrett — January 5, 2012 @ 8:32 pm

  33. I think both the Red Sox (who also have spent nothing despite not winning a playoff game since 2008) and Yankees have agreed to reign in spending in return for concessions on revenue sharing. If so, and I am just speculating, this would be a form of collusion, making the luxury tax threshold in effect a hard cap that the MLBPA would never agree to.

    Both teams can easily afford the tax given their enormous revenues. The revenue sharing dollars they shell out dwarf the tax and any significant reductions there would be attractive to both Yankee and Red Sox ownership, perhaps even to the point where they might risk some revenues by fielding a team at risk of missing the playoffs..

    Comment by pft — January 5, 2012 @ 8:54 pm

  34. I actually chuckled at the thought of the NYY trimming down their payroll to 189M:

    In other news, Oprah just needs to lose 10 pesky pounds.

    Comment by CircleChange11 — January 5, 2012 @ 9:47 pm

  35. I have read (sorry no link) that the new CBA provides some incentives for NYY to stay below the luxury threshold $178M, I recall. The incentives include the opportunity to share in the revenue sharing monies that they now pay out.

    Anyone else heard/read this?


    Comment by Kimo — January 5, 2012 @ 9:50 pm

  36. Yeah, but it’s 189 million. It is explained in depth here

    Comment by William — January 5, 2012 @ 11:38 pm

  37. I believe this is more the sons being cheap and looking at the profits. The Boss would hate what they are doing to his team. They raise ticket prices just to make more of a profit. Yankees are headed for a down turn and you will see even more empty seats over the years.

    Comment by Roger — January 6, 2012 @ 12:25 am

  38. Noesi looked good to me but I’ve not seen him enough to make any predictions. For those who follow the Yankees, how does he look? I see FG has his FBV at 93.3 which is not bad at all. His MiLB BB/9 rates were mostly under 2 but his K rate looks pedestrian. Does he project as someone who might contribute as a 5th starter?

    Comment by algionfriddo — January 6, 2012 @ 12:27 am

  39. The Yankees should be looking for the next Colon. Unfortunately, that guy isnt out there. Kuroda is not the guy. Maybe Oswalt (depending on price). Rich Harden would probably be my favorite target (Bedard would have been better).

    As for their top priorities, they should be looking at Cespedes and Soler. Swish is gone and if they want to get under the luxury tax, I dont see how they sign both Granderson and Cano for $18M+ next year. (honestly, I dont see how they get under the tax until Jeter and ARod are done, but that’s me). If they want to be under the tax long term it is all about quality youth. Cespedes wont be cheap but if he is as good as the scouting a video implies, he will still be a bargain at $8M per.

    Comment by Socrates — January 6, 2012 @ 1:30 am

  40. I think the whole overpaying players for time served is a ridiculous concept. For a team to reward a guy for years of good play and a term of service to be rewarded with one final big payday. Now I didn’t do hours and hours of research on this but just looked up 2 key guys that played their entire career with one organization, and are HOF’ers. I looked at Mantle and Musial both were rewarded for service rendered at the tail ends of both of their careers. In 1966(basically the beginning of the downfall) Mantle made 100,000, the MLB avg was a little over 19,000. Musial in 1959 (same basis as Mantle) made a reported 100,000, the mlb average was only 11,000. So the precedence to overpay players has been set and is part of baseball as fan’s want to see players period and it makes more sense for a team to keep an icon than get lambasted for letting him leave. Jeter only made 5 1/2 times the league avg. Where as players back in the day were making 8 times as there fellow players.

    Comment by Rob — January 6, 2012 @ 2:32 am

  41. Keep in mind that while this is still the NY Yankees, and the team is still owned by a family named Steinbrenner, and their GM is still Brian Cashman, and their SS is still Derek Jeter, and their closer is still Mariano Rivera, it is nevertheless not quite the same NY Yankees baseball fans have known for past generation.

    The current Steinbrenner running the Yankees is named Hal, not George, and Hal has a masters in business and is known as a financial person who built Steinbrenner Hotel Properties into a growing and profitable organization, and was the man his father picked to oversee the construction of the new Yankee Stadium (can we finally drop new?) turning it into a cash-generating machine. He has his department heads submit budgets, which he expects them to meet. They do long-range planning, something the team was not known for under George. To him, the Yankees are a business; to George, the Yankees were a passion.

    Hal and company really started running the team in 2008, before MLB officially approved the transition to the new Steinbrenners heading into 2009. This is important, because since 2008 the Yankees really have operated differently, even though it may not appear that way to those outside of New York. They did not pursue Johan Santana, concerned that his shoulder would not hold up and not happy they’d have to pay the price in rookies (Hughes, Cabrera, etc.) and money. They instead opted to keep their prospects and targeted a pitcher they thought would be a better bet in Sabathia the following year. This never would have happened under George.

    They will still spend money, as we saw with the signings of Sabathia, Burnett and Teixeira heading into the 2009 season, but they seem way less inclined to go after the Pavano, Wright and Igawa type of free agents, or at least at the prices the market is asking. They were certainly going in heavily on Cliff Lee, and I expect they will go heavy after a Cain or a Hamels if they make it to market.

    As George’s influence began to wane in the mid-2000s, the Yankees have shown a greater willingness to incorporate rookies, including Cano, Wang, Gardner, Robertson, Chamberlain, Nova and Noesi. Cashman has taken a barren farm system and built it into what now rated as a top five or top six system over the past five years. These are things, once again, that did not happen under George. I point it out because it becomes clearer that these Yankees will still spend, but they are operating much differently than the George Steinbrenner Yankees, and I have no doubt that Hal Steinbrenner is looking for ways to decrease the Yankees payroll by about 13% by 2014 because that will mean about $50 million dollars a year to the Yankees.

    I’m sure Hal Steinbrenner thinks there should be no reason the Yankees can’t keep fielding competitve teams with a $189 million payroll, and make more money in the process. And you know what? I think he’s right. We’re seeing the off season how they are operating differently, yet they’ve been heading this way for a few years. It just seems to becoming clearer to the rest of the baseball world.

    Comment by RobM — January 6, 2012 @ 3:57 am

  42. There are a lot of empty expensive seats in the bronx. Isnt is as simple as the insane contracts dont really sell tickets? Jeter does not “put butts in seats”. Winning does.

    Comment by Eric — January 6, 2012 @ 7:48 am

  43. Thank you for articulating that RobM. You are absolutely correct at a team that is run differently. I think that we can compete at $189M but I am a little concerned that it is unlikely to happen with ARod and Jeter are on the roster.

    I worry that smart long term planning is being sacrificed to get under $189M. Why is 2014 our target year? Why not wait till the legacy contracts are complete (ARod, Jeter, Mo). Is it really possible to cut payroll next season AND resign Granderson and Cano? Cano is a must because the replacements at 2B are a huge drop off. But if we are honestly trying to get under the tax, Granderson is probably a luxury that we cannot afford. That will disappoint a lot of Yankee fans (including me).

    It seems to me that the better long term plan to get under the luxury tax and keep fielding top talent teams is not set an artificial date on payroll reductions, but to make prudent baseball decisions.

    Soriano is done after ’13. Jeter if resigned will see another decrease in salary (say we save $5M). Burnett is done. Swisher is probably done after 2012.

    First lets lock up Granderson and Cano. Second, lets sign Cespeded to 6/$54M, and third lets lock up Hamels or Grienke (he is over his head problems).

    Next ARod’s contract winds down and is done in 2017. Before that Tex and CC will be done. As important contributors as these guys are, they are the ones that will get us under the tax. Bichette replaced ARod, Tex is replaced by Montero, and CC is replaced by signing Strasburg (:.

    Comment by Socrates — January 6, 2012 @ 8:58 am

  44. I think cain’s high flyball rate and huge FIP/ERA gap would really disagree with signing him. Normal flyouts are home runs in yankee stadium, smashed balls are caught in San Fran.

    Comment by Antonio Bananas — January 6, 2012 @ 9:09 am

  45. You can’t look at 20 million for the Yankees as the same thing as 20 million for most other teams though. It IS okay for the Yankees to spend more than other teams because they play in a larger market, so each dollar spent can conceivably create more money in return. Say a player gains interest from 5% of the population in your city. 5% of the people in new york > 5% of any other big league city.

    Comment by Antonio Bananas — January 6, 2012 @ 9:12 am

  46. The beauty of the second wild card is that it actually rewards you for being good. The playoffs may be a crapshoot, but now if you are a wild card team, you have to go through a coin toss first before you can even get into the crapshoot. I think it’d be smarter to make sure you have a 100 win team to avoid the “coin toss”.

    Comment by Antonio Bananas — January 6, 2012 @ 9:13 am

  47. “they raise ticket prices to make even more of a profit” no, people pay higher prices. If all it took was raising prices to make more money, candy bars would cost 1,000 dollars. It doesn’t work that way. You don’t just raise prices and BOOM, more profit. If people are willing to pay then what’s the big deal? If they aren’t willing to pay, then profit doesn’t go up. If they raised prices and people paid it, then they simply made a good business decision, nothing dastardly about that.

    Comment by Antonio Bananas — January 6, 2012 @ 9:18 am

  48. Rob, you can’t really use how much more players get paid than other players as a measure because there were more artificial barriers back then for player pay. Free agency either wasn’t around or was in it’s infant stage. Now player pay in general is higher because players have more rights. Comparing the price (salary) of players from the 60s to today is kinda like comparing the price of bread in the US and Soviet Russia.

    Comment by Antonio Bananas — January 6, 2012 @ 9:21 am

  49. I’ve written a lot about this issue on my blog, but your argument ignores the possibility that the Yankees may not think the available pitchers are actually worth the money. In my estimation, the Yankees are not pinching pennies as much as refusing to throw good money after bad.

    Comment by Will — January 6, 2012 @ 9:23 am

  50. How many more butts is 107 wins going to put in the seats as opposed to 97? Especially since it’s hard to tell as the season goes on since baseball is such a streaky sport? The tickets are likely a pricing issue. The Yankees should always be an upper tier, world series/playoff contender type of team. That’s what sells, each individual win doesn’t add X amount of people. It’s not a smooth slope. A lot is based on the previous years’ performance and the upcoming expectations. If you have super expensive seats, none of that matters. Yankee stadium is practically a tourist attraction, the Yankees are a guarantee playoff contender, the problem isn’t in the players.

    Comment by Antonio Bananas — January 6, 2012 @ 9:26 am

  51. I think it could be one of two things (or some of both)…

    1. Hank has previously stated that he wants to see the Yankees keep and develop their young pitching. Signing over priced starters would hinder some of those young arms from getting innings at the big league level.

    2. Hank also despises supplementing revenue to teams like Tampa Bay under the current revenue sharing agreement. I do remember he had a couple funny one-liners to the media in the past about this. Why would he want to pay a luxury tax if that means helping the competition?

    Maybe I’m giving Hank too much credit here. These are just theories in my mind this morning…

    Comment by Mike B. — January 6, 2012 @ 9:27 am

  52. I agree. Anyone know what kind of stocks Hal likes to invest in? I’m guessing high risk isn’t his thing. Pitchers get hurt and only play 1/5 games only play in about 2/3 of those games. Plus their production has so much variance. I bet Hal figures to “shotgun” (throw a lot at a target) his rotation after CC and hope a handful stick.

    Comment by Antonio Bananas — January 6, 2012 @ 9:28 am

  53. I always thought the luxury tax went into the revenue sharing pot. Good to know.

    Comment by Shane — January 6, 2012 @ 9:33 am

  54. You should know better than to quote anything Wallace Matthews says. He has no sources.

    Comment by Tom B — January 6, 2012 @ 9:49 am

  55. It’s hard to know whether they’re worth the money when you’re refusing to even meet with a guy like C.J. Wilson. Obviously WIlson is worth something. Why won’t they even consider him?

    Comment by Alex Remington — January 6, 2012 @ 9:56 am

  56. I am pretty sure the Yankees had a very strong idea about what Wilson would command. Meeting with him would have been nothing more than a formality if their interest didn’t rise to that level.

    Comment by Will — January 6, 2012 @ 10:03 am

  57. He actually reminds me a lot of Nova, just with better K/BB rates.

    Comment by j — January 6, 2012 @ 10:07 am

  58. Actually, no one had an idea of what Wilson would command, because he took far less than market value to go home to Southern California and play on the same team as Albert Pujols. The point is, there undoubtedly are pitchers on the market who would be worth the amount of money it will take to sign them. But the Yankees simply haven’t done anything. They seem opposed to the idea of spending money, rather than just the idea of spending it foolishly.

    Comment by Alex Remington — January 6, 2012 @ 10:08 am

  59. Most of the stories I’m reading indicate that it’s Hal, not Hank, who’s been calling the shots on the fiscal austerity plan.

    Comment by Alex Remington — January 6, 2012 @ 10:08 am

  60. This is what companies do when they are getting ready to sell: try to look/be as profitable as possible on paper. This is not saying that the Steinbrenners are selling the Yankees today, or tomorrow, but they may be enacting a plan to do so within the next two to three years. Remember, there are four members of the family who are owners; Hal is heavily involved but the other three, only tangentially. They just may be asking for the asset to be liquidated. And really, by his own admission, Hal “has never been a baseball guy.” And one could imagine that with the new stadium and other assets, this team could sell for in excess of $1.7 billion or so in the next few years. Food for thought.

    Comment by Nando — January 6, 2012 @ 10:14 am

  61. I am not sure that helps your point. If Wilson took a “discount”, that only means the price would have been higher for the Yankees. Besides, I am not sure why you think the Yankees didn’t meet with him. There are articles stating that Cashman did speak to his agent. If those initial conversations were prohibitive, there would have been no reason to have a meeting.

    It’s very hard to argue that the Yankees don’t want to spend money, especially when you can make a strong case against every free agent contract handed out to a pitcher this off season.

    Comment by Will — January 6, 2012 @ 10:34 am

  62. I doubt the Steinbrenners are looking to sell, but even if they were, it wouldn’t make sense to “pinch pennies” if they thought spending would really make the team better. A payroll that is $10 million less would do little to enhance franchise value, so it would make more sense to do everything possible to ensure the team is still winning when it came time to sell.

    Comment by Will — January 6, 2012 @ 10:37 am

  63. I think that the Yankees didn’t meet with him because that’s what Tyler Kepner reported: “The most telling moment of the Yankees’ off-season was when they simply said no to C. J. Wilson. Here was the No. 1 starter for the Texas Rangers, the two-time defending American League champions. He wanted to come to New York for a visit, and the Yankees would not even extend an invitation.”

    Comment by Alex Remington — January 6, 2012 @ 11:08 am

  64. He was coming off the best year of his career at age 35. That screams “fluke.” Catchers are notorious for aging poorly, and Posada was coming off a season in which he had a .386 BABIP. Every sign was pointing toward a major regression. As it happened, while his offense tailed off, he was still decently effective in 2008-2010 — he just missed a bunch of games. Of course, that’s what old catchers tend to do.

    Comment by Alex Remington — January 6, 2012 @ 11:27 am

  65. Don’t forget, Noesi was mostly a reliever last year, and studies have shown that pitchers typically gain velocity in the pen.

    Comment by Alex Remington — January 6, 2012 @ 11:29 am

  66. Well, the Alfonso Soriano contract IS one of the worst ever. I know you’re talking about Rafael — but when people talk about awful Soriano contracts, Rafael can’t hold a candle to Alfonso.

    Comment by Alex Remington — January 6, 2012 @ 11:30 am

  67. Eh, yes and no. The second wild card does place more of a premium on winning your division, but the Yanks would have to spend closer to 40mm than 10mm to lock up the AL East. Realistically, the 4 best teams in the AL will once again include 3 teams from the AL East.

    Comment by Jordan — January 6, 2012 @ 11:44 am

  68. Well Yankee fans don’t like these pay raises because if you’ve been to a playoff game at NYS it sucks because they have turned Stadium seats into what amounts to a giffen good. Many people at those games are not Yankee die hards, but bandwagon folks who buy out passionate supporters. This most recent incarnation of Yankee Stadium is a quite, wealthy playground, not a sports stadium.

    Comment by Cliff Lee's Changeup — January 6, 2012 @ 11:50 am

  69. The refers to a physical meeting. However, it’s also true that Cashman talked to his agent, which seems more relevant. Presumably, from those conversations, parameters would have set from which to determine interest. I am not sure why so many people hard to believe that the Yankees didn’t want to give a big contract to 31 year old lefty with two full seasons as a starter under his belt, but concluding the team doesn’t want to spend money anymore seems to ignore so many other rational explanations.

    Comment by Will — January 6, 2012 @ 12:04 pm

  70. Personally, I love what the Yankees are doing. With the extra wild car team, the Yankees as currently constructed are good enough to make the playoffs, when anything can happen. Meanwhile, Cashman is focusing on getting younger, improving an already strong farm system, and getting under the salary cap. You are right about 2014, when both Burnett and Soriano come off the books. There’s nothing they can do about the A-Rod, Tex, or Jeter contracts, so the best way to deal with that is to spend wisely going forward.

    I’m still not convinced the Yankees won’t bring in Kuroda or Oswalt on short-term deals, but they were absolutely right to avoid giving CJ Wilson a long-term deal. They don’t need another player on the wrong side of 30 signed well past his prime.

    Cashman’s doing a fine job balancing present vs. future needs and transitioning the Yankees.

    Comment by Ben — January 6, 2012 @ 12:56 pm

  71. So I don’t think his anything to do with an overreaction or with buyer’s remorse. This has to do with pursuing the most prudent strategy going forward. Let’s not make any conclusions about Kuroda, Oswalt, or other short-term deals just yet, because the Yankees still may be in on this. But avoiding long-term deals for the over-30 crop of free agents available in this market was a smart decision, regardless of what the Yankees have done in the past.

    Comment by Ben — January 6, 2012 @ 1:00 pm

  72. Finally, for those that say they can’t afford Granderson and Cano and stay under the luxury tax, you are incorrect. The expiring contracts of Burnett, Soriano, and Swisher alone adds up to over 40 million in savings. Furthermore, A-Rod’s salary goes down from 30 mil to 21 mil, netting an additional nine million in savings, Rivera is unlikely to play that long, netting another 15 mil in savings, and Jeter is probably done after 2014, good for another 17 mil in savings. With the Yankees’ farm as strong as it is, and many of these guys not producing much anyway, the Yanks can stay at the same level of play, extend both Cano and Granderson, and get under the luxury tax threshold within the next two years. Impatient Yankee fans will be calling for Cashman’s head throughout this period, but his plan of action is the right one going forward.

    Comment by Ben — January 6, 2012 @ 1:14 pm

  73. No. I’m talking about Alfonso. And it isn’t. Try to set up some sort of constraints for your theory (100m+, long term position, etc) and see where it ranks. Its a common cry of the uneducated, but there are significantly worse contracts and its not close.

    I’ll give you a hint on evaluating contracts. MVP-level performance in Y1 coupled with allstar performance in Y2 makes it very difficult for a contract to be among the worst ever. That is… Unless you want to make a top 10 out of a pool of 30. In which case, then I guess you’d be correct in some bizarre way.

    Comment by Garrett — January 6, 2012 @ 2:27 pm

  74. So aside from Soriano, Jeter, ARod, Burnett, and Posada, they haven’t drastically overspent on any players. Got it.

    Comment by JohnnyComeLately — January 6, 2012 @ 2:27 pm

  75. I also seem to remember seeing A BUNCH of empty seats right behind home plate the last couple of years. You know, those $5K/game seats or whatever ridiculous amount they were/are charging.

    Comment by JohnnyComeLately — January 6, 2012 @ 2:31 pm

  76. I personally don’t think the Yankees “drastically” overspent money on Burnett or Posada. The Burnett contract, at the time, was completely defensible. The Yankees had a glaring need for a #2 starter. The big question was his health. Posada’s deal was fine until the very last year. That’s something the Yankees of all teams can deal with.

    Comment by Frank — January 6, 2012 @ 4:15 pm

  77. if by “huge” you mean a third of a run over his career and shrinking for the past 3 years in a row, then okay, it’s “huge.” also you’re looking at the very superficial things about cain, but cain’s true talent is in the IFFB. also a new york defense with gardner/granderson/someone is theoretically better than most anything the giants have been running out, with the exception of 2010 andres torres

    Comment by jim — January 6, 2012 @ 4:23 pm

  78. Agreed. It’s good that the Yanks aren’t spending money for the sake of spending money. There is also still a month left in the offseason. I’m not worried about the Yanks making moves, nor am I worried about the Yanks not competing.

    Comment by raf — January 6, 2012 @ 6:34 pm

  79. To the former, it should be noted that the Yanks acquired Chuck Knoblauch, Roger Clemens and Alex Rodriguez in February 1998, 1999 & 2004 respectively.

    Comment by raf — January 6, 2012 @ 6:44 pm

  80. He needs a better second pitch. He throws hard and seems reasonably unfazed and composed. But he seemed incomplete from what I saw.

    Comment by dan — January 6, 2012 @ 11:20 pm

  81. Mike Axisa recently did a post over at River Ave Blues reminding us that the other guys available for the Yankee money that year were Lowe and Sheets. Given that context, Burnett seems like a BRILLIANT move. If you asked everyone what was the smart move at the end of 2009, everyone would agree it was Burnett. If you ask them at the end of 2011, they say…well they say it would have been better to spend no money at all. But then again, who knows if the Yanks win in 2009 without Burnett. And if they held onto their cash, maybe they sign the best pitcher available in 2010. And that was Lackey.

    Comment by dan — January 6, 2012 @ 11:27 pm

  82. He needs to get more time at AAA in order to refine his secondary pitches. In AA scouts said he had an above average change and slider, but he rarely used the change in MLB last year and only threw the slider when he was ahead in counts. But he has an above average fastball, with above average command, so that’s a good start.

    Comment by Preston — January 7, 2012 @ 12:00 pm

  83. Well, no, because getting the payroll below $189M would mean that the Yankees would be making $50M more than they would have if they didn’t. Taking in $50M more a year in revenue makes your business much more valuable.

    Comment by AndrewYF — January 7, 2012 @ 4:40 pm

  84. I see what you’re saying I think. It’s not that the yankees are really doing anything bad from a business perspective, but more of a passion perspective. Well, except for the obvious example fo over charging and no one pays for the seats in the example above.

    Comment by Antonio Bananas — January 9, 2012 @ 12:06 am

  85. I’m not sure the exact numbers, but I know that George’s investment in the Yankees basically kicked ass for him. A ridiculous growth of like 20% over the first 30 years I think. I doubt the Yankees are still growing at 20%, but if someone gave me an option of investing in the stock market, or the new york Yankees, I’d probably say the yankees. What else could the steinbrenners want to put their money in?

    Comment by Antonio Bananas — January 9, 2012 @ 12:14 am

  86. Any guessing on a Phillies-Pedro type of mid season signing? I’m sure Oswalt wouldn’t want to miss a whole season. Then again, I really doubt he’s going to be allowed to go that long.

    Comment by Antonio Bananas — January 9, 2012 @ 12:17 am

  87. There really aren’t empty seats at Yankee Stadium, or a better way of saying it is there really aren’t that many unsold seats at Yankee Stadium. Those high-priced seats are mostly sold, but they are sold to major corporations and rather wealthy individuals, who don’t go to every game, or in many cases are in sitting in the private club that goes with those seats. That area is very profitable.

    Even during the less-than-great economic times of the past few years, Yankee Stadium is running at well over 95% capacity.

    Comment by MikeD — January 9, 2012 @ 4:48 am

  88. In order for Wilson to come play in NY, the Yankees would have had to exceed the Angels offer, and it’s not all that clear he would have come to NY if the Angels made a good offer as they did. It’s a bit unusual for a free agent to request to come to a team, usually it’s the team that does that when they are negotiating a contract. By agreeing to meet with Wilson, it would have created more more interest in Wilson which could be used to increase his price. Even if the Yankees had an interest, it would not have served their interests to actually meet with him in NY, yet that doesn’t mean they didn’t have an interest in Wilson at a certain price. He clearly exceeded that price. The Yankees passed.

    Comment by MikeD — January 9, 2012 @ 4:54 am

  89. I would say that’s correct. Hal is the financial-minded person. In fact, it was Hank who handled the A-Rod negotations, and once it became clear how much the Yankees had overpayed, Hal Steinbrenner’s rise was complete. We don’t hear about Hank that much anymore. He’s one of the owners, but he is not the one running the team.

    Comment by MikeD — January 9, 2012 @ 4:57 am

  90. I don’t think I’m explaining myself well. I don’t necessarily think that the Yankees should have signed Wilson. I merely think that their refusal to meet with him is indicative of their unwillingness to spend money on anybody at all.

    Clearly, they could use some pitching. But rather than try to find a good deal, they appear to prefer no deal — rather than spend money wisely, they would prefer not to spend money.

    Comment by Alex Remington — January 9, 2012 @ 8:51 am

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