When Should San Diego Trade Adrian Gonzalez?

While it has generally been assumed that Adrian Gonzalez won’t be in San Diego much longer, the Padres front office confirmed these beliefs with some public comments last week, stating that Gonzalez’s asking price was not something they could afford and suggesting they would listen to trade offers for their star first baseman this winter. The question is no longer whether the team will trade Gonzalez – it is simply a matter of when. For Jed Hoyer, the biggest decision they will make all winter is whether to start the season with Gonzalez at first base. Should they?

Buster Olney laid out a few reasons for why San Diego should consider keeping Gonzalez on his blog last week. The main points: Gonzalez is good for attendance, they have a chance to contend with him on the team in 2011, and they might find a desperate team at the deadline who is willing to overpay to make a final playoff push. These are all valid points to consider in the decision making process. But even factoring those things in, I think the Padres should deal Gonzalez this winter, assuming they get a fair offer.

Gonzalez is one of the game’s most valuable assets over the next 12 months, offering a combination of elite performance and a laughably low salary. If we estimate that he’s a +5 win player, and that the going rate for players of his ability is around $5 million per win, one season of Gonzalez is worth about $25 million or so. He’ll actually earn $5.8 million in 2011 before he hits free agency, where he’ll qualify as a Type A free agent. The additional value of the compensatory draft picks would add another $6 to $8 million in value, so having Gonzalez around for one year is a savings of $25 million or so.

In real terms, there’s probably additional value to some franchises who aren’t capable of taking on a high salaried star, or taking the long term risk that comes from signing one as a free agent. For those teams, trading for Gonzalez represents one of the only real options they have to add a star player. You could make a good argument that a team like Tampa Bay should be willing to pay a premium for Gonzalez above and beyond the difference between his market value and his actual salary.

In other words, the Padres are sitting on a goldmine. They should be able to do very, very well when they trade Gonzalez. Even as just a one year rental, they should be able to command either an elite prospect or a couple of quality young major league players. There will be teams willing to sacrifice something in the neighborhood of $30 million in value to acquire a full year of Gonzalez’s services.

Keeping Gonzalez represents a pretty significant risk. For one, his performance could suffer next year, driving down his value around the league. 18 position players had at least +10 WAR between 2008 and 2009, representing the best players in the game. As a group, they averaged 5.69 WAR per 600 PA in those two seasons. In 2010, those same players averaged just 4.36 WAR. Injuries derailed the likes of Dustin Pedroia, Kevin Youkilis, Chase Utley, and Chipper Jones, while players like Mark Teixeira, Lance Berkman, and Alex Rodriguez simply weren’t as good as they had been in prior seasons.

Gonzalez is a terrific player in his prime, but those players still struggle from time to time, and they also get hurt. Either of those scenarios coming to pass in the first half of 2011 would significantly damage what the Padres would be able to get for Gonzalez at the trade deadline. In a worst case scenario, an injury could put him on the DL during July, essentially shutting down the summer market for Gonzalez entirely.

Even if we assume there is only a 10 percent chance that Gonzalez lands on the DL, and maybe another 10 percent chance that he fails to hit like he has the past two seasons, that’s still a 1 in 5 shot at a significantly reduced asset. This does not even account for the reduction in amount of games Gonzalez would be able to play for his new team, nor does it take into consideration a potential repeat of 2010, where the Padres choose to keep Gonzalez for a playoff run that may not pan out.

Could they extract a little bit more value out of a desperate team at the trade deadline than they might be able to get this winter? Perhaps, if everything falls exactly right – Gonzalez stays healthy, plays well, the Padres fall out of contention, and the right contender needs a first baseman to put them over the top. That is, however, an awful lot of ifs for a marginally better outcome.

If the Padres can trade Gonzalez for something approaching $30 million in value this winter, they should say yes. The risks of keeping him outweigh the potential benefits for a team in San Diego’s position. The theoretical maximum return would probably come from a July trade, but the risk associated with attempting to get the best possible deal simply isn’t worth it. Take 95 percent of the best possible outcome now and let someone else absorb the risk that comes from having that much value tied into one player. The Padres aren’t the kind of franchise that can afford to have their most valuable asset wiped out with one bad break.



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Dave is the Managing Editor of FanGraphs.


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Forrest Gumption
Member
Forrest Gumption
5 years 8 months ago

Has it been discussed why San Diego, who ranked 27th in payroll last season, is not willing to pay him whatever he wants? Are they in financial disarray? You would think profit sharing alone would cover Adrian.

Also: Isn’t MLB trying to prevent teams from doing this because its abusing profit sharing? Wasn’t there talk last year that they had been keeping an eye on the Marlins and A’s to make sure they were spending the shared money adequately?

For a team that won 90 games last year and didn’t spend a dime, this doesn’t reflect well on them, no matter what value Adrian has on the trade market.

Zach
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Zach
5 years 8 months ago

The Padres’ current ownership group still only owns about half the franchise, with former owner Moores still accounting for the other half. They still have to finish buying him out, which will take some years.

Moreover, they have a massive amount of stadium debt on Petco Park, and a crappy TV deal. They simply don’t have the financial resources for a payroll much greater than $40 million, and have one player account for 50% of that amount is just foolhardy.

James
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James
5 years 8 months ago

They should have the resources, but they probably want to turn a profit (like Pittsburgh). I don’t think there is enough external pressure to force them into winning now, and they can get away with a low payroll (like the Chargers) without financial consequences (see again, Pittsburgh).

The TV deal should be up soon (maybe 1 year left) – they could get creative and do something like Texas or LA Dodgers are trying to do by lining up that contract to get an influx of cash now to pay salaries/divorce attorneys.

The best way to make money in MLB is by cutting costs, and the best way to cut costs is MLB-player salaries/payroll. That’s why the owners engaged in collusion, and that’s why MLB is concerned about the financial document leaks.

Adam
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Adam
5 years 8 months ago

Zach, that sounds about right. Why MLB let the current ownership buy the Padres essentially on lay-away is beyond me. That purchase deal pretty much screws the Padres for years.

Mike Savino
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Mike Savino
5 years 8 months ago

Because, my friend Zach, the payroll will probably not approach $100 million even at its peak.

It would be foolish to tie up 25-30% of payroll on one player no matter how good he is for the next 7-10 years. Eventually he won’t perform.

I’m a Padres fan and I’d much rather watch the Red Sox/Yankees over pay Gonzalez during his age 39 seasons than have future seasons absolutely killed by an albatross contract. No matter how much I love Adrian, I can’t root for that.

The Padres maybe should keep him–the free agent class this year offers enough supplemental pieces that there may be a very realistic chance for the Padres to win the division. But they should up their payroll to the $70 MM range with other parts (Middle infielder? Outfield help?) and try their luck. Not up their payroll to $70 MM by spending it all on Adrian.

TL
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TL
5 years 8 months ago

As a Yankee fan I’d love to see him in pinstripes for 7 years and even worse I’d hate to see him in Beantown for that time. He’s going to be 29 next season. Assuming a team who traded for him in the offseason would sign him before the season, that would make him 35 at the end of a 7 year contract. That’s 4 or 5 very good seasons before he would begin to decline. And even 80% of his current production is still a good starter.

In any case, it’s a shame that SD can’t sign him. They’ve been bad for awhile. It would be nice for them to turn the corner and put together a few fun winning seasons in a row.

B N
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B N
5 years 8 months ago

“Gonzalez is a terrific player in his prime, but those players still struggle from time to time.”

On the other hand though, Gonzalez could perform better than his last two years and put up 6 WAR rather than 5 WAR. Many of the players listed are really in the decline of their careers: Chipper, Arod, and Berkman are not guys you can bank on for 5 wins in my book, nor were they guys you’d necessarily expect that out of starting the season. While definitely it’s easier to go down than go up from 5 WAR, Gonzalez has no obvious red flags so I would have to think he’s equally likely to improve rather than decline.

Plus, for guys who got injured you’re still getting more performance per game. It’s not like they go on the DL and nobody replaces them. If you get 4 WAR out of Gonzalez over 130 games, most competitive teams will still be able to put up 0.5 WAR over the remainder of the season from that position.

Hodgie
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Hodgie
5 years 8 months ago

Is that actually the case though? Is it really customary for even the most competitive teams to have what would be the equivalent of a 2.5-3 WAR player just sitting around to provide that 0.5 WAR over 30 games? I ask in all seriousness as that seems at least to me a bench luxury that most teams would not have access to.

Bigmouth
Guest
5 years 8 months ago

That’s a fair point, B N, but I suspect the probability of his declining by more than 1WAR is probably higher than the probability of his improving by 1WAR or more.

JH
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JH
5 years 8 months ago

What about the value of making the playoffs, Dave? If the team gets back ~30 million in major league ready value, I’m for it. But if we’re talking about top prospects who need more seasoning, it seems pretty cynical for a team with a legitimate shot at the postseason to punt 2011.

Bryant
Guest
5 years 8 months ago

This depends on whether or not the front office believes they are actually legitimate contenders in the NL next season. Hoyer’s recent comments regarding a pretty significant roster overhaul to ensure repeat success implies that another 90-win season might not be easily repeated.

Regardless, the current front office believes that Adrian is a major piece of their 2011 team; but they need to consider how dealing him might result in several key pieces for their future beyond next season. They can’t simply live for next season, not with the current ownership buyout still ongoing.

JH
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JH
5 years 8 months ago

In the NL West, a team has to be a pretty big disaster to write off contention before the offseason even starts.

Bryant
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5 years 8 months ago

Contention in the NL West, sure. Contention in the NL and in the playoffs is another story.

Los
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Los
5 years 8 months ago

Didn’t a team from the NL West just win the world series?

Jason B
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Jason B
5 years 8 months ago

Agreed w/ Los. If you can contend and maybe even just eke into the playoffs, you can contend for a pennant and a World Series. In a five-game or seven-game series, anything can happen.

wat
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wat
5 years 8 months ago

Impossible. You must mean the AL East.

quincy0191
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quincy0191
5 years 8 months ago

The first-place, World Champion Giants had the second-best record in the NL while playing in the NL West. The Dodgers, who were good enough to be picked by many to win the NL West, finished in 4th place with a record of 80-82. That’s the second best 4th place record (1st is the Blue Jays at 85-77). The last-place Diamondbacks had a pretty good rotation, a very good lineup, and failed due to bullpen trouble. Four teams were competing for the playoffs last year, and all four will likely be competing for a playoff spot this year.

The NL West is a very tight division, mostly because it’s pretty damned good. Probably the second best division in baseball; the NL Central, AL West, and AL Central are easily worse, and the NL East might give the West a run for its money, but they only had two teams above .500, as opposed to three for the West.

Eric M. Van
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Eric M. Van
5 years 8 months ago

In case anyone else was on vacation and is reading this days late …. actually, the NL West was the 4th best division in baseball in terms of schedule-adjusted winning percentage, but were just edged by the AL Central for second by schedule-adjusted Equivalent RS / RA (including 10% of the differential to win %). That’s with proper schedule adjustments rather than BP’s.

Adjusted Win %, Adjusted 90% stats + 10% Win %
AL East .563, .562
AL Central .506, .507
NL East .503, .499
NL West .498, .506
AL West .495, .500
NL Central .446, .439

Zach
Guest
Zach
5 years 8 months ago

I tend to think that unless they get blown away by an offer this winter, they’ll start the season with him and see where things go. Flags fly forever and the fanbase is desperate for some kind of success. If they find themselves in good position come July, I’d expect them to hang on to Adrian and go for it again, and settle for draft picks when he signs elsewhere.

Bryant
Guest
5 years 8 months ago

The Padres are in the middle of a five-year buyout of the team and salary is, unfortunately, impacted negatively by this. However, Adrian wants something around $22m a season (an issue that was confirmed by his agent) and to think that the Padres – a small market team who simply cannot afford to pay that much for ONE player – it makes much more sense to plug some holes in their roster by dealing him now.

Revenue sharing could certainly help the Padres sign Gonzalez, but that ignores that they have to field 24 other players around him. There are, possibly, 5-6 teams in all of MLB that can afford the kind of contract he’s asking for and still field a competitive roster around him – San Diego is not and will not ever be that team due to the financial disparity that exists in the league.

Bryant
Guest
5 years 8 months ago

As a side note, I think it should be noted that Gonzalez’s recent shoulder surgery might possibly impact trade talks this winter. While I tend to agree that a deal this winter is a much better bet at maximizing return value, who’s to say that teams might balk at investing in a guy coming off surgery?

Just a thought.

Travis
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Travis
5 years 8 months ago

I think this could lower the number of prospective suitors (some GMs, and some team-situations, are more risk averse). Indirectly that will bring his price down, at least in theory. In reality, all it would take is a couple of GMs to decide that the surgery is a minor matter, and to bid against each other.

WY
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WY
5 years 8 months ago

“In real terms, there’s probably additional value to some franchises who aren’t capable of taking on a high salaried star, or taking the long term risk that comes from signing one as a free agent. For those teams, trading for Gonzalez represents one of the only real options they have to add a star player.”

Yet you could argue that the Padres themselves are one of those teams. They aren’t capable of taking on a high-salaried star. If they plan on trying to contend, then that $20 million of surplus value in performance — plus the $6 or $8 M in draft-pick value — is something they themselves could benefit from.

In other words, I don’t see what makes the Padres’ situation all that different from a supposed small-market suitor like the Rays. I feel like it would have to be a big-market team that plans on signing him to an extension as a condition of making the deal (which could include renegotiating his salary for the upcoming season).

Judy
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Judy
5 years 8 months ago

The Rays appear to have a much larger collection of surplus talent than the Padres.

WY
Guest
WY
5 years 8 months ago

That is a good point. I guess that’s the one big difference. Although I do wonder how inclined they are to part with a significant amount of talent for a one-year rental, given their own payroll constraints. They may be willing — I don’t know.

Brad Johnson
Member
Member
5 years 8 months ago

I’m very doubtful that the Rays are willing to deal a clutch of prospects for a rental player. It will be interesting to follow. If they do deal prospects, be sure that they will be players the Rays don’t believe will be stars or cost effective.

Keep an eye out for a 3 team deal that sends Shields/Garza in another direction.

Bigmouth
Guest
5 years 8 months ago

Good point, WY.

Sean D
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Sean D
5 years 8 months ago

The article talks about the idea that Adrian Gonzalez may get hurt and that would decrease his trade value. However, he’s already hurt and underwent shoulder surgery in the offseason. Doesn’t that already decrease his trade value? Wouldn’t teams be willing to offer more once they’ve seen that he’s recovered from the injury?

Bryant
Guest
5 years 8 months ago

I brought that up above and while the procedure was considered “minor,” that’s definitely a discussion point that went unmentioned in the article. Another way to look at it is the potential for increased injury risk during next season, which could negatively impact his trade value even more than now.

Personally, I see Gonzalez as a ticking time bomb with his body type and the amount of playing time he gets, ala Teixeira.

Jacob
Guest
Jacob
5 years 8 months ago

He wants something comparable to Howard’s (5Yrs/$125M) & Teixeira’s ($8Yrs/$180M) contracts. The Padres payroll briefly peaked at around $75M in 2008, which I think is about as high as the team will ever go.

Since moving to Petco, the payroll has averaged about $65M. For 2010, it was around $40M. Paying Gonzalez would add about $20M & pretty much kill the team’s financial flexibility. Something like 7Yrs/$100M could work, but he wants more.

I guess signing him wouldn’t be so bad for the Padres, if it was guaranteed that he would continue to perform like he has the last few years. But, of course, there is no guarantee. If he gets injured, the Padres would be screwed. I think it’s too risky to sign him. They should be able to get a nice haul in a trade. It’s a shame because San Diego is his hometown.

Eric E
Guest
5 years 8 months ago

Let us not forget that the former front office of the Padres locked up Jake Peavy to a long-term deal in the ballpark of $13 mil/season and realized that amount of money was too much to invest in a single ballplayer. He was dealt to the White Sox and the following year the team won 90 games. If we take some time to predict which teams would actually have a realistic chance (and need, no less) for a 1B of Adrián’s caliber, it becomes evident that the potential talent-level return the Padres could receive would far outweigh the benefit of retaining Adrián for one more season. I am all for dealing him this winter if Jed gets the right offer. The low payroll issue has nothing to do with illegitimate use of revenue-sharing, etc., it has everything to do with realism and understanding that our city’s major league baseball team will NEVER be able to take on the risk that comes along with putting all the eggs in the basket of one player; the first world series championship will be brought to San Diego by building through the draft and avoiding bad contracts. The Padres are not the Chicago Cubs.

Adrián Gonzalez will be more than missed in San Diego, but all good things inevitable come to an end. At least we will still have Tony Gwynn, Jr.’s CF defense to look forward to.

Scott T
Guest
5 years 8 months ago

I agree. I think the Padres have done a great job over the last 4 years of ridding themselves of bad contracts and investing in young players through trades and drafts.

Jeff Wise
Guest
5 years 8 months ago

What in the world would they do to replace his home runs and rbi’s if they traded him? The Padres would probably only trade him because of the financials. He’s going to cost too much and they could probably get a few high quality prospects for cheap.

Rocky B
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Rocky B
5 years 8 months ago

AAADDDRRRIIIAAANNN!!!!

Elaine Benes
Guest
Elaine Benes
5 years 8 months ago

SSTTTEEELLLLLLAAAAAAA!!!!

Nathaniel Dawson
Member
Nathaniel Dawson
5 years 8 months ago

KAAAAAAAAAAAAHHHHHNNNNNNN!!!!!!

George Costanza
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George Costanza
5 years 8 months ago

TAAAMMMAAAALLLLEEEE!!!!

Bradsbeard
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Bradsbeard
5 years 8 months ago

Is it safe to assume that there will be no window to negotiate an extension prior to a trade? Over on a Cubs blog, some commenters and I were having a discussion about whether or not there would be one. I am of the opinion that regardless, Gonzalez (and his agent) will not be amenable to an extension in this scenario, but would prefer to test the full market in free agency (rather than limit his negotiating partners to one team). If that’s the case, since the receiving team is only getting at most a year out of Gonzalez, I’m wondering where that puts his trade value?

Some recent deadline deals for expiring contracts netted one big prospect at most (Cliff Lee for Smoak and a throw in, Mark Teixeira for Casey Kotchman (ugh!), CC Sabathia for Matt LaPorata, Matt Holliday for Brett Wallace). The A’s actually gave up a lot more before the season to get Holliday then they got back at the deadline (Carlos Gonzalez, Huston Street + others). It seems like trading teams haven’t been getting outrageous returns on these types of deadline deals. From that standpoint, you’d think the Padres would be better off selling now.

Scott T
Guest
5 years 8 months ago

I think the teams involved in aquiring Adrian will likely want a long term deal. This will impact his trade value during the offseason. However, the impact may be less during the season to a desperate team. There are other variables to consider… an aging team with one last shot might be willing to pay more.

Tom
Guest
Tom
5 years 8 months ago

Why would the Padres get more for Gonzalez now than at the trading deadline? The last superstars that were traded in the off-season were Roy Halladay, Cliff Lee and Johan Santana (although I’m sure I’m leaving someone out). All of them were traded for basically nothing – in fact the return for Lee was higher at the deadline than in the off-season. The Rangers got a ton for Teixeira at the deadline although the Braves dumped him to the Angels for nothing. If you aren’t going to get squat for him in return why in the world would you trade him now instead of at the last minute?

WY
Guest
WY
5 years 8 months ago

“Why would the Padres get more for Gonzalez now than at the trading deadline?”

One reason would be that the team that acquires him gets him for six months instead of two. Although you don’t see the same desperation among certain teams in the offseason that you do in late July.

With Lee, it’s tricky because he was traded three teams — twice midseason and once in the offseason. Although like with Teixeira, he still had an additional season to go with one of those deals.

It’s also hard to compare the returns on these trades because some of the teams (Cleveland, Minnesota) didn’t seem to get as much as they should have for dealing these star players.

Tom
Guest
Tom
5 years 8 months ago

You would think so but with the exception of Holliday (traded for CarGo, Street, and a pitcher) the teams got more return from the deadline deals than the off-season deals. And if Carlos Gonzalez is just a Coors Field mirage (which is certainly possible looking at his splits) than Holliday was traded for very little in the off-season as well.

Hodgie
Guest
Hodgie
5 years 8 months ago

Kyle Drabek (#3 BA Prospect Eastern League), Travis D’Arnaud (#5 BA Prospect Gulf Coast League) and Michael Taylor who became Brett Wallace who became Anthony Gose (#8 BA Prospect Gulf Coast League) would argue with your definition of basically nothing. The Teixeira trade, part one is becoming an anomaly.

pft
Guest
pft
5 years 8 months ago

Well, he is coming off shoulder surgery and while his 2011 salary is low, part of signing him beyond 2011 will likely require them boosting his pay for 2011. Furthermore, the new CBA could well eliminate the compensation pick for the 2012 draft. For teams interested in Adrian, a mid season trade or waiting for him to be a FA would be best.

The argument for the Padres trading him this off season is strong, nobody can say how he will perform next year of if he stays healthy (labrums can be tricky). If the Padres for example made a deal with the Red Sox for Jacoby Ellsbury or Daisuke Matsuzaka and Casey Kelley or Rizzo, that would be a nice package that helps out in 2011 and beyond.

And if Adrian had an off year attributed to a shoulder problem, that would make the GM look good. Of course, a healthy Adrian in Fenway with the RF fences moved in 10 ft might hit 60 HR. Can’t wait to see what he will do in YS3.

Paul S
Guest
Paul S
5 years 8 months ago

Dave – idea for your next post. You can re-write this article, replacing “Jed Hoyer” with “Doug Melvin” and “Adrian Gonzalez” with “Prince Fielder.” Minimal additional edits would be necessary …

Big Jgke
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Big Jgke
5 years 8 months ago

Flags fly forever. Trading him now is loser talk.

Eric M. Van
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Eric M. Van
5 years 8 months ago

An otherwise terrific analysis which leaves out the single most important factor: the long-term value to a franchise of making the post-season. I seem to recall studies which show that such value is huge. In Jed’s case, he has to judge it versus the negative value of apparently punting on a chance to contend. You really needed to estimate those and throw them into the value calculations.

I was pretty friendly with Jed when we were both with the Sox (he was my immediate boss my first year) and if I had to guess, he goes for a pennant and takes the two draft picks. He’s got a Scouting Director with a terrific track record, which will amplify their value (fairly or unfairly) in his mind. I don’t think he’ll be able to resist the chance to go for it next year, and he can look to the future by dealing Heath Bell, making Mike Adams the closer, and using the saved money to improve the team elsewhere. He has stated he would need to be overwhelmed to make a trade: and who is going to do that for a one-year rental?

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