Saturday, January 08, 2005

Conversations

"Frank, how's it going."

"Going well, Paul. Jamie told me the darnedest joke this morning..."

"That's great, Frank. Listen, I wanted to talk about the payroll."

"OK, go ahead."

"Here's the thing: we're really getting to the point of marginal returns. We've got two guys we're looking at, both of them are pretty good. Each one's worth about five or six per."

"What are they asking?"

"That's the thing. We can get one for three at eight and the other for four at nine."

"Well, who else can we go after?"

"There's not much out there. And compared to the other stuff that's out there, these guys are much smaller injury risks."

"So we'd be giving each one about two and a half or three extra per year, over what, seven years? So, like, we're looking at $20 million extra here?"

"Yeah. Versus just picking up two guys off the street, we're looking at a difference of maybe ten wins here. Well, it gets complicated there, but certainly we don't have a lot of options if we don't overpay.

"What about the playoffs?"

"Yeah, that' where I was gonna go. These guys are worth that five or six as regular season players, but if we leverage their extra value at playoff time, they could be worth a little more."

"All right, what about further on down the line?"

"Well, the thing is that, well, there's not a lot out there next year, so even if we can get Joel and Edwin to take over for Kaz and Jeff, we'd still need to get someone. And for '07, it's pretty hard to say we can get Chad, Ryan, and Greg all ready at the same time, so with the attrition rate we'd probably need someone there."

"Okay, so it makes some sense to overpay by some here."

"Yeah, but we're still looking at overpaying by a considerable amount. The thing is, though, that I'm wondering if looking at everyone's value in dollar terms - well, I think we're getting to the point of diminishing returns. That is, if we're pinching pennies on every guy, we end up with a lower payroll and a team that's not quite as good. So, we've done a really good job of getting all the position players on the cheap and our bullpen costs almost nothing past Eric. So, I guess what I'm saying is the only way for us to leverage the competitive advantage that our payroll gives us is to overpay."

"Okay, I see what you're saying. But what about a couple years down the line?"

"Yeah, that's the other part. I mean, we're just stocked in the mid-minors, so unless all our player development goes haywire, we can expect to have this kind of situation for a while. Plus, we still got Darren coming off the books, which covers all the arbitration raises and then some."

"All right, so what you're saying is there's a reason for us to overpay here?"

"Yeah, I mean, we can keep the payroll at eighty-seven and make 95% of the cash, or we can push up to a hundred to make it the full way for the regular season. There's no way to predict what would happen in the playoffs, but we've done some work on that and we think this maybe helps us there enough that it's a pretty neutral investment."

"So what you're saying is, we have a payroll advantage that we can't leverage unless we do some of these ugly deals, and in the end it might be enough to pay off?"

"Yeah, I think that's how I see it. So really, my question to you is this: should I invest that money in these players, or should I invest it in player development, where the returns might be diminishing too?"

"Wow, that's a tough question. You know what? We've got to go for it. These jackasses whining about some fire sale - yeah, let's do it."

"Well, wait now, Frank, let's not get irrational. I mean, they're gonna forget once they see us winning, which we'll do either way."

"Yeah, but they'll forget more if we win more, and we can do that. I don't want anything going wrong with this season. If we win that World Series, we get a free pass for a long time."

"What's that free pass worth to you, Frank?"

"I won't get into that, but it's worth enough for you to sign these guys."

Comments:
great stuff Tom! any chance the LA Times will dump that Plaschke moron and sign you? (grin) rgds, will
 
That's it. Been reading for a little while and I'm hooked. Keep it up.
 
Great post!
 
Tom,

Great stuff. You've become a must read for me.

I have been thinking about it and thinking about it. Why overpay for Perez or Lowe? Your answer has been as compelling as any I have seen, but I wanted to run something else by you.

Could it have something to do with the age old analogy of good pitching beats good hitting? Anotherwards, even though the wins shares generated by signing #2 SP's are less that if the cash was instead spent on superb offense, when push comes to shove, all those good bats you spent money on will underperform in the playoffs when they run up against good pitching.

Would the Dodgers be better off throwing 5 cheap SP's pitchers out there(say Dessens, Jackson, Harahan, Ketchner and Alvarez) and instead spend the 35 million being allocated to their rotation on Varitek, Beltre and Delgado?

Our lineup would be awesome(Izturis, Bradley, Drew, Beltre, Delgado, Kent, Varitek, Werth) and I think would be worth more win shares than having our current starting staff. Against good pitching though, would we be any better off?

I thought I'd run the idea past you as you seem to be an analysis king. It was just an idea I had.

Cameron
 
Tom,

Great stuff. You've become a must read for me.

I have been thinking about it and thinking about it. Why overpay for Perez or Lowe? Your answer has been as compelling as any I have seen, but I wanted to run something else by you.

Could it have something to do with the age old analogy of good pitching beats good hitting? Anotherwards, even though the wins shares generated by signing #2 SP's are less that if the cash was instead spent on superb offense, when push comes to shove, all those good bats you spent money on will underperform in the playoffs when they run up against good pitching.

Would the Dodgers be better off throwing 5 cheap SP's pitchers out there(say Dessens, Jackson, Harahan, Ketchner and Alvarez) and instead spend the 35 million being allocated to their rotation on Varitek, Beltre and Delgado?

Our lineup would be awesome(Izturis, Bradley, Drew, Beltre, Delgado, Kent, Varitek, Werth) and I think would be worth more win shares than having our current starting staff. Against good pitching though, would we be any better off?

I thought I'd run the idea past you as you seem to be an analysis king. It was just an idea I had.

Cameron
 
Well, a well-rounded team seems much better than a dream team lineup and a minor league pitching staff. Not sure how that will work, but i don't think it will translate to wins. We would have one of the best offenses in Dodger history, but the worst rotation probably in a long time.
 
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