Re: How Bad are AKME?
Posted: Sat Feb 10, 2024 2:53 am
dougthonus wrote:MikeDC wrote:Every NBA team counts insurance payments as part of its calculus for team cost, so from a team building perspective, so should you.
The NBA does not. I am speaking about the league, not the individual decisions about how various owners may or may not allocate cash, but their behaviors also all back my opinion on the topic, which is that they also won't exceed the tax threshold without a chance to win in the playoffs.
The NBA sets rules for spending. Those rules do not account for insurance paybacks. It's explicitly defined as not counting as cap relief. There are structural rules in place for spending and penalties for various thresholds. Insurance is not counted there.
Duh. Insurance does count in profit though.
If the insurance money were counted as cap relief and not just as cash in hand, do you think we would have spent more money in FA? I think we would have done so.
Again, they likely could have accomplished this by trading Lonzo for an active player. They chose not to. They decided the likelihood of it leading to much additional revenue was low, but the extra $16m of cost was bug and certain.
Which is my point. We are guided by the league cap rules, not the cash rules. The amount of profit is not determining the spend, the cap and league thresholds are. If we lose a 20M dollar marketing deal tomorrow, we won't lop off 20M in roster costs, we'll still spend up to the tax threshold even though profits are worse
The Bulls, when they do not expect to win, spend less. Well below the luxury tax threshold. The expected profit absolutely determines the spend. This is exactly what the Bulls do. When they xpect revenues to be down, they maintain profits by cutting expenses. Thats why the Bulls often operated far below the LT line for several years.
I really don’t understand you circumlocuting around this. Ever hear of the phrase Cash Considerations? I know you have. How did that become a punchline and the name of a Bulls podcast?
Well, because the Bulls gave away a high second rounder for Cash Considerations, right there at the outset of their rebuild. When thngs like high second round picks are useful to rebuilding basketball teams. But wait, you say, they always spend right up to the luxury tax threshold. How can this be!?!
Here, let me let John Paxson explain it to you. Moves like this…
[quote=“John Paxson”]build equity within the organization for future decisions.[/quote]
He laid it out for you in black and white. He’s literally saying, “Hey, we’re going to be cheap today, so that when we ask to spend more tomorrow, Jerry will let us”.
Of course, its BS, like Charlie Brown trying to kick that football, tomorrow never comes. But they’ll definitely spend less today.