Could the Raptors Benefit from a lowered salary cap?

[ropjhk]

When the salary cap rises quickly over consecutive years usually teams with longterm contracts already signed will benefit. The reason is because the rise in the salary cap will more than offset the rise in salary increases and create new cap space for those teams. That's why so many good, but not great players will sign max contracts when the salary cap is rising quickly. An overpayment today will look much better tomorrow.

The Warriors are an example of a team that took full advantage of the rising salary cap when they had Steph, Dray and Klay all signed to multi year deals before the salary cap rose quickly enough to have cap room to sign KD.

Conversely a period of declining salary cap should have to opposite effect. Teams with cap space should benefit because they'll be able to sign players at a discount. Teams with long term contracts signed before the salary cap starts declining will be left with bloated contracts and reduced flexibility to improve their teams.

If the Chinese boycott of the NBA continues (possible if Trump stays in office and continues the trade war) then the 2020 offseason would be the offseason to avoid committing big longterm money (sucks big time for those free agents) and the 2021 offseason may be the year to have cap space to sign players to long term contracts that will look better and better as the salary cap starts to rebound and rise again.

Of course we could also fall into a global recession that could lead to a longterm (more than 2 years) decline in revenues and salary cap. In that situation there will be small market teams like Indiana that may have to sell off their players to save money.

I think the Raptors are in a good position to take advantage of the Chinese NBA boycott. If Masai plays this right he can easily rebuild another championship team.

[bstein14]

That lowry extension was the right move from a pr standpoint but If there is a significant drop in the cap that could be a killer in terms of offseason flexability.

[Hungry]

That lowry extension was the right move from a pr standpoint but If there is a significant drop in the cap that could be a killer in terms of offseason flexability.

We'll see the corresponding moves they make with the other expiring deals but the Lowry extension looks to have been a move to punt capspace to the 2021 off-season. If this is in fact what the Raptors are doing, Lowry's salary next year is largely irrelevant for roster construction purposes. If it's not the plan, absolutely you're right it could be a concern

On a similar question, how does the concern of a lowered cap play into a Siakam extension? Maybe both sides compromise on a 90-95% of max extension?

Personally I think this will all blow over and we'll forget about it in a month.

[kalel123]

That lowry extension was the right move from a pr standpoint but If there is a significant drop in the cap that could be a killer in terms of offseason flexability.

Disagree. The flexibility was overblown anyway due to projected salary increase on Siakam, uncertainty on direction of the team, and lack of compelling FA available.

[bstein14]

That lowry extension was the right move from a pr standpoint but If there is a significant drop in the cap that could be a killer in terms of offseason flexability.

We'll see the corresponding moves they make with the other expiring deals but the Lowry extension looks to have been a move to punt capspace to the 2021 off-season. If this is in fact what the Raptors are doing, Lowry's salary next year is largely irrelevant for roster construction purposes. If it's not the plan, absolutely you're right it could be a concern

On a similar question, how does the concern of a lowered cap play into a Siakam extension? Maybe both sides compromise on a 90-95% of max extension?

Personally I think this will all blow over and we'll forget about it in a month.

Siakam would be even more of a max player with a reduced cap his max might be $20 million less over the length of the contract.

[Hungry]

That lowry extension was the right move from a pr standpoint but If there is a significant drop in the cap that could be a killer in terms of offseason flexability.

We'll see the corresponding moves they make with the other expiring deals but the Lowry extension looks to have been a move to punt capspace to the 2021 off-season. If this is in fact what the Raptors are doing, Lowry's salary next year is largely irrelevant for roster construction purposes. If it's not the plan, absolutely you're right it could be a concern

On a similar question, how does the concern of a lowered cap play into a Siakam extension? Maybe both sides compromise on a 90-95% of max extension?

Personally I think this will all blow over and we'll forget about it in a month.

Siakam would be even more of a max player with a reduced cap his max might be $20 million less over the length of the contract.

Sorry I should have been clearer, how does the threat of the lower cap impact extension discussions between the Raptors and his agent?

[Psubs]

That lowry extension was the right move from a pr standpoint but If there is a significant drop in the cap that could be a killer in terms of offseason flexability.

We'll see the corresponding moves they make with the other expiring deals but the Lowry extension looks to have been a move to punt capspace to the 2021 off-season. If this is in fact what the Raptors are doing, Lowry's salary next year is largely irrelevant for roster construction purposes. If it's not the plan, absolutely you're right it could be a concern

On a similar question, how does the concern of a lowered cap play into a Siakam extension? Maybe both sides compromise on a 90-95% of max extension?

Personally I think this will all blow over and we'll forget about it in a month.

With a lower cap, isn't the max recalculated, as it's a % of the cap?

[Hungry]

That lowry extension was the right move from a pr standpoint but If there is a significant drop in the cap that could be a killer in terms of offseason flexability.

We'll see the corresponding moves they make with the other expiring deals but the Lowry extension looks to have been a move to punt capspace to the 2021 off-season. If this is in fact what the Raptors are doing, Lowry's salary next year is largely irrelevant for roster construction purposes. If it's not the plan, absolutely you're right it could be a concern

On a similar question, how does the concern of a lowered cap play into a Siakam extension? Maybe both sides compromise on a 90-95% of max extension?

Personally I think this will all blow over and we'll forget about it in a month.

With a lower cap, isn't the max recalculated, as it's a % of the cap?

Thanks for this. A quick look at Larry Coon, and my interpretation is you're correct that if his signed extension year 1 ended up as more than 25% of the cap when it kicked in it would be lowered to 25% though I could be wrong.

[StopitLeo]

We'll see the corresponding moves they make with the other expiring deals but the Lowry extension looks to have been a move to punt capspace to the 2021 off-season. If this is in fact what the Raptors are doing, Lowry's salary next year is largely irrelevant for roster construction purposes. If it's not the plan, absolutely you're right it could be a concern

On a similar question, how does the concern of a lowered cap play into a Siakam extension? Maybe both sides compromise on a 90-95% of max extension?

Personally I think this will all blow over and we'll forget about it in a month.

With a lower cap, isn't the max recalculated, as it's a % of the cap?

Thanks for this. A quick look at Larry Coon, and my interpretation is you're correct that if his signed extension year 1 ended up as more than 25% of the cap when it kicked in it would be lowered to 25% though I could be wrong.

I believe you're correct. Absolute salary numbers on extensions are adjusted for the coming season once the cap is set in July. But even then I think there can be additional adjustments at the end of the year when they look at the actual BRI and escrow (where players might get money back).

In absolute dollars a 15% drop in the cap will only lower Pascal's starting salary by $4-5M.

[ropjhk]

We'll see the corresponding moves they make with the other expiring deals but the Lowry extension looks to have been a move to punt capspace to the 2021 off-season. If this is in fact what the Raptors are doing, Lowry's salary next year is largely irrelevant for roster construction purposes. If it's not the plan, absolutely you're right it could be a concern

On a similar question, how does the concern of a lowered cap play into a Siakam extension? Maybe both sides compromise on a 90-95% of max extension?

Personally I think this will all blow over and we'll forget about it in a month.

Siakam would be even more of a max player with a reduced cap his max might be $20 million less over the length of the contract.

Sorry I should have been clearer, how does the threat of the lower cap impact extension discussions between the Raptors and his agent?

In the short term I think it should be clear that unless they get a significant discount right now the Raptors should wait until the 2020 offseason to extend Siakam. The uncertainty regarding Chinese revenue makes it hard to commit money beyond next season.

If the Chinese go nuclear and totally ban the NBA forever you'll have long term downgraded salary cap projections. Before this current period of rising salary cap, the cap grew from 53mil to 56 mil between 2007 to 2014. A player like Siakam would not have been likely to sign a max contract during that period. When Gordon Hayward signed an early max deal in 2014 it was a surprise to many who were used to borderline all star players of his calibre getting less than the max. The contract turned out to be a deal for the Jazz as Hayward became an all star and the salary cap rose to make his 2014 max look like a 2017 steal.

[Dennis 37]

Wiretap indicates that China has decided to let the issue slide.

[LiSTWithLani]

I don't understand how people view the max as a dollar amount. If you want to win, you need to understand salaries as a percentage of the cap. Money allowed to be spent is finite (yeah, it's a soft cap, but still) and paying someone 25% of the cap (max) must mean that those players really vault you into contention.

I LOVE Siakam, but he isn't among the top dozen players in our league. If we want to win, I don't want to give him a max slot. period. Regardless of what the cap is set at.

[I_Like_Dirt]

Wiretap indicates that China has decided to let the issue slide.

It suggests that China hasn't decided to let it slide, but rather has determined that they have potentially more to lose here than the NBA does so they're trying to make this look like a warning to the NBA, effectively getting what they want anyway without taking the global backlash they were suffering and effectively having a Streisand effect happen with Hong Kong. If anyone else tweets anything, you'll see how much China has actually let anything "slide."

[Dennis 37]

Wiretap indicates that China has decided to let the issue slide.

It suggests that China hasn't decided to let it slide, but rather has determined that they have potentially more to lose here than the NBA does so they're trying to make this look like a warning to the NBA, effectively getting what they want anyway without taking the global backlash they were suffering and effectively having a Streisand effect happen with Hong Kong. If anyone else tweets anything, you'll see how much China has actually let anything "slide."

The only Streisand effect I know of is when she turns into a Godzilla like creature. Is that what you are referring to?

[Metallikid]

Wiretap indicates that China has decided to let the issue slide.

It suggests that China hasn't decided to let it slide, but rather has determined that they have potentially more to lose here than the NBA does so they're trying to make this look like a warning to the NBA, effectively getting what they want anyway without taking the global backlash they were suffering and effectively having a Streisand effect happen with Hong Kong. If anyone else tweets anything, you'll see how much China has actually let anything "slide."

The only Steisand effect I know of is when she turns into a Godzilla like creature. Is that what you are referring to?

It is the name given to the scenario where trying to hide some piece of information actually causes more attention to be drawn to it.

[AkelaLoneWolf]

if it lowers the supermax, then less difference between max and supermax might put us into play for giannis.

[WaltFrazier]

Wiretap indicates that China has decided to let the issue slide.

It suggests that China hasn't decided to let it slide, but rather has determined that they have potentially more to lose here than the NBA does so they're trying to make this look like a warning to the NBA, effectively getting what they want anyway without taking the global backlash they were suffering and effectively having a Streisand effect happen with Hong Kong. If anyone else tweets anything, you'll see how much China has actually let anything "slide."

Right, they probably assume that no one else in the NBA will dare to exercise their right to free speech. Meanwhile the actual Hong Kong situation will end badly, like Tiananmen Square. Protestors will either be killed and/or arrested en masse, or quietly identified and simply disappear.

[Johnny Bball]

Raptors players and management start making china comments like crazy and drive that cap down until we are the only team that has space in 2021!

[StopitLeo]

if it lowers the supermax, then less difference between max and supermax might put us into play for giannis.

I don't know if that would matter to begin with. The supermax hasn't really been effective in its goal of keeping players with the team that drafted them. A winning/better situation seems to take priority over size of contract in most cases. From my calculations the difference is $217.5M (5 years) vs.$161.25M (4 years); that works out to a little over $3M difference in each of the first 4 seasons and it's quite possible that the first year of a new deal (after the 4 year contract) could exceed the 5th year salary of the supermax.

[AkelaLoneWolf]

if it lowers the supermax, then less difference between max and supermax might put us into play for giannis.

I don't know if that would matter to begin with. The supermax hasn't really been effective in its goal of keeping players with the team that drafted them. A winning/better situation seems to take priority over size of contract in most cases. From my calculations the difference is $217.5M (5 years) vs.$161.25M (4 years); that works out to a little over $3M difference in each of the first 4 seasons and it's quite possible that the first year of a new deal (after the 4 year contract) could exceed the 5th year salary of the supermax.

thats because there maybe 5-6 players actually worthy of getting the supermax and giannis is one of them. besides kawhi, has anyone actually declined the supermax? even with kawhi there was extraneous circumstances i.e. the injury that precluded the spurs from offering it.