Teams are prepping scenarios where the cap is 10-15% lower due to the NBA situation with China

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Teams are prepping scenarios where the cap is 10-15% lower due to the NBA situation with China 

Post#1 » by TheBoi10 » Wed Oct 9, 2019 11:27 pm

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Re: Teams are prepping scenarios where the cap is 10-15% lower due to the NBA situation with China 

Post#2 » by clyde21 » Wed Oct 9, 2019 11:28 pm

of course the first thing they do is cut wages
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Re: Teams are prepping scenarios where the cap is 10-15% lower due to the NBA situation with China 

Post#3 » by bisme37 » Wed Oct 9, 2019 11:32 pm

clyde21 wrote:of course the first thing they do is cut wages


That's the nature of the collective bargaining agreement. Owners and players get an equal share of revenue. So if there is 10-15% less revenue, the teams have 10-15% less to spend on player personnel. Of course that doesn't mean existing contracts will be lowered, if that's your concern. Just has an effect on each team's cap.
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Re: Teams are prepping scenarios where the cap is 10-15% lower due to the NBA situation with China 

Post#4 » by TheBoi10 » Wed Oct 9, 2019 11:43 pm

bisme37 wrote:
clyde21 wrote:of course the first thing they do is cut wages


That's the nature of the collective bargaining agreement. Owners and players get an equal share of revenue. So if there is 10-15% less revenue, the teams have 10-15% less to spend on player personnel. Of course that doesn't mean existing contracts will be lowered, if that's your concern. Just has an effect on each team's cap.


Maxes would lowered since they're dependent on % of the cap (which future projections would be incorrect for with the 10-15% decrease).
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Re: Teams are prepping scenarios where the cap is 10-15% lower due to the NBA situation with China 

Post#5 » by JonFromVA » Thu Oct 10, 2019 12:15 am

TheBoi10 wrote:
bisme37 wrote:
clyde21 wrote:of course the first thing they do is cut wages


That's the nature of the collective bargaining agreement. Owners and players get an equal share of revenue. So if there is 10-15% less revenue, the teams have 10-15% less to spend on player personnel. Of course that doesn't mean existing contracts will be lowered, if that's your concern. Just has an effect on each team's cap.


Maxes would lowered since they're dependent on % of the cap (which future projections would be incorrect for with the 10-15% decrease).


And in theory salaries across the board could be lowered to make up for losses, but that's something the NBA hasn't had to do because so far just holding back a % of the salary has been sufficient to make up for any slop in the final numbers.

So, short of digging in to the CBA, I guess we'll have to see ...
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Re: Teams are prepping scenarios where the cap is 10-15% lower due to the NBA situation with China 

Post#6 » by bisme37 » Thu Oct 10, 2019 12:20 am

JonFromVA wrote:
TheBoi10 wrote:
bisme37 wrote:
That's the nature of the collective bargaining agreement. Owners and players get an equal share of revenue. So if there is 10-15% less revenue, the teams have 10-15% less to spend on player personnel. Of course that doesn't mean existing contracts will be lowered, if that's your concern. Just has an effect on each team's cap.


Maxes would lowered since they're dependent on % of the cap (which future projections would be incorrect for with the 10-15% decrease).


And in theory salaries across the board could be lowered to make up for losses, but that's something the NBA hasn't had to do because so far just holding back a % of the salary has been sufficient to make up for any slop in the final numbers.

So, short of digging in to the CBA, I guess we'll have to see ...


You can't change an existing contract because you suddenly don't want to pay the contracted amount. It's signed and legally binding. So I don't think that theory is valid.
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Re: Teams are prepping scenarios where the cap is 10-15% lower due to the NBA situation with China 

Post#7 » by Sixerscan » Thu Oct 10, 2019 12:27 am

JonFromVA wrote:
TheBoi10 wrote:
bisme37 wrote:
That's the nature of the collective bargaining agreement. Owners and players get an equal share of revenue. So if there is 10-15% less revenue, the teams have 10-15% less to spend on player personnel. Of course that doesn't mean existing contracts will be lowered, if that's your concern. Just has an effect on each team's cap.


Maxes would lowered since they're dependent on % of the cap (which future projections would be incorrect for with the 10-15% decrease).


And in theory salaries across the board could be lowered to make up for losses, but that's something the NBA hasn't had to do because so far just holding back a % of the salary has been sufficient to make up for any slop in the final numbers.

So, short of digging in to the CBA, I guess we'll have to see ...


No way they change contracts already in place. That would involve the players' consent which isn't happening. Maybe they don't get the nominal amount that's held in escrow but they won't actually lower salaries.

Could impact the max extensions already signed but haven't kicked in yet. Simmons and Murray get 25% of the cap next summer, we'll see what that is...
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Re: Teams are prepping scenarios where the cap is 10-15% lower due to the NBA situation with China 

Post#8 » by MadDogSHWA » Thu Oct 10, 2019 12:30 am

OK so lets assume the Chinese GOV is upset with the NBA. How exactly does that translate to financial losses? Have the games been banned there?
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Re: Teams are prepping scenarios where the cap is 10-15% lower due to the NBA situation with China 

Post#10 » by scrabbarista » Thu Oct 10, 2019 12:32 am

Read the thread title and remember that this is the result of a single tweet that said, "Fight For Freedom. Stand With Hong Kong." Really think about that. And then dare to take a side.

Personally, I don't believe the CCP would jeopardize that much money for a single tweet, but assuming they would, imagine how insecure you have to be as a government to light billions on fire for seven harmless little words that were there for like an hour and then were erased. If you ask me, the CCP is a tottering regime that will go to insane lengths to protect its "legitimacy" domestically.

And I don't think it's just the money that's at stake for the CCP. I think that if the CCP bans the NBA (or, to a far lesser extent, the Houston Rockets), it will do more harm to its rule in China than good. I believe the silent majority of Chinese understand their government is extremely crappy, to put it mildly. When you see loud Chinese voices shrieking online for Chinese sovereignty and nationalism, blah blah blah, what you're mostly seeing is fear and self-interest. Most of those same people would do anything to get out of their country if they could. That's my opinion as someone who lived in China and Taiwan, speaks some Chinese, and has followed China news nearly every day for about ten years. I don't know who'll agree with me on these boards, but I truly believe that the CCP needs the NBA more than the NBA needs China. If the NBA sticks to its guns and we end up seeing a Berlin '89 or USSR '91 situation in China in the next five years, remember this comment.
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Re: Teams are prepping scenarios where the cap is 10-15% lower due to the NBA situation with China 

Post#11 » by NBAFan93 » Thu Oct 10, 2019 12:34 am

bisme37 wrote:
JonFromVA wrote:
TheBoi10 wrote:
Maxes would lowered since they're dependent on % of the cap (which future projections would be incorrect for with the 10-15% decrease).


And in theory salaries across the board could be lowered to make up for losses, but that's something the NBA hasn't had to do because so far just holding back a % of the salary has been sufficient to make up for any slop in the final numbers.

So, short of digging in to the CBA, I guess we'll have to see ...


You can't change a contract value because you suddenly don't want to pay the contracted amount. It's signed and legally binding. So I don't think that theory is valid.


Many contracts are based on a % of the cap. Those ones would easily go down. I’m not sure about contracts for less than the max - if the people who drew them up were smart though there would be language that accounts for a signifiant decrease in the cap - and don’t think any guy can make more than the max (which is a percentage of the cap) regardless.
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Re: Teams are prepping scenarios where the cap is 10-15% lower due to the NBA situation with China 

Post#12 » by oceanlife » Thu Oct 10, 2019 12:36 am

MadDogSHWA wrote:OK so lets assume the Chinese GOV is upset with the NBA. How exactly does that translate to financial losses? Have the games been banned there?


Cap is based on collective income. If China restricts the NBA's access, which lead to lower income, then based on the current CBA the cap would decline. Teams would then need to lower salaries on new contracts accordingly.

After decades of growth the US Basketball Market is fairly saturated, there's not much the NBA can do domestically, so to grow their income they need to go international. China is the easiest money at the moment. Huge population with disposable income. If the NBA plays their cards right in China the NBA can double their income by the end of the next decade. Means next generation LeBron makes 60+ million a year. Role players making $15 million. Big time $$.

The NBA wants other regions, like Indian and Africa, but they are much poorer than China at the moment. Europe is a tough nut to crack since they already have their own leagues. China is the big opportunity right now. China's only requirement is for the NBA to stay silent while the communist government steals western intellectual property, imprisons its citizens, and continues to recolonize Africa. Small price to pay for a few bucks right.
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Re: Teams are prepping scenarios where the cap is 10-15% lower due to the NBA situation with China 

Post#13 » by Sixerscan » Thu Oct 10, 2019 12:38 am

NBAFan93 wrote:
bisme37 wrote:
JonFromVA wrote:
And in theory salaries across the board could be lowered to make up for losses, but that's something the NBA hasn't had to do because so far just holding back a % of the salary has been sufficient to make up for any slop in the final numbers.

So, short of digging in to the CBA, I guess we'll have to see ...


You can't change a contract value because you suddenly don't want to pay the contracted amount. It's signed and legally binding. So I don't think that theory is valid.


Many contracts are based on a % of the cap. Those ones would easily go down. I’m not sure about contracts for less than the max - if the people who drew them up were smart though there would be language that accounts for a signifiant decrease in the cap - and don’t think any guy can make more than the max (which is a percentage of the cap) regardless.


The *first* year of many contracts are based on the cap, and then there are max raises or declines based on that. After that they are set in stone.

So a max contract that starts in 2020 would be impacted. Not anything earlier though.
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Re: Teams are prepping scenarios where the cap is 10-15% lower due to the NBA situation with China 

Post#14 » by azcatz11 » Thu Oct 10, 2019 12:39 am

Can someone explain to me in like 2 sentences why China cares about a Morey tweet and why this has turned into such a cluster?
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Re: Teams are prepping scenarios where the cap is 10-15% lower due to the NBA situation with China 

Post#15 » by CarMalone » Thu Oct 10, 2019 12:39 am

MadDogSHWA wrote:OK so lets assume the Chinese GOV is upset with the NBA. How exactly does that translate to financial losses? Have the games been banned there?

Yes, in 1999, NBA games in China were pulled after the Chinese Embassy in Belgrade was bombed by US warplanes.
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Re: Teams are prepping scenarios where the cap is 10-15% lower due to the NBA situation with China 

Post#16 » by spikeslovechild » Thu Oct 10, 2019 12:40 am

clyde21 wrote:of course the first thing they do is cut wages


Keep hunting those And1's.

There is a cost and revenue is split this is how it works but the league should have never accepted Chinese blood money in the first place. How can you speak of things like police brutality and social justice while taking money from a country that literally engages in slave labor and imports workers from North Korea?

How do you accept money from a regime that kills and brutalizes it's own people and causes dissidents to disappear? If Kerr, Popovich, Lebron and Curry continue to remain silent on these issues they've lost the moral authority to speak about social justice not that these multimillionaires had much to begin with.
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Re: Teams are prepping scenarios where the cap is 10-15% lower due to the NBA situation with China 

Post#17 » by Sixerscan » Thu Oct 10, 2019 12:41 am

MadDogSHWA wrote:OK so lets assume the Chinese GOV is upset with the NBA. How exactly does that translate to financial losses? Have the games been banned there?


They've stopped showing preseason games, some chinese sponsors have pulled out.

There's a bunch of ways, maybe most straight forward is just saying that any contracts with the NBA are unenforceable.
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Re: Teams are prepping scenarios where the cap is 10-15% lower due to the NBA situation with China 

Post#18 » by scrabbarista » Thu Oct 10, 2019 12:44 am

MadDogSHWA wrote:OK so lets assume the Chinese GOV is upset with the NBA. How exactly does that translate to financial losses? Have the games been banned there?


This is a great question that I've been wondering myself. I would guess the actual answer is pretty complicated. As far as games being banned, only the Rockets have been banned indefinitely so far. The streaming company Tencent who owns the NBA rights said Chinese fans who had Rockets' packages can get another team instead. The Nets-Lakers games this week were also banned from being broadcast, I heard. (Which I found to be hilarious, considering Joseph Tsai's facebook bl@wj@b of the CCP.) The Rockets have also been banned from Weibo, China's Twitter. I assume that means all mention of them, more or less. Many companies with Rockets/NBA endorsement deals have said they are discontinuing all promotion of the Rockets. It's not really clear, but I would assume this means only the promotional activity that is kind of "complementary," so to speak, or "supplemental." I.e., I don't think these companies are actually going to tear up their contracts with Houston or the NBA. I could be wrong on that.

But, as I said in my previous comment in this thread, I think the CCP will ultimately do a lot more saber-rattling than actual economic damage. That's typically their M.O.. More bark than bite. Ultimately, they're pragmatists who'll do whatever they perceive to be in their best interests. I don't know for sure, though.
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Re: Teams are prepping scenarios where the cap is 10-15% lower due to the NBA situation with China 

Post#19 » by oceanlife » Thu Oct 10, 2019 12:44 am

azcatz11 wrote:Can someone explain to me in like 2 sentences why China cares about a Morey tweet and why this has turned into such a cluster?


China is testing the western world's resolve like the Velociraptors in Jurassic Park tested their cage. If they can get the Rockets to shut Morey up then it sends a clear message to all other businesses to stay in line and not cross China.

It's not just Morey's tweet, China is censoring western movies, influencing the news we watch, and even manipulating opinions on social media social media (China is investing hundreds of millions into Reddit). It's a big deal.
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Re: Teams are prepping scenarios where the cap is 10-15% lower due to the NBA situation with China 

Post#20 » by MotownMadness » Thu Oct 10, 2019 12:45 am

It will balance itself out and they will survive it im sure, let China keep crying

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