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

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

Post#101 » by Johnny Bball » Thu Oct 10, 2019 3:30 pm

Well this is propaganda and BS at its finest. It would never be 10 x 15% first off.ll but and it would never happen en masse by teams two days later. And how can anyone believe this trash....it’s just another reason to shut down people’s free speech. :banghead:

Two days later.. in October... teams prepping scenarios for caps situation over a year years away. ... and nobody asked if this would be an insane overreaction? honestly, could we have any kind of critical thinking before posting trash.
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Re: Teams are prepping scenarios where the cap is 10-15% lower due to the NBA situation with China 

Post#102 » by MrDollarBills » Thu Oct 10, 2019 3:31 pm

Honestly, Darryl Morey really does deserve to be fired for this. I wouldn't want the Rockets to do it for several reasons, but he really did some serious damage here.
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Re: Teams are prepping scenarios where the cap is 10-15% lower due to the NBA situation with China 

Post#103 » by LofJ » Thu Oct 10, 2019 3:32 pm

GoCeltics123 wrote:
LofJ wrote:
ropjhk wrote:This thread has been derailed. I was hoping for some discussion on how the hit to the salary cap would affect each team and which teams are poised to benefit and which teams would be most screwed over. Instead the political discussion just goes on.

I guess people don't care much about basketball anymore.


I think the teams that will be most negatively affected are the ones that will be over the lowered cap and still have players to re-sign. So teams like the Pacers (Sabonis), Celtics (Brown), Magic (Isaac, Augustin), and Nuggets (Beasley, Millsap, Plumlee) might need to find a way to cut future salary obligations or they could be forced to let some of these guys walk.

Wouldn't it affect teams with cap space too, though? Like, Brown and Sabonis may not get the money they want since a lot less teams would have max space


If this year's class of unrestricted free agents was better that would likely happen, but it's not so I expect that young, good players like Sabonis and Brown are still going to get paid, either by the team that drafted them or by someone else.
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Re: Teams are prepping scenarios where the cap is 10-15% lower due to the NBA situation with China 

Post#104 » by dhsilv2 » Thu Oct 10, 2019 3:33 pm

Can anyone here explain how the escrow rules play a role in all of this? My understanding is already players are only paid 90% of their salary and then based on BRI they are paid out of the escrow based on where the BRI went. So a drop in revenue would mean they do not get the full escrow back and an increase means they'd get it plus additional funds.

Not sure how that flows into a cap though. Is the cap hold based on expected numbers as well and thus dynamic?
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Re: Teams are prepping scenarios where the cap is 10-15% lower due to the NBA situation with China 

Post#105 » by Johnny Bball » Thu Oct 10, 2019 3:38 pm

kulaz3000 wrote:
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 can stop all NBA operations, stop televising games, advertising etc. It's not unprecedented for China to go to such extreme measures.


And the money is all tv. And the nba has a contract and still gets paid. So how is any of this a reality when it talks about teams prepping.

As for biting their own nose off to spite their face.., doubtful. All that money isn’t just going into US pockets.
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Re: Teams are prepping scenarios where the cap is 10-15% lower due to the NBA situation with China 

Post#106 » by xxSnEaKyPxx » Thu Oct 10, 2019 3:43 pm

Johnny Bball wrote:
kulaz3000 wrote:
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 can stop all NBA operations, stop televising games, advertising etc. It's not unprecedented for China to go to such extreme measures.


And the money is all tv. And the nba has a contract and still gets paid. So how is any of this a reality when it talks about teams prepping.

https://www.usatoday.com/story/sports/nba/2019/10/09/nba-china-hong-kong-whats-at-stake/3912447002/#targetText=In%20July%2C%20China's%20Tencent%20reached,including%20coverage%20of%20the%20playoffs.

Not to mention sponsorships and such.

Contracts usually have an out, I imagine something like this would qualify.
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Re: Teams are prepping scenarios where the cap is 10-15% lower due to the NBA situation with China 

Post#107 » by ropjhk » Thu Oct 10, 2019 3:49 pm

GoCeltics123 wrote:
LofJ wrote:
ropjhk wrote:This thread has been derailed. I was hoping for some discussion on how the hit to the salary cap would affect each team and which teams are poised to benefit and which teams would be most screwed over. Instead the political discussion just goes on.

I guess people don't care much about basketball anymore.


I think the teams that will be most negatively affected are the ones that will be over the lowered cap and still have players to re-sign. So teams like the Pacers (Sabonis), Celtics (Brown), Magic (Isaac, Augustin), and Nuggets (Beasley, Millsap, Plumlee) might need to find a way to cut future salary obligations or they could be forced to let some of these guys walk.

Wouldn't it affect teams with cap space too, though? Like, Brown and Sabonis may not get the money they want since a lot less teams would have max space


I think the teams with cap space will benefit in the long run. If there is no end in sight to the China ban in 2020, then free agents will be cheap that year and fewer players will get max contracts as teams expect future revenues and cap levels to drop. The 2021 free agency class is the one to watch because of the big names involved. If the salary cap continues to goes down, then free agents will end up signing for less as the max contract and mle go down as they are pegged to the salary cap.

When the salary cap is dropping and expected to keep dropping teams who have a lot of players signed long term will suffer the most. Those long term salaries with their pre negotiated salary increases will eat more and more of the cap, making those players harder to trade and giving those teams less room under the cap to improve their teams.

Conversely, when the salary cap is rising faster than usual and expected to do so, teams with longterm contracts signed when the cap was still low will benefit. Golden State was able to sign KD because Klay, Steph and Dray were already signed longterm before the salary cap really exploded for the 2016-2017 season.
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Re: Teams are prepping scenarios where the cap is 10-15% lower due to the NBA situation with China 

Post#108 » by ropjhk » Thu Oct 10, 2019 3:54 pm

YogurtProducer wrote:
ropjhk wrote:This thread has been derailed. I was hoping for some discussion on how the hit to the salary cap would affect each team and which teams are poised to benefit and which teams would be most screwed over. Instead the political discussion just goes on.

I guess people don't care much about basketball anymore.

Or maybe people realize there are way more important issues going on right now than the **** nba


There are always more important issues going on than basketball. There are plenty more important issues than China and Hong Kong. Basketball is supposed to be a distraction to help us relax our minds away from these things.

We already have multiple threads talking about the politics of the China-HK situation. I think we'd be better off saving this thread for basketball related talk in regards to the salary 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#109 » by snaquille oatmeal » Thu Oct 10, 2019 3:57 pm

Johnny Bball wrote:Well this is propaganda and BS at its finest. It would never be 10 x 15% first off.ll but and it would never happen en masse by teams two days later. And how can anyone believe this trash....it’s just another reason to shut down people’s free speech. :banghead:

Two days later.. in October... teams prepping scenarios for caps situation over a year years away. ... and nobody asked if this would be an insane overreaction? honestly, could we have any kind of critical thinking before posting trash.

That’s how the price of gas is set as well. It’s called the speculative market. It’s like when Iran bombed the Saudi oil fields, the speculation was that the world supply of oil would be reduced therefore the price of gas at the pump immediately went up about 50 cents per gallon. The Saudis brought their productions back to normal in two weeks with a minimal to impact to actual supply production, but the price of gas remains high.
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Re: Teams are prepping scenarios where the cap is 10-15% lower due to the NBA situation with China 

Post#110 » by TheDoors24 » Thu Oct 10, 2019 5:09 pm

MrDollarBills wrote:Honestly, Darryl Morey really does deserve to be fired for this. I wouldn't want the Rockets to do it for several reasons, but he really did some serious damage here.


100%. The league is going to feel this impact for a while and i also think the Rockets will be impacted. Will the owner want to invest as much if he lost all that sweet sweet china money?
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Re: Teams are prepping scenarios where the cap is 10-15% lower due to the NBA situation with China 

Post#111 » by Johnny Bball » Thu Oct 10, 2019 5:20 pm

snaquille oatmeal wrote:
Johnny Bball wrote:Well this is propaganda and BS at its finest. It would never be 10 x 15% first off.ll but and it would never happen en masse by teams two days later. And how can anyone believe this trash....it’s just another reason to shut down people’s free speech. :banghead:

Two days later.. in October... teams prepping scenarios for caps situation over a year years away. ... and nobody asked if this would be an insane overreaction? honestly, could we have any kind of critical thinking before posting trash.


That’s how the price of gas is set as well. It’s called the speculative market. It’s like when Iran bombed the Saudi oil fields, the speculation was that the world supply of oil would be reduced therefore the price of gas at the pump immediately went up about 50 cents per gallon. The Saudis brought their productions back to normal in two weeks with a minimal to impact to actual supply production, but the price of gas remains high.


NBA teams are not futures Chicago or stocks tracked on the Dow or S&P, nor would their yearly financial projections, budgets, and most importantly cap space projections which have nothing to do with either of those... require revising after 48 hours with no known outcome.
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Re: Teams are prepping scenarios where the cap is 10-15% lower due to the NBA situation with China 

Post#112 » by Snotbubbles » Thu Oct 10, 2019 5:25 pm

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 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.


NHL and NHLPA did a salary rollback of 24% back in 2005. As long as the rollback is collectively bargained between the League and the Players Association, the Courts will allow it.
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Re: Teams are prepping scenarios where the cap is 10-15% lower due to the NBA situation with China 

Post#113 » by snaquille oatmeal » Thu Oct 10, 2019 5:57 pm

Johnny Bball wrote:
snaquille oatmeal wrote:
Johnny Bball wrote:Well this is propaganda and BS at its finest. It would never be 10 x 15% first off.ll but and it would never happen en masse by teams two days later. And how can anyone believe this trash....it’s just another reason to shut down people’s free speech. :banghead:

Two days later.. in October... teams prepping scenarios for caps situation over a year years away. ... and nobody asked if this would be an insane overreaction? honestly, could we have any kind of critical thinking before posting trash.


That’s how the price of gas is set as well. It’s called the speculative market. It’s like when Iran bombed the Saudi oil fields, the speculation was that the world supply of oil would be reduced therefore the price of gas at the pump immediately went up about 50 cents per gallon. The Saudis brought their productions back to normal in two weeks with a minimal to impact to actual supply production, but the price of gas remains high.


NBA teams are not futures Chicago or stocks tracked on the Dow or S&P, nor would their yearly financial projections, budgets, and most importantly cap space projections which have nothing to do with either of those... require revising after 48 hours with no known outcome.

I never said that they were I was just pointing out what these guys are doing by projecting the future cap in the NBA.
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Re: Teams are prepping scenarios where the cap is 10-15% lower due to the NBA situation with China 

Post#114 » by JonFromVA » Thu Oct 10, 2019 6:10 pm

Snotbubbles 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 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.


NHL and NHLPA did a salary rollback of 24% back in 2005. As long as the rollback is collectively bargained between the League and the Players Association, the Courts will allow it.


Taking a look at the Coon FAQ, question 17 addresses what happens in the case of a BRI drop. It looks like taking money back from the players would be only done in an extreme situation and only after good faith talks between the unions and ownership.

17. What happens when there's not enough money in the escrow account?

Players never lose more than 10% of their salaries to the escrow system (1). If they reconcile the numbers after the season and discover that the escrow fund is insufficient to return salaries & benefits back down to the players' designated share, they take the shortfall out of the supplemental benefits pool that is funded with 1% of BRI (see question number 15). If they exhaust the entire supplemental benefits pool and still haven't brought salaries down to the designated share, they stop there. The players don't lose any additional money, and will earn more than their designated share that season.

However, there is a system in place to try to prevent this from happening. If there is an overage -- i.e., if the players were paid more than their guaranteed amount in the previous season (pre-escrow) -- and the system is getting close to exceeding what the league can get back through the escrow system, then the cap and tax levels may be reduced in the following season in order help put on the brakes.

If the overage was less than 6% then no action is taken.
If the overage was between 6% and 9%, then they look at projected BRI (see question number 12). No action is taken if projected BRI will be high enough to fix the problem on its own. If the projected BRI is not high enough, then the cap and tax levels are reduced.
If the overage exceeds 9%, they put on the brakes (by reducing the cap and tax levels) without regard to projected BRI.

For example, if the total salaries and benefits for 2019-20 are $4.686 billion and this results in an overage of $351 million (7.5% of total salaries and benefits), and if the projected BRI for 2020-21 exceeds the BRI for 2019-20 by 9%, then the 2020-21 salary cap is adjusted downward by $0.8 million, and the tax level is reduced by $1.07 million.

If the players ever end up earning more than their designated share due to a substantial decline in revenues, then both sides will negotiate in good faith to revise the CBA in order to address the issue.

(1) The exception is when there is money that should be on deposit with the escrow agent but is not, for example if there is a procedural or accounting error. Any such shortfall is deducted from the players' salaries the following season.


http://www.cbafaq.com/salarycap.htm#Q17
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Re: Teams are prepping scenarios where the cap is 10-15% lower due to the NBA situation with China 

Post#115 » by Buzzard » Thu Oct 10, 2019 6:37 pm

ropjhk wrote:This thread has been derailed. I was hoping for some discussion on how the hit to the salary cap would affect each team and which teams are poised to benefit and which teams would be most screwed over. Instead the political discussion just goes on.

I guess people don't care much about basketball anymore.

If this is still going on next season it will hurt teams who have borderline max contract ability. It will also put those already near or in luxury tax land in a much more precarious situation. I think teams with a lot of cap room next season will be looked at in a more envious manner by other team owners.

It may level the playing field. Imagine the fall out if teams could no longer reasonably afford to build a big three; at least until all these current mega contracts expire. 2019 Cap of 109.14 minus 10% is 98.23. I imagine the NBA will not change the luxury tax level by a lot; or they will possibly grant grandfather exclusions should such a drastic drop happen.
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Re: Teams are prepping scenarios where the cap is 10-15% lower due to the NBA situation with China 

Post#116 » by scrabbarista » Thu Oct 10, 2019 6:40 pm

MrDollarBills wrote:Honestly, Darryl Morey really does deserve to be fired for this. I wouldn't want the Rockets to do it for several reasons, but he really did some serious damage here.


My friend. He posted a tweet. If I call you ugly and you hit me in the face - or, to make the analogy more appropriate, you blast me in the face with a rocket launcher - who is responsible for the violence?
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Re: Teams are prepping scenarios where the cap is 10-15% lower due to the NBA situation with China 

Post#117 » by paulbball » Thu Oct 10, 2019 6:46 pm

TheDoors24 wrote:
MrDollarBills wrote:Honestly, Darryl Morey really does deserve to be fired for this. I wouldn't want the Rockets to do it for several reasons, but he really did some serious damage here.


100%. The league is going to feel this impact for a while and i also think the Rockets will be impacted. Will the owner want to invest as much if he lost all that sweet sweet china money?


100x

This hurts the owners so much.

1. It decreases revenue for all teams. 10-15% in revenue of last year's $7.4B is $740m to 1.11 billion in projected revenue losses. Each owner is going to be short on average 25m in revenue due to one tweet, impacting the larger teams more on average. Rockets are absolutely hosed though since they are blacklisted from broadcast/merchandise sale in China right now.

2. It decreases the owner/franchise cut of the revenue by a greater percentage. The cap shrink will increases luxury tax, plus cause the player's share of the revenue to exceed the targeted 49-51%. Unless negotiated, this will further cut into the owner's share. The owners/franchises are paying for the fixed operational costs in the first place. Whatever their operational income will be shrink beyond the projected 10-15%. Half the teams in the league aren't making money in the first place (ignoring the rise in their team valuation of course).

3. Plus, this hurts players drafted in 2016 who have/are signing an extension one year early and players who have signed for max contracts that do not go into effect until 2020, 2021 or later. Their salaries aren't fixed on $, but are rather fixed as a % of the max cap.

I believe 3 players are affected by this. Contracts that will start this year are number locked.

Damian Lillard: 20-30m+ in damages starting in 2021
Ben Simmons: 17-25m+ in damages starting in 2020
Jamal Murray: 17-25m+ in damages starting in 2020
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Re: Teams are prepping scenarios where the cap is 10-15% lower due to the NBA situation with China 

Post#118 » by Jabroni Lames » Thu Oct 10, 2019 6:46 pm

ropjhk wrote:This thread has been derailed. I was hoping for some discussion on how the hit to the salary cap would affect each team and which teams are poised to benefit and which teams would be most screwed over. Instead the political discussion just goes on.

I guess people don't care much about basketball anymore.


My first thought was that this could affect how Bradley Beal is thinking about signing the extension that's in front of him. And that the Raptors (Siakam) and Celtics (Brown) should hold back any extension offer unless they're getting a significant discount.
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Re: Teams are prepping scenarios where the cap is 10-15% lower due to the NBA situation with China 

Post#119 » by paulbball » Thu Oct 10, 2019 6:51 pm

Jabroni Lames wrote:
ropjhk wrote:This thread has been derailed. I was hoping for some discussion on how the hit to the salary cap would affect each team and which teams are poised to benefit and which teams would be most screwed over. Instead the political discussion just goes on.

I guess people don't care much about basketball anymore.


My first thought was that this could affect how Bradley Beal is thinking about signing the extension that's in front of him. And that the Raptors (Siakam) and Celtics (Brown) should hold back any extension offer unless they're getting a significant discount.


This will absolutely change their contract extension. They will have to sign a Kevin Durant/Kyrie Irving type of contract aka less than max with a $ of based on the current cap instead of max contract based on % of a projected future cap.

Effectively assuming that their teams are still willing to pay them a % max based on the current cap knowing that the cap will decrease, they will have to sign a non % value of max - $1. This means that they will lose on the the % change in projected cap increase (which is not happening next year).
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Re: Teams are prepping scenarios where the cap is 10-15% lower due to the NBA situation with China 

Post#120 » by G35 » Thu Oct 10, 2019 6:52 pm

oceanlife wrote:
Pennebaker wrote:
scrabbarista wrote:
On the other hand, if they didn't support the government's actions, they wouldn't be able to tell us, would they? When the voice of the Chinese people is controlled and suppressed by the Chinese government, how are we supposed to recognize their true voice?


There are 80,000 American citizens that live and work in China. They have Chinese friends and Chinese co-workers. They discuss things like censorship and how regular Chinese people feel about it (most are indifferent). No one is getting arrested for this. Most educated and worldly Chinese people actually like their government and they know full well why Americans think that they shouldn't.


Of course the Chinese love their government. There's a few reasons why.

#1 The Chinese government is making their citizens rich. The US government is letting their citizens be eaten alive by financial parasites. Big difference in priorities. Now, it's not all roses in China, but if you look at the trajectories and the individual worker the Chinese man is getting richer while the American is getting poorer.

#2 The Chinese teach their kids to love their country, Americans don't. History Classes in American schools tend to highlight everything we did wrong in the past, from slavery, to killing Indians, to oppressing other countries, if you've been to American schools you've learned all this. But in China, how shall I put this, imagine a Donald Trump Rally with more discipline, that's a Chinese history class. Get educated in China and you'll think China is fantastic.

#3 America has media that is controlled by international corporations while China is state controlled. Basically in America you have a small group of companies, some people put it at 6, that run 95% of all media in America. Every one of those companies has a large foreign ownership component. Many of them run programming that is negative to America. China does not allow such negative media. Chinese media trains the citizens to love their people and government, American media trains you to be critical of your people and government.

I'd still take America 10/10 times over China, but I understand why they are so unified.



Very good analysis.

As much as people want to talk about the patriarchy and social engineering, the media does not want to talk about how the public is being socially engineered to dislike and criticize America. Its almost like you are not being a good citizen if you are not speaking against your country and there are several who have bought into that reality.

There are pros/cons of allowing too much freedom compared to limiting civil liberties. I do prefer the United States approach, but I do not think the US will last as long as China since our own citizens do not believe in America......
I'm so tired of the typical......

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