Financials: Why Rubio won't come in 2011

PHTown · Post #1 » by **PHTown** » Fri Jun 25, 2010 5:55 am

I posted this in another thread, but I wanted to get a serious objective discussion going about exclusively the financial motivations and disincentives for Rubio to come over in 2011. I wanted a more limited discussion on this topic alone, which is why I did not post it in Rubio thread.

I believed Kahn when he said Rubio would come over next year, because I wanted to, despite financial logic. I no longer do, because it would be a horrible financial decision for Rubio. After this draft, I've lost any confidence that Kahn is a better judge than the average joe. Hopefully someone can reconvince me other wise.

Why Rubio won't come:
He showed with his previous decision(I'm assuming all of us know the details of the original situation) that financial considerations are very important to him. This shows me he and his team are smart.

Why coming in 2011 is a bad financial decision:
1. Rookie Contract. He comes over in 2011, he is bound to this. $16.3 million max over four years I believe.

2. NBA lockout. All sources point to the fact that it is going to happen. He will not get paid the first year of his deal if it does. The threat of it may be enough to keep him away. Why? because:

3. Virtual Free agent. If he waits one more year, he can basically negotiate a contract with the wolves. Think about it: How much will David Kahn pay to get Rubio over here? Did you picture a mountain of gold? I did and if Rubio's team didn't, they haven't been paying attention.

If he came he would be agreeing to a contract the first year of which would be voided by the lockout anyways.

In the end the cost to him of coming over and signing a rookie contract could easily range in the $16 million dollar range over three years.(this includes the diffence between a four year rookie salary and an estimated 8 million a year free agent deal(which we all know Kahn would pay)+ the difference in pay he would make in a working year in Europe vs. a lockout year in the NBA.

Think about it: how much is one year of sitting out worth to you? 16 million dollars? it is to me.

On the sad plus side....if it is a lockout year, no one is playing anyways. I just think it is weird that Kahn doesn't ever acknowledge that the lockout is a possibility. I'm sick of him saying Ricky will come next year when it makes no sense from Rubio's perspective. Sorry David, it ain't happening till 2012 at the earliest. Unless Rubio makes a stupid decision. Please prove me wrong.

younggunsmn · Post #2 » by **younggunsmn** » Fri Jun 25, 2010 6:15 am

I think the potential lockout is a much bigger issue than any of us have realized. I don't know the deadline for him to exercise his opt-out, but if we don't have a new CBA by later summer I think we can kiss any dreams of 2011 Rubio goodbye.

Rubio would be smart to wait until 2012 (cha-ching), but I don't know if that loophole survives the next CBA.

shangrila · Post #3 » by **shangrila** » Fri Jun 25, 2010 6:28 am

Jesus, you picked a hell of a time to post this buddy

andyhop · Post #4 » by **andyhop** » Fri Jun 25, 2010 6:40 am

It actually makes sense for him to opt out his deal regardless of the NBA situation because he is signed to a below value deal because of the buy out Barca paid.

Saltine · Post #5 » by **Saltine** » Fri Jun 25, 2010 7:03 am

Possible, but we have no idea how much the new CBA is going to cut into salaries. They certainly are not going to go up. Turning down guaranteed money is always very risky, especially when you are an athlete.

andyhop · Post #6 » by **andyhop** » Fri Jun 25, 2010 7:11 am

If you change your assumptions then Rubio not coming over in 2011 could cost him hundreds of millions of dollars.

PHTown · Post #7 » by **PHTown** » Fri Jun 25, 2010 7:20 am

andyhop wrote:If you change your assumptions then Rubio not coming over in 2011 could cost him hundreds of millions of dollars.

How?

andyhop wrote:It actually makes sense for him to opt out his deal regardless of the NBA situation because he is signed to a below value deal because of the buy out Barca paid.

I believe his deal has an NBA only opt out. So his choice is Barca or NBA rookie salary only. It is also pretty much the same in 2012, NBA only opt out, I think.

PHTown · Post #8 » by **PHTown** » Fri Jun 25, 2010 7:22 am

shangrila wrote:Jesus, you picked a hell of a time to post this buddy

Sorry. I was hoping someone could challenge my thinking and cheer me up. It is very clear from the draft that Kahn is all in on Rubio coming over in 2011 and it just doesn't seem to make sense. I want to be wrong on this.

lbeboipinoy · Post #9 » by **lbeboipinoy** » Fri Jun 25, 2010 7:24 am

He's not coming to this team. He doesn't want to. They should trade him before it's too late. I think if he doesn't get traded he goes to the clippers. If I'm wrong, Twovle owe them a first round pick for the 2012 or 2013

horaceworthy · Post #10 » by **horaceworthy** » Fri Jun 25, 2010 7:32 am

PHTown wrote:3. Virtual Free agent. If he waits one more year, he can basically negotiate a contract with the wolves. Think about it: How much will David Kahn pay to get Rubio over here? Did you picture a mountain of gold? I did and if Rubio's team didn't, they haven't been paying attention.

In the end the cost to him of coming over and signing a rookie contract could easily range in the $16 million dollar range over three years.(this includes the diffence between a four year rookie salary and an estimated 8 million a year free agent deal(which we all know Kahn would pay)+ the difference in pay he would make in a working year in Europe vs. a lockout year in the NBA.

He wouldn't be a virtual free agent. If the Wolves want to pay him above rookie scale they would have to do so out of either cap space or the MLE (under the current CBA).

I doubt the Wolves are $8M under the cap after the 2011 season, and some of the talk around the new CBA is that the owners are looking to eliminate the exceptions.

All that being said, I think it's the lockout that keeps him from coming to the NBA for 2011-12.

shangrila · Post #11 » by **shangrila** » Fri Jun 25, 2010 7:32 am

PHTown wrote:
shangrila wrote:Jesus, you picked a hell of a time to post this buddy

Sorry. I was hoping someone could challenge my thinking and cheer me up. It is very clear from the draft that Kahn is all in on Rubio coming over in 2011 and it just doesn't seem to make sense. I want to be wrong on this.

I'd think he'd want to come over. With the way the CBA looks like it's headed he'd probably be taking a paycut from the rookie scale even if he waited to be a FA. That and he's said he's coming over in 2011.

I don't know, I don't think there's any way to change your mind with evidence because all of it's subjective.

andyhop · Post #12 » by **andyhop** » Fri Jun 25, 2010 7:33 am

PHTown wrote:
andyhop wrote:If you change your assumptions then Rubio not coming over in 2011 could cost him hundreds of millions of dollars.

How?

He says no in 2011, Kahn gets fired and the new GM sees no reason to overpay for him and basically offers him the equivalent of his rookie deal.Rubio refuses and stays in Europe ,falling out with the team over it.Wolves get real lowball offers as other teams know he won't play for us.He turns into the star player we hope he will become in Europe and plays out his career there on less than half the money he could make here whilst missing out on $10m+ a year in endorsements he could have made as a Star in the NBA.

Saltine · Post #13 » by **Saltine** » Fri Jun 25, 2010 8:44 am

He does stand to make a hell of a lot more pitching products in the US than he does in Spain. I'm sure his agent, and Nike are well aware of this. He'd still make that cash even if there is a lockout.

Fran Vasquez · Post #14 » by **Fran Vasquez** » Fri Jun 25, 2010 11:32 am

i think he will play in the nba, otherwise he would be a coward!!!!!! fran angry nao!!!!!