The "Trickle Down" effect.

[Gray Mule]

With the posibility of all the huge contracts going to all

the free agents out there, something has to give.

Think about it. If all the free agents signed for somewhere

in the neighborhood of what they are asking by teams

willing to spend that amount of money, then some players

are going to be out of a job. When you add players at

the top, players are forced out at the bottom since one

team can't keep them all.

Then there is the salary cap. Some teams worry about this

and some don't. They get whoever they want, pay the tax

and say to heck with it, it's only money. We want to win

and are willing to pay the money to do so.

Someone gets left out. Who gets the leftovers?? Poor

teams that can't or will not go over the cap.

Can't buy a championship? Don't say can't - It can happen.

[jeddelong]

Just a thought: Players aren't really forced out of the bottom. You make it sound like they just leave the league. In reality what happens is that the NBA salary structure works against the mid-level to lower player. They end up taking less; however, in the end, the eventually take what they are offered. So in truth they aren't really forced out of the league they only end up with a lower salary. This of course can benefit a team like the Hawks who are left to feed over other team's leftovers.

Mark Cuban once argued that it is cheaper for him to go over the cap to put a good product out on the court. I guess that makes sense if you do the math. In truth though, desiring to go over the cap isn't everything. You have to be in an ideal situation too. The Lakers have a huge fan base and make tons in marketing; however, they have spent so much on there stars that they are financial tied up. Yes they can exceed the cap to sign their own players (paying dollar for dollar); however, they struggle adding new talent. My point is that you could have all the money in the world but that doesn't mean you can spend without limits. So in truth, you can buy a championship; however, it takes shrewd moves to allow that money to truly work to your benefits.

[Diesel]

It's a system designed to Kill BIG contracts for young players.

A few years ago, there was a bunch of players that got BIG contracts:

Shaq, Howard, KG. They got Over 120 million dollars. The problem especially with KG is that they were young enough to collect more after that contract time. So the league put a cap and a Luxury tax in place. The only teams that are hurt by it is Smaller Market teams and Teams not willing to spend money. However, Allen, Cuban, Layden, etc will always be able to put a good product on the floor because they are willing to spend the money.

The problem comes with the second tier.

They get the blunt of the blow. That would be guys like:

Walker, Reef, Spreewell, Rose, Jamison, Allen....

These guys got reletively BIG contracts (Max Contracts) and are soon to become free agents again. The problem is that they are not worth their contracts now that there's a cap in place. UNLESS, these guys can move to a team with an owner who is willing to spend, they won't be getting more than they are making now.

The third group are those on the third and fourth teir. You would think that teams wouldn't be willing to spend on these guys either, but they are: Look at Bowen and the guy in Philly. These are mere role players and they got nice contracts.

The bottom line on the Luxury tax is that it is a joke. The owners get that money right back as long as they don't spend so extravagantly. So the only thing that's going on is that the Luxury tax was put in place so that Owners have an excuse for not signing BIG contracts.

[Double_Dribble]

it's a system designed to keep salaries low until these rookies and young starts "earn" it.

it will be interesting to see what happens with payton and malone, see as how they are used to their big paydays.

maybe they stay with their current teams and abandon their hopes of a ring so they can cash one more big payday?

[jeddelong]

Diesel our posts agree for the most part; however, I think the system may not play out the way you are suggesting. If it was truly an open market based only on player talent and salary, then yes that makes sense. The marginal talent will get squeezed. Yet, don't you think that guys who go to unappealling places get overpaid and through off your rationalization. Think about Bruce Bowen's contract or even Ira Newble going to Chicago. These contracts blow your theory because they are clearly above market value (talent equal to pay). The superstars will get the top salary, and I think that the mid guy is defintely going to lose compared to the old system. I mean if they hadn't have stepped in crazy salaries like KG would probably be the norm. Yet, I think that some mid-guys willing to go to a team like Denver will get overpaid. (Look at what would happen if they signed Jason Terry or any of the Clippers players, they will get above market value because the best won't go there an because they have money to spend. That leads to mid-players making more in some instances, all because the system is so regimented and forces the best players to go to the best teams that can afford the mandated salary ceiling for a player......but that is just my opinion.

[Gray Mule]

My point was, and still is, not that these players are

forced out of the N.B.A. but that they are faced with

going to a lesser team, which can afford to pay them

at a lower salary than they had originally, or one who

will be unable to make the playoffs.

When all the dust settles and everyone has a spot on

someone's roster, the middle of the pack players will still

have a job, just not with the team that they had hoped

to play for.

We saw last season where some free agents failed to sign

until very late. They weren't super stars and they weren't

expected to be the 12th man on the roster either. All

the teams were pretty well set until someone got hurt or

a rookie got released to open up a spot.

It will happen again. Some teams grab the free agents

they want early, trades are made and still these other

free agents go unsigned. Since the Hawks are loosing

some of their players now { Or very soon } and the

ownership and the coaching is unsettled, that may be

the time for us to grab some pretty good talent to fill

our empty spots.

[Diesel]

This new CBA was put in to help the owners maintain their profits. This is what happens.

1. First and foremost, the Cap (hard with tax) helps to stop the usage of the BIRD Rule. Now, it's not smart for a team to go over the cap to resign it's own free agents. Because now there's a Penalty.

But do you think that will stop most teams from trying to resign it's better players? Think about it. The Lakers were far over the Cap when they resigned Kobe to a Max Deal.

2. The Cap (luxury tax) causes a team to actually manage it's players. Before it was easy to have a contract or two like CC's that doesn't hinder you from doing what you wanted to do personnell wise. BUT now, those Millions that you give out means something. When the Cap was softer, you didn't worry about bad contracts because you could always have good players on your teams that you could resign. Now, a bad contract will effect your ability to resign. For INstance, Glover is not being resigned. DO you think anybody on the board would not drop CC's contract in order to give Glover a Contract?

3. The Cap Causes a team to Manage when it's players come off of free agency. It really forces trades. A great example if Indy. They were a in the Championship game four years ago. NOW, they have NOTHING from that team. Right now, Reggie, Jermaine, and Brad Miller are all free agents. It means that Indy has limited money to spend in order to reaquire it's own players. They realistically have to make a choice of which one stays which one goes. If we sign JT, we will be in the same prediciment. Theo, Dog, CC, SAR, Hendu all come off the books at the same time. Some look at it as a good thing. However, if we were to make a championship run with our current team, we will be in dire straights trying to figure out who stays and who goes.

4. The Middle Class people will get paid but 9 times out of 10, they will have to take what a team offers (advantage Owners). This is what happens when fat Cats like Juwaun Howard and Pat Ewing Negotiates the deal for the players side. A great example is Stackhouse and Hendu.

Both of these players can opt out for a new contract. Problem is that Both know that on this Market, they will fetch NO MONEY. So both stay in their current contracts and are paid third tier money. Teams are willing to spend their MCE on these third tier players but it's really up to the team how much a player makes. An interesting case is Ricky Davis. He's signed for a long time but if he were in his contract year Now, would he make more than the MCE? He should. But My bet is that most owners wouldn't offer more to him.

Basically, what the CBA does is takes the power out of the hands of the Agent... Remember when Jordan's Agent ruled Basketball. Where is he now. It takes the Power out of their hands and put it back into the hands of the owners. BUt the funny part is that it's all a joke.

The teams get a kick back from all the luxury taxes. It comes back to the owners based on their percentage of how far they have gone over. For instance, last year, I think we made a Profit from the luxury taxes. I think everybody made a profit except NY, Dallas, and PTL. Even Sorry Miami who had to beg the league to go over the luxury tax made a profit from the luxury tax. I think PTL broke even.

So, it's all a joke but it was designed to give Owners control of contracts and to take Agents out of the game. The only guys who really need agents are Rookies and third tier guys.

[Diesel]

Not every team that has cap money to spend is a Lesser team.

For instance:

The Clipps can have: Brand/Odom/Ely/Maggette/Jaric/Richardson/and Wilcox on their roster and have room to sign 1 max Salary, 1 7 million dollar Salary, and 1 MCE. Are they a lesser team?

The Nuggets can have:

Mello/Nene/Tskitsville/White/and Camby and still have room to sign 2 Max Contracts.

The Spurs can Have:

Duncan/Bowen/Parker with room to sign M. Rose and one max Contract. IS that a lesser team?

The point is that If a team has people on rookie contracts who are good, they will have money to get More talent. Like Chicago. If they get Pippen. The question is HOW much Longer does ROSE have? I would try and get him above most other players if we plan to keep JT.

SAR for Rose/Chandler.

[Catapult]

Team by team analysis of lux tax situation, free agents & signings and profitability.

http://www.realgm.com/src_feature_article.php?articleid=8

"Thus, for a team right at the luxury tax threshold, it costs them $15 to $17 million to add a player for $3.5 million"

how can that be? go and figure it out. Very interesting article!

i hope the link works.

[Diesel]

what that Article don't emphasize is that those teams who go over the CAP has it's money redistributed amoung the owners. SO when NEW York is 30 million over the cap, that's 3 more million to each owner. IF you have 8 teams over the cap by 30 million, that's an addition of 24 million to each owner. And As some teams go further in debt, they lose out on their rebate, so that's more money distributed amoung the rest. SO that 24 would be distributed amount 22 owners. Finally, there's a new team in basketball. The owners will get 10 million more because of the entrance of Charlotte.

There's a lot of money out there. Just because teams are not making what they used to doesn't mean that they are not prospering.