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View Full Version : The reason Maggs wont sign here.......


joeynach
06-07-2004, 09:27 AM
Its very simple, his name is JR and his wacky contracts and way of doing business. As many of us know Maggs was offered a pretty big contract a while ago in april, 4 years 58 mil. Good deal right. Wrong. In a classic not straight foward act of course JR deffers a majority of money, backloading the contract. As well as making incentive cluases that equate to the 58 mil anyway. Then Maggs says he wants more years so the sox are said to have offered 6 years 68 mil straight up. So let me get this straight. We offer the amount he is looking for, but not the years in a stupid deffered way to make a good contract offer a bad one. Then we offer a new one with more years and way less money. I dont get it. Stop clowning around JR, get the deal done. No deffered money, no backloading, no incentive clauses. Just give him a nice even deal thats fair for both. Im sick of the way this guy does business. It the reason we have Koch. It was contract year for Foulke and he didn't want to pay a good closer what hes worth so he traded for a closer with a friendly financial situation, AND LESS SKILL. Over time im starting to beleive that he is costing us. Sorry to sound like Mariotti here, but this is just ridicoulous when you actually look at it. I mean if Maggs walks here over all these non straight foward clowed around contracts what does that tell the baseball world. That you can come to the sox, work your butt off, become a superstar, and then not be rewarded at all becuase the owner is a retard and offers bad contracts. Sorry JR but most people that win the lotto like to take the lump sum, not the deffered money every year, its human nature.

joeynach
06-07-2004, 09:31 AM
And something else just hit me. Why is JR even involved in Maggs' contract and signing players and stuff. Last i looked player personell is the GM's job, not the owner. You hired KW for a reason, for him to handle these situations. JR you are now the GM and should not be involved in player personell.

The Critic
06-07-2004, 09:36 AM
I agree, deferred money repels free agents.
If you want to compete with other teams' offers, you can't come at a guy with a "pay a little now, pay a little later" kind of deal.

SEALgep
06-07-2004, 09:44 AM
Originally posted by joeynach
And something else just hit me. Why is JR even involved in Maggs' contract and signing players and stuff. Last i looked player personell is the GM's job, not the owner. You hired KW for a reason, for him to handle these situations. JR you are now the GM and should not be involved in player personell. Well JR signs the checks, so him being involved isn't too unreasonable. GMs need approval in most cases from owners, especially when talking about huge contracts.

joeynach
06-07-2004, 09:44 AM
Originally posted by The Critic
I agree, deferred money repels free agents.
If you want to compete with other teams' offers, you can't come at a guy with a "pay a little now, pay a little later" kind of deal.

Well if we 20 something year olds understand this why cant a 60 year old man who has been running this busniness unseccesfully (in terms of winning championships) now for 22 years see this. What a joke this guys is. Older = Wiser...............my ASS!!!

SoxOnTop
06-07-2004, 09:46 AM
Originally posted by joeynach
That you can come to the sox, work your butt off, become a superstar, and then not be rewarded at all becuase the owner is a retard and offers bad contracts.

That's why there is free agency. Maggs is going to get paid. It just might be with another team. JR is a fool, but I don't think that too many of the players suffer. I certainly don't feel sorry for the players. When you work your butt off and produce someone in the market will pay you.

joeynach
06-07-2004, 09:51 AM
Originally posted by SoxOnTop
That's why there is free agency. Maggs is going to get paid. It just might be with another team. JR is a fool, but I don't think that too many of the players suffer. I certainly don't feel sorry for the players. When you work your butt off and produce someone in the market will pay you.

The point is somone will, but not the Sox becuase of their owner. You can be a star or you can become a star and you usually get what you pay for, but JR wont pay for it. You dont need to a 100 mil payroll of inflated ego superstars, but you dont need to let a homegrown superstar walk either of a set of stubborn disrespectful clasuses and deffered payments to one of your best players ever.

Hangar18
06-07-2004, 09:52 AM
Any wonder why we HAVNT signed anyone of any WORTH here?
Who wants to play for an Owner like that. 22 years .............
No World Series. He Cant Live Forever thankfully

harwar
06-07-2004, 09:53 AM
Originally posted by joeynach
Well if we 20 something year olds understand this why cant a 60 year old man who has been running this busniness unseccesfully (in terms of winning championships) now for 22 years see this. What a joke this guys is. Older = Wiser...............my ASS!!!

We're not all young guys my friend.Maybe i can't hump all day with a heavy pack and drink all night anymore,but i like to think that i know a bit more now than back when i just thought i had it all figured out.
I'm to the point now where the more i know,the more i realize that i don't really know anything.

joeynach
06-07-2004, 10:22 AM
Originally posted by harwar
We're not all young guys my friend.Maybe i can't hump all day with a heavy pack and drink all night anymore,but i like to think that i know a bit more now than back when i just thought i had it all figured out.
I'm to the point now where the more i know,the more i realize that i don't really know anything.

The point was about being older and wiser to Mr. Reinsdorf. He has been doing this for 22 years and you would think at this point he would learn that if he wants the guy to sign to not mess around with this whacky contracts. I mean if me a 20 year old can figure this out why cant a 60 year old man who has been running this team for 22 years see that players dont like to sign backloaded, deffered money, and incentive ridden contracts. It turns them away, its obvious.

soxtalker
06-07-2004, 10:36 AM
As much as I hate being in the role of defending JR, I think that people are missing the point on the complexities of these contracts. There is a lot of money involved, and there are people skilled in negotiations on both side.

Take the issue of deferred money. Both sides can compute the present value of the money. If a player really wants to take it all now, he can certainly find someone to give him a loan that will pay him the money up front or over any kind of time frame he desires. The transaction will cost him something, but it is a standard practice in business and personal life (e.g., mortgages, reverse mortgages, insurance, pensions, etc. are variations on this theme).

These contracts also probably involve a number of option clauses. I doubt very much that either side is trying to insult the other, but each has a different view of the world and what the future is likely to bring. Options are a good mechanism to deal with these different views. Say Maggs is super confident and believes that he'll have five more all-star years, but the club is worried that his production will tail off (for whatever reason). One way of handling this is to add incentive options. If Maggs is right, he profits. If he isn't, the club is protected.

The big problem, I believe, is that we hear one aggregate number -- so many dollars over a given number of years. I don't know any way around that. These negotations aren't done in the press; they are done behind closed doors.

joeynach
06-07-2004, 11:09 AM
Originally posted by soxtalker
As much as I hate being in the role of defending JR, I think that people are missing the point on the complexities of these contracts. There is a lot of money involved, and there are people skilled in negotiations on both side.

Take the issue of deferred money. Both sides can compute the present value of the money. If a player really wants to take it all now, he can certainly find someone to give him a loan that will pay him the money up front or over any kind of time frame he desires. The transaction will cost him something, but it is a standard practice in business and personal life (e.g., mortgages, reverse mortgages, insurance, pensions, etc. are variations on this theme).

These contracts also probably involve a number of option clauses. I doubt very much that either side is trying to insult the other, but each has a different view of the world and what the future is likely to bring. Options are a good mechanism to deal with these different views. Say Maggs is super confident and believes that he'll have five more all-star years, but the club is worried that his production will tail off (for whatever reason). One way of handling this is to add incentive options. If Maggs is right, he profits. If he isn't, the club is protected.

The big problem, I believe, is that we hear one aggregate number -- so many dollars over a given number of years. I don't know any way around that. These negotations aren't done in the press; they are done behind closed doors.

It doens't matter, we are not just resigning one of our regular guys. This is different. This is our star. I know we did this with the contracts to lee and buehrle and thats good becuase they are young and still improving. But Maggs is different. He is older and in the prime of his career, he is our home grown superstar who is on the brink of being in a different uniform next year. No more games, no more protection, no more upper hand, no more clowing around, give the guy a good deal and get it done.

samram
06-07-2004, 11:39 AM
Originally posted by soxtalker
As much as I hate being in the role of defending JR, I think that people are missing the point on the complexities of these contracts. There is a lot of money involved, and there are people skilled in negotiations on both side.

Take the issue of deferred money. Both sides can compute the present value of the money. If a player really wants to take it all now, he can certainly find someone to give him a loan that will pay him the money up front or over any kind of time frame he desires. The transaction will cost him something, but it is a standard practice in business and personal life (e.g., mortgages, reverse mortgages, insurance, pensions, etc. are variations on this theme).

These contracts also probably involve a number of option clauses. I doubt very much that either side is trying to insult the other, but each has a different view of the world and what the future is likely to bring. Options are a good mechanism to deal with these different views. Say Maggs is super confident and believes that he'll have five more all-star years, but the club is worried that his production will tail off (for whatever reason). One way of handling this is to add incentive options. If Maggs is right, he profits. If he isn't, the club is protected.

The big problem, I believe, is that we hear one aggregate number -- so many dollars over a given number of years. I don't know any way around that. These negotations aren't done in the press; they are done behind closed doors.

Good post. Sometimes there seems to be a notion that a "fair" contract means the team gives the player whatever he wants. A fair deal is actually when the agreement is signed. I want Maggs resigned, but if paying him $14M for five or six years means that other areas can't be addressed (because JR won't allow more flexibility), maybe it is best to use the money for a shortstop, bullpen help, maybe even a third baseman (hopefully that won't be a problem, but it looks like it may be). Remember that power hitting right fielders are pretty easy to find.

As for your other point about deferred money and loans, it is very easy to get loans to make up for the deferrment because the guaranteed contract means no default risk (or very little). The interest rate would probably be pretty small too.

soxtalker
06-07-2004, 11:45 AM
Originally posted by joeynach
It doens't matter, we are not just resigning one of our regular guys. This is different. This is our star. I know we did this with the contracts to lee and buehrle and thats good becuase they are young and still improving. But Maggs is different. He is older and in the prime of his career, he is our home grown superstar who is on the brink of being in a different uniform next year. No more games, no more protection, no more upper hand, no more clowing around, give the guy a good deal and get it done.

My comments are even more true for a special player like Maggs. A "regular guy" probably doesn't have much power in a negotiation. Management can turn to lots of alternatives. Maggs has lots of power in this negotiation. In addition, the contract involves enough money that Maggs is able to employ good business people on his side to handle his side of the negotiations.

I understand the frustration, but I think that this process is much more like a dance than a simple fixed-price transaction at a store. Maggs has his concerns and demands, but management does also. We don't expect Maggs performance to tail off, but there is always the chance that it could. Then we'll be faced with a huge contract hanging over our head. That doesn't mean that management should avoid such deals, but it is perfectly reasonable for them to include things in the contract that mitigate those risks somewhat.

PaulDrake
06-07-2004, 11:51 AM
Originally posted by harwar
We're not all young guys my friend.Maybe i can't hump all day with a heavy pack and drink all night anymore,but i like to think that i know a bit more now than back when i just thought i had it all figured out.
I'm to the point now where the more i know,the more i realize that i don't really know anything. I'm (gasp!) a little older than you. I sure as hell can't drink all night, and even though my bench press is better than it ever was, I still need that occasional afternoon nap to see me through the day. So your comments are welcome. Of course at our age we've come to realize that many of those easy answers aren't so easy anymore. That being said I feel confident in stating that JR is a complete horses patoot as White Sox owner. I wish there was some way to convice him to sell and enjoy a comfortable retirement in sunny Arizona.

steff
06-07-2004, 12:25 PM
Originally posted by Hangar18
He Cant Live Forever thankfully




You are a complete *******!

Brian26
06-07-2004, 12:28 PM
Originally posted by steff
You are a complete *******!

I'm not a big fan of wishing death upon people either.

Lip Man 1
06-07-2004, 12:40 PM
The problem is that while Uncle Jerry continues to have 'fiscal responsibility' (his words) other clubs are more willing to take risks for potential rewards on the field of play. So they wind up signing good players.

Uncle Jerry is a brilliant businessman...and a lousy owner. But unfortunately the group that is paying the heaviest price for his ownership is the increasingly smaller number of White Sox fans.

Lip

Kilroy
06-07-2004, 01:27 PM
Originally posted by joeynach
Sorry JR but most people that win the lotto like to take the lump sum, not the deffered money every year, its human nature.

That's because they are greedy, stupid, or both.

Imagine a $20 million dollar jackpot. 50% is going to go to taxes no matter which way you get it. If you take the lump, you forfeit another 20-30%. So instead of getting a half mil every year for 20 years, the average person tosses away 3-4 mil just to take the lump. In the end, the lump nets about 6 mil, where the annuity nets 10. Sorry, but when I win, I'll take annuity.

Hangar18
06-07-2004, 01:34 PM
Originally posted by Kilroy
That's because they are greedy, stupid, or both.

Imagine a $20 million dollar jackpot. 50% is going to go to taxes no matter which way you get it. If you take the lump, you forfeit another 20-30%. So instead of getting a half mil every year for 20 years, the average person tosses away 3-4 mil just to take the lump. In the end, the lump nets about 6 mil, where the annuity nets 10. Sorry, but when I win, I'll take annuity.

Yes, but wouldnt the STATE in fact be making $$$ off the annuity?
and not the Winner?

Kilroy
06-07-2004, 02:25 PM
Originally posted by Hangar18
Yes, but wouldnt the STATE in fact be making $$$ off the annuity?
and not the Winner?

They're already making money off the lottery. And you are only going to get the jackpot amount that you won. So if the fund earns more interest than they have to pay you, what do you care? You still get paid.

pearso66
06-07-2004, 03:23 PM
I see nothing wrong with the contract offers to Maggs. He didn't like the 5 year because it wasnt the length he wanted, and he didnt want the 6 year because it was too little money. I dont mind the 5 year, because it is incentive laden, which EVERY PLAYER SHOULD HAVE. A person shoudl be paid what he is worth. Who's to say that 5 years down the line Maggs will be worth 14 mil a season, there is a chance he wont. If he is confident that he'll play up to his standards, he'd be a fool not to take that. The reason he doesnt is because he knows that his skills could deteriorate(wow i botched that one) and he wants to get paid regardless. So we give him 6 years with guaranteed money, but its 11.15 a season. Great, I think thats all he shoudl be getting anyway. And since he is signed for a long time, if he does falter, it wont hurt as bad as a guaranteed 14-16 mil contract will.

If he wants the big bucks, he should take the 5 year deal, and in 5 years, when he is Frank's age, if he is putting up the kind of numbers Frank is, he will make more. I don't feel sorry for a guy who makes 11 million dollars a year when I'll be lucky to get 60,000.

illiniwhitesox
06-07-2004, 03:40 PM
Originally posted by Kilroy
They're already making money off the lottery. And you are only going to get the jackpot amount that you won. So if the fund earns more interest than they have to pay you, what do you care? You still get paid.

It's not that hard to figure out actually. Someone mentioned the TVM (Time Value of Money) calculation of money. Basically, you model multiple approaches using different scenarios and rates of return, based off of your expectations. This would include taxes.

If you feel that the bird in the hand is worth more than the two in the bush, take the cash now - you may rightfully assume that the investment power in this money is greater than than taking it in a deferred fashion (taxes included).

There's no set rule here - it's based off of your expectations of earned income off of investments and taxes.

illiniwhitesox
06-07-2004, 03:42 PM
Originally posted by joeynach
And something else just hit me. Why is JR even involved in Maggs' contract and signing players and stuff. Last i looked player personell is the GM's job, not the owner. You hired KW for a reason, for him to handle these situations. JR you are now the GM and should not be involved in player personell.

I hate to stick up for JR, but if I were an owner and someone were to ink a contract worth over $50MM, you damn well better believe I would have hands-on input into the decision and how it was crafted.

A bad decision with this kind of money equals the ruin of a business.

Paulwny
06-07-2004, 04:20 PM
Originally posted by Kilroy
That's because they are greedy, stupid, or both.

Imagine a $20 million dollar jackpot. 50% is going to go to taxes no matter which way you get it. If you take the lump, you forfeit another 20-30%. So instead of getting a half mil every year for 20 years, the average person tosses away 3-4 mil just to take the lump. In the end, the lump nets about 6 mil, where the annuity nets 10. Sorry, but when I win, I'll take annuity.

Lump sum or annuity is very much age dependent.
Someone under the age of fifty is probably better off with the annuity.
For those over the age of 50 it's iffy for those who take the annuity.
If you live 20yrs great, but if you die before the 20yrs is up it'll be a headache for your heirs.
Suppose someone wins $40 mil, $2 mil/yr for 20 yrs, but dies after 10 yrs. This will leave $20 mil in the annuity. The tax people will tell your heirs that they will owe taxes on $20 mil for this tax year not the $2 mil that they receive from the annuity each yr.
There are companies who will purchase these annuities from people caught in this bind. They usually give the heirs enough money to pay the taxes and an extra $1 or $2 mil . Of course this is all dependent on the amount remaining in the annuity.

gosox41
06-07-2004, 04:22 PM
Originally posted by joeynach
Its very simple, his name is JR and his wacky contracts and way of doing business. As many of us know Maggs was offered a pretty big contract a while ago in april, 4 years 58 mil. Good deal right. Wrong. In a classic not straight foward act of course JR deffers a majority of money, backloading the contract. As well as making incentive cluases that equate to the 58 mil anyway. Then Maggs says he wants more years so the sox are said to have offered 6 years 68 mil straight up. So let me get this straight. We offer the amount he is looking for, but not the years in a stupid deffered way to make a good contract offer a bad one. Then we offer a new one with more years and way less money. I dont get it. Stop clowning around JR, get the deal done. No deffered money, no backloading, no incentive clauses. Just give him a nice even deal thats fair for both. Im sick of the way this guy does business. It the reason we have Koch. It was contract year for Foulke and he didn't want to pay a good closer what hes worth so he traded for a closer with a friendly financial situation, AND LESS SKILL. Over time im starting to beleive that he is costing us. Sorry to sound like Mariotti here, but this is just ridicoulous when you actually look at it. I mean if Maggs walks here over all these non straight foward clowed around contracts what does that tell the baseball world. That you can come to the sox, work your butt off, become a superstar, and then not be rewarded at all becuase the owner is a retard and offers bad contracts. Sorry JR but most people that win the lotto like to take the lump sum, not the deffered money every year, its human nature.

A couple of comments:

1. How do you know the status of Magglio's negotiations? You are only speculating about deferred money. Fact is JR is more likely to throw deferred money towards a pitcher then a hitter.

2. Foulke wasn't going to resign here as long as JM was around. It was no reason to make that ill fated trade, but my guess is Keith didn't think too highly of JM and the coaches.

3. JR always gets involved in negoitations for bigger contracts no matter who the player is. It's better him then having KW screw it up. KW can't even get the smaller contracts done right.


Bob

Paulwny
06-07-2004, 04:31 PM
Originally posted by gosox41


3. JR always gets involved in negoitations for bigger contracts no matter who the player is. It's better him then having KW screw it up. KW can't even get the smaller contracts done right.


Bob

MAYBE,
JR has learned from King George. A few yrs ago The King sat in on a player's contract negotiations and then paid himself a few $mil from the yankmee coffers for being a consultant.

joeynach
06-07-2004, 04:51 PM
Originally posted by gosox41
A couple of comments:

1. How do you know the status of Magglio's negotiations? You are only speculating about deferred money. Fact is JR is more likely to throw deferred money towards a pitcher then a hitter.

2. Foulke wasn't going to resign here as long as JM was around. It was no reason to make that ill fated trade, but my guess is Keith didn't think too highly of JM and the coaches.

3. JR always gets involved in negoitations for bigger contracts no matter who the player is. It's better him then having KW screw it up. KW can't even get the smaller contracts done right.


Bob

I have a couple friends inside the organazation. One is a minority shareholder one is the technology consultant or something. Nevertheless we always talk sox when we are together and they have mounds of useful and new info always.

nasox
06-07-2004, 05:19 PM
Half the crap reported by the media is a bunch of crap (that includes Chicago stuff too, not just the ny papers-Bruce Levine can ve completely wrong sometimes). I am of the opinion that we will sign Maggs and we will have him in RF on the south side. Remember, these things take time, and fortunately, they have time on their (or our) side.

Lip Man 1
06-07-2004, 05:33 PM
Illini says: "A bad decision with this kind of money equals the ruin of a business."

But when that business had its stadium publicy funded, when that business continues to have clauses in their contract with the state that requires the state to buy tickets if attendence falls below a certain level and with revenue sharing and subsidies among MLB teams how would it ruin the business even if it turns out to be a flop?

Seems to me the bigger risk is pissing off the increasing fewer number of your clients by NOT doing the deal don't you think?

Lip

joeynach
06-07-2004, 10:50 PM
Originally posted by Lip Man 1
Illini says: "A bad decision with this kind of money equals the ruin of a business."

But when that business had its stadium publicy funded, when that business continues to have clauses in their contract with the state that requires the state to buy tickets if attendence falls below a certain level and with revenue sharing and subsidies among MLB teams how would it ruin the business even if it turns out to be a flop?

Seems to me the bigger risk is pissing off the increasing fewer number of your clients by NOT doing the deal don't you think?

Lip

Exactly!!!!!

TornLabrum
06-07-2004, 11:17 PM
I absolutely love how so many of our fans are concerned with whether or not Uncle Jer manages to keep his fortune. We are truly a magnanimous group of souls to be so concerned about the well-being of the owner of our ball club.

I guess that comes from the 23 consecutive championships he has brought us.