2/7/14

Mack’s Morning Report – 2-7-14 – Podcast, Finance, 6-yr Plan, Shortstop



Coming up...

       10:30am - Herb GRalph Kiner: HOF Ballplayer, Outstanding Broadcaster, Superb Human Being ~ You Will Be Missed!

      11am - Christopher Soto - Top 25 - #22

      12:30pm -   Christopher Wuensch -  Saved From The Trash Heap: Garbage Pall Kids

        2pm  -  D Whit  - How the Mets ended up 8th in payroll and 23rd in Wins since 2009 pt. 2


I spent some time with Ed Marcus and Stephen Keane on their podcast Wednesday night. We talked for an hour about a bunch of Mets related subjects, especially finance, the building of a new team, and the future at shortstop.
Regarding the finance issue…

Look, Mets fans have to realize something before you go on with rooting for this team. The Wilpons are a very rich family. Not one member of them owe a single penny to anyone. They are debt free. Their cars are paid off, there is no mortgages on their homes, hell , even the mattress on their bed isn’t on time payments.

The Mets, which is just one of their lucrative ‘real estate’ investments, has a net worth of one billion dollars. But, their real estate holdings don’t end there and every one of them are pumping out positive cash flow.

The problem you have, as a fan, is you feel the Wilpons look upon the Mets as more than just one of their ‘investments’. Oh, it’s a fun one, but, in reality, it’s just an investment.

And, if they wanted to spend more money on this ‘investment’ they would. They may not have seen their friend Bernie coming, but they knew the economy was going in the crapper. They were going to have to operate this baseball team different under any condition.

They seemed to have hired a General Manager who either a) the Commish convinced them or b) Sandy convinced them… that he could build a new ‘model’ using a salary range similar to teams like the Atlanta Braves and Tampa Bay Rays. I’m sure he also pointed out that it would take a 3-5 year period to ‘turnaround’ the team from a heavily weighted free agent, large contract team, to a draft pick/IFA based ‘controlled’ team. Fred Wilpon liked what he heard and the rest was history.

Regarding the rebuilding of the team…

            I give Sandy Alderson an ‘A’ for his efforts during the first three years which is obviously a five or six year plan. The only reason I didn’t rate him ‘A+’ was for his lack of explanation as to why he can’t overnight turn this team around.

            The future of this team is within the organization already. Alderson knows that and he also knows he’s going to someday have to pay them, first through the arbitration process.

            Matt Harvey, Zack Wheeler, and Noah Syndergaard alone could represent a 2018 combined payroll of $60+mil.

            At the same time, you just can’t throw around multi-year contracts. David Wright, yes… Curtis Granderson, sure… but the rest of the 2014 and (probable) 2015 team will be bits and pieces one year deals while, at the same time, arbitration figures (Murphy, Gee, etc.) begin to pile up.

            You break this out on a flow chart and project where this team is going, salary wise, and you’ll have your $100mil+ payroll in a heartbeat.

Regarding shortstop…

            Every interview has to start somewhere and it took less than ten seconds to get back to the age old Stephen Drew question.

            It seems to me that the job of a ballplayer’s agent is to get the best deal he can for his client and, in the case if Drew, this may turn out to be a one year contract with the New York Mets.

            Boston wants to sign him, but only as a utility infielder. The Dodgers want some depth at the position and the Yankees are also interested in some insurance in case Derek Jeter goes down, but all three of these teams don’t offer Drew the chance for 500+ at-bats and that last great contract every ballplayer wants to get when they are south of thirty years old.

            No, it may be in the best interest of Scott Boras to tell his client… take the Mets one year offer, do the best you can, and then we’ll tell Alderson to suck an egg at the end of the season.

            The only problem for Boras is the fact that this could backfire with a late season trade to even another team, but that wouldn’t get in the way of negotiating a new deal a la the one Marlon Byrd did with Philadelphia.
            So, frankly, until we hear differently, we’re back to square one and the deciding factor could be whether or not Alderson is past all this drama. As I mentioned on the podcast, I don’t think he likes dealing with Boras, nor does he like him personally, and the Mets may just have moved on.

            I hope not for the team. They need to take a close look at the chance of a one year deal for Drew vs. Ruben Tejada. It wouldn’t kill Tejada to spend one more year at the AAA level while Drew gives this team a legitimate leadoff hitter that doesn’t jumble up your outfield.


Dave Cameron chat –

            Comment From Joe - Where and for what will Drew sign?
Dave Cameron: Boston, 2/20.



11 comments:

tommyb said...

Drew for a year works for me.

Finances in 4 to 5 years could definitiely explode, except they will likely trade one or two of the stud pitchers for great value, and roll in very good cheaper ones from the minors to replace them.

Anonymous said...

Morning Mack,

Back in the office after a 2 day sick leave.

Regarding Harvey/Wheeler/Synder,

I think its important for fans to realize that their salaries are not going to suddenly skyrocket. The purpose of the arbitration system is to prevent hyperinflation of salaries through controlled modest and calculated raises.

By the time 2018 comes when Harvey and Wheeler become free agents the front office will have already signed them to team friendly extensions as with Jonathan Niese.

Also by 2018 the financial stability of the team should be in better condition to handle larger contracts. Also the average team salary by 2018 should be upwards of $150-$160M due to inflation so $60M will consist of a lower % of the overall team payroll then as it would now.

Unknown said...

Soto a few weeks ago u said to me the Mets wouldn't be getting the same amount of $$$ from the mlb tv contract as small market teams. Just curious where you got that info from, cause I don't remember hearing about that.

Anonymous said...

I outlined it in that thread.

http://macksmets.blogspot.com/2014/01/macks-morning-report-1-24-14-2nd-base.html?showComment=1390574688223#c5179755277916686272

The statement is based on personal research into the ticket sales, CBA, and TV contracts.

It may be wrong but I'm certain the math works out.

TP said...

Mack,
If they sign Drew, they need to make it 2 years. One year doesn't make a lot of sense to me, as they give up a draft pick and likely will be right back where they are now next winter. Cameron's price of 2/$20 mil to me is a no brainer.

While they do have all these big arms on the way, $#&! happens all the time. The likelihood of all these guys panning out, staying healthy, and earning top dollar contracts is unlikely. And, if they somehow did that, the team should be really good and able to afford them.

Anonymous said...

In short....the Mets WILL be receiving substantially more in TV revenues....however due to the heavy declines in sales and concession revenues its basically just replacing those.

Once the team starts winning again and attendance jumps back up.....that's when you'll see the impact of the TV deal.

Herb G said...

Mack -

I listened to the podcast and I think you handled it extremely well. You came across as very knowledgeable.

I don't agree, however, that the Wilpons regard the Mets simply as one of their many real estate investments. I believe they are avid New York baseball fans (Brooklyn fans, if you will) and they love the fact that they can own a New York based major league team. I do believe, however, that they want to run the team like a sound business, and that they feel that just throwing money at free agents is bad for the game. With Alderson, they finally seem to have been convinced that there is an alternative to signing big ticket free agents to blockbuster, long term contracts in order to build a winner. As you said, the Alderson plan appears to be working and the team should return to its winning ways by 2015 and beyond, if things go according to schedule. Under the Alderson plan, they must realize that payroll will gradually grow to the $125 - $140 million level in the next few years, as the young players mature and they are supplemented with strategic free agent additions.

I think 2018 is a bit premature for the $60 million estimate for the Big 3. But that day will certainly come if they stay healthy, and it could be more than a Big 3 if Mejia and Montero are as good as we think they are, and if they too stay healthy. My guess is that by 2020 they could have an $80 million rotation and a $150 million payroll.

Mack Ade said...

Well Herb... looks like you and I are on the same page at around 90%.

That's damn good for the two of us :)

Herb G said...

Mack,

High 5!

Glad you didn't say "for the two of us old farts."

Unknown said...

So it's your own math and calculations, it wasn't written down anywhere? Ok cause I usually read most things out there and never saw this. U would think this would all be broken down somewhere on the Internet? Please if u can disclose some different sources so I can look it up as well.

Mack Ade said...

Zozo -

what are you talking about?