2014 IFA: Yankees Double Down, More Names Emerge

A surly Kiley McDaniel has followed up his original scoop about the Yankees' plans to to binge on this year's by putting some names out there:

Dermis Garcia (3B, Dominican) is believed to have a deal for $3 million, Nelson Gomez (3B, Dominican) is also believed to have a deal for $3 million, Juan De Leon (CF, Dominican) is believed to have a deal for $2 million, Jonathan Amundaray (OF, Venezuela) is believed to have a deal for $1.5 million, Chris Torres (SS, Dominican) is believed to have a deal for $1 million and Diego Castillo (SS, Venezuela) is believed to have a deal for $900,000.

Garcia was the only player specifically tied to the Yankees previously. In addition, McDaniel reports that shortstop Adrian Rondon likely has a $3.5 million agreement, perhaps with the Tampa Bay Rays. When combined with the previous report of Gilbert Lara to the Brewers at $3.2 million, that makes four players who are likely to top last year's high bonus of $2.8 million for Eloy Jimenez. There may yet be hope for the Cubs in trying to trade pool space.

Phase Two for the Yankees

In addition, McDaniel breaks another development:

…the industry is preparing for another wave of signings from the Bombers in the coming months. International sources are now saying they've heard a "second phase" is coming, with a significant amount of bonus commitments: presumably another coordinated signing wave. One source says he has heard $20 million mentioned as a possible target for overall Yankee bonus spending.

The total spending by all the teams in 2014 was around $97 million. Twenty million is going to be a big slice of this year's pie. As I noted repeatedly last year, once in the max penalty, it only makes sense to keep spending. That's even more true in 2014, since overspending teams will be faced with restrictions for the next two years instead of one. Might as well try to cover that gap as much as possible now, and it looks like the Yankees are doing that.

December is the New July

McDaniel also makes an argument that the phenomenon of deals happening earlier and earlier is being incentivized by the CBA:

When the market had no spending limits, clubs knew they could always outbid someone for a top player, so deals generally weren't struck except for a few months before July 2nd and almost never before January. With spending limits in place, clubs are looking for the best way to get bang for their limited buck and many feel that locking players up early is the best way.

I think he's on the right track, but a little unclear. It seems to me that there are pretty straightforward explanations for why deals are coming earlier. Of course it's in the interest of teams to get deals done early. Early deals allow them prevent drawn-out negotiations that could drive up prices. Moreover, if there are only one or two teams planning to be in the max penalty, getting commitments early allows those teams the advantage of other teams trying to stay within their budgets. The latter are faced with the difficulty of trying to line up trades for pool space many months before those trades can take place. 

The question is why the players are agreeing to it. And that, I think, is mainly reflective of their representation. Is there any doubt at all that things would play out differently if these guys were represented by Boras Corp et al.? Agreements on deals 7+ months before the signing period starts? That's valuable time for haggling and mystery teams and the like. Why not wait and see which teams end up wanting to spend more come July, when they can actually acquire more space? After all, the Yankees are all-in no matter how it plays out. Waiting could actually provide them with a competitor for your services.

I don't think the buscones realize the full implications of what has happened in the current CBA. International free agency is now the only way for teams to spend additional money on young talent. Teams know this and are trying to get the best bang for their buck. The players, meanwhile, have had their prices inflated for reasons that have little to do with them, and are happy with marginally higher bonus that could be even higher.

There are limitations to this early spending, though. As McDaniel notes earlier in the piece, talent levels change rapidly in players at that age, so the best 16 year-old probably wasn't the best 15.5 year-old (the Damon Bailey problem). And unlike the international draft, this is something that the Commisioner's Office has discretionary power over. From the CBA:

Any Club that fails to submit a contract to the Office of the Commissioner in order to circumvent the system will be subject to penalties determined by the Commissioner.

A few voided contracts would probably be effective in getting sources to shut up, at least.

Did the Cubs have a Precedence Problem?

There's one nugget in McDaniel's original piece that I didn't notice initially. In discussing how the Yankees will become the fourth team (2012 Rays, 2013 Cubs, 2013 Rangers) to employ a big spending strategy, he drops this:

An executive with one of the three clubs that has already employed this strategy said they had trouble signing all the players they had targeted, as agents assumed their pre-July 2nd offers weren’t genuine when the agents caught wind of all the rumored deals the club had in place. Agents didn’t see the strategic move this club was making, assumed bad faith in negotiations and steered their players away from signing with that club.

So, which of those three clubs was the source from? I'm betting it wasn't the Cubs for several reasons:

  • All of the players that the Cubs were connected to publicly last year actually ended up signing with the team.
  • The Cubs didn't top their spending limits by nearly as much as the Rangers did. The Rangers spent nearly $8.5 million when their budget was $1.94 million. The Cubs were in the same neighborhood, spending-wise, but their budget was over twice as high. And a big chunk of their spending was on Jen-Ho Tseng ($1.625 million), to whom the rumors of a connection were tenuous, and who didn't end up committing to the team until later in the period.

The Rangers were also rumored to have actually topped the Cubs' offer on Eloy Jimenez. So I think they are a decent bet for Kylie's anonymous source. (Also, he has previously gushed about Rangers strategy in Hardinian terms). I wouldn't rule out the Rays, even though they only spent about $4 million when the limit was $2.9 million. They were the first team to pull off the overspending strategy under the current CBA and wouldn't have had the benefit of an example to point to.

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