Salary cap crunch next year

[UsernameWasTaken]

Because of the slumping CAD, the salary cap may not rise much next year...or at all.

The falling Canadian dollar has caught the attention of the NHL’s head office in New York and the NHLPA’s headquarters in Toronto.

With the dollar hovering around 90 cents U.S., the revenues may not be nearly as much as was projected this season and that means the salary cap could only rise slightly, stay status quo or, heaven forbid, fall below the $69.3 million threshold it’s at this season.

The latter doesn’t seem probable.

The league’s board of governors will get an update on where the cap may go during next month’s meeting in Boca Raton, Fla., but one league executive noted Saturday he doubts “it will go down†because of what teams will receive in the new TV deal with Rogers.

“It would have a tough time going down. There’s so much money there,†he said. “I could see it only going up slightly or staying the same. It may not go up as much as people projected that’s all.â€

http://m.ottawasun.com/2014/11/08/slumping-canuck-dollar-could-affect-salary-cap

TORONTO — NHL general managers are no longer operating under the assumption that the cap is going to increase next season.

...

Given the fixation of escrow under which the players currently are having 14 percent of their pay withheld, it certainly is a realistic possibility the NHLPA will not exercise a 5-percent escalator for 2015-16.

That might mean a stagnant cap in the $69 million range, which fall some $5 million to $6 million shy of previous optimistic projections.

http://nypost.com/2014/11/08/theres-a-good-chance-the-nhl-salary-cap-wont-increase/

Click to read more...

 

[OhCaptainMyCaptain]

Posted this in the NHL thread, but a good idea to just start its own thread.

If true, hope those guys down in Rockford are ready..

 

[Kurtosis]

Good thing T and K did the team a solid.

 

[Crow]

CAD/USD could just as easily reverse tomorrow. As someone who has traded forex for many years now, I'm not buying this one bit.

How much revenue is from the US in proportion to canada?

If USD/CAD is so important to the NHL, why are owners not hedging the currency pair?

 

[No Fun Shogun]

A few guys will need to be dealt and we'd have to rely on Teravainen, McNeill, Danault, Johns, Clendening, and Pokka being NHL ready and cheap for a few years (TVR as well, but he'll obviously have a year, or part of a year, up on them).

Aside from the cap not being as high as the team was likely expecting, thinking that that's been their game plan for a while now.

 

[Nothingman*]

CAD/USD could just as easily reverse tomorrow. As someone who has traded forex for many years now, I'm not buying this one bit.

How much revenue is from the US in proportion to canada?

If USD/CAD is so important to the NHL, why are owners not hedging the currency pair?

The only way that will happen is if oil hit $125+ per barrel. That is not happening any time soon. And our interst rates rising faster than Canada and our economy growing faster than theirs (see oil price).

 

[Crow]

The only way that will happen is if oil hit $125+ per barrel. That is not happening any time soon.

I don't agree. There are infinite ways it can happen.

 

[OhCaptainMyCaptain]

@MarkLazerus: Per @capgeek, the #Blackhawks have about $65M tied up in just 15 players for 2015-16.

 

[Nothingman*]

I don't agree. There are infinite ways it can happen.

I edited my post above. There area many things that can happen. But if you recall, the Canadian dollar was weak against ours for many years. Having the strong Canadian dollar is not the norm in the last decade or so at least.

 

[OhCaptainMyCaptain]

Start by getting rid of Sharp and Seabrook and go from there.

 

[UsernameWasTaken]

I edited my post above. There area many things that can happen. But if you recall, the Canadian dollar was weak against ours for many years. Having the strong Canadian dollar is not the norm in the last decade or so at least.

...and in many ways it's to Canada's own benefit to have it trading lower. So don't expect the Feds to do anything anytime soon.

From capgeek

 

[Nothingman*]

Yeah. Neither country cares about the NHL and how it affects it to be honest.

That cap geek shows that there are going to be a lot of open slots in the upcoming two years.

 

[OhCaptainMyCaptain]

And to think we still have to figure out the Saad deal..

 

[Taze em]

Don't worry about a thing, because every little thing is gonna be alright.

 

[Kurtosis]

The weaker loonie will definitely help their exports which I'm sure is more important than a higher NHL salary cap (to Canadians at least).

 

[1420]

And to think we still have to figure out the Saad deal..

Even if the cap only increases by, say, $2,000,000, the "cap crunch" is manageable. Simply replace Richards, Bickell, Versteeg and Oduya with TT, McNeil, Danault and Dahlback. Of course, I am assuming that Bowman will be able to ship Bickell and Versteeg out and not retain any salary. Resign Kruger with a slight raise and Saad at $4,000,000.

CAPGEEK.COM ARMCHAIR GM ROSTER
15
FORWARDS
Brandon Saad ($4.000m) / Jonathan Toews ($10.500m) / Patrick Kane ($10.500m)
Patrick Sharp ($5.900m) / Teuvo Teravainen ($0.894m) / Marian Hossa ($5.275m)
Jeremy Morin ($0.800m) / Marcus Kruger ($1.600m) / Andrew Shaw ($2.000m)
Phillip Danault ($0.863m) / Mark McNeill ($0.863m) / Ben Smith ($1.500m)
Daniel Carcillo ($0.550m) /
DEFENSEMEN
Duncan Keith ($5.538m) / Brent Seabrook ($5.800m)
Niklas Hjalmarsson ($4.100m) / Trevor Van Riemsdyk ($0.925m)
Klas Dahlbeck ($0.605m) / David Rundblad ($0.914m)
Adam Clendening ($0.761m) /
GOALTENDERS
Corey Crawford ($6.000m)
Antti Raanta ($0.750m)
BUYOUTS
Steve Montador ($0.000m)
BONUS OVERAGE
$0
------
CAPGEEK.COM TOTALS (follow @capgeek on Twitter)
(estimations for 2015-16)
SALARY CAP: $71,000,000; CAP PAYROLL: $70,639,045; BONUSES: $850,000
CAP SPACE (22-man roster): $360,955

 

[UsernameWasTaken]

A $2m increase might be optimistic. The last time CAD plunged badly was in 08/09 and the cap went up $100k for the next season (and that was when the hrr split was 70/30).

I also think it will be hard to ship out Bickell's salary without taking a player back (unless we're packaging him with a desirable prospect). I wouldn't think Versteeg would be hard to move - although apparently Bowman tried it this summer and it was unsuccesful.

 

[OhCaptainMyCaptain]

A $2m increase might be optimistic. The last time CAD plunged badly was in 08/09 and the cap went up $100k for the next season (and that was when the hrr split was 70/30).

I also think it will be hard to ship out Bickell's salary without taking a player back (unless we're packaging him with a desirable prospect). I wouldn't think Versteeg would be hard to move - although apparently Bowman tried it this summer and it was unsuccesful.

That was after a tough year, though. If he keeps up what he's doing this year, should be able to find someone who is willing to bite.

In the end, I think we end up having to get rid of Seabrook and/or Sharp.

 

[kmwtrucks]

I still think you might want to consider moving either sea book or sharp at trade deadline. I know it will hurt our chances, but what u can get at trade deadline is so much greater then in the off season when everybody knows the hawks are screwed. If u are going to do it, I would do it early. Bring up johns and pair him with Keith.

 

[Taze em]

This would hurt other contenders worse than the Hawks IMO. BOS, LA, PITT, SJ have few prospects to fill in their rosters.

In that sense this will help Anaheim and Chicago.

I also 1) don't believe this report, 2) don't think we'd lose near as much as people are thinking, 3) feel bad for Brandon Saad.

 

[Ace Rothstein]

I still think you might want to consider moving either sea book or sharp at trade deadline. I know it will hurt our chances, but what u can get at trade deadline is so much greater then in the off season when everybody knows the hawks are screwed. If u are going to do it, I would do it early. Bring up johns and pair him with Keith.

The Hawks won't dump salary in season if it is going to hurt their chances at a Cup. They aren't in the business of maximizing value.

 

[Crow]

The weaker loonie will definitely help their exports which I'm sure is more important than a higher NHL salary cap (to Canadians at least).

I'm not sure about that.

 

[hawksfan50]

But Canada just concluded a new deal with China that allows business to be conducted in Chinese currency instead of first having to convert to $U.S. to conduct trade business..This is supposed to save Canada a ton of cost and will remove the need to buy as many American dollars which artificially makes the exchange rate to U.S.currency an inflated cost and before meant lowering the value of $CDN Since China is Canada's largest trade partner after the U.S.,and that trade is expected to grow more because Canada is making a big push fir more with them...this new initiative to make trade easier and less costly for Canada Should help significantly in stemming effects of an otherwiis stronger U.S. Dollar coming from its economic recovery and jobs growth..So there may become counter-balancing coming to prop uo the $DN or keep.it from falling as it would before this new change in trade with China. I am not an economist but if oil prices keep falling it also makes it cheaper to transport everything to China..That too could expand DN trade and exports there. THUS it is not so simple to predict that the $CDN will fall as much as this disaster vis a vis the cap is suggesting. ..The issue may be how quickly the new arrangement 's effects on this balancing possibility will come into play..Hopefully in time to.prop up the DN dollar enough to.mitigate an otherwise decline from.any further drop in oil and resource prices.

 

[supersonic jet]

But Canada just concluded a new deal with China that allows business to be conducted in Chinese currency instead of first having to convert to $U.S. to conduct trade business..This is supposed to save Canada a ton of cost and will remove the need to buy as many American dollars which artificially makes the exchange rate to U.S.currency an inflated cost and before meant lowering the value of $CDN Since China is Canada's largest trade partner after the U.S.,and that trade is expected to grow more because Canada is making a big push fir more with them...this new initiative to make trade easier and less costly for Canada Should help significantly in stemming effects of an otherwiis stronger U.S. Dollar coming from its economic recovery and jobs growth..So there may become counter-balancing coming to prop uo the $DN or keep.it from falling as it would before this new change in trade with China. I am not an economist but if oil prices keep falling it also makes it cheaper to transport everything to China..That too could expand DN trade and exports there. THUS it is not so simple to predict that the $CDN will fall as much as this disaster vis a vis the cap is suggesting. ..The issue may be how quickly the new arrangement 's effects on this balancing possibility will come into play..Hopefully in time to.prop up the DN dollar enough to.mitigate an otherwise decline from.any further drop in oil and resource prices.

hotels are full of cdn across the border Americans stay home creates strong Amer. $ nothing is going to change.

 

[hisgirlfriday]

I've been worried about this in the Business of Hockey forum for a little while.

It's so bizarre that the fate of a hockey club can depend so much on how much OPEC wants to charge for a barrel of oil (oil prices going down is the main reason for the Canadian dollar's swoon).