2023 MLB Thread

[njdevils1982]

The baseball rumor mill ran amok the past few days, before Ohtani himself posted on Instagram. Jon Morosi of MLB Network gave hope to Canada on Friday afternoon when he reported that Ohtani was on his way to Toronto, presumably to finalize a deal. Several outlets knocked down the report, then Morosi retracted it, writing on X,

“Today, I posted reporting that included inaccurate information that Shohei Ohtani was traveling to Toronto. I regret the mistake and apologize to baseball fans everywhere. I am deeply sorry for letting you down.”

source: Shohei Ohtani Will Sign the Biggest Deal in MLB History


...what a f***ing hack. who can take this guy seriously after this gaffe?

you either know or .... you just make up shit i guess

 

[Saugus]

Yes but hearing it's heavily deferred to evade the luxury tax. I'm going to laugh if it's something like a 25 year payout. Baseball really needs to average out the salaries for the luxury tax because the Dodgers will still be in on Yamamoto if they are paying him something ridiculously low like $30M out of the $70 in the first X amount of years.

It would be sad but also kind of hilarious if Ohtani was this highly sought after, and then became the new Bobby Bonilla because of the deferred money clauses.

 

[denverdevil]

The baseball rumor mill ran amok the past few days, before Ohtani himself posted on Instagram. Jon Morosi of MLB Network gave hope to Canada on Friday afternoon when he reported that Ohtani was on his way to Toronto, presumably to finalize a deal. Several outlets knocked down the report, then Morosi retracted it, writing on X,

“Today, I posted reporting that included inaccurate information that Shohei Ohtani was traveling to Toronto. I regret the mistake and apologize to baseball fans everywhere. I am deeply sorry for letting you down.”

source: Shohei Ohtani Will Sign the Biggest Deal in MLB History


...what a f***ing hack. who can take this guy seriously after this gaffe?

you either know or .... you just make up shit i guess

So much just completely wrong reports on Twitter. I'm just waiting for Passan on anything from now on.

 

[lightsout]

$680 million deferred

 

[JrFischer54]

Yes, but in this analogy, the Oilers are also broke because their owner died and the salary cap doesn't exist.

The Yankees are one of the few teams that can pay the market value for Soto in UFA. I guess the Padres figure they might as well get some assets for him while they can.

I don’t get it the padres still have a really solid team on paper. Keep him for the year instead of this chump change package.

 

[TheUnseenHand]

$680 million deferred

I need someone to explain the benefit of this to me.

 

[Ripshot 43]

I need someone to explain the benefit of this to me.

Partly helps because instead of counting 70 million against the cap it will count 40 something million a year (helps recruit other players) because of deferred money. He makes like 45 million a year from off the field stuff. So when he’s retired he will get 68 million a year for 10 years while trying to win a championship now.

 

[lightsout]

I need someone to explain the benefit of this to me.

Not a big baseball fan, but from what I think I know it lowers their team spending so they stay under the pay roll luxury tax (aka revenue sharing) threshold.

 

[Emperoreddy]

We lost a 1st round pick signing a contract like that

 

[TheUnseenHand]

So it's cap circumvention?

I'd want significantly more of that money up front if I were him. Yeah, he makes a lot of money, but that still feels like a risk on his part.

 

[Devs3cups]

So it's cap circumvention?

I'd want significantly more of that money up front if I were him. Yeah, he makes a lot of money, but that still feels like a risk on his part.

Not very familiar with the MLB’s contract rules, but how is it a risk on his end? Curious to learn more about this.

 

[SteveCangialosi123]

So it's cap circumvention?

I'd want significantly more of that money up front if I were him. Yeah, he makes a lot of money, but that still feels like a risk on his part.

He makes like 50 million a year from off the field stuff. I think he just wants the team to win. Suffering on that Angels team will do that to you.

 

[Devs3cups]

He makes like 50 million a year from off the field stuff. I think he just wants the team to win. Suffering on that Angels team will do that to you.

I also read that if he did this to not be taxed in California for the 680 million.

 

[Ripshot 43]

So it's cap circumvention?

I'd want significantly more of that money up front if I were him. Yeah, he makes a lot of money, but that still feels like a risk on his part.

It’s not a risk. He’s just pushing out the payments to a later time which probably got him more total money so his team can sign more players or another big player.

 

[TheUnseenHand]

I also read that if he did this to not be taxed in California for the 680 million.

Ah, that makes a lot of sense.

It’s not a risk. He’s just pushing out the payments to a later time which probably got him more total money so his team can sign more players or another big player.

It's a risk because money in your hands now is worth more than money in the future.

 

[NJDevs26]

So it's cap circumvention?

I'd want significantly more of that money up front if I were him. Yeah, he makes a lot of money, but that still feels like a risk on his part.

It's not a risk, it's a long-term investment play...the kind Bobby Bonilla once made and the Mets have been killed on it ever since.

 

[Ripshot 43]

Ah, that makes a lot of sense.



It's a risk because money in your hands now is worth more than money in the future.

Perhaps winning actually means something to him (I don’t know lol). I would think that deferring the money 10+ years also got him a huge bump in overall contract value. Say he would’ve signed for 50 million a year and pushing it off got him 70 million and a deeper team? Who knows. Seemed like something was up when he signed for I believe double what the last largest contract was.

 

[TheUnseenHand]

Perhaps winning actually means something to him (I don’t know lol). I would think that deferring the money 10+ years also got him a huge bump in overall contract value. Say he would’ve signed for 50 million a year and pushing it off got him 70 million and a deeper team? Who knows. Seemed like something was up when he signed for I believe double what the last largest contract was.

That actually makes a ton of sense as well. All that deferred money very likely bumped up the value of the contract overall.

 

[Billdo]

Ah, that makes a lot of sense.



It's a risk because money in your hands now is worth more than money in the future.

He makes like 50 mil a year in endorsements apparently, I think he'll be alright.

 

[My3Sons]

It's not a risk, it's a long-term investment play...the kind Bobby Bonilla once made and the Mets have been killed on it ever since.

It’s absolutely a risk by the current owners if they can’t sell the team the minute Ohtani starts to break down.

 

[Darkauron]

Bruhhh the MLB is a joke and needs a cap

 

[Emperoreddy]

So it's cap circumvention?

I'd want significantly more of that money up front if I were him. Yeah, he makes a lot of money, but that still feels like a risk on his part.

In a way. It's meant to keep the dodgers under the luxury tax which is basically a soft cap (you can go over it but you got to pay a tax)

 

[NJDevs26]

In a way. It's meant to keep the dodgers under the luxury tax which is basically a soft cap (you can go over it but you got to pay a tax)

Billionaires finding a tax loophole, what a concept in America!

 

[MasterofGrond]

Ohtani and the Dodgers would literally have both been better off if he had taken a $40M a season deal paid out normally (or even less than that depending on your market assumptions). The MLB doesn't discount deferrals enough for cap calculations, they discount them like a risk free rate, when that's obviously not right.

but that doesn't create headlines I guess so, whatever.

 

[HBK27]

I need someone to explain the benefit of this to me.

As far as my understanding of all this - by deferring $680M without interest, it knocks the annual value applied to the Competitive Balance Tax to ~$46M per year over the 10-year span of the contract. That's because MLB uses a net present value calculation for luxury tax purposes and since the deferred payments are not gaining interest, the value is lower now.

One of the benefits for Ohtani is that by lowering the CBT rate and only paying him $2M in salary per year over the next 10 years, the Dodgers should be able to field a more competitive team around him. As others have already mentioned, there may also be significant tax advantages for him if he's no longer living in California when $680 of that $700M is paid out.

He's already probably filthy rich to begin with and collecting an estimated $50M per season in endorsements, so deferring such a large amount probably doesn't put a dent in his lifestyle.

Not very familiar with the MLB’s contract rules, but how is it a risk on his end? Curious to learn more about this.

There's really no risk on his end as the money is guaranteed. Also read somewhere that the Dodgers have to start setting parts of the deferred payments aside as soon as 2025, so there's no chance they can default on the payment.