Blog Entry

What would a hard cap do to trades in the NBA?

Posted on: August 29, 2011 7:06 pm

By Matt Moore

Trades are the lifeblood of the NBA. Yes, Miami was able to become an instant contender with its smorgasbord last summer, but that's what made it so rare. In reality, teams have their foundations built in the draft, then augmented through trade. The best way to improve your team, your payroll, your future, your organization, is through a shrewd trade.

It's also what drives a ridiculous amount of fan interest. Trade rumors do big business and though they're the scourge of coaches, GMs, pragmatic fans and cynical critics, they most often come from somewhere. But what's more important is that they deliver hope. Your team terrible and stuck in a rut? One good trade and they're back in business, baby. Look at the Charlotte Bobcats, who went from a nightmarish wreck of a franchise to an up and coming team stocked with young players. The Celtics were languishing with only having won 17 championships before 2007 came and Danny Ainge pulled off the best trade season in the past twenty years.

Trades give GMs wiggle room. They give owners the ability to correct bad decisions. They give fans something to hope for. And they give players second chances.

And the entire market could come falling to the ground in a flaming heap if the new CBA is structured as the owners are pushing for.

On Monday, the Seahawks and Bengals completed a trade sending Seattle CB Kelly Jenkins for DT Clinton McDonald. It was a rare exception to the norm in the NFL which is that trades are almost always a one-for-one ordeal and very rarely happen. The NHL may be a better comparison though. Trades are more commonplace in the NHL due to the way the sport's structured and the nature of contracts. And since the NHL lockout, there are still a great number of trades that occur nearly daily. But almost all of them involve only one-for-one deals, or deals for draft picks. There have been three multi-player deals in the NHL this offseason, which may seem like a fair amount, but considering the amount of roster movement, there's still a slower function of trades than we're used to seeing in the NBA.

A hard cap would limit team's abilities to move those players significantly. For starters, the hard cap removes any wiggle room for teams to get traded players added to their roster with exceptions and the like. It likely means teams committing more money to their stars and less money to their veteran players. The problem? Moving players making star money then becomes more of an issue in terms of moving one-for-one. And star players don't move easy.

From there the concern becomes a matter of re-defining value in a new hard cap era. The gap between stars and roleplayers becomes greater, the flexibility of moving players is impacted. If the gap between a great role player, say, Glen Davis is lowered and becomes closer to that of say, Mo Evans, instead of making it easier to move those types of players, there's a confusion surrounding what their actual value on the market is. If trades begin to be expressed more for draft picks, the relative value needs to be determined.

All this could be incredibly bad for several entities in the NBA. It means a harder climb back to contention for teams in the gutter, as their only real options are now the draft or free agency. The small market teams are the ones fighting hardest for a hard cap to keep their costs down. But if their free agents are leaving to pursue bigger markets, and they can't trade to get better assets, all this does is strengthen the divide between them and the large market teams. The ability to trade assets is how smart teams get around market divides. Even large market teams benefit from circumventing the free agency race. Consider Dallas, who acquired four of their starters, Jason Kidd, Caron Butler, Tyson Chandler, and technically, Shawn Marion, in trade. In a system with limited trade options, the Mavericks would simply be trying to win with the same core. That's the definition of insanity.

But there's a flip side to this. The reason these questions haven't been asked is because there's no telling what the effect of the cap would be on trades. There would still have to be trades at some level, the makeup of the game itself demands it. And to keep them in play, there may be changes to the core structure of a hard cap proposal. The worst thing the NBA could do is rush into a hard cap only to discover that while it solves all of the financial issues, it makes the game worse.

Trades won't stop in the NBA. But the blockbuster, multi-team, multi-player trades that have come to define each February and draft night for fans could be a thing of the past if a hard cap is introduced, as the movement within the league becomes more stagnant and difficult to manage. And for teams who have committed money to marginal stars and were looking to clear the books with an expiring-contract trade, that could have long-term effects for the future.
Category: NBA

Since: Sep 7, 2009
Posted on: September 2, 2011 12:47 pm

What would a hard cap do to trades in the NBA?

Keep the soft cap, but limit the length or dollars on guaranteed contracts. Maybe a 3-year guarantee at the offered salary, then less guarantee or less money for the rest of the contract. Or maybe a max dollar limit or max guarantee limit on contracts longer than 3 years?

Keep Larry Bird Rights, but get rid of sign-and-trade. If you don't want to stay with your own team, then you don't deserve the extra incentive. And if you can't sign your own free agent using Larry Bird Rights, then you don't deserve to be compensated for them -- that's what unrestricted free agency means.

Let teams re-negotiate existing contracts to fit under the cap like in NFL. But player can't receive "less" than original contract, but can trade off dollars for extended length (or extended length for dollars).

Penalize teams who keep changing head coaches and/or general managers by not allowing them to deduct the remaining contracts for all those fired head coaches and GMs from BRI. Look how many ex-coaches the T-Wolves and how many ex-executives the T-Blazers still have on their payroll. You can't keep firing former coach-of-the-year and executive-of-the-year types every couple of years and then expect your team to magically improve. And you can't keep paying guaranteed money to ex-coaches or exs-GMs to sit out and then whine about how much you pay ex-players not to play.

Stop bidding against yourselves and overpaying players nobody else wants. Stern pointed to Eddie Curry's contract as an example, but nobody put a gun to the Knicks' head to sign him to that kind of money. The Bulls traded him because they didn't want to pay him a premium. Nobody was bidding for Alan Houston's services when the Knicks gave him a max dollar contract either. Before you start asking for take-backs, start treating your teams more like a business (financially speaking) than like a hobby.
And, by the way, stop pretending that Toronto is a small market city and Miami is a large market city. Both population size and TV market share don't support that claim. The difference has more to do with how their respective owners/management worked the salary cap to their advantage/disadvantage.

Since: Sep 14, 2008
Posted on: September 1, 2011 12:29 pm

What would a hard cap do to trades in the NBA?

I totally disagree with this analysis.  A hard cap would increase trading because teams wouldn't have to woory about all these cap exceptions and such that currently exist.  It would be a simple dollar for dollar calculation making it simpler to make a trade.  Also, NHL trading has increased since the lockout.  On trade deadline day (post-lockout), nearly 40 trades are made every trade compared to 10-20 pre-lockout.  I believe a hard cap would make the NBA's trade deadline day bigger than it currently is.  For example, the NHL trade deadline day has become a 'national holiday' in Canada post-lockout because of the amount of activity.  I think this article is way off line and the author needs to be fined for even writing such an article.

Since: Aug 17, 2011
Posted on: August 31, 2011 11:50 am

Forget a Hard Cap the NBA needs a franchise tag.

Coming from a Raptors fan, it's hard to pay 150 bucks for a decent seat to watch a team, that may win 30 games this year.  After loosing guys like Carter, McGrady, now Bosh, for a team that has only been around for 15 years, this just wont do.  Right now the team is just lucky that they force season ticket holders of the  Leafs, to buy Raptors tickets.  I know the TV numbers say that more and more people are watching the games, but just take a look at the arenas, less and less people are paying at the gates.  Lets look at the simpliest argument for a Franchise tag, Cleveland and Toronto.  These two teams will have little chance to ever draft players like James and Chris again,  a franchise tag could have kept these players in cities that needed them in order for the fans to show up at the gates and for the team to grow.  Now both team have to start all over again.  When will Cleveland be in the finals again?  When will the Raptors even make the playoffs again?  

Since: Aug 19, 2006
Posted on: August 31, 2011 1:24 am

What would a hard cap do to trades in the NBA?

slowroast--- i didnt say it was the Lakers ''fault'', just that they are exploiting a broken system. Is it a small market teams ''fault'' that they are in a smaller market than the Lakers? Its the same argument I hear from Yankee fans. The Lakers spend more on their team than almost any other team can afford to spend, what was your point again? I think in end it cheapens a title a bit. Sure the Heat brought in two stars, but they still spent far less than the Lakers... far, far less.

Since: Jul 3, 2007
Posted on: August 31, 2011 12:05 am

What would a hard cap do to trades in the NBA?

richyriches...Paying more money to get a better team is exactly what the game is all about though.  That is how you get a better team unless you get really lucky and end up having a superstar player still on a rc contract.  It's not the Lakers fault they might have more money than other clubs to throw at players.  They got that money by being good and building good teams and having a large fan base.  Also worth mentioning the Lakers have had quite a few very awful players who were on big contracts eating up money.  So all that money they are over the cap with isn't necessarily going toward elite players.  Come to think of it really the only big player they have on a big contract that they "bought" was Gasol and he came in an incredible trade that they just got lucky on.  Kobe has been there forever, Bynum was drafted by them, Odom came in the Shaq trade, and Artest was had at the same price Ariza (who was a nobody) was.  So in hindsite, the Lakers have not gone out and "bought" anybody.  However the Heat went a "bought" Lebron and Bosh and now dont have any money to spend on a bench or supporting players unless they want to go over the cap.  Well, look what that got them.  The thunder are a great team right now at an unbelievable salary.  But that will absolutely change with time as their player contracts expire and they achieve more.  Those same exact players will not be had at the same price they are at right now.

Since: Jun 25, 2009
Posted on: August 30, 2011 9:05 pm

What would a hard cap do to trades in the NBA?

Hard Cap with no guaranteed salaries (similar to NFL).  

I'm starting to believe people on these boards REALLY BELIEVE that NFL players don't get any guaranteed money.  It's insane I know, but seriously, people really believe that !!   NFL starters get TONS of guaranteed money in their deals.  They get huge signing bonuses and they get huge roster bonuses.  And they still get a good salary every single season.    And about 2 or 3 years into a deal once the guaranteed money is gone NFL players just hold out for more.  The owners normally give in and they get renewed early with once again a huge signing bonus. 

Since: Mar 2, 2008
Posted on: August 30, 2011 6:10 pm

What would a hard cap do to trades in the NBA?

I will take NBA salary-cap serials when the Clippers start going near the max of the cap with this over-age Sterling rich-kid.  Otherwise, who cares about loser NBA owners and their crappy management skills.  They got here by their own meddlesome doing, having a FAIL like New Orleans (potential owners only wanting in with the potential low-cap) in the league was an NBA decision.  Take FAIL up amongst themselves, instead of showing NBA upper management incompetences.  Repeating NHL-level of FAIL is not cool at this point.  The pro-league with the fewest players on their rosters simply makes it a worser sitch.

Since: Dec 5, 2006
Posted on: August 30, 2011 2:53 pm

What would a hard cap do to trades in the NBA?

There does seem some confusion about the salary cap and the players' percentage of BRI. They follow together. The total players' take, less benefits paid by the league is divided by the number of teams. The reason a hard cap is desired by the owners is that the income stream is so drastically different by city. Luxury tax has been proven to be inadequate to deter overspending. When LA or NYK have over $100M in local broadcast revenue, and that dependent somewhat on having competitive teams the payment of luxury tax is not difficult. However for the small-market teams they struggle to make money even spending under the cap. The players' share must be closer to 50% to allow an opportunity for profit for each team.

There is a different flip side to this coin. With a hard cap there does not have to be salary matching in trades. Just as in the NFL, many trades are for draft picks. The hard cap makes this possible. It allows a team to break down and start over with picks while trading away mature players who can help contenders win

Sigma 1575 - I do know the NFL vs. NBA differences as well as how baseball works. My point is not that there will be picks for players (there already are) but that it is possible under a hard cap without matching up player salaries. Did Utah get value for D-Will? Not likely but they still traded him for a couple of lesser players and picks. Same for Denver getting value for 'Melo. With a hard cap each team will have to have room under the cap to fit the incoming players. In some cases the veteran players' salary is weighing a team down to begin a youth movement so indeed you can see a player traded for picks. Perhaps you don't consider Beasley a starter but Miami gave him away to Minnesota to get a couple second round picks.

Your points on players drafted might be a tad exaggerated. Every year we get a couple of surprises. Think Tony Parker, Manu Genobili for San Antonio, Carlos Boozer when he started, Agent Zero in Golden State, and Wesley Matthews in Utah.  The picks below 15-20 certainly are a crap shoot. Even Koby was a 13<sup>th</sup> pick (from memory). Can you draft a whole team without trades? OKC and Portland come to mind as teams that have largely succeeded. And there are a lot of teams that have failed, probably proving your point. But a hard cap does not stop progress, it only brings new limitations and new opportunities. Resourceful GMs will scheme any situation to advantage (which is partly why we have such a disparity.)

Since: Oct 26, 2006
Posted on: August 30, 2011 2:41 pm

What would a hard cap do to trades in the NBA?

Dude... there hasn't been an NBA champion under the cap for a long time.  There were only a couple of teams UNDER the cap last year.

The easiest way to fix the NBA is as follows:

1. Most Important - CONTRACTION  The talent just isn't there...  2 teams go this year 2 teams next year  League becomes significantly more competitive.

2. Hard Cap with no guaranteed salaries (similar to NFL).  The guys hurting the nba financially are those that get big deals and then flop or just don't care (ie eddie curry).  This puts the team in cap hell which takes to long to work out of and results in lost interest by fans.

3. Allow for player contracts to be reworked (similar to NFL).  Currently the Players association won't allow this.

4. Franchise Tag for up to 3 years.  Keeps top talent in market it was drafted in and allows for efficient marketing of the team.

There are other minor issues needing to be addressed but that is the main points that will make the league more competitive and fan friendly.    &n
bsp;     &

Since: Sep 11, 2006
Posted on: August 30, 2011 12:09 pm

What would a hard cap do to trades in the NBA?

Trades in the NBA remind me of what I read about in MLB back in the day.  Rich teams fleecing players off poor teams due to monetary concerns.  Use just about any NBA trade as an example.  The fact that actual living breathing players get traded for "mid level exceptions" or whatever the NBA cap terms are and that many players are more valuable if they DON'T play for a team that trades for them is unbelievably ridiculous.  Lets trade our all star for two players we can cut immediately!!!!

BTW, I'm no Laker historian so this is a real question.  Who is the last drafted Laker player to actually make a difference?  Fisher?  Come on.  Who is the last Laker FA acquisition to make a difference?  Artest?  Oh, you mean the guy they've been trying to PAWN, er, TRADE for the past two years?  Right, try Shaq.  And when was that?  They consistently have one of the top 2 to 4 teams in the league (and by consistently I mean over the last 40 years) by trading for players that other teams can't afford anymore while giving them a tad more than a bag of donuts (in the form of monetary relief - just what a fan wants to hear, that their team just became more affordable for their owner!)  The salary cap rules, along with the LA location, gives LA a huge advantage over other teams.  I applaud their owner for being willing to spend lots of cash and I can't fault LA for being LA - it is a great place to be, but what a hard cap would do is attempt to offset those permanent advantages a little bit.

And BTW, I love Laker fan arguments - "hey, we had the biggest payroll and didn't win LAST year!!"  And I can see the "hey, the Lakers were a tad below .500 for a few years in the early to mid 90s and again when Kobe was sulking for a few years so there!!!" argument coming too.  To both of those I say - why don't you look around at reality once in a while?  Do you really think coming in 2nd or 3rd (or heck, even 5th) in the league for a couple of years constitutes a down cycle?  Or maybe being a .500 team for two years out of every 15?  Most teams would kill to be in their zip code just once every 10 years.  But hey, the soft cap they have must work, right?!!?!?!  Every year its the Lakers and 2 other flavor of the year teams really competing while the other 27 or so teams play the role of Washington Generals.  Thats one great league you got there Mr. Stern.  Based on how things work, the Dallas Mavs winning the title was probably about the biggest upset in the history of team sports.

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