Future Salary Cap Discussion

[Steve Jobs]

Thought I’d get this started...

Considering COVID-19 has all but derailed the end of this NBA season, and league-wide revenue controls the salary cap, I thought sooner was a better time than later for us to discuss the salary cap implications for D720.

We’re currently running a 10% (* n years) luxury tax model on a 150% hard cap, with the base cap number matching the RL NBA’s figure as closely as possible. I consider it highly unlikely that we see a massive drop in the RL salary cap, but I think it’d be foolish to project anything without at least considering the possibility that this suspended season pushes the salary cap lower than the current ~109M.

Seeing as 1) we’re unlikely to halt our season in any substantial way, and 2) there are significantly harsher implications for team-building restrictions should we try to match any RL salary cap of < or = ~109M...

I propose we vote now on what salary cap figures we’d like to enforce for next season, most likely departing from the RL cap for at least a season, to give every GM here the time they need to appropriately handle their team’s financial affairs without having to blow anything up prematurely due to a virus that won’t actually impact our sim league.

If I recall correctly, the previous projection from the league was a $115M salary cap for the 20-21 season. My personal vote would be that we set that former projection in place as our salary cap for the 20-21 season and resume following the NBA once we have official figures for the 21-22 season (even if that means the cap goes way down and some teams are forced to unload salary to fit underneath the hard cap).

Other options I can easily imagine working acceptably well here:

1) Aim to match the RL 20-21 salary cap numbers no matter what, and simply be prepared to relax our luxury tax penalties / hard cap if the cap falls short of previous projections,

2) Keep 19-20 salary cap figures for 20-21... worse for some of our teams but still a reasonably easy team salary figure to maintain (probably need to cap repeat Luxury Tax penalties somewhere below the 20% to account for established salary raises of players on multi-year deals).

3) Settle on some middle ground... X% cap raise between current cap and the previously projected $115M.

Or other ideas as suggested by anyone else.


Anyway, just thought I’d get a discussion started since it’s been on my mind due to the precarious nature of my cap situation for next season, and how disastrous it could be for team’s like mine (that are flirting with the luxury tax and/or hard cap) to not be able to prepare our finances for the coming season. Please continue this discussion to your hearts content...

[Brian Scalabrine]

Idk--not decided on it, but this is my view.

If we just match what the salary cap is next year and it actually goes down a significant amount, it WILL be a disaster, but could be really interesting in the league. I think that it would encourage extra activity, that the trading market would become particularly robust, and that while some teams would be hurt--it wouldn't be all bad.

For example, long term FA deals signed this summer would become high value contracts in a season

The premium bottom feeder teams would receive for taking on salary would be higher than ever

And, highest cap teams being forced to do a shake up is not the worst thing anyway. I think it keeps things interesting. Sure, there's going to be losers if the cap goes down a notable amount in our league, but there will winners, too. And as far as I'm concerned, that's all a part of the fun.

From my view, we take on risk not matter what just through the nature of our game. Yes, the virus is unprecedented, but unpredictable things happen all the time. Career ending injuries. Guys pop or fall off a cliff in terms of production. Free agents leave unexpectedly. Your team falls in the lottery.

I view the repercussions of the virus as a weird, new, and significant challenge that no one saw coming that (hopefully) will never happen again. I say we roll with it and do what the NBA does.

[Jackie Kong]

Honestly, if there is a 150% hard cap in place it should be kept. TC took me as a joke when I used Hard Cap reasons for some of my trades so now I think it is unfair to rescue teams that might need to trade players. Covid or not, if a team is projected to be over the Hard cap it is because they have big salaries. Not because of the virus. If you are over the hard cap, trade for lesser salaries.

And there is a really simple way to back up my argument. Say the projected cap goes down by $15M. Then, the actual extra hard cap impact is $7.5M (50%). If someone gets into a Hard Cap situation because of a $7.5M difference it is because they had really big contracts and they were tax payer (close to the Hard Cap) to begin with.

Ultimately, I think we should make a change if and only they make one in real life. They don't have a hard cap as far as I can tell but they will have very similar situations with teams not wanting to have a big payroll. In real life you hardly see teams with 150% of the cap in salaries.

If cap goes down enough to affect the majority of the league then I would agree something should be done but to do it just to rescue a couple of teams I am not so sure.

I would maybe do something though with the 125% luxury cap. That could potentially be an issue for most.

[Allan Houston]

The fears you raise also impact the NBA. In fact, to a much larger degree, since in the NBA it's actually real. My guess is that the NBA will deviate from the formula (as they do in lockout years), and the cap next year will be set in an ad hoc fashion, probably somewhere around the 19/20 number. So that leads to a few points:

1 - If I'm correct, then there is no difference between (1) and (2).

2 - If I'm incorrect, and they lower the cap, it'll not be because of the one time shock of the covid season. The people in charge are smart enough to smooth the cap to fit the "true" trend. Therefore, if they lower it, I believe it's not because of a one season deviation, but because they foresee a long term downturn in revenue. If that's the case, then if we artificially inflate the cap to $115, then we're kicking the can down the road.

3 - I don't see why we shouldn't wait for the NBA. I guess it screws with planning, but that's even more true for the NBA. We have our weird trade deadline. If anything, I'd suggest a trade moratorium.

[Brian Scalabrine]

Y'all, imagine if all this means Kareem Abdul-Jabbar finally HAS to make a trade

[Steve Jobs]

Not to downplay any of the good points made by you guys, but I can’t stress enough that what I’m really urging on is a discussion about how we as a league choose to handle the scenario rather than a particular outcome being my goal.

If we choose tomorrow to match the RL cap exactly, everybody has the means to take that information and plan accordingly... teams will be incentivized immediately to offload salary where they can because the odds that the RL salary cap isn’t affected by this are roughly 0%. If we kick the can down the road, that will put our league in a situation where most of the worse GMs with cap issues get blindsided by the need to break up their team without enough time to get adequate return, further upsetting what could already be described as a rather precarious balance of good/bad teams league wide.

Now obviously there are countless solutions to our issue, and it’s why I wanted to get the discussion started sooner, but personally the biggest reason I see for addressing it by locking in an appropriate raised cap for our sim league lies firmly in just how much total, unavoidable salary is on the books around the league. Today there are... I believe 3 total teams with any significant amount of space to just eat contracts during the season. Several more teams will have space open up in the offseason, but most of them will be looking at free agent signings rather than taking on larger contracts via trade... the supply of cap space (with willing GMs to fill it in exchange for assets) will be far exceeded by the demand for cap space to trade salary into... the real $ amount of a $15M drop might only be a $7.5M difference, but considering that everyone’s books are built to grow indefinitely with the salary cap, any notable drop (including staying even at $109M) will lead to probably over half of the league needing to jettison salary and nowhere near enough teams willing to take it on in the short term. We’d functionally achieve the exact opposite mistake that the NBA made by *not* using cap smoothing before the $20M jump... instead of too many teams dishing out much bigger deals than necessary we’ll have too many teams with no choice but to blow it up and a severe lack of avenues towards which to blow it up.

Anyway, again, just my two cents. Since our league will “go on” as usual. I think it’d be easier and more logical to treat our cap like nothing happened in RL rather than accepting the chaos as inevitable and potentially upsetting the balance of the league beyond what we can recover from.

[Jackie Kong]

May 5, 2020 21:13:07 GMT -5 Brian Scalabrine said:

Y'all, imagine if all this means Kareem Abdul-Jabbar finally HAS to make a trade

Well, isn't he projected to be over the luxury already? Some months ago, I remember offering to help him by absorbing Dragan Bender who is pretty much 2 years away from being 2 years away from Europe. And I told him that if he pays luxury then, he will have a 10% hit the following season and 20% after. Of course, he didn't care.

[Theodore Duncan]

I agree pretty much with Brian and Allan wrote above.

If the cap stays the same or even if it's lowered, I would still stick to the same number as NBA. If it's lowered it could make sense to give some leeway on the luxury tax and hardcap figures for transitory period of one year for example. But I'm pretty sure they need to do similar things also in NBA to not screw over teams right close to the cap limits.

That we don't know is part of the fun. Whatever comes we can adjust. And indeed the trading market has been maybe more stagnant this year, so a small shakeup for the league would not be the worst thing.

Also after 2016-17 many GM's (in D720 and NBA) got burned by bad contracts after the predictions of two years in a row of cap spiking did not happen after all. So, everyone should be also learning from that experience. Maybe it's good to be more conservative than optimistic when figuring out the future before anything is confirmed

[billy]

It's always been my assumption we'd just follow the NBA. If that becomes untenable -- we could maybe discuss some type of mitigation for effected teams, but I imagine the NBA will be implementing that and we would just implement the same program.

[Steve Jobs]

I think the main thing I’m trying to get at here is this:

Every normal year, we have available salary cap projections for several years out. They’re not always right, but we have *something* to base our plans on. The RL NBA may not know what’s going to happen exactly, but you bet your ass the owners and GMs have been hounding league offices for as much information as possible to help project the future salary cap implications of this situation.

Meanwhile, right now the only thing the GMs in this league know is that things definitely won’t be what was projected before. I think it’s in the league’s better interest to address the situation more than “let’s just wait and see” so that people still have something to plan for... if the thing we plan for ends up changing, so be it, but having nothing at all can only hurt the league.

[Jackie Kong]

May 6, 2020 7:36:09 GMT -5 Theodore Duncan said:

I agree pretty much with Brian and Allan wrote above.

What about the Kong? I said the same but with slightly different words and some tough love for the TC.

I would like to add something more to the discussion if it wasn't brought up already. Hard for me to read the long posts completely.

The projection before the virus was fuzzy and everyone accepted it as it was. I am talking about the China incident with Morey. The way I see it if the cap goes down you can't really tell if it is because of the virus or because of the previous China incident.

In fact, I am not even sure if the virus will make them lose that much money because season might eventually resume and they had been working to get their digital media going for a while. So if season returns it could have some really high ratings just like with the Last Dance documentary.

One could even say that the NBA was suffering from low ratings this season before the virus because fans were getting tired of this and that from the new high tempo with no defense that you see nowadays. So the wait might actually revive some of their interest.

The Morey incident though might have had some permanent damage. I am not into the details though.

^ About the ratings obviously it doesn't help Warriors having multiple national TV games while sucking but there is more to it than just that.

In any case and like I said earlier, if cap goes down I think teams should adjust the same way they did when cap jumped enormously in one season. Obviously that was the exact opposite case but it caused Allan to lose Kevin Durant for example because all of a sudden you had multiple teams with max slots. And that included the defending champion at the time.

[Theodore Duncan]

May 6, 2020 13:13:58 GMT -5 Jackie Kong said:

May 6, 2020 7:36:09 GMT -5 Theodore Duncan said:

I agree pretty much with Brian and Allan wrote above.

What about the Kong? I said the same but with slightly different words and some tough love for the TC.

Haha.. Now after properly reading it I agree also with you xox. I was just glancing over the posts earlier quickly

[Jackie Kong]

May 6, 2020 13:33:21 GMT -5 Theodore Duncan said:

Haha.. Now after properly reading it I agree also with you xox. I was just glancing over the posts earlier quickly

[Steve Jobs]

May 6, 2020 13:13:58 GMT -5 Jackie Kong said:

May 6, 2020 7:36:09 GMT -5 Theodore Duncan said:

I agree pretty much with Brian and Allan wrote above.

What about the Kong? I said the same but with slightly different words and some tough love for the TC.

I would like to add something more to the discussion if it wasn't brought up already. Hard for me to read the long posts completely.

The projection before the virus was fuzzy and everyone accepted it as it was. I am talking about the China incident with Morey. The way I see it if the cap goes down you can't really tell if it is because of the virus or because of the previous China incident.

In fact, I am not even sure if the virus will make them lose that much money because season might eventually resume and they had been working to get their digital media going for a while. So if season returns it could have some really high ratings just like with the Last Dance documentary.

One could even say that the NBA was suffering from low ratings this season before the virus because fans were getting tired of this and that from the new high tempo with no defense that you see nowadays. So the wait might actually revive some of their interest.

The Morey incident though might have had some permanent damage. I am not into the details though.

^ About the ratings obviously it doesn't help Warriors having multiple national TV games while sucking but there is more to it than just that.

In any case and like I said earlier, if cap goes down I think teams should adjust the same way they did when cap jumped enormously in one season. Obviously that was the exact opposite case but it caused Allan to lose Kevin Durant for example because all of a sudden you had multiple teams with max slots. And that included the defending champion at the time.

Big, big difference between this and the KD->Warriors cap jump offseason.

I was telling people the cap was set to jump in 16-17 during the offseason before that 15-16 season even started. Can’t remember who it was off the top of my head but I also had a pretty sizable argument in a trade thread with someone that refused to believe it was about to go up about $20M and was making some stupid money decisions because of it, etc.

Plus, John and I were both able to offer KD a max and become finalists for his services because we spent months preparing a scenario where we could keep as much of our talent on board while still making sure we had a full max salary slot available.

Now instead of the inverse of a cap situation where it goes up dramatically and everyone has a chance to prepare, we’ll have a situation where the cap does NOT raise as much as expected (if at all, plus that assumes it doesn’t ultimately drop below the current $109M - which I consider doubtful but not impossible) and no one has any way to actively prepare for it. By the time the NBA’s cap is set, we could have people thaf would have been dumping salary discreetly for weeks/months forced into emergency dump situations where they get gouged for their players. Again, I’m not saying we need to decide today, nor am I saying the cap shouldn’t ultimately go down, I just think there are ways we could come together as a league to actively mitigate the fall out from the salary cap difference before it becomes a larger issue. If there were some active projections for the 20-21 NBA salary cap coming from the league right now, I wouldn’t say a word regardless of what they are. But since there is nothing substantial being put out there, I just think there is a decent amount at risk if we don’t address this ahead of time.

[Jackie Kong]

The big cap number wasn't out till late that season though. Sonics weren't really prepared to offer Durant the max. We had to do like 20 trades in 10 days to have that much cap space.

Well, maybe not 20 but a lot. Now, teams might need to do some off-season moves to get cap space for the exact opposite reason.

Edit: I get though that there is a bit of a contradiction in this post because the cap jumped and I say we needed to get more cap space. But that was to get the extra we needed.

My point is that it was a challenge and that people weren't really prepared for cap to jump that much even if it was expected. Mostly because they didn't know how much it would jump exactly but also because some large contracts all of a sudden looked like bargains.

That's sort of what I see for the current situation (the virus, the Morey incident, the low ratings) with cap going down a bit maybe instead of going up. And teams might need to adjust but that's part of running a team as it was back then.

[Steve Jobs]

May 6, 2020 14:54:27 GMT -5 Jackie Kong said:

The big cap number wasn't out till late that season though. Sonics weren't really prepared to offer Durant the max. We had to do like 20 trades in 10 days to have that much cap space.

Well, maybe not 20 but a lot. Now, teams might need to do some off-season moves to get cap space for the exact opposite reason.

Edit: I get though that there is a bit of a contradiction in this post because the cap jumped and I say we needed to get more cap space. But that was to get the extra we needed.

My point is that it was a challenge and that people weren't really prepared for cap to jump that much even if it was expected. Mostly because they didn't know how much it would jump exactly but also because some large contracts all of a sudden looked like bargains.

That's sort of what I see for the current situation (the virus, the Morey incident, the low ratings) with cap going down a bit maybe instead of going up. And teams might need to adjust but that's part of running a team as it was back then.

Nah, this is the thread I was referring to, and it is from November 2015.

dynasty720.proboards.com/thread/864/dallas-utah

It was pretty much set in stone from the moment the TV deal was signed (finding articles from October 2014) and it just took some time for the signed deal to kick in.

Plus, again, I’m not saying that I disagree with that idea that adjusting to the cap going down is a part of running a team, what I AM saying is that if we don’t have any information to lean on about where the cap might be for next season then we’re at a much larger disadvantage than actual NBA teams will be... so to me a “wait and see” approach is unilaterally worse for the league than any decision we could make (including pre-emptively lowering the cap and being wrong) because it means every GM is just knowingly proceeding towards a cliff, blindfolded, and hoping not to fall off. Some GMs will simply cut ties early to avoid major penalties, some GMs will wait until it is too late and inevitably be forced to blow it up sooner than maybe was necessary otherwise, and other GMs (namely, the ones with cap space or those maneuvering to get it this offseason) will profit massively off of the “being in the right place at the right time.” All of these things are inevitable, but could be minimized / mitigated if we’re just proactive about our cap (one time ever) rather than reactive.

[Allan Houston]

I gotta say, I don't really follow your logic.

>if we don’t have any information to lean on about where the cap might be for next season then we’re at a much larger disadvantage than actual NBA teams will be

Why is that the case? You must be assuming those teams have inside information, I guess? I don't really buy it. If there's material information to go off of, it'll either be released or leaked. If teams are just doing educated guesswork, there's nothing stopping us from doing the same.

As for your hypothetical decision scenarios, I also don't really buy it.

> Some GMs will simply cut ties early to avoid major penalties

Or under the wait and see approach, they could ... wait and see?

> some GMs will wait until it is too late and inevitably be forced to blow it up sooner than maybe was necessary otherwise

If the cap number forces them to blow it up, it forces them to blow it up. The deadline for doing so, i.e. when it's necessary to do so, is invariant. Namely, it's their trade deadline. And I'm pretty sure no one is gonna have a trade deadline until the season restarts or it's cancelled. Maybe Philly, but then the narrowly tailored solution is to let Philly trade.

The "benefit" would be that setting a cap now gives them more time to execute it. That is, it gives them from now until some unknown trade deadline rather than from the announcement of a projected cap number to their trade deadline. But why does that matter? They can still negotiate contingently in case the cap is low, but under wait and see they get the opportunity to back out if the cap isn't low. That's a benefit to me, no?

In fact, precisely the inverse problem arises under your approach. Suppose we set a cap now at $110 (which is my guess atm). Some team decides that puts them in salary cap hell and blows it up. Then, the NBA comes along and says, "We think the league will rebound to full health, so we'll jsut stick with our last projection: $115M." Then, in fact, that team was forced to blow it up prematurely, and would rightfully be pissed.

So you respond, "well then we should account for that and make our artificial cap high, so there's little chance of that." For one, that seems to be an ad hoc approach that favors high cap teams and disfavors low cap teams artificially. And two, as I mentioned earlier, it kicks the problem down the road. What if we set the cap at $115M, and in next year, the NBA doesn't recover and the cap is at $110M still the following year? Now all these high cap teams committed to keeping their salary up, only to have to bite the bullet even harder the next year.

> other GMs (namely, the ones with cap space or those maneuvering to get it this offseason) will profit massively off of the “being in the right place at the right time.”

Sure, but that's always the case. A lower cap number helps low salary teams, a higher one helps higher salary teams. There are always winners and losers. It seems weird to determine those winners and losers now arbitrarily rather than use a principled method and follow the NBA.

[Jackie Kong]

The debate was turning around with me mixing everything up till Deputy Commissioner came in to put some order.

[Steve Jobs]

I genuinely don’t understand why there is such a strong push back towards every option but “wait and see.”

There are way more problems that arise from waiting than from making our own choice here. Our league is slated to not “stop”, whereas the NBA could play no more games this season. It would make no sense for us to match an NBA that lost 1/4 of the season and playoffs if we finish the season and have our playoffs.

I personally would vote to go with the prior $115 projection (because I think it’s the only realistic outcome that a hypothetical Non-coronavirus NBA would result in and it benefits our league members by giving us a scenario that doesn’t deviate immediately from the plans we had made), but I’m perfectly happy to be out-voted on what exact solution we choose, I just really disagree with the idea that there is any benefit at all for D720 by waiting to see what the NBA does. I especially disagree with Allan insinuating that he thinks the NBA owners (and by extension the GMs) don’t have any access to the information they need to make cap projections for themselves. It’s a revenue based model in the first place, so even if Silver has yet to make a final decision on how/if to after the formula, they at least know the numbers they need to know in order to generate their own “worst case scenario” projections. Our GMs are completely in the dark even though we have it in our power to address it

I just genuinely don’t see why discussing preparations to potentially deviate one singular time apparently has zero other interest across the whole league. The worst-case implications of a “wait and see” scenario are genuinely pretty scary to me regarding the future of the league, while putting our heads together to figure out how to proceed for one year so that we’re not flailing blindly as GMs has no real repercussions.

[Allan Houston]

I want to make clear that I'm not being adversarial for the sake of it. I genuinely want to understand your logic. If your conclusion is correct, then that seems pretty important! I just don't track the logic that gets there.

>Our league is slated to not “stop”, whereas the NBA could play no more games this season.

Maybe this premise is our misunderstanding! Last I understood:

>we suspend the season on the same game the NBA suspended the season. Then while we wait we do the Fantasy Draft sim stuff until the NBA decides what to do. If they restart, we will restart. If they cancel the season we will have another poll on how to finish out the season.

See dynasty720.proboards.com/thread/7476/season-suspension-poll

My understanding is that our season is stopping at game 65 or so, no?

> It’s a revenue based model in the first place, so even if Silver has yet to make a final decision on how/if to after the formula, they at least know the numbers they need to know in order to generate their own “worst case scenario” projections.

If we assume the revenue based model, then the cap is fucked. NBA revenue massively comes from the playoffs. If the NBA follows their formula, the cap will go down literally dozens of millions of dollars, which is simply not feasible. Almost certainly the NBA will deviate from their standard formula. That's not unprecedented. They do it in lockout years.

>I just genuinely don’t see why discussing preparations to potentially deviate one singular time apparently has zero other interest across the whole league.

Discussing preparations is great! This thread is genuinely interesting and has garnered a lot of interest, from what I can tell. I, in particular, really like the thought experiment and appreciate your contributions. I just don't fall in line with your view. At least not yet.

>The worst-case implications of a “wait and see” scenario are genuinely pretty scary to me regarding the future of the league

This is what I'm interested in. I don't see the same scenario you're perceiving. If you can really spell it out, that may be useful. Give me the hypothetical example of the team that gets utterly fucked by the wait and see approach (as compared to setting the cap at $115M now). In all its detail because I don't want to lose it in ambiguity (as you please, of course; this shit is a hobby, so if you feel it's a waste of time, no worries).

[Brian Scalabrine]

Allan Houston , what I'm guessing Steve is referring to, or at least, the only thing I see that could maybe become a real problem is this scenario:

Let's say the cap goes DOWN by, for an extreme example, 15 mil. How many total teams does that put over the hard cap when adding on the 10% luxury tax for teams that are already slated to receive that penalty? For the record, I do not know the answer to that question. But in an absolute worst case scenario, seems like a significant amount of teams could end up in this situation or near it, if the cap reduction is that significant.

It's one thing to say they have to shake things up, BUT, IN THE ABSOLUTE WORST CASE SCENARIO, I think the big question becomes:

*** Is it possible that the total amount of must-be-moved to be get under the hard cap could exceed the amount of total free cap space in the league + reasonable amount to expect to be moved in trades that are for smaller salaries using the 125% rule? ***

I'm not a math guy really--but it seems unlikely to me. If this DID happen, though, we would probably have to come up with something to alter it.

[Jackie Kong]

Well, the worst case scenario you present actually has a work around if a couple of players get stretched.

Say there is a rebuilding team with $20 in cap space and $20M in expirings. If he finds out his cap space is super valuable he might want to stretch the $20M expiring into $6,7M over 3 seasons. That's isn't a lot if we are actually talking about $20M expiring distributed into 3, 4 players (usual rebuilding team case). That's because if you have 4 contracts for 3 years and $2M each season they aren't that hard to move.

So then that team has $33,3M.

Stretching can work as well for teams over the Hard Cap because once you stretch the player his cap hit moves to 33% of it's original value. Would that make them lose value? Probably but you can't win every battle if you know what I mean.


Also, like I said earlier if we are talking about $15M difference the actual impact is 50% of that.


But again, if something happens it is the GMs' job to figure it out unless they apply a solution in real life that we should copy. That's what the league usually does to be as real as possible even if that is impossible to achieve.

I just gave a free tip with the "Stretch Provision" idea so it should be easier for people to figure it out now.

[billy]

May 6, 2020 22:59:46 GMT -5 Steve Jobs said:

There are way more problems that arise from waiting than from making our own choice here. Our league is slated to not “stop”, whereas the NBA could play no more games this season.

For all intents and purposes we are going to "stop" though the same time as the NBA, we have about 7 sims left fwiw. Then we'll mess around with the fantasy roster/league until we see what the NBA will do.

You're right though -- if they end up cancelling the season we will probably run it through (maybe award two champions -- a regular season "real life" championship (or however the NBA decides to award theirs), and our regular playoffs champion).

[Steve Jobs]

Allan Houston - My assumption for where we differ is informed primarily by the 13 votes for continuing in some form or fashion vs the 7 to follow the NBA exactly. As it stands, suspend but continue eventually won the three dog race anyway, but when over 60% of the voters prefer continuing at some point it’s all but certain that we will regardless of what the NBA does.

To expand on Brian’s point, which is definitely among the things on my mind here: We currently have, I believe, 6 teams with Luxury tax penalties on the books and 9 teams with potential to be penalized for next year (3 of those that would incur the 20% penalty next year). If my math is correct, those 12 cases (just counting the 3 20%ers as two 10%s each) of a 10% cap penalty equal out to roughly 4% of the total available space under the current hard cap. The salary cap would only have to drop to $104,774,400 for that current 4% of the total available space under the league wide hard cap to evaporate completely. That obviously doesn’t mean there’s no way enough contracts are expiring to still afford that drop, but it has to be acknowledged that the impact on the cap itself wouldn’t have to be that dramatic for the potential to not even have enough available space for the teams that need to dump salary.

As for a legitimate worst case scenario, obviously I don’t have any specific, detailed description of the outcomes that could harm our league the most, but every time we’ve had deals like Anthony Davis getting traded to John, it’s severely harmed the competitive balance of the league for years to come. We will almost certainly see one or more trades in that vein if the cap drops and we don’t at least have a pre-discussed solution for options on how to handle it.

... To be clear, I’m not using the blanket concept of superstar trades as an example of a problem, I’m referring specifically to blockbuster deals that are obviously very unbalanced. The main issue here is that there will not be an abundance of freedom of choice for these trades, the deals will be purely about getting the best deal while actually shedding the necessary salary, such that the available options for trade partners will be limited almost entirely to those with open cap space. We can pinpoint right now the teams that will likely be on the receiving end of this since only 3-4 have any actual cap space at all right now.

I guess the best solution I can come up with off the top of my head would be to include a complementary amnesty clause (to be used concurrently with the deal) to any teams that come to terms on a trade with the sellers that said sellers and the TC can all agree on. That way the pool of potential suitors becomes the whole league and it isn’t just up to the pure chance of the coronavirus who wins/loses when the cap hurts us. To me this is a much more complicated solution than just agreeing on our cap number sooner to give people extra time to formulate their strategy, but at least it’d provide a... league-wide release valve, if you will, for the excess salary that will be floating around if/when the cap doesn’t go up.

[Jackie Kong]

Steve. You will just need to stretch or trade one of your big contracts for something smaller. I think you will live.

All teams with high payrolls are high profiles teams. Only teams that might suffer a bit are Nets because they don't trade and Memphis but no one forced Logan to give Wall a massive contract.