Hey Pete,

O's at 7 - 150 M
Others at 8 - 160 M
What's the big deal about another year for 10M more?

7 at 150 M is higher per year anyway?
Seems if the O's were equal to other offers Tex would come home?
What's holding them back from adding a year or total value of 160M????

Speaking of contracts, how come teams don't offer signing bonuses to free agents? In this sense the O's could offer Tex 7 yrs/ $150 mil w/ a $15 mil signing bonus bringing the total to $165 mil. Are they only permitted to offer signing bonuses when it comes to draft selections?

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Pete's reply: I don't believe there is anything that prevents a ballclub from offering a signing bonus, but it's not very good business. The reason they are so prevalent in football is because of the salary cap.

Pete, please tell me there has been some movement one way or another.

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Pete's reply: I've got to believe that something will give in the next day or two.

If it's true that Boros orchestrates the media, then could it be that he's publically orchestrating Olney's (and others') latest word, "the O's are out of it," with a purpose--that Tex and (Scott) want the O's to step up? Just trying to spin some hopeful logic, although a Tex signing won't make much immediate impact without guys that get the other team out.

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Pete's reply: Anything is possible. I don't necessarily think Boras directly is trying to control the media. He just creates an environment where this kind of speculation runs wild and he's able to exploit it.

hey pete
how come in football you can just cut a guy, and sometimes it goes against the salary cap and sometimes it doesn't?
and in baseball if you cut a guy you got to pay him the full amount?
after the season what would happen if the ravens cut magahee, and mccalister?
thanks, j.

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Pete's reply: The two sports just have different labor agreements. Don't know McAllister's contract situation off hand. McGahee would be a big cap hit if they cut him.

I don't know the specific rules about player contracts, but I believe there is a rule about the contract not being able to drop a certain amount per season (I want to say 20%).

Couldn't a signing bonus be a way to get around that rule, in a similar way it is used in the NFL to get around contract rules?

For example, let's say a team has room to increase payroll immediately, but doesn't want to hamstring future deals that may have to be made.

Could they offer a deal where the player they want to sign gets a large amount of the contract up-front, and the yearly salary is much less? The player gets the same money, and the agent (at least a certain one) will get a percentage of the giant deal, just as before.

Wouldn't an offer of eight years, $184 million, with a $40 million bonus as part of the deal be a possibility? There is a huge payout now, when the team could afford it, but the remaining average is $18 million a year, which would be more reasonable when it comes to future payroll needs.

I could see where the union would have a problem with it, but would they be able to fight it outside of collective bargaining, where they would have to give up something to get that kind of rule change?

There has to be some rule about this, since even though I consider myself reasonably intelligent, there is no way I'm the first person to think about this (and there are other ways to get around the rules to a point, like deferred money).

Just wondering.

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Pete's reply: I don't know any economists who would think it's better for the team to give a huge amount of money up front -- all other things being equal. If you want to do it as an inducement to sign, that's another story.

has anyone asked the question what are the chances Tex is reading this blog? after all he's from here, so would he read the Sun to catch up on local news? just a thought i had after reading all these comments, After all last I checked he is human.

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Pete's reply: I suppose it's possible, but I doubt it.

Pete:

A little gap in that logic, though, right? You can't offer bonuses based on qualitative stats -- but you can offer bonuses based on performance: All-Star appearance; MVP; Cy Young; etc. How do you explain that? Is it that it's being judged by someone outside? By the same logic, what's to stop a player who'll get a $500K all-star game bonus from paying a manager $50k to pencil him in as a reserve?

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Pete's reply: I didn't say it made perfect sense, but that's the rationale.

Hey Pete, have The O's expressed any interest in Pudge?

They need a veteran catcher and while he'd have a pricetag, they could get him for a couple years and Weiters could learn from one of the best. Also, if he takes more than a year to develop, they don't lose any production at the plate (assuming his numbers don't plummet like Ramon's and Javy Lopez's did).

Plus, since no one thinks they're landing Teixeira, why not? You could turn around and trade him at the deadline if Weiters is panning out and you're even better.

Just a thought...

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Pete's reply: I don't believe that IRod is under consideration.

Pete. On the subject of contracts, why do think owners would even think of including an opt-out clause? I believe CC has one-is that true? An opt out clause really favours the player and ties the teams hands-look at the mess the AJBurnett contract caused the Jays.
Your thoughts?

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Pete's reply: Not sure about C.C., but I agree with you. If you're going to guarantee a guy $160 million, he has to at least accept the risk of staying with you if he plays well. Sometimes, they help get a deal done, but the O's would be nuts to include one for Tex after two or three years.

MLB salaries are guaranteed NFL salaries are not. Signing bonuses in the NFL are guaranteed and paid up front but are prorated over the length of the contract, thus if a player is cut the remaining portion of the signing bonus is applied to the cap.
I am not an economist nor a cpa and I do not play either role on TV.