Yankee Finance 101

Here’s a good peek behind the curtain on the Yankees’ revenues. Missing the playoffs costs the club a little more than $50 million in ticket and suite sales. (And presumably  a decent chunk of change in merchandise and concession sales too.)

So, if you are wondering why the Yankees paid Ellsbury there’s your answer.


Word on Twitter is the Yankees have either finalized or are close to finalizing a 7 year/$150 or so million deal with Jacoby Ellsbury.

When the Red Sox signed Carl Crawford my biggest knock on the deal was that they were signing a “legs” player well into his 30′s and that seldom works. The Yankees are doing the exact same thing here. If you take away Ellsbury’s 32 homer season (I admit that I have always cast a very skeptical eye on that season PED-wise) he is not a power guy. So, what happens when he gets old?

Ah, but these are the Yankees you say. They will simply import a younger guy to take his place and they will figure out a way to move the salary or live with it. (Sidebar- since AAV is what determines luxury tax, the Yankees could front load this deal and pay Ellsbury the bulk in the first few years if they wanted to.) I just don’t think this is a great way to do business. I get that the draft pick was already gone with McCann, but where does this end? I also get that baseball is awash in cash and more seems to come in every day, so I guess the plan is to win now and figure the details out later, but sooner or later that has to fail, right?

And what does this mean for Robinson Cano? Assuming the salary numbers are true, Ellsbury will cost around $21 million a year. Add that to the current salaries (including McCann’s) and you are around $137 million. The true figure for staying under the luxury tax is $179 million so things are tightening up. Now, they could get A-Rod off the books, but….

Don’t get me wrong, this is a good baseball move for 2014 and the near term, but beyond that I worry. I just wonder if anyone in the front office joins me in doing so?

UPDATE- 10:30PM Here’s a very interesting article from Cliff Corcoran of SI.com from two weeks ago. Here he attempts to value Ellsbury’s next contract. You should read it in detail, but let me give you the broad strokes.

He values Ellsbury to be a productive player (positive WAR) over the next seven years. That’s good for the Yankees, no drop to replacement level here.

His value estimate is harder to grip because he has a number of assumptions which you may or may not agree with, but he has a range of $104 million for 7 years to $163 million. That suggests that even at the most pessimistic value, the Yankees didn’t make a crazy mistake. (For an example of a crazy mistake take A-Rod who was paid $26.4 million more than he produced in 2013.)  Now valuing something is an inexact science, but this does make me feel better.

He points out, and this is very important, that his method values all wins as meaning the same to each team. But, all wins don’t mean the same thing to each team. A team that loses 90 games will value a win much, much lower than a team that wins 90 because the team that wins 90 is in playoff contention and those extra wins could bring in extra revenue.

But all of this got me to thinking about the Yankees as currently constructed. You add Ellsbury and McCann and you have improved by over 8 wins based on 2013. However, subtract Cano and you lose 6 of those wins. (Obviously, his replacement could add some value but it won’t be more than half of that figure.) So, these moves while good for 2014, lose a lot of their luster if Cano doesn’t return.


Some Encouraging News

The title of this piece, “Yankees have no plans to offer Robinson Cano a $200 million deal” is encouraging on its own, but buried in the text is a second quote that should make Yankees’ fans smile- “While the depth of New York’s talks with outfielder Carlos Beltran have been overstated….”

So, the Yankees won’t break the bank for Robbie (good) and may not be as seriously after Beltran as previously stated (great!). In the article, Passan puts the Yankees at 7 years/$160 for Cano and suggests they would increase that offer by $15 million. For me the key is keeping the deal to 7 years. That’s an acceptable length of deal at this point, but any further is really pushing it and risks a chunk of dead payroll in 2020 and beyond.

George King takes a couple of Brian Cashman quotes and decides that he is pessimistic about the chances of bringing Cano back. I’m not sure I draw that same conclusion from those quotes, but it does seem to corroborate Passan’s article on Yahoo that the Yankees won’t go much higher for Robbie. And buried in the King piece is word that the Yankees have made a $15-million offer for Kuroda. That seems fair and while his second half concerns me, I think that may have been to overuse more than anything. Bringing Kuroda back on a one year deal makes a lot of sense.

And finally we have some interesting quotes from Cashman in today’s Daily News. Speaking about third base and Eduardo Nunez, Cashman said:

“Nunez has options. He’d be a utility player. I wouldn’t want to start him there at that position (third), regardless of how he might feel about it. I’d want to find someone I’d feel more comfortable with. Power is a big component for me at that corner infield position, so Nunez and Brendan Ryan aren’t power providing guys, which is why I would hope to be able to do better than that.”

And he expanded a bit on Ryan saying:

“We were definitely looking for a situation where we needed a shortstop in the event that Derek has struggles again or needs time. We really feel comfortable that (Ryan) is going to catch the ball and make the routine plays and he can run out there every day.”

So the Yankees didn’t think enough of Nunez at short defensively to feel comfortable with him and his bat doesn’t produce enough to play third. That’s a bad combination and while Cashman may suggest he could be a utility player I suspect his time as a Yankee will be coming to a close very soon.


Jon Heyman is reporting that they Red Sox and A.J. Pierzynski have agreed to a deal.  Great, just when I thought the Red Sox were getting rid of a catcher whose name I can’t spell in Jarrod Saltalamacchia, they go and sign an equally hard to spell catcher.  Very selfish of them if you ask me.

Pierzynski is the catcher everyone hates, unless he is your teammate, which means he’ll probably fit in just fine in Boston.  At the tail end of his career, he is a durable back-stop but we probably can’t expect more offensively from him than we would have from Salty.

Believe it or not, Pierzynski is a year older than David Ross, so the Red Sox have an AARP platoon at catcher.  Ryan Lavarnway had best stay ready as it is likely Ross and maybe Pierzynski could break down, despite the latter’s track record of good health.

I like this signing, it provides a veteran platoon situation and doesn’t, I assume, lock the Red Sox up in a 5 year deal with a catcher.  AJ, being the lefty, will get the majority of at bats and that is just fine, as long as he is in the 7-9 spots in the line-up.  Of course, until details of the deal are released, I reserve final judgement.

Non-Tender Is The Night

The Yankees have cleared some roster space today. First, they traded Chris Stewart to Pittsburgh for the infamous PTBNL. (The fact that they are actually going to get a player back for Stewart makes me wonder what the Pittsburgh front office is doing). They have also non-tendered Jason Nix, Matt Daley and David Adams.

Nix was an obvious choice since he is arbitration-eligible and the Yankees are bringing back Brendon Ryan. Daley is a 31-year old pitcher who clearly isn’t part of the future. The Adams move is curious however. He wasn’t eligible for arbitration and the Yankees could have kept him on the roster until they needed space and then simply DFA’ed him. I get that he didn’t hit this year, but throwing him away at this point is strange to me unless we don’t know something else that is going on. After all, the Yankees are going to keep David Huff for now, which is very hard to understand.

So, that’s 4 open spots on the 40-man, plenty of room for Cano, Beltran, Kuroda and Tanaka, right?  Right?

Hughes To Minnesota

Reports are Phil Hughes has signed a three-year/$24-million deal with Minnesota. I don’t think anyone who has followed the Yankees is shocked that he has left town, but his destination and deal length are interesting.

Personally, I thought Hughes would take a one-year deal and try and recapture his earlier success. Minnesota is also not the place where I thought he would  end up. Sure, it is low-pressure and a pitcher-friendly park, but I thought he would head to the west coast or the NL.

Hughes will always represent what could have been to Yankees’ fans. We will always think of his near no-hitter in his first start and the subsequent hype that followed him afterwards. He was supposed to be the guy who fronted the rotation throughout this decade. That didn’t happen and the Yankees would be smart to figure out why the potential of Hughes, Joba and Kennedy fizzled into 80 wins and disappointment all around.


The Red Sox off-season is simmering with no sign of a boil over.  For everyday players, the Red Sox have the following:

c – David Ross (expect him to be paired with a lefty platoon partner)

1b – Mike Carp

2b – Pedroia

3b – Middlebrooks

ss – Bogaerts

lf – Gomes/Nava platoon

cf – Jackie Bradley Jr.

rf – Shane Victorino

dh – David Ortiz

Of course Stephen Drew, Jacoby Ellsbury, Mike Napoli and Jarrod Saltalamacchia could all return thus getting the band back together, but for now, the above is what we have.  As it stands, that’s not a train-wreck line-up, hardly so but Middlebrooks is not a sure thing, although I really want him to pan out.  Drew might be a good defender, but Bogaerts has got to be the everyday ss moving Middlebrooks to 3b and Middlebrooks has too much raw power to give up on him now.  He was a disaster 1st half but posted .276/.329/.476 vitals after the all-star break.  Not all-star stuff, but serviceable and he just turned 25.

As Peter noted the Red Sox and Yankees are both linked to Carlos Beltran.  That’d be fine, I supposed for Boston, but it would mean the Red Sox aren’t ready to give the CF job to Bradley Jr.  My problem with Beltran is that he is old and after seeing him leave game 1 of the World Series only to return to game 2 (less than 24 hours later), made me question his willingness.  It’s the WS after all.  You never know when you’ll get there again, you’ve got to force yourself to stay in that game.  And while he has been decently durable since 2011, remember this is the guy would couldn’t stay on the field during large spells with the Mets.

Aside from that, there really isn’t any news to report.  The big names have yet to drop off the board and until they do, we’ve got little to no news.

Don’t Do It!

Word on the internet is that the Yankees are strongly pursuing Carlos Beltran. So far, they have refused to offer more than a two-year deal, but they are reportedly considering going to three years because Texas and Boston are making strong bids.

This is a terrible idea. Beltran is the epitome of what the Yankees should be avoiding right now. He will be 37 at the start of next season and has had a checkered injury past. Yes, he put up some very good offensive numbers in 2013, but his defense has slipped below average by almost all metrics. (Some metrics put his defense as lousy)  He is projected to hit .277/.343/.473 next year, a certain plus, but the Yankees should not make a three-commitment to a guy who will become a full-time DH soon.

I was never a fan of the Travis Hafner signing, but the idea behind it was a good one. Find someone who can pull the ball and put them in Yankee Stadium for 81 games. Along those lines, I would much prefer someone like Justin Morneau on a one-year deal than Carlos Beltran on a three-year one. Signing Beltran seems more like a move to sell tickets than anything else.

Business As Usual

As some of you have noted in the comments, the Yankees did today what their DNA programs to do- spend money on a big free agent. They have reportedly agreed on a five-year/$85-million deal with Brian McCann.

Let’s start with the bad about this deal. First and foremost, it costs the Yankees the 18th-overall pick in the MLB draft. They will probably recoup  a first-round pick when Curtis Granderson takes his talents elsewhere, but that pick will be in the 30′s, so they have essentially moved back 15 spots in the draft. That is not insignificant for a team trying to restock its farm system.  Signing McCann is by no means an abandonment of the farm system, but it is hard to equate rebuilding it with this move.

Second, this is a lot of money to pay a guy who may not be able to hit lefties anymore and will probably not be a catcher at the end of the deal.

Despite those complaints, there are some big positives from this move.

It’s hard to overstate just how badly the Yankees needed a catcher who could hit. And, the Yankees ideal world with this deal is very easy to see. McCann plays the next three years behind the plate while taking advantage of the short porch to hit lots of homers. In 2017 he transitions to more of a 1B as Gary Sanchez has established himself as a full-time catcher while Mark Teixeira is a free agent.

And, let’s not forget about this. (Note to Red Sox fans- see the position of the mask. That’s how these things are done!)  I loved that when I first saw it and that kind of fire was missing from the 2013 Yankees.  McCann is going to add a much needed spark to this team.

After reading the relevant CBA sections again, I am pretty sure that the Yankees can’t lose any additional draft picks for signing a free agent who was offered arbitration. (The team that lost such a player would still receive a compensation selection.) So, the Yankees can go after another one of those free agents, or two, without worrying about a penalty. If I am right, and the Yankees choose wisely, they could be very dangerous in 2014.

40 Man Decisions

Yesterday was the deadline to add a minor league player to the 40-man roster in order to protect him from the Rule 5 draft. The Yankees added six players. Five from the minors and one they acquired by trade.

The five from the minors include some familiar and somewhat unfamiliar names. Gary Sanchez and Slade Heathcott are two names very familiar to Yankees fans and need no additional comments from me. Jose Campos is the other arm they received from the Mariners in the Montero-Pineda swap. He is still a long way from the majors, but he has looked very good when healthy.

That leaves Bryan Mitchell and Shane Greene. Both have made it to AA last year. Greene pitched better than Mitchell in 2013, but he is also two years older. Neither one looks like a front of the rotation starter.

The player they acquired by trade from the Padres, Dean Anna, won the PCL batting title last year. He put up a line of .331, .410, .482 as a middle infielder in 2013, which sounds great until you realize that its the PCL and he is 26. However, he has played all over the diamond and hits lefty, so he should have a solid chance to make the team as a reserve in 2014.

And the Yankees left some interesting players unprotected. Tommy Kahnle had awesome strikeout numbers at Trenton, but way too many walks. Chase Whitley put together a nice swing season in AAA and will probably get selected in the draft as a bullpen arm for some club.

Now we will wait for some free agent signings or the tender deadline on December 2nd for another roster shakeup. One position to note is catcher where the Yankees have five guys on their 40-man roster. You would have to think that either Cervelli or Stewart will be non-tendered when the first free agent signs.