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Monday, February 11, 2013

Juliano: Making Sense, and Cents, of an Extension for Robinson Cano

Do you Cano? Come on over! Alone! Now!...Okay!!

Perhaps the most compelling reason to re-sign Cano now is the luxury tax implications. Because Cano is playing under a club option in 2013, the $15 million he is owed is applied straight up to this year’s payroll calculation. However, if that amount was rolled into a long-term extension, the Yankees could use the extra year and lower salary to reduce the average annual value (AAV) of Cano’s new contract.

...It’s important to note that if the Yankees don’t sign Cano to an extension now, that doesn’t mean they can’t re-sign him in the offseason. The only thing forfeited would be the opportunity to save approximately $1 million in AAV. Hal Steinbrenner knows his economic situation and intentions better than anyone, so if this savings isn’t worth the risk that Cano will suffer an injury or drastic decline in 2013, there’s no compelling reason to execute an extension now, unless, of course, the Yankees fear that the market for Cano would break through the Arod barrier. Then again, with Scott Boras as his agent, if that is a real possibility, chances are Cano wouldn’t even consider forgoing free agency.

Ultimately, if Cano is willing to sign a deal at terms comfortable to the Yankees, they should it now. If the Bronx Bombers have any reservations, however, they should wait until the off season. Although that creates more uncertainty, it also gives the team more time to figure out its priorities. Is it winning, maximizing profit, or some combination of both? The answer to that question could decide whether Cano is wearing pinstripes in 2014.

Repoz Posted: February 11, 2013 at 07:26 AM | 13 comment(s) Login to Bookmark
  Tags: business, yankees

Reader Comments and Retorts

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   1. Bug Selig Posted: February 11, 2013 at 07:59 AM (#4366900)
Ultimately, if Cano is willing to sign a deal at terms comfortable to the Yankees, they should it now.


Well, no ####.
   2. Bhaakon Posted: February 11, 2013 at 08:53 AM (#4366908)
In what universe does he signed for less than 15M AAV?
   3. DCA Posted: February 11, 2013 at 09:09 AM (#4366917)
That's not issue. If he signs for 9/$225m next winter, that's $25m against the 2014 salary cap (which the Yanks are trying to get under). But sign it today and include the option, and it's 10/$240m, which only counts $24m against next year's cap.
   4. Jose Can Still Seabiscuit Posted: February 11, 2013 at 09:14 AM (#4366918)
The Yankees probably have less need to sign a player like Cano today than any other team in baseball. No team is going to come in and blow away whatever contract they are willing to offer so the certainty is less important to them than it is to other teams.
   5. bobm Posted: February 11, 2013 at 09:26 AM (#4366925)
Apparently "William Juliano" is a pen name for Jon Heyman.
   6. snapper (history's 42nd greatest monster) Posted: February 11, 2013 at 10:59 AM (#4366961)
The only thing forfeited would be the opportunity to save approximately $1 million in AAV.

Why would you take additional risk (he could get hurt, he could have a bad year) for $1M in AAV savings?

The only reason to extend Cano now is if he offers a reasonable deal, say 7/160.
   7. JJ1986 Posted: February 11, 2013 at 11:03 AM (#4366968)
The Dodgers are not yet paying $15m+ annually to a second baseman. It's one of the few positions they can say that about.
   8. BDC Posted: February 11, 2013 at 11:05 AM (#4366969)
This stuff is beginning eerily to resemble the arcana of NBA salary-cap calculations.
   9. Walt Davis Posted: February 11, 2013 at 11:51 PM (#4367563)
The Yankees probably have less need to sign a player like Cano today than any other team in baseball. No team is going to come in and blow away whatever contract they are willing to offer so the certainty is less important to them than it is to other teams.

Says a man who's never met Ned Colleti.
   10. Jack Carter, calling Beleaguered Castle Posted: February 12, 2013 at 12:00 AM (#4367566)
Hal Steinbrenner knows his economic situation and intentions better than anyone, so if this savings isn’t worth the risk that Cano will suffer an injury or drastic decline in 2013, there’s no compelling reason to execute an extension now, unless, of course, the Yankees fear that the market for Cano would break through the Arod barrier. Then again, with Scott Boras as his agent, if that is a real possibility, chances are Cano wouldn’t even consider forgoing free agency.


Even if Cano racks up 10 wins in 2013, if he's 'through the Arod barrier' the Spankees should cheerfully forgo the opportunity to sign him.

Ultimately, if Cano is willing to sign a deal at terms comfortable to the Yankees, they should it now. If the Bronx Bombers have any reservations, however, they should wait until the off season.

Gutsy writing, right there.
   11. Bourbon Samurai Posted: February 12, 2013 at 01:20 AM (#4367607)
I disagree. They should reject comfortable terms, but jump in if they have reservations! The George Costanza way!
   12. Walt Davis Posted: February 12, 2013 at 02:17 AM (#4367624)
"Well, it's not like I was expecting Scott Boras."

{Boras, jumping into scene): "NOBODY EXPECTS SCOTT BORAS."

"Oh no!"

"My key weapon is surprise. Surprise and fear. My two main weapons are surprise and fear and an almost fanatical devotion to my clients. My three main weapons are ..."

"My God! What do you want?"

"8 Years, $200 M."

"No."

"No? No? This is my "assistant" Mr. Fang. Mr. Fang, begin the torture."

"Torture?"

"Yes Mr. Cashman. If you don't give me what I want, then Mr. Fang will torment you with...."

{DUN DUN DUN}

"... the comfortable terms."
   13. Nasty Nate Posted: February 12, 2013 at 11:28 AM (#4367721)
Why would you take additional risk (he could get hurt, he could have a bad year) for $1M in AAV savings?


And it's not even actual savings - it's just $1M less toward the soft cap, right?

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