Have I got a deal for you...

Robin Brownlee
January 26 2009 11:09AM

It wasn't long ago that the rationale for handing out lucrative, long-term contracts to players like the pact the Edmonton Oilers signed Tom Gilbert to was: "It might seem like an overpayment now, but it will be a bargain two years from now." At the time, it seemed a reasonable argument.

A lot of contracts, Gilbert's and countless others around the league, were inked with the NHL salary cap spiralling upward with no sign, apparently, it would stop, even though common sense dictated -- didn't it? -- there had to be a correction at some point.

Well, as anybody who has watched the value of their stock portfolio and house plummet over the past 18 months or so can attest, the correction is here, even if there's been a lag in seeing the results of a troubled North American economy come to roost on the NHL's doorstep.

With projections the NHL salary cap could drop from $56.7 million to close to $50 million for 2009-10 and escrow payments by players set to almost double, a lot of those contracts signed not so long ago will be anything but bargains. Yesterday's slight overpay becomes a millstone when it comes to general managers, like the Oilers Steve Tambellini, trying to move players.

While you and I can choose to take a $100,000 haircut on selling our house now as opposed to 18 months ago if we really must downsize to make ends meet, Tambellini and his peers don't have that option in moving players -- short of trying to give them away on waivers.

If they have to trade the "bargain" forward they signed to a $24-million deal over six years in July 2007 to clear cap space, they can't take the same kind of haircut just to move the player. The contract remains. How is Player A, who really isn't worth a $6-million cap hit when the ceiling is $56.7 million, going to be a bargain if the cap drops by $5 million?

Tough times

The Oilers, for instance, already have about $44 million committed to 17 player salaries for the 2009-10 season, according to NHLNumbers.com. Included in the $43.854 million figure is one bargain -- Ales Hemsky's $4.1 million cap hit. After that? Not so much. Didn't anybody, specifically former Oiler GM and now president of hockey operation Kevin Lowe, have an inkling a market change was coming?

What teams, for instance, would be interested in Dustin Penner and his $4.25 million cap hit? Or in Shawn Horcoff, who'll earn $26 million over four seasons starting in 2009-10. Any takers on Gilbert, who'll earn $3.5 million again next season, then $5.5 million, $5 million and $3.5 million? I can't imagine those contracts looking any better a year from now. Can you?

That's not to say the aforementioned players aren't good players, and I'm no economist -- as my wife and banker will confirm -- but as any financial analyst with half-a-clue will tell you, when the bottom falls out of any market, yesterday's bargain can turn into tomorrow's while elephant in a hell of a hurry. That's the situation the Oilers and a lot of teams -- again, didn't anybody see this coming? -- are going to find themselves in over the next two years.

No bargains

It looks to me like there's going to be a lot of GMs sitting on assets they can't move as they try to adjust to a changing salary cap.

One analogy I can draw on based on something I know, even if it is a bit ham-handed, unfolded last summer when I was looking for a car to replace the one that was written off after some dummy ran a red light and T-boned my Escalade at about 60 clicks, doing almost $30,000 damage.

I went to a local dealer. At the used end of the dealer's lot, there was a like-new 2007 Escalade with low mileage. The sales guy tells me he can make me a smoking deal -- if I play my cards right, I can get it for $64,000. Decent value, considering the vehicle stickered at $83,500 new.

The problem is, down at the new vehicle end of the very same lot, I could get a new 2008 Escalade for $59,900. Because of increasing gas prices and a big drop in demand, the market had changed drastically and people weren't buying without significant factory incentives -- incentives that didn't apply to the previous model year. How are you going to sell that used 2007 Caddy when a new one is cheaper? You're not.

In today's drastically different market, a lot of teams, the Oilers included, will be sitting on the equivalent of that big, used gas-guzzling SUV whether they like it or not as they wait to find out what the 2009-10 salary cap will be.

-- Listen to Robin Brownlee every Thursday from 4 to 6pm on Just A Game with Jason Gregor on TEAM 1260.

Aceb4a1816f5fa09879a023b07d1a9b4
A sports writer since 1983, including stints at The Edmonton Journal and The Sun 1989-2007, I happily co-host the Jason Gregor Show on TSN 1260 twice a week and write when so inclined. Have the best damn lawn on the internet. Most important, I am Sam's dad. Follow me on Twitter at Robin_Brownlee. Or don't.
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#1 Pokie Reddik
January 26 2009, 11:19AM
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With the tandem of GM, asistants and the Prez, I think the Oilers will do well in restructuring the team and start from scratch to rebuild the Oilers. It's what the Oilers are known for... staying in rebuild mode, trying to find players that MacT can coach, or as in th 06 run, can coach them selves. We have no problems here in Oil Country.

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#2 BUCK75
January 26 2009, 11:22AM
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Good analogy RobBro. The teams that are at the basement will have an advantage in a couple of years - assuming that they have teams in those markets. Do you think that next time CBA negotiations come around the teams might want to be able to retain salary or be able to trade salary(NBA) to increase player movement? Or even better (not that the players would ever go for it) stopping the guaranteed contracts like in the NFL.

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#3 Lofty
January 26 2009, 11:40AM
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Guaranteed contracts would be the best thing that could happen in the NHL. It would never pass the NHLPA but it would make players acountable for all the years of their contract rather than just the season before they become UFA. Yashin would have never gotten the stupid cash he got! How interesting the game would become.

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#4 Milli
January 26 2009, 11:42AM
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Crazy times, but anyone that didn't see it coming should be Fired, I mean promoted. Can you imagine your financial advisor (and i'm sure some did) telling you to buy, buy, buy....Don'y worry, everything will be alright? You'd sack his A$$!!!! Here again is the benifit of being broke!!!!

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#5 RobinB
January 26 2009, 11:42AM
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Pokie Reddik wrote:

With the tandem of GM, asistants and the Prez, I think the Oilers will do well in restructuring the team and start from scratch to rebuild the Oilers. It’s what the Oilers are known for… staying in rebuild mode, trying to find players that MacT can coach, or as in th 06 run, can coach them selves. We have no problems here in Oil Country.

No worries. None. I thought "rebuild mode" was supposed to be a thing of the past after fans were forced to sit around with their thumbs up their backsides during the lockout.

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#6 shakey
January 26 2009, 11:45AM
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Robin, Oilers aside, can you name some players on other teams that fall under the 'Gilbert rule' of over-paid now but great deal later?

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#7 swany
January 26 2009, 11:48AM
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Robin I watched Betman last night with Ron. He stated that this year the rvenue went UP 5% so for next year he doesn't see a drop off in the cap BUT he stated that the next indication for next year would be playoff tickets if they sell great he see a bright future, he expects the cap to fall but not as bad as everyone is predicting. Also the Canadian teams will have to kick in less money for revanue sharing as the Canadian dollar drops.

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#8 RobinB
January 26 2009, 12:12PM
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shakey wrote:

Robin, Oilers aside, can you name some players on other teams that fall under the ‘Gilbert rule’ of over-paid now but great deal later?

Gilbert won't be a great deal at any point in this contract. How'd you get that from what I wrote?

@ swany: As I've argued before, I'd be very surprised if we don't see the cap closer to $50 million than the $56.7 million it's at now when the 2009-10 season begins. Remember this with Bettman: he probably doesn't think -- or at least won't admit publicly -- there's any big problems in Phoenix or other cities where franchises are in trouble. He'll say, "Well, overall attendance is up . . ."

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#9 Pokie Reddik
January 26 2009, 12:15PM
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swany wrote:

Robin I watched Betman last night with Ron. He stated that this year the rvenue went UP 5% so for next year he doesn’t see a drop off in the cap BUT he stated that the next indication for next year would be playoff tickets if they sell great he see a bright future, he expects the cap to fall but not as bad as everyone is predicting. Also the Canadian teams will have to kick in less money for revanue sharing as the Canadian dollar drops.

Betman is a sales man,thats his history, When he gets an answer he has problems answering his eyes go shifty , he looks away, and doesn't directly answer the question. On the interview, how many questions did he truly answer? 2? Be very wary of this guy, there are teams that should be moved or dissolved, and then revenues will go up, He does not want to look like a "loser" but he is one.Leaving the Coyotes where they are,along with some other teams, will lower the cap. he has stepped on a lot of toes, it just a matter of time.

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#10 Bob Arctor
January 26 2009, 12:19PM
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Robin,

Do you think the Oilers would be willing to stash bad contracts in AHL? Maybe not so much the younger players they've recently signed to bad deals, but vets who are rapidly declining and nearing the end of their contracts...

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#11 MattL
January 26 2009, 12:22PM
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Is it just me, or is Bettman's exit from the NHL loooooooong overdue. He reminds me of that old Iraqi information minister. "The NHL is stronger than ever! We will out-sell the NFL by 2012." Ok, he hasn't gone that far. Still, Bettman needs to go. Why are we trusting a greasy, humourless lawyer to sell a fun game? The NHL has made mis-step after mis-step, including the last minute, mandatory All-Star game attendance rule. How about a little warning, jerk? And US television anyone? Might be an idea to let people watch your game...

Also, QUESTION: Wasn't there reverse-arbitration in the latest CBA? Why haven't we seen any of that? Surely it will come up if the cap goes down dramatically...

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#12 Rick
January 26 2009, 12:27PM
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BUCK75 wrote:

Or even better (not that the players would ever go for it) stopping the guaranteed contracts like in the NFL.

Or how about count the post escrow salaries for cap purposes?

That would account for any down turns in the economy but wouldn't actually cost the players anything additional.

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#13 Travis Dakin
January 26 2009, 12:29PM
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MattL wrote:

The NHL has made mis-step after mis-step, including the last minute, mandatory All-Star game attendance rule. How about a little warning,

This is actually one move of his that I applauded. Forget the warning... how about doing your damn job which is to work for the NHL. It's not overtime, it is during the season and if you want the big paydays that the nhl provides for you by giving you a forum to earn your living, well you better well show up and earn it.

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#14 tricksnard
January 26 2009, 12:29PM
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For a second there I thought this was a Wanye post and I had all these visuals of him ghost riding an Escalade.... crazyness.

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#15 Dropping Deuces
January 26 2009, 12:31PM
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Bob Arctor wrote:

Do you think the Oilers would be willing to stash bad contracts in AHL?

Come on, Penners stache ain't that bad.

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#16 CurtisS
January 26 2009, 12:33PM
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Well we recalled Reddox today. Some great news.

Does anyone know any news on Brule. Im sure he stays down now???

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#17 MattL
January 26 2009, 12:35PM
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@ Travis Dakin:

I think the move was right, but the timing was ridiculous. If he had announced it at the start of the season, or in the off-season, or even like, two months before the game, it wouldn't have been an issue. But if it's in the news in the days leading up to the game, I think it's bad publicity. "Everyone, come watch our crappy, boring game, that the players REALLY don't want to participate in, but we make them."

Makes a guy like Lidstrom look bad, after putting in all kinds of hours for the league over the years.

Like I said though, I like the move itself. It's a good way to stop teams from telling their stars that the team is more important than the league as a whole.

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#18 dawgbone
January 26 2009, 12:37PM
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Robin, you should probably re-think your life choices if you don't think Gilbert is a $4mil/year defenceman based on what he's done.

There are currently 62 defencemen in the NHL that are paid either more than Gilbert or within $500k under him.

The names in that range includ guys like Salo, Clark, Finger, Hatcher, Mitchell, Ohlund, Phillips, Poti, Rathje, Rivet, Seabrook, Suter, Schultz, Burns, Sarich, Brad Stuart, Orpik, Bieksa, Commodore, Martin, Wideman, Morris, Meszaros, Pitkanen, McKee, Aucoin, Regehr, Streit, Liles, Kaberle, Brewer, Weber, Hannan, Hainsey, Johnsson, Bouwmeester, Kubina, Blake, Gonchar, Rozsival, Green, Zubov, Souray, Hamrlik, Visnovsky, Schneider, Markov, McCabe, Rafalski, Pronger, Timonen, Jovanovski, Phaneuf, Redden, Boyle, Niedermayer, Campbell, Lidstrom, Chara.

Out of that list of 62, there are 15 guys who are clearly better than Gilbert, a bunch of guys who are in his range and another group that are much lower.

In terms of quality of competition, he's exactly in the range of a player making his amount should be plus he's outscoring them. There are only 25 defencemen in the NHL who have faced a similar Qualcomp or tougher that have also managed to do a better job than Gilbert at outscoring.

Are there better deals out there? Sure, there always is. But this one is pretty damn good, especially with what he's shown he can do up to this point.

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#19 oilerdago
January 26 2009, 12:38PM
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Robin, hindsight is 20/20. I don't think anyone saw last summer how bad the Canadian dollar or the US stock market were going to drop. So what looked good 9 months ago, looks very different today.

If the reverse had happened, what would we all be saying now about how the Oilers blew it by not locking up Gilbert when they had a chance too.

Also, if I'm not mistaken, the salary cap for 09/10 is going to be based on this year's revenues, most of which were booked before the stock market plummeted. So if I'm not mistaken, the cap for next year if it falls, may only drop to around $54-$55 million.

It's still going to be a challenge because you've got Cole/Smid/Grebs and a couple of bad contracts (Staios/Moreau) but the real day of reckoning is not until 2010/11 when Gagner/Cogliano come off their rookie deals.

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#20 Travis Dakin
January 26 2009, 12:44PM
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@ MattL:

You make a very good point. I agree.

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#21 jdrevenge
January 26 2009, 01:00PM
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How does the Escrow work within the CBA. Based on the collective thought process theres going to be a lot of middling players that are forced out of the league due to teams being unable to sign anybody but the Mcintyres of the world. This I would imagine would have been something that the PA wouldve forecast. There must be some sort of provisioning that in the event of a serious downturn wages are scaled back. This is what i thought the escrow did, effectively...

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#22 Rick
January 26 2009, 01:17PM
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jdrevenge wrote:

This is what i thought the escrow did, effectively…

That's the way I understand it but that is only for how the actual dollars change hands.

How the cap is managed isn't factored in though.

So based on league revenues you could reach a situation where the salary cap drops by say 5 million dollars, due to escrow you are only paying out 90 cents on the dollar (or whatever escrow is) for existing contracts but for cap purposes you are handcuffed at 100 cents on the dollar.

I don't know how the fine print would shake out because I am sure it wouldn't be that simple but it only makes sense to me that if the players are getting less on their paycheques it would be reasonable for the cap number to reflect the lower amount.

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#23 shakey
January 26 2009, 01:21PM
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@ RobinB: That's not at all what I meant. I was meaning in the spirit of the contract when it was originally completed where we were told it was going to be a good deal down the road. Similar to Penner's deal where it was admitted that it looked like an over-pay in the beginning but could be a deal down the road. I was just looking for other examples of other players on other teams that are in this same position.

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#24 jdrevenge
January 26 2009, 01:22PM
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@ RickSo based on league revenues you could reach a situation where the salary cap drops by say 5 million dollars, due to escrow you are only paying out 90 cents on the dollar (or whatever escrow is) for existing contracts but for cap purposes you are handcuffed at 100 cents on the dollar.:

Ya, you would think that it would reflect the change in percentage of player salaries over the league. Shouldnt be able to say that the players only get a percentage of whats owed to them but the teams are free to spend 100 cents on some and 90 on others. The math would just get too confusing wouldnt it?

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#25 Darcy
January 26 2009, 01:23PM
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Robin,

You repeatedly say "didn't anyone see this coming?" in your article.

Most economists and business forecasters, whose job it is "to see things coming", didn't see this quick hard recession.

You're holding a bunch of hockey people accountable for not seeing what professional forecasters didn't see?

Do you want Loweballini to tell us when to buy and sell our stocks too? It amounts to the same thing you are blaming them for in the article.

Your comments regarding their "not seeing this coming" is unfair.

Dawgbone also shows your evaluation of Gilbert's fair price is probably off as well.

I usually like reading your stuff, but this is not your best effort.

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#26 Fiveandagame
January 26 2009, 01:28PM
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@ dawgbone:

Nicely done DB. My thoughts exactly.

You want to talk about overpaid d-guys.

Wade Redden, the 24th most expensive player in the league. Making 8 mil this year and 6.2 per year for the ramainder of his 5 year contract.

Dan Boyle 6.67 mil for 6 years.

On the forward front, Scott Gomez at 7.3 mil for the next 6 years.

The Oilers are average in their overpay. I would rather have Penner at 4.25 that Daniel Briere at 6.5 over 7 years or Brad Richards at 7.8 for 3 more years.

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#27 Travis Dakin
January 26 2009, 01:30PM
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@ Darcy:

It didn't take a rocket scientist to see that the caps rise from 39 million in 05/06 to 56 in 08/09 was unsustainable growth. The point he was obviously making was that making the 12 year deals based on the assumption that it would steadily rise was a bonehead move. There is ALWAYS a market correction. And the question was asked, "Didn't ANYBODY see this coming." Shame on all those in charge that failed to be prepared just in case.

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#28 Rick
January 26 2009, 01:32PM
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jdrevenge wrote:

Ya, you would think that it would reflect the change in percentage of player salaries over the league. Shouldnt be able to say that the players only get a percentage of whats owed to them but the teams are free to spend 100 cents on some and 90 on others. The math would just get too confusing wouldnt it?

Way more confusing than I am capable of working through but on the surface from the PA's perspective what is better for them;

Having all the teams bumping up against the cap even before free agency and having their players taking 50 cents on the dollars compared to past years or;

Having all the teams having an additional 10 or 15% cap space headng into free agency and having their players taking 65 cents on the dollars compared to past years?

Considering existing contracts would already be devalued in real dollars by 10 or 15% I would think option 2 would not only be more appealing but the so called market values ends up being fairly close.

I would suspect that either way one thing that will be drastically different should be that the terms will be much shorter, which Robin already touched on.

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#29 swany
January 26 2009, 01:35PM
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It's a fact that all clubs have bad contracts and on the other hand we have some good ones to Hemsky at 4 mil when he should be getting 6-6.5 Grebs deal this year you could say he's a 3- 3.5mil a year D-man and what's he getting 1.5 or something like that. My point is yeas we have some bad contracts but we do have some that point the other way.

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#30 Rick
January 26 2009, 01:47PM
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Travis Dakin wrote:

... making the 12 year deals based on the assumption that it would steadily rise was a bonehead move.

I don't know if this is a fair comment.

The 12 year deal comment is fair because that kind of term really is rediculous but signing guys to 6 year deals wasn't all that irrresponsible at the time.

Anyways my main point is that those contracts weren't necessarily done on the assumption that the cap would continue to grow at the rate it was.

The expectation could very well be that the so called market correction would merely be that the revenue would plateau in which case the teams have some key guys locked up long term under contracts that fit within an established salary structure.

If during the those contracts the cap did rise, even marginally, then the contracts become a greater bargain. If the cap drops slightly then they are less of a bargain but not necessarily an albatross.

What ended up happening and the direction that things are headed are pretty much unprecedented in modern times though.

Some of the best economists in the world didn't anticipate the bottom dropping out of the economy the way it did or for the reasons it did.

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#31 Travis Dakin
January 26 2009, 02:16PM
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The reason teams were so quick to throw these huge long term deals (Dipietro NYI, Richards PHI etc) was because Kevin Lowe was throwing out huge offers to RFA's (50 M for Vanek) and teams were so affraid to be poached of their RFA's in the future. So, they signed them to what they thought were prudent long term deals. Brian Burke was right in that Lowe did eliminate the second contract in the NHL because teams wanted to protect their assests. Problem with that is, obviously in hinde sight, the lack of a foresight about the economic landscape in the NHL and world. Teams forgot that Huge talents are becoming UFA's every year as low as 25 years old. Instead of handcuffing their franchise for years by holding on to some players, they could afford to let some guys walk, take the draft picks and pick up a new player or two the next year on the market. Like having a fixed mortgage locked in for years at what seemed like a good rate last year, now those rates look like crap today. Should have gone with the variable rate.

I mean, Penner's deal won't ever be that bad because when the cap does go down he will only have a year or two left. His was a mid term length deal (less painful)

I guess the point is that teams should be looking at 3-5 year cycles. Seems like good business to me. Or does the 5 year plan seem a little to Stalinist?

Deep Oil Out...

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#32 Travis Dakin
January 26 2009, 02:17PM
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@ Rick: The reason teams were so quick to throw these huge long term deals (Dipietro NYI, Richards PHI etc) was because Kevin Lowe was throwing out huge offers to RFA's (50 M for Vanek) and teams were so affraid to be poached of their RFA's in the future. So, they signed them to what they thought were prudent long term deals. Brian Burke was right in that Lowe did eliminate the second contract in the NHL because teams wanted to protect their assests. Problem with that is, obviously in hinde sight, the lack of a foresight about the economic landscape in the NHL and world. Teams forgot that Huge talents are becoming UFA's every year as low as 25 years old. Instead of handcuffing their franchise for years by holding on to some players, they could afford to let some guys walk, take the draft picks and pick up a new player or two the next year on the market. Like having a fixed mortgage locked in for years at what seemed like a good rate last year, now those rates look like crap today. Should have gone with the variable rate.

I mean, Penner's deal won't ever be that bad because when the cap does go down he will only have a year or two left. His was a mid term length deal (less painful)

I guess the point is that teams should be looking at 3-5 year cycles. Seems like good business to me. Or does the 5 year plan seem a little to Stalinist?

Deep Oil Out...

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#33 Darcy
January 26 2009, 02:22PM
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Travis Dakin wrote:

@ Darcy: It didn’t take a rocket scientist to see that the caps rise from 39 million in 05/06 to 56 in 08/09 was unsustainable growth. The point he was obviously making was that making the 12 year deals based on the assumption that it would steadily rise was a bonehead move. There is ALWAYS a market correction. And the question was asked, “Didn’t ANYBODY see this coming.” Shame on all those in charge that failed to be prepared just in case.

That level of growth is unsustainable, but I disagree that any of the deals that Lowe did assumed that continued growth percentage.

No one. No one saw a massive correction happening all at once. Except for a few guys who shorted the banks and bought as much mortgage insurance as the banks would sell.

Also, there are no "12 year deals" there are 6 year deals in place.

Blame them for overvaluing Penner.

Blame them for overpaying Horcoff next year if you think that way.

Blame them for overpaying Moreau, Pisani and Staios.

Blame them for being short sighted and not giving themselves enough wiggle room even if you assume the cap will remain flat (the contraction of the cap will add to the pain). They certainly have not be practicing prudence.

Blame them for overpaying 3rd & 4th liners.

But do not blame them for not seeing the economic trainwreck that we are in the middle of.

The correction is exposing their flaws quickly, and has made some planned salary dumps harder, but "didn't anyone see this coming?" can be applied to almost everyone in every business.

Good times never last, but a correction this hard and fast hasn't come since the 30's.

I wonder if Conn Smyth would have "seen it coming?"

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#34 Jack "slacking off at work" Bauer
January 26 2009, 02:35PM
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Ummm.....Gm's have been signing players to long term contracts long before Kevin Lowe offered Vanek the offer sheet.

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#35 Travis Dakin
January 26 2009, 02:38PM
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Darcy wrote:

Also, there are no “12 year deals” there are 6 year deals in place

I was talking about the NHL as a whole. And I don't think Lowe over paid for those guys. I think he rewarded the guys that got this team to the finals in 06 as it should be.

I do like the Hemsky deal but I thought that giving Gilbert the same deal was silly. And Horcoff's deal is a little out to lunch. The reason Lowe didn't give Ryan Smyth the money he wanted was because he quote, "Didn't think the cap would go up as much as it did."

Having seen the steady increase in cap room, along with the impending sale of the franchise to Corpral Money Bags, Lowe decided to try to lock up his young emerging stars long term for big money to protect himself from the system he helped create. He figured, I can afford to give Gilbert and Horcoff this much now because there will always be more cap room. Instead he should have given him a 2-3 year deal and let the market dictate price later on. This is a ridiculously stupid economic system that the NHL has. Lets face it, Guys like Lowe are Hockey players and not economists or financial wizards. What else should we expect.

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#36 Travis Dakin
January 26 2009, 02:42PM
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Jack "slacking off at work" Bauer wrote:

Ummm…..Gm’s have been signing players to long term contracts long before Kevin Lowe offered Vanek the offer sheet.

Yeah, UFA's who were proven and around the 30-31 age when there was No cap. Signing a guy with potential to a decade long contract is insane. And that didn't start until Lowe offered Vanek a 50 million 9 year deal or whatever the hell it was. Vanek was 23. Great player and all but it is risky.

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#37 Ol goalie
January 26 2009, 03:01PM
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1. Your Escalade analogy is boring and doesn't explain anything; we get that it's hard to sell things that cost too much.

2. You don't really argue for your claim that Gilbert isn't worth 4 million a year. Moreover, you seem willfully ignorant of the fact that 'his contract will soon seem like a bargain' is more about his improving play than changes in the cap. Quite frankly, Gilbert started off shaky but now looks fantastic; his numbers back that up, and "hockey people" seem to rave about him.

3. If the Oilers have a Cap problem it's Staios (2.7), Moreau (2.0), and -to a lesser extent- Cole (4.0) creating it. They cost a total of 8.7 million and they haven't exactly brought an 8.7 million dollar game. Replace the first two with 800,000 veterans off the market, and let Brule or somebody young take Cole's second line job. (You'd also have to trade one of the small young guys a grittier young guy.) Cole is gone next year anyway and one of the old guys can be bought out, the other moved to Florida: the natural resting place for the elderly. :)

4. How much would you offer current pending free agents to keep them? Cole? Probably takes 4.5 for 5, no? Grebs? If he keeps picking his game up he's gonna get Gilbert's deal just to keep him here, IMO. That is, Penner was an overpay for sure, but could Horcoff or Gilbert or anyone else you're referring to be had for less? How do you go about signing players for less? Is it just a matter of being smarter, maybe taking echinacea?

5. Edmonton ain't like NYC for young millionaires. It ain't San Fran. or L.A. It ain't even Florida or PA or Toronto or Montreal. Thus, this team has to overpay for free agents and it has to reward it's veterans very well to encourage players to come here or stay here. That sucks, but that's how it is. Failing to mention this in an article about contracts in Edmonton is ridiculous. (BTW, I'm a local guy who loves Edmonton and I've lived in NYC, L.A., and San Fran for years. It pains me to say this, but if somebody offered me 1 million a year in NYC and 2.5 million in Edmonton, I'd take the former. There's just so much your millions could buy you in NYC, and you don't need to be a millionaire to eat at your local Keg Steakhouse in Edmonton. You just don't.)

Now, don't get all upset RB. I know Wanye has asked everyone to hold off and be nice. Please note, I like you and I'm sure you're very smart. I'm just criticizing what you wrote, so, again, please don't take it the wrong way. :)

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#38 RobinB
January 26 2009, 03:03PM
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Bob Arctor wrote:

Robin, Do you think the Oilers would be willing to stash bad contracts in AHL? Maybe not so much the younger players they’ve recently signed to bad deals, but vets who are rapidly declining and nearing the end of their contracts…

That's one option, and some teams are already doing that. How much is Kyle McLaren making in the minors? That's goofy.

@ dawgbone: Fair points. I'm using Gilbert as an example as much because he got a huge hike in pay over a relatively long-term as I am because I consider him a horrible overpayment. My point is a lot of GMs clearly miscalculated (or didn't allow for) the possiblity the cap wouldn't just keep rising and rising. Many, many players just coming out of entry level deals gote more money and longer terms than they deserved because teams feared they'd command more down the road -- now, it's clear, for the next couple of years at least, they'll get less. A lot of those contracts will be very hard to move. Gilbert is far from the worst example, but he's no bargain.

One last thing -- lay off with the "life choices" kind of remarks. I'm very good at what I do and it's perfectly accurate to write -- without breaking everything down and grading players 1-700 in order of who's the best deal and who's the worst -- that there are going to be a lot a contracts out there that don't make sense with the cap declines as we think it will over the next couple of years. I don't need or want validation from you to know that (end of snotty remark under the new Wanye edict).

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#39 RobinB
January 26 2009, 03:10PM
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Ol goalie wrote:

#37 Ol goalie January 26 2009, 3:01 pm. 1. Your Escalade analogy is boring and doesn’t explain anything; we get that it’s hard to sell things that cost too much.

I'm glad you get it that it's hard to sell things that cost too much. That's something a lot of GMs are about to find out.

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#40 Ethan
January 26 2009, 03:24PM
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The fact you can afford an Escalade shows your an overpayment.

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#41 Travis Dakin
January 26 2009, 03:47PM
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Ethan wrote:

The fact you can afford an Escalade shows your an overpayment.

And that kind of remark shows a marked bit of envy.

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#42 TV
January 26 2009, 03:50PM
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Travis Dakin wrote:

Jack “slacking off at work” Bauer wrote: Ummm…..Gm’s have been signing players to long term contracts long before Kevin Lowe offered Vanek the offer sheet. Yeah, UFA’s who were proven and around the 30-31 age when there was No cap. Signing a guy with potential to a decade long contract is insane. And that didn’t start until Lowe offered Vanek a 50 million 9 year deal or whatever the hell it was. Vanek was 23. Great player and all but it is risky.

While KLowe is a little culpable with his RFA offers in 07', he is far away from the person/s who cast the 1st stone in this arena.

People can drink all the Bjurke Kool-Aid they want from his canteen if they so choose, but to say K.L. was the reason or the offer sheets he tendered to those 2 players, were the direct result of a entry level player not getting a "2 level or 2nd term" SPC in the future, is just a finger pointing exercise in futility & not well researched IMO...

If that finger "Has" to be pointed in that direction, then point it where it belongs & we it came to be in the 1st place...

Doug Maclean/The Blue Coats & their contract offer to Rick Nash right after his entry level deal was up.

Don Waddell/Hotlanta & their contract offer to Kovy right after his entry level deal was up.

That is where the 1st domino fell in the "Elimination of 2nd term SPC's" came to pass.

1st blood is 1st blood, no matter how you spill it. So anything after that (right or wrong) is just simply collateral damage after the fact.

Laying blame does nothing at the end of day, but if your going to do it, you should at least make sure that finger is pointed in the proper direction unless you want another finger (pointing upwards) staring you right back in your face...

x6

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#43 Travis Dakin
January 26 2009, 04:09PM
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@ TV:

Fair point, but locking up your franchise player to satisfy the season ticket holders, sponsors and fans is one thing,

Tendering these offer sheets to other teams star players and inevitably driving up the price of your own is just stupid if the cap doesn't keep rising along with it. That's Lowe's baby.

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#44 Travis Dakin
January 26 2009, 04:12PM
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And no the offers to Sakic and Federov don't count - Pre cap

And the Kessler offer was for 1.5 million for two years. - A very normal contract for a needed roll player.

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#45 RobinB
January 26 2009, 04:57PM
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Ethan wrote:

The fact you can afford an Escalade shows your an overpayment.

I'll be a bargain two years from now.

Ol goalie wrote:

2. You don’t really argue for your claim that Gilbert isn’t worth 4 million a year. Moreover, you seem willfully ignorant of the fact that ‘his contract will soon seem like a bargain’ is more about his improving play than changes in the cap. Quite frankly, Gilbert started off shaky but now looks fantastic; his numbers back that up, and “hockey people” seem to rave about him.

I didn't intend to make the item I wrote about Gilbert and maybe I could have used Horcoff in the first mention and not him, but . . .

-- How much is Gilbert going to improve? He's 26, not 23. Started off shaky but now looks fantastic? Well, yes, with five of his 24 points in the last three games, he's been very good lately, but let's not get carried away based on that little spurt. -- A previous poster mentioned Qualcomp stats showing Gilbert has performed reasonably well. I'm not going to split hairs on that, but I can say I'm personally not overwhelmed with how Gilbert has performed. What about quality of the guy he's playing with, namely Sheldon Souray? I'd think he'd be better offensively just feeding off Souray's leftovers and all the attention he draws from opponents. Yes, 3-21-24 is decent, but (I really do check stats sometimes) fully half of Gilbert's 24 assists, 12, are second assists. They still count, but . . . Again, Gilbert's a good player, but he's no bargain at $4 million and, assuming his numbers stay about the same, he'll be less of a bargain when the cap drops. A lot of guys fall into that category.

The point of the item -- perhaps clumsily made -- is that teams and GMs spent too freely thinking the cap would continue to rise and now there's a big problem looming. As for the argument most if not all economists didn't see the downturn coming, that's fair. But that doesn't let GMs off the hook -- they, and the presidents of NHL teams, are the equivalent of CEOs and CFOs of companies. Lowe and his peers are overseeing multi-million dollar businesses. You can't just shrug it off and say, "Oops."

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#46 TV
January 26 2009, 05:32PM
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Travis Dakin wrote:

@ TV: Fair point, but locking up your franchise player to satisfy the season ticket holders, sponsors and fans is one thing, Tendering these offer sheets to other teams star players and inevitably driving up the price of your own is just stupid if the cap doesn’t keep rising along with it. That’s Lowe’s baby.

KLowe made those moves for many reasons & 2 of them were for the exact same 2 reasons that you stated above. As I stated before, while his methods or choices may not be infallible, he did what he needed to do 'at that point in time' to make his Hockey Club more competitive after being painted into a corner by circumstances that were out of his control. Using every & all options that are legally available to him is quality hockey management IMO. He's not in New York City, if he's not using every single tool in the tool box, then he's not doing his job.

Although, to say that it's just 'stupid' in hindsight only, is playing the arm-chair G.M. game to the fullest. Maybe it's just me, but you seem to take this issue on a personal level & not the puck biz side of it. .?

Either or, Thx for the reply...

x6

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#47 Chris
January 26 2009, 05:35PM
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In the spirit of the new optimism surrounding the nation, I remain hopefull that the cap will not drastically decline next season. Chicago and Boston are two huge markets on the rise, and many people in Canada will eat dogfood before giving up their seasons tickets... Things in Tampa, Phoenix etc were poor before the economic collapse... already poor sales will only get marginally poorer. Some of the problematic Oiler contracts will come off the books as soon as after next season; and the next round of UFA and RFA contracts will sort themselves out in the new marketplace. Being up against a shrinking cap along with 20 other teams is soooo much better than icing a $25 million roster against an opponent paying $80 million plus. Can't wait to see if Tambellini is up to some of the new challenges he will face in the not too distant future.

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#48 RobinB
January 26 2009, 05:43PM
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Back to the reference to Gilbert in comment #45(an edit button or decent math skills would work), I wrote that fully half of his "24 assists," or 12, are second assists. Gilbert, of course has 24 points and 21 assists, so MORE or than half are second assists.

AHA! Makes my point even stronger. No?

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#49 ned flanders
January 26 2009, 07:45PM
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Given these economics, how will the oilers afford a good goaltender in the next two years?

A lot is made of Gilbert's deal, but Vish and Souray are great now, but are going to look older and expensive in a couple more years of their long term deals.

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#50 mwhite.dking@nf.sympatico.ca
January 26 2009, 07:53PM
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I read as much as I can but I can't remember reading anywhere else that the cap would drop by as much as ~ 7 mill.

Where did you come up with that number?

The easy awnsers for the Oilers will be to stash the salaries of 24 and 18 in the minors.

It ain't pretty but it's a way to let the blood off the big cap.

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