Money Talks with shrink
Summer 2010. Wolves fans have waited many years and seen many trades accumulating cap space looking forward to this summer. In eight months, they will finally see whether their team can use this space for a top free agent, or trade it for another valuable star. The talent pool is deep. A declining NBA economy will lower both the salary cap and the luxury threshold, making their cap space more valuable than in previous years. Wolves fans have been watching the finances of other teams more closely than ever, to see which ones are also below the cap, and can compete with them for free agents. Surprisingly, a team well over the lux may be one of the stiffest competitors.
Erick Dampier may determine an NBA Championship.
More precisely, Eric Dampier's unusual contract may set the stage for the Dallas Mavericks to bring in an elite player that could give them enough talent to be win the league. Here's how it works.
The expensive final season of Dampier's contract is only guaranteed if he meets certain performance standards, which isn't going to happen. This summer, his $13 mil contract would become a valuable trade chip for a team wishing to cut salary, and with a little incentive, it might land them an elite free agent. Dallasbasketball.com dubbed this the DUST chip, the Dampier Ultimate Sign-and-Trade. Once they play this chip, its gone like dust. Let me give you an example of how this works:
Suppose you're the Cleveland Cavaliers this summer. As he said last week, LeBron James repeats that playing for a winning team is more important than money, and he isn't going to accept your contract offer, and may check out free agency. You swallow hard. You have the most valuable basketball player on the planet, and you stand to lose him for nothing! You can sign-and-trade him, but you'd still need to find a team that would make LeBron happy. Suddenly, you get an offer from the Mavericks, of Dampier and a little incentive. Hmmm. LeBron may like the Mavericks because they are already contenders, and they can salary-match almost all of LeBron's salary with Dampier's contract and lose little talent. Hmmm. With Dampier's unguaranteed deal, your finances don't take a beating from unnecessary salary filler you'd receive from other teams trying to match LeBron's salary. Unlike expirings, you can simply let Dampier go, and get immediate salary relief for the 2010-11 season. The Mavs would need to give you some incentive, in picks, cash, etc, but this deal is clearly better than losing him for nothing. You're happy, LeBron's happy, and Mark Cuban is very very happy.
Wolves fans should understand that LeBron-to-DAL is just a scenario, and far from a done deal. All three parties, the Cavs, the trading team, and LeBron, all have to think this is the best option -- and for a player like LeBron, there will be a lot of options. Every team will make a sign-and-trade offer for LeBron, and he will make more money this way rather than simply go to free agency. Teams under the salary cap like the Wolves can even provide similar 2010-11 salary cap relief, since they aren't required to salary-match if they can do the whole deal beneath the cap. The Wolves young players and picks gives them many valuable assets to include that the Cavs might crave, and they may even be able to put together a package that would outbid other teams. I'm skeptical, but John Hollinger even thinks it might not be a bad idea. However, if LeBron (or some other free agent) would rather play elsewhere, there will be no deal. A sign-and-trade starts with a "sign."
Unguaranteed or partially guaranteed deals are uncommon, but they have value in the league. In a complicated trade before the season, Dallas was able to turn Jerry Stackhouse's partially guaranteed deal into Shawn Marion. Stackhouse's $7.25 mil deal was only guaranteed for $2 million. Technically, since teams over the salary cap like Dallas must match contracts within 125% + $100,000, Stackhouse could have been dealt for a player on a deal over $9 million. The original team could have then waived Stackhouse and saved $7 million immediately -- maybe double if they were that far over the luxury threshold. Dampier's unguaranteed contract at $13 million carries far more value. This is something to keep in mind if the Wolves decide to trade Ryan Gomes in a deal that takes on 2010 salary, or include him in a sign-and-trade package.
Mark Cuban's Mavericks have been over well over the salary cap for a long time. However, the big contract that they gave to Erick Dampier, and its unguaranteed last year, may turn them into one of the leading contenders, both to acquire an elite free agent and to win an NBA Championship.