Comments on: Parise Makes Pact with the Devils

By: kamullia

kamullia — Sat, 04 Aug 2007 15:35:15 +0000

I do not agree with several things. First off, it is not a lot for an 18-year-old because the marks set in the CBA for individual and league-wide performance, justify the pay. In other words, if a player scores 50 goals, it does not matter what age he is, just the fact that he was prolific. His age or level of experience is only worth as to the amount of odds beaten and how credible or otherwise is the feat for his age.

Second, and biggest among my disagreements (as you will see), I highly doubt that Kane will be paid in the $2-$2.5 range for his rookie year, because of how the 'A' and 'B' bonuses are delineated and the rookie alumni. Just to get him to roughly $1.7M he would have to do as a minimum (but I do suspect more in Kane's case) 4 of the following:

Be top-6 on ice-time per game/aggregate for his club.
20 goals.
35 assists.
60 Points.
0.72 PPG for the season (minimum of 42 games).
Season top 3 on team in +/- (min 42 games).
NHL all-rookie team.
NHL all-star
All-star MVP

Keep in mind that the goals, points, assists, and PPG are floating values. The CBA says these are the bare allowable minimums, but the marks can be set higher (e.g. 70 points), which I think is more than likely the case for Kane in assists and points. But even by the minimums, I think he is probable for all-rookie and assists, but everything else will be a chore, Havlat or not.

And then class 'B' bonuses are:

Top 5 in Hart, Selke, and/or Richard. (It does not matter, which or multiple, the bonus is only paid once.)
Top 3 in Lady Bing.
Top 3 in Calder.
NHL All-Star.
Win Conn Smythe.
League top 10 in goals, assists, points, or PPG.

And every single one of these, with the sole exception of the Conn Smythe, are scaled. In other words, for Kane to get the entire $2M in his 'B' bonuses he must top each category, as for example winning the Richard and being First-Team All-Star. Anything else, he gets compensation, but is less than the maximum, therefore he gets less than the $2 Million aggregated.

Therefore in the end, I doubt he will even hit $2M for the year, with or without Havlat, and notice that "rookie" anything (like points as you mentioned) are not categories, other than the Rookie-All-Star (which is only an 'A' bonus) and Calder (which pays at most $212,500 for the winner). To boot, Kane will have some worthy competition in the rookie category with Radulov, both Johnson defensemen, Backstrom, and Toews just to name a few. This rookie class might not have the ultra-bright shinny head above upcoming mega-star among them, but as a collective they might be the best class ever (including the '06 Class with Crosby and Ovechkin).

I also think Havlat is awesome, but only part-time (somehow he is not always "on"), and I feel playing with Martin would only marginally help Patrick's entire-year numbers. Bertuzzi is extremely overpaid for what he has amounted to since the Moore incident, but obviously Burke feels he can bring back the old Todd. As to Penner being a Bertuzzi, well it all depends which Todd you think of. If it's the present Todd, I will almost agree, but not the prior Todd. I simply have doubts on Penner becoming the player you (and others) envision out of him.

But in the end, you are right, it is all a wait-and-see game. I just do not have much faith on Penner, the Oilers plan, or Kane outshining the rest of the rookie class or league in general.

By: senators101

senators101 — Sat, 04 Aug 2007 11:57:21 +0000

In one of other posts of our little conversation here, I wrote that Kane will not be maxing out. I know for a fact he's not getting 3.7, but I think he will lead the league for rookie points, and I think that's one of the 'B' bonuses.

I think Kane is a centreman and I do see him playing with Havlat or Samsonov. Lang will likely play with the other. If he plays with Havlat, his numbers are going to be through the roof. Havlat, arguably, is one of the most talented players in the NHL. That guy can do anything. If Kane plays with him, there is no question that Kane's points are going to be inflated and he will collect those 'A' bonuses. Again, I don't know of any big-name Rookie this year, so my prediction is that he will be receive that portion of the 'B' bonuses. I see him making between 2-2.5 million dollars this year. Bonuses or not, that's a lot for a 18-year-old kid who hasn't played one game in the NHL nor even attended training camp.

That's all I'm really trying to get at. I like your analogy of apples to suspenders. And yes, it's unfair to compare the high mark to the regular mark, but hey, if a team sees that much worth in someone, I can't complain until I personally see him play garbage. I think this conversation should be put off for one year to see how Penner plays this year.

Bertuzzi got about 4 million I think. I think Penner is being looked at as a similar player as him and will put up similar numbers given some quality players. But, we shall discuss this sometime in June of 2008, once we see how Penner adapts to his new fortune.

By: kamullia

kamullia — Sat, 04 Aug 2007 05:50:30 +0000

You are correct, it is two years if you look at it in that way. It is just a matter or perspective. In my views, everything that happens after the Stanley Cup is awarded belongs to the next season, since it is in preparation of it. Hence in my head we are on the third year, but never mind my convention, just chuck it up to me making a mistake.

Penner and Kane are not comparable contracts because Kane's is strictly an entry level contract, which limits his income. Penner's was not limited. Hence, there is the possibility to argue that Kane could have been paid more, whether through incentives or regular salary. In fact, that is another difference, because Penner is guaranteed his entire salary, if he plays better...too bad, if he plays worse...he got lucky. Whereas Kane's only guarantee is the $875k and he must attain at least 4 different performance marks (that is the minimum, but I admit have not seen Kane's contract) to get another $850k, and then he must beat out the rest of the NHL (or rookies, depending) in order to obtain the 'B' bonuses and collect a further $2M. Bonuses for lacing up the skates went out the door with the new CBA.

In the grand scheme of things, and accepting the argument you made for the situation in Chicago (although debatable), let us assume Kane will attain the performance marks (i.e. 'A' bonuses) in his rookie campaign. But to reach those 'B' bonuses is an entire different puck game. Not Alexander Ovechkin, nor Sidney Crosby have reached the maximum attainable on 'B' bonuses in a rookie campaign. And only Crosby did get the max last year of $3.7M (plus another $800k from the NHL) by winning the Hart, Pearson, and Art Ross. Everyone else who has the new entry-level contracts has fallen short of maximum compensation, and I do not expect Kane to max out either. I have heard of no one (expert, analyst, or otherwise) willing to make the statement that Kane will max out on his 'B' bonuses during the contract, unless you are willing to be the first on record.

The point is, Penner will get paid all the money, even if he sits on the bench or is scratched the entire season, whereas Kane's only way to attain his big paycheck will be by sweating his bum off and beating out all or most of the competition throughout the NHL. You have to consider that, those 'B' bonuses mean that Kane must be among the statistical leaders among the entire NHL and in some cases beat out everyone else (including Crosby and Penner) in the categories available, in order to get paid. Therefore, these are not comparable, even if the high mark on Kane's is close to Penner's regular mark, we are most certainly talking apples and suspenders (oranges are too close to compare).

By: senators101

senators101 — Sat, 04 Aug 2007 00:48:04 +0000

How is it three years removed from the Stanley Cup final. This year was Ottawa vs. Anaheim. The year prior was Edmonton vs. Carolina.

I understand Patrick Kane and Penner are from the old vs. new. But their contracts now are comparable. Penner scored 29 goals on the 2nd line and Kane hasn't played a game. Up to 3.7 now vs. 4+ now. i'm not comparing Penner's old salary to Kane's new.

By: kamullia

kamullia — Fri, 03 Aug 2007 18:31:22 +0000

Your reference to Penner not being paid in a stepladder form is counterintuitive. Reverse stepladders are very typically meant for players who are UFAs, past 30 years of age, and whose decline in their game is viewed as a possible in the near future. This certainly is not supposed to be what describes Penner, whose only campaign was his rookie season. And especially worse makes the fact that the entire basis of signing Penner by Lowe is that he is betting on the fact that the player will be more productive in the future. He is betting on his potential (and them some) to come through. And in that light, and from your earlier argument, you pay the player accordingly. Therefore, paying in a stepladder makes all the sense for Penner, and all up-and-coming players. In fact, with the premise that Lowe signed Penner, you are almost obliged to pay him in that form factor. And you certainly are not betting on him flapping and falling on his face. Not when you are willing to give up so much, cause a raucous, and all the possible implications that it brings.

Your argument that getting better players by overpaying them, is not the case for Edmonton, because that is exactly what they tried this off-season. They offered very bloated contracts (the Canadiens did the same), and player by player, they turned them down. And for a team who is three-years (not two) removed from being one win from a Stanley Cup, that is absurd, even without Pronger. Throwing money at the players obviously is not working, two years in a row. Although Katz is trying to buy them, especially considering the latest history around the NHL (Balsillie anyone?), players will wait before something is finalized and done, than to bid their time waiting on promises.

As to the meeting having been taken place already and several times, I seriously doubt it because of their inactivity. And if all they came up with was giving bloated offer sheets to RFAs, they certainly are on a bullet train for failure. If I was an owner and this was the case, I would clean house, and bring in an entire new executive and management team because this one is obviously too busy spelling "FAILURE" with the print on dollar bills.

P.S. Some notes: Ovechkin and Semin are more than likely not going to play on the same line, although you did not specifically make that argument. But I certainly do agree that playing on a line with Ovechkin, or playing with Semin, beats playing with Edmonton's liners. As a side note, Edmonton should have given more effort to keep Sykora, although I am not sure anything would have worked. Sykora was pretty set on his mind to play for the Penguins already. I can tell you that story, if you are ever interested.
Patrick Kane and Penner are apples and oranges. Yes, they are both recent to the NHL, but Penner is a byproduct of the old CBA, and therefore the rules for entry-level contracts did not apply to him.

By: senators101

senators101 — Fri, 03 Aug 2007 14:21:13 +0000

Paying Penner in the stepladder form is pointless because nobody will take his contract later on if a team has to pay him 6 million dollars. The common stepladder is in reverse when teams pay big time now and less later on, making the player tradeable if worse comes to worst.

I'm no rocket scientist, but your suggestion of sitting down the executives and asking what the problems are doesn't seem extraordinary and it's probably already been done. The execs of any franchise aren't stupid and I'm sure that meeting you proposed to find the actual problem has been accomplished and probably multiple times as well.

Edmonton is loaded with prospects but they will not be formidable anytime soon. They are not contenders and perhaps that is the problem. What is the point in coming to Edmonton when there is no possibility of winning. In their current situation, making the playoffs will be like winning the lottery. Nylander escaped Edmonton because he got an offer from Washington. Now, if I'm him, and I had the choice of those two teams, it's a no-brainer. I'm going to play with Ovechkin and Semin. Hemsky and Horcoff just doesn't sound the same.

If this is what the Oilers Execs perceive to be the problem, then there is only one way to fix it. That is, signing some players, even if it means overpaying for them. Like I previously mentioned, they know Penner is not worth his 4+ million salary at the moment, but do believe he will be in the future. Why isn't the Patrick Kane deal filling up the hockey forums as him being over-compensated? He has the potential to make 3.7 million dollars in his first years and he hasn't played one NHL game yet. Clearly, the Blackhawks are in dire straits and needed someone to take over and be the face of this franchise. I know the base salary is 875K, but bonuses are still money. Now, I am not delusional and I don't think he'll get 3.7million dollars, but I see him earning atleast 2 million dollars next year, and I see him playing with Havlat as Handzus is gone. His numbers will be grossly inflated because of Havlat's ability to put up the points, meaning his earnings could easily be higher. Edmonton is in the exact same predicament. They aren't a city or team that bodes well with losing and they did what they had to do.

For Penner to play with Perry and Getzlaf, 2 young guys and not be on their first line but still rack up 29 goals in his first full season, he must have played well. Playing him with a fantastic playmaker who is very shifty in Ales Hemsky, the Oilers have just got better.

I understand the whole Alexander Daigle situation. I understand that they overpaid for Penner. The Oilers probably know they've overpaid for Penner, but they did what they had to do.

Another reason Edmonton had problems attracting people to come there is that they were not willing to spend to the cap. With this news about a possible takeover in Edmonton and the new owner saying already that he will provide enough finances for the team to spend to the cap every year, that is another problem solved.

They lost their face of the franchise in Smyth and they need someone else. Who better than Hemsky and Penner. 2 guys that will be there for 5 years. Both, young with a lot of skill and the ability to carry this team provided that they have a supporting cast.

They have to show to UFA's out there that they are serious about winning. By showing that they are willing to spend, that problem becomes less of an issue.

Their goalies are good enough. They've acquired Souray and Pitkanen. Now they've acquired Penner. They aren't stanley cup contenders, but they're making the appropriate steps forward.

Allow me to reiterate something I said in my last post. Teams that are desparate will likely overspend.

By: kamullia

kamullia — Fri, 03 Aug 2007 14:14:37 +0000

Now, to my sentence "And the experts as a whole are very divided on whether Penner will live up to the financial compensation, but surprisingly not so much because of his play, but because of the inflation created by Lowe and others on all contracts across the board."

Regardless of how/what you understood the sentence, this will be worth it for some other readers without a doubt, therefore dismiss the fact that it is somewhat simplistic. I will illustrate with analogies, since this should simplify the ideas, but the root of it all is making a clear distinction between future worth and inflation.

Worth: A loaf of bread might have a certain price in an economic system, say $2. It's price is derived from many things, but in the end that price is a percentage of the worth of a national economy and the average worker stipend regardless of inflation. Whether inflation goes up or down, if the price of bread remains, as say 1% of the average worker salary, then its worth has not changed. However, if that percentage decreases, then the worth of bread has decreased, and the same applies in the opposite direction.

Inflation: A loaf of bread might presently cost $2, but in a healthy progressive economy, it most certainly cost less in the past, say $1. This is common to understand, because everyone has heard an older person say "I remember when ( ) used to cost ( -less)." and we personally experience the changes everywhere in North America as time goes by due to, for the most part, stable economies. However, that does not mean that the worth of a loaf of bread has changed. If the loaf of bread, costs more, but the average worker salary increases thus maintaining it at (from the previous) 1% of the average salary, then the worth of the bread is still the same. It costs more, but since it is the same fraction of the salary, nothing changes in essence.

And therefore, more closely to the Penner situation, if I go to a baker and tell him I will pay him a whole sum in advance, which amounts to $6 per loaf of bread, for the next 5 years, it relates to future worth and inflation in different manners. If inflation goes up, while its worth stays the same, and the bread costs more than $6, it is a good deal if the 5-year average of the price of bread ends up averaging more than $6 per loaf. If on the other hand (and regardless of inflation) there is a huge famine making food scarce, and bread's worth increases to more than 1% of the average salary to say 20% of the average salary, then it is also a good deal, because I paid it in advance when its worth was less.

What I meant by the sentence, is that experts being very divided, is on the perception (there has been no census done), that half the people believe Penner will be worth the money and half do not. But what makes it 50-50 is that the ones who believe he will be worth the money are composed of a split, of people that believe is due to him raising his worth and other people who believe inflation (in part due to the same contract) has been set into place and he will not change his worth, just simply the system will be more expensive and that will be his future price.

And let us assume (although I have feedback otherwise) that the split of that 50% of the total who do think it is worth the price is 50-50 also, with half thinking his worth increases, and others thinking it is his inflation-set price. That translates into only 75% of the total thinking Penner will not increase his future worth, and that is a big issue and carries an underlying message. To go through all this trouble to acquire a player that will not make a clear and distinct difference, is asinine. And that is not even taking into account the detriment to salaries across the board, just on the effect to the team of that player's playing ability only.

Again, the majority of the experts could be wrong, and Lowe better pray Penner shows they are. Because if they are not, he has set the stage to become second fiddle only to Mike Milbury, when it comes down to detrimental GMs (although some might give that distinction to Mike Keenan).

By: kamullia

kamullia — Fri, 03 Aug 2007 13:06:12 +0000

You are obviously wrong about your assumption of the stepladder form. Those contracts are not uncommon. But you are right as to the cap hit being the average of the worth of the contract by the length of its duration.

I have no argument with your premise that if you think the player is worth it, you pay him what you think he is worth. But giving large amounts to unproven players due to potential is clearly dangerous, as was put in evidence by Alexander Daigle. And all the owners across the board, including EIG, made it a point to be dealt with by assuring standardization and limitation of entry-level contracts in the CBA. The message was: Prove you are worth it for a few years first in order to get paid accordingly. Clearly, Dustin Penner has not proven he is worth it with just one complete NHL season, therefore he is being paid purely due to potential, and when you are talking potential then you are better off by using the consensus of the experts. That does not mean they majority is always right (e.g. Luc Robitaille, Martin St. Louis, etc...), but they do get paid to make those calls and the vast majority of the times they are correct. And when it comes to Penner's worth it the majority does not feel proof of his worth, which I will explain in a separate reply because I do not know if you simply misunderstood my words about the views of the experts or if you did not grasp the concept. Therefore, not knowing, I am obliged to explain the concept which makes it a lengthy reply in itself.

Overpricing majorly affects everyone. Period. You might delay it. But in the end, it will take over the entire spectrum of your finances and strategy as a team. As Lowe, or whoever is the GM in Edmonton, sign future contracts starting from yesterday, have no doubt that this offer to Penner will come into play whether directly or indirectly in the compensation.

From your answer relating to Lowe's relationship with other GMs, it is clear you are not familiar with the nature of how things run in the NHL. Perhaps with only a few exceptions in the coaching staff of some teams, everything above that regarding interactions between teams in the management ranks (and ownership) throughout the entire NHL runs as a good ol'boys club. That does not make it right, but it is still the fact. And although in some instances that will be put to the side, if a deal is favorable and desirable, it is quite true also that some deals do not materialize due to fractured relationships, even egos. And most of the times, unless somehow the owner sees a clear detriment, the owners are supportive of the GMs that refuse the deals because of how things run in general in the NHL. And while securing the RFAs is clearly a necessity now for Edmonton, there are many other ways in trades and other facts, of how Edmonton will be affected because GMs to a good extent, depend on each other. They pass or withdraw information to each other as to certain knowledge, that is typically crucial to the acquisition of players. General Managers share information as to players non-publicly known personal views/situations, third-party GMs dealings/intentions, agents focuses and intents, and much more. Just cutting Lowe off that loop will already be a clear damage to the organization alone in acquiring players and making trades, let alone what people will do in the way of damaging or blocking Edmonton's intentions.

As to being interested in the player and what would I have done in Lowe's shoes, I simply would not have given an offer sheet at all. Lowe is treating the symptom, not the disease. The problem at the root of all of this, is the fact that players do not want to play in Edmonton, and signing RFAs to an offer sheet is not going to change that. Edmonton has a clear image problem, whether merited or not, and they must change that immediately. If it indeed there is clear detriment to being in Edmonton, they need to get rid of the cause, and if that is not possible, then the solution is creating intangibles that compensate for the shortcomings. So my answer is that I would have assembled my staff and asked for suggestions, and then I would have sat down with Ownership and Senior Staff and stated the problem, proposed any worthy efforts in my staff's views, while asking for possible solutions from them, and give them the clear message of the importance of the resolution of the issue. Edmonton's symptoms might be cured (although that is highly in doubt), but the disease is very much untouched and if this is the case of management and the front office putting the head in the sand, someone better put a cactus to their bum and very quickly.

By: senators101

senators101 — Thu, 02 Aug 2007 23:08:11 +0000

As far as I knew, nobody could be paid in step ladder form. The cap hit is the average of the money, is it not?

You yourself are saying that the experts are divided on whether Penner will live up to that financial compensation. Clearly Lowe and his executive team took the side of the experts that agreed that he would be worth it. Anaheim showed that having a big and strong team is the way of the new NHL, obviously along with speed. Penner is young and he's a beast. 6'4'', 245 pounds but at the same time, knows his way around the ice and isn't a pilon.

Like I said before, if Lowe attempted to sign him for his CURRENT value, he wouldn't have signed him as Anaheim would have accepted. Edmonton got screwed with the Nylander fiasco. They are a city of champions and they don't want 2 sub-par seasons in a row. He did what he thought would make their team better. He's got the cap-room, so why not use it? Teams often overspend when they are desperate, and just like Philly was, the Oilers were desperate, especially after making it to the 7th game of the Stanley Cup finals only a year before.

Tell me, if they are interested in him and they know that Burke will sign if it's market value, what would you do? IF you think he'll be worth it in the future and you have the cap space, you sign him. If they didn't think he would be worth it, they wouldn't have signed him.

Why will the Oilers be paying for this one?
If you think that teams will be hesitant to trade with them because of this, you're way off. No team is going to keep the oilers out of mind and out of site because they made offer sheets. If the Oilers provide the best deal, teams won't overlook them.
If Brian Burke and Darcy Regeir both have trade offers and Edmonton is offering the best deal, they'll still take the oilers deal. Why would they get lesser value from another team? Doesn't make sense. If Burke and Regeir accept other offers even though Edmonton's is clearly the best, they should be fired.

All Edmonton has to worry about is protecting their RFA's. Obviously Lowe knows that teams will take a run at him (especially Anaheiim and Buffalo) so he'll sign them before they have that opportunity. The guy isn't stupid.

This over-pricing won't affect them that much. They have an extensive amount of prospects and youth coming in. Those contracts that have to be renewed will be in a while. They got Hemsky locked up, and now Penner is locked up. I don't think anything's going to happen.

By: kamullia

kamullia — Thu, 02 Aug 2007 13:29:37 +0000

I would like to know in what book is written that in order to sign an RFA you need to overpay, or the player cannot be offered a step-ladder deal. It is certainly not in the CBA, because I have actually read those sections in legalese. And who says that all GMs must be in a flock and jump off the bridge all together? You hint to the fact that Lowe is doing a wrong, although only by partly admitting the contract is bloated. But the truth is that it is anyone's guess what Penner will amount to in the future, unless you have a special crystal ball, in which case please send me the lotto numbers for this Saturday. And the experts as a whole are very divided on whether Penner will live up to the financial compensation, but surprisingly not so much because of his play, but because of the inflation created by Lowe and others on all contracts across the board. The majority of the ones who believe he will be worth that compensation are basically saying that the damage might be done, and that this simply is the new standard as all other contracts will also rise.

I do agree that the overpaying to RFAs did not start with Lowe, but I never hinted to that fact, in fact I mention Clarke who did so before Lowe, but other did it even before Clarke. But again, where is written this is the way to do it? If all GMs stood steadfast as the owners did for the CBA, the players would simply accept the reasonable compensations when the bloated ones disappear. Yes, the rising of salaries was not enacted by Lowe, and the McCabe contract was also bloated (among others), but we are talking about a UFA and the rules and situation do differ, although regardless a bloated contract affects everyone. Regardless, just like JFJ did a wrong by giving out such contract, so did Lowe. Neither one is right, and both think they are helping their team, and they might be in the short-term, but in the long-term overpricing will affect their teams, and all teams negatively. Especially overpricing RFAs.

Offer sheets themselves is another entire subject altogether but putting that aside, if everyone was steadfast and were tepid and reasonable with the contracts given out to players on offer sheets, the players would be choosing not because of money, but because of the organization. I say build your organization and make it one that players want to play for because of its staff, its commitment, its plans, and their intangibles. The players would be choosing then an organization by belief, and not the love of the money. And a player who is believes in the organization is psychologically predisposed to do better than one who goes where the dollar signs leads him.

Lowe did not start this. But he sure as hell is not making things better nor helping the situation. And in the long-run, the Oilers themselves will be paying for this one, regardless of where Penner ends up.