The Rays Tank: The Subjectivity of Surplus Value

Our trend this off-season has been to use projected surplus values to evaluate the strength of proposed trades for David Price, but how objective is surplus value?

Surplus value should be viewed as a ranking system. Prospects are evaluated by respected minds in the industry and ranked accordingly. We use those rankings to project the future performance of one prospect, based on past performance of many others. Our dollar amounts are then based upon $5M per projected win above replacement, and we subtract out the cost of a rookie contract.

A ranking, given dollar amounts, is still a ranking.

There is subjectivity in every trade consideration that needs to be considered, and that is not something surplus value is intended to accomplish. Say the Rays could trade David Price for a third base, right field, and second base prospect at the Triple-A level that add up to $100M in surplus value, and that this is the best offer on the table. The Rays may choose to accept a different trade at a lesser objective value.

Say another team has offered a projected front of the rotation starter that is major league ready and worth about $55M in surplus value, along with a rookie-ball prospect worth $20M in value and a replacement level first baseman that has three years of control. The Rays would be far more inclined to take this deal.

Likewise, it could make more sense for a particular team to try to acquire a player than others. Seattle can find incentive to sign Robinson Cano that goes beyond $/WAR -- such as making Seattle a more appealing free agent destination for other players, or trying to woo back a fanbase that has been disenchanted since Ken Griffey Jr. was shown the door.

You might think that the Royals made an objectively bad trade last season by trading Wil Myers, Jake Odorizzi, and two lower-expectation prospects for starting pitchers James Shields and Wade Davis, but there are subjective reasons why having an ace like James Shields was important to Kansas City. Two years of playoff contention were suddenly attainable, and the Royals were immediately competitive within their division.

Dave Cameron wrote a piece yesterday on the idea of the Mariners trading for David Price, taking issue with the idea that Price should command a better deal that the Shields-Myers trade. He was rather generous with his surplus value allotments -- starting with a ceiling of $90M in surplus value for Pirates prospect Gregory Polanco, for instance, but eventually settling down to Michael and my projection of $40M -- and made the argument that high-level, high-ceiling prospects are not worth a two-year rental in any case. That conclusion, however, is based purely on objectivity.

As we continue to evaluate prospects and trade potentials, remember to factor in reasons beyond dollars per projected wins above replacement.

LINKS

- On revenue in baseball:

Why, exactly, were the Yankees so quick to sign Brian McCann and Jacoby Ellsbury to long term deals at higher dollar levels than you'd expect? Two important reads that circulated yesterday relate to this question, and the first of which I would implore you to read:

Neil deMause, who runs Field of Schemes, looked into how revenue effects decisions made by General Managers. deMause postulates that the correct question we should ask is, "Will the extra wins that a player generates bring in enough new revenue to pay off the team's investment?" deMause found this question had been investigated and answered well by Graham Tyler in his undergraduate thesis at Brown. Tyler did some brief sports writing, and has since been hired by the Rays.

The other piece examined just how much the Yankees are effected by missing the playoffs, particularly looking into ticket revenue streams. Another subjective aspect for the Yankees concerning Robinson Cano.

- Baseball Prospectus:

Trackman analysis is wonderfully useful and unfortunately proprietary, outside of what is provided by MLBAM. Former pitcher Zach Day used some information from Trackman to discuss spin rates, which is a rather important aspect to understanding the nuances of movement.

A guest piece by Evan Petty took a deep dive into the accuracy of splits that I'll have to devote some extra time to reading this weekend.

Zachary Levine polled industry folks on why so many transactions have happened this week (behind the paywall), with my favorite theory being that Thanksgiving came a week "earlier" in relation to the Winter Meetings this year.

- Hot Stove:

Contract details are now available for Juan Carlos Oviedo, who has agreed to a $1.5M major league contract with $1.4M of incentives built in. The deal could total $2.9M for 2014, substantially more than the contract the Rays had previously declined at $2M guaranteed -- choosing a $30K buyout instead. Should Oviedo not be fully recovered from Tommy John, the team has essentially removed $470K of risk, while giving Oviedo $1M of motivation to be all he can be. (via Marc Topkin)

The latest rumored salary offer from the Mariners to Robinson Cano is $225M over nine years, but talks have supposedly fallen through.

After acquiring Nori Aoki from the Brewers, rumor has it the Royals never offered Carlos Beltran that $48M.

For those curious as to what the White Sox are up to, the plan appears to be a platoon at DH between Dunn (vRHP) and Konerko (vLHP).

- Cuba:

Jeff Passan and crew have unearthed some surprising details in a lawsuit filed by Leonys Martin, detailing a possible baseball player smuggling operation in Cuba.

Baseball's dirtiest secret is out: Cuban players are being sold to the highest bidder. "Like eBay for human beings." http://t.co/3Ho8FAOIoT

— Jeff Passan (@JeffPassan) December 6, 2013

- Evan Longoria:

Jonah Keri published his now-annual MLB Trade Value column, which is completely separate from surplus value but wonderfully embracing of subjectivity, and he ranked Evan Longoria the 4th most valuable trade piece in all of baseball, switching spots with the now number five Buster Posey. Also featured in the Top-50 rankings: David Price at No. 30, and Wil Myers at No. 23. On the outside looking in were Alex Cobb and Ben Zobrist. (Part 1 | Part 2)

An article I found combing through Gammons Daily, which I do not recall us linking to: an appreciation of Evan Longoria by BtB's Neil Weinberg.