Shohei Ohtani to LA Dodgers

[Axeman33]

Today, the Dodgers dont have the pitching to win in the playoffs this season. It's that simple. Kershaw is almost 37 years old and running on fumes. Uriah is in poop due to a domestic violence arrest. It's hard to know what to expect out of Walker Buehler after he missed all of last year. That leaves some sort of rotation around Gonsolin, May, and a bunch of kids.

Lets be honest, their offense is outstanding, but that pitching rotation for 2024 is nothing to be scared of. They will Edmonton Oiler their opponents and hope to outscore them but that only gets you so far.

I also am not naive enough to think that the Dodgers are done working their roster and I am sure they will find some pitchers out there, much like their acquisition of a Lance Lynn type of starter again.

[2014olympicgold]

Dodgers rotation is Buehler, Yarbrough, and Bobby Miller essentially right now. Then I would think they are guessing Ryan Pepiot takes a step. But their rotation is Buehler and a hope and a prayer.

[Axeman33]

Dodgers rotation is Buehler, Yarbrough, and Bobby Miller essentially right now. Then I would think they are guessing Ryan Pepiot takes a step. But their rotation is Buehler and a hope and a prayer.

I think the hope and prayer is that Buehler can last the entire year. I am not sure he is a regular starter early on as they try and work him back into the rotation, but we'll see. Lots of excellent pitching options out there, either FA or rumored to be available via trade (Snell, Gray, Montgomery, Stroman, Burnes?, Glasnow, Bieber, Cease (but would be expensive)) to name a few.

[Pengwin7]

Different sort of topic to the Ohtani signing.

I was just reading an ESPN article about money "pouring in" to betting sites on Toronto World Series bets in the last week.
And I'm thinking... boy... I'd bet the betting sites loved this rumbling and how all these bettors were flocking to put down bets on the Jays.
Additionally - the ESPN article references some real big-name bettors also putting money down.
And whoever comments from the betting sites has to make statements like "some pretty respected players that were betting the Blue Jays" and "(reports) were from legitimate baseball guys".
Psh.

But still...
Was this - possibly - all just a coordinated/intentional leak by some higher-ups to flood betting money into a sinkhole?!?

In wake of things like the GameStop stock price... I'd imagine a lot of casual bettors think they are linked in well-enough to internet info to get an edge.
(Guess what - we're not... if you think you are... they got you.)


I'll be honest - I didn't see a match with Ohtani & Toronto.
Maybe somebody has read some things... but it just never seemed like a "fit" for a superdupermegastar Japanese player in MLB.
(but perhaps the distinctiveness of "Canada might"... duped a lot of people)

[2014olympicgold]

Per P7

Ohtani to Toronto fit from Toronto's stand point is that he fit more of a marketing aspect than baseball fit. He is what the team needs offensively (power), he would slip into a hole next yr pitching (there's an open spot in the rotation), but that was it. He would eat a DH spot they like to keep Vlad and Springer fresh, he would also take up a spot on the roster for just a DH in this yr, which isn't Toronto's MO really.

But marketing wise, it meant they'd likely make $3 for every $1 spent on him up to X number of millions. From Ohtani's aspect the idea of continuing to get the same USA marketing money, the same Japanese marketing money, and now more Canadian marketing money was being sold to him. He would get to take another country essentially. The medical side of Toronto is better than pretty much every team apparently, which Ohtani admired.

But it was always the Dodgers. Toronto got used and I don't think there was any chance he wasn't going to the Dodgers unless they pulled out because Ohtani played chicken too long (kinda like how Freeman ended up in LAD).

As for the gambling stuff...there is a heavy grey area happening with these websites. I forget who it is, but an insider was somehow connected to a betting site and he was pushing some news that didn't end up happening, and people were like "wtf?" and it just died off. It happened this yr, it was touched on by Pat McAfee on his show, but I can't even remember the sport. You def see everyone using the common man to change what's happening through gambling right now.

Jays also allowed tickets to sell at a record rate for the team as the fans thought they got Ohtani, when the team knew he wasn't on the plane. The amount of money the team made off of the rumour is likely a lot, and the team allowed it to go.

[Pengwin7]

Wow - awesome info!
(some REP to you - thanks)

[2014olympicgold]

Ben Nicholson Smith said he had a source that said the Jays were "right there" with Dodgers $700m/10yr deal.

Scenario 1:
Toronto obviously needed to outbid Dodgers to get him. Toronto could have been very close to signing him and had a contract offered to Ohtani who would have accepted it. But Ohtani gave the Dodgers another chance to match the deal, and they did. Rumours could have started going because Ohtani was legit close to signing. Dodgers got nervous and upped their offer in the 11th hour and Ohtani was in agreement on Friday night, but wanted to post it himself on Instagram Saturday morning.

Scenario 2:
It was always the Dodgers. They found 5 teams who were going to pay $500m for him. The agency used 4 other teams to constantly up their offers to get the Dodgers upping there's. Teams were falling off once the offers exceeding $600m, but the Jays were there, and surprisingly gave an offer that shocked the Ohtani camp. Then they started taking them a bit more seriously and started investigating their medical team, spring training facility and what not. Then on Thursday, Ohtani camp went back to the Dodgers and told them what Toronto was going to do. Thursday night/Friday morning, the online plan to put pressure on the Dodgers went into place. Dodgers got very nervous because they thought he was on the plane, knew the Jays offer, and thought he was going there to sign. They matched Toronto's offer before the plane landed, and the rest is history.

I think the more likely scenario was #2. He wasn't serious until the Jays last offer made him take them seriously. And the Dodgers made the last offer.

---EDIT---
Jim Bowden came out and did say the Dodgers on Friday made a new offer after the plane business. It's unknown what was the change, but the Dodgers changed their pitch in the 11th hour and Ohtani was comfortable enough with Toronto if the Dodgers didn't up the offer. He also said the contract per year in the 10yrs will be between $52-56m/yr roughly. So the 10yr deal is going to be like $550-$600 prolly. So $100m+ is differed.

[LuigiC173]

I think LA will trade for one of Dylan Cease or Tyler Glasnow if not both if they miss out on Yamamoto.

[2014olympicgold]

Shohei Ohtani's $700 million contract calls for him to be paid only $2 million a year for the next 10 seasons, with $680 million deferred until the end of the deal, sources confirm to ESPN.


The CBT hit on the contract is going to be around $46 million, a huge discount for L.A.

[Axeman33]

Shohei Ohtani's $700 million contract calls for him to be paid only $2 million a year for the next 10 seasons, with $680 million deferred until the end of the deal, sources confirm to ESPN.


The CBT hit on the contract is going to be around $46 million, a huge discount for L.A.

https://twitter.com/JeffPassan/statu...nfoUor1gw&s=19

Credit.

This almost seems illegal and a way for the Dodgers to avoid paying the luxury tax. No other way to say it; that's bullsh*t.

[Belexus75]

https://twitter.com/JeffPassan/statu...nfoUor1gw&s=19

Credit.

This almost seems illegal and a way for the Dodgers to avoid paying the luxury tax. No other way to say it; that's bullsh*t.

if it was illegal it would most likely be rejected by the league....its finding loopholes just like NHL teams do with LTIR etc...its one of those things that if it happens to your team you love it if it happens to someone else you hate it...

[2014olympicgold]

In the CBA it states there's no limit on deferred money. But why won't every player just do this going forward? I literally see no penalty for the team, the Dodgers now get to invest that money for 10-20yrs and pay him out, so as of today, the team probably only needs $500m to pay his $700m. For the player, you make enough money, why not?

No way should this be a thing, but it's completely legal, so why not.

[LawMan]

Shohei Ohtani's $700 million contract calls for him to be paid only $2 million a year for the next 10 seasons, with $680 million deferred until the end of the deal, sources confirm to ESPN.


The CBT hit on the contract is going to be around $46 million, a huge discount for L.A.

So how does this work? The money is deferred for luxury tax ("competitive balance tax") purposes, but the Dodgers still have to pay the money later, so do they have a luxury tax hit later?
Ohtani has a CBT hit of $46million. So, are the Dodgers looking at a 10-year window of Ohtani luxury tax (cap hit) of $46million and then another 10 years of "dead cap space" (to use an NHL term) of $24million? ($70m-46m)

That would mean the Dodgers have a window while Ohtani plays but then have a massive problem to deal with for the following (10?30?100? years) thereafter.
Now, hopefully the CBT floor keeps going up so it is not as bad but this must be kicking the can down the road correct ?

EDIT: so MLB discounts deferred money for CBT purposes. So Ohtani will be a cap hit of $46million for 10 years, then no cap hit.
This is somewhat in line with what I calculate below and reflects that "in accounting reality" Ohtani is making $40 -46 million for 10 years.

Further EDIT: MLB appears to use an interest rate of around 4.9% when discounting deferred money.

[LawMan]

In the CBA it states there's no limit on deferred money. But why won't every player just do this going forward? I literally see no penalty for the team, the Dodgers now get to invest that money for 10-20yrs and pay him out, so as of today, the team probably only needs $500m to pay his $700m. For the player, you make enough money, why not?

No way should this be a thing, but it's completely legal, so why not.

It has been a while since I took undergraduate finance but the obvious answer is that deferring pay costs the player a significant sum in present value.
Using the first present value calculator I could find on the internet, using a safe 6% interest rate throughout (well below a safe S&P500 9%):

The net present value of Ohtani taking $70million per year for 10 years is $546,118,458
The net present value of taking $2million for 10 years than $68 million for 10 years is $311,840,231.32
So, the agreement to defer is costing Ohtani $234,278,227 in value ... Why not just take $450 million/10 years and by done with it

For sake of argument taking $40million for 10 years has a NPV of $312,067,690.98 --> So from an accounting perspective Ohtani is making effectively $40million per season.

[senryu]

Sorry I can't rep you LawMan; this is excellent.