He definitely could have gotten a bigger contract after 2009, but is the extra millions worth the risk of possibly blowing out a knee or shoulder or his back over the next 2 years? $150M is a lot of money. I'm sure he's not going to go to bed and cry over not signing for $200M a couple years from now. Of course, if I were him, I'd be crying about being stuck in Detroit for the next 8 years. Detroit is probably one of the worst cities in the US to live in.

Wow. What a great deal.

Wow, what a poor deal!

I would bet Miguel would get well over $20 million per year if he went the free agent route next year.

Just because that is what he MIGHT get, does not mean he is WORTH that. Whether a signing was good or bad should be based on what a player is worth, NOT what he is perceived as being worth by other teams. If a player is overrated, based on what he would likely get as a FA, and a team signs him for that, or even less, then it just means that that team overrated the player also - and consequently it was NOT a good deal.

Cabrera is overrated because of his poor defense (even though, unlike a player like Jeter, it is well-known that his defense is poor), and the fact that he plays a slightly below neutral (to the left in the spectrum) defensive position, and for other unknown (to me) reasons. His WAR value is 3.5 to 4 wins. That ain't worth 20 mil a year. More like 16-18.

And if you sign someone to an 8-year contract, they better give you a discount for security for them and risk for you. I am assuming that FA inflation cancels out his decline phase, starting in 2 years or so, as well as his increased chance of getting a catastrophic injury.

A much more reasonable salary figure is 14 mil a year for 8 years, or 112 mil, rather than 153.3 mil. Doesn't sound like a big difference, but 41 mil, or 5 mil a year is a lot of money!

MGL writes:
*****
Just because that is what he MIGHT get, does not mean he is WORTH that. Whether a signing was good or bad should be based on what a player is worth, NOT what he is perceived as being worth by other teams.
*****

That is only true in the abstract. Supply and demand of both revenue and talent dictate free agent contracts. In other words, what you have to pay a player to retain him *is* dictated by the perception of other teams.

In general, this means that the real singular talents are overpaid (but even then, by less than you'd think) as soon as they have negotiating leverage. Barry Bonds' first Giants deal was spectacular for the time, far more than this measure would decide he was "worth" ... and it's tough to look back on that deal as anything other than a tremendous bargain for the Giants.

Cabrera is "over-rated"? Now I've heard it all. He is 25 years old and has a career OPS+ of 143. He has been playing in complete obscurity in Florida, but what he has done at such a young age is remarkable. His WARP average over the last 3 years compares favorable to Alex Rodriguez and Cabrera is almost 8 years younger.

This is a good deal for the Tigers. It's not like a player of Cabrera's talent couldn't be moved if the right deal comes along either.

Sorry, but if a particular player is over or undervalued, based on their actual value (based on, say, some kind of WARP) for whatever reasons, then if you are a smart team, you avoid the overvalued player and go after the undervalued ones. That is the ONLY thing that a smart team can do to get an edge over the other teams (in terms of signing FA players).

To say that in practice, even a smart team must pay whatever the other teams (in aggregate) think the value of a player is, makes so sense whatsoever.

A smart team has to pay market value for a marginal win. But he certainly does not have to pay market value for an overvalued player. Again, that makes no sense. If that were the case, what would separate the smart teams from the not-so-smart ones (again, in terms of paying players)? Why would a team need to value a player at all, if they felt compelled to pay all players just what the league as a whole thinks they should be paid?

The overvalued player is the one to avoid. Unless of course you have no other better alternative.

I certainly can't begin to speculate what alternatives are and will be available to the Tigers, but a team that more often than not pays market value for overvalued players will get less bang for the buck than the ones who do not and especially the ones who go after the undervalued players.

No matter how you look at it, when the average FA player cost 4.5mm per marginal win, and you pay 5-6mm in an 8-year deal, you did NOT make a good or great signing. It may not be terrible. It may even be OK, again, considering the alternatives, but there is NOT way, it is a good/great move. The only people to whom it is a good move are those who overvalue Cabrera as a player. Almost every baseball insider overvalues the value of Cabrera. If I made a list of the 5 players you most likely never heard of who are close to the value of Cabrera, most baseball insiders would think I was crazy. If I made a list of all the players in baseball who currently have more value than Cabrera, they would also think I was crazy. That is because he is overvalued, by a lot. It is virtually impossible not to overpay (and thus it is likely a BAD deal) a player who is overvalued, by definition.

So, MGL, I guess you're smarter than Dave Dombrowski, the architect of two championship-quality teams?...

If anyone in baseball is worth this kind of contract, it's Miguel Cabrera. He's a 25-year-old established middle-of-the-order power hitter. That's one of the two rarest commodities in baseball (the other is top-of-the-rotation ace). Given his age and accomplishments, this is a better deal than the A-Rod extension, the Red Sox/Manny Ramirez contract, or Bonds' long-term Giants contract. Given the inflation rate of baseball salaries, Cabrera will be a bargain within a couple of years -- even if he does have to move to 1B or DH. (Besides, as a purely practical matter, the Tigers made their long-term commitment to Cabrera when they traded away the cream of their farm system. The contract is but the confirmation of that fact.)

Yes, there is potential downside. Just look at Albert Pujols, who was the most valuable property in baseball until his recent spate of injuries. But that's how baseball works; if you want a star-quality player to anchor your team, you give him a long-term, big-dollar contract. And much as I admire the dollar-smart franchises like Oakland and Minnesota, they have yet to win championships. They get the trophy for "least dollars spent per win," but there's no victory parade for that.

Why is each marginal win worth the same amount of money? I see no reason to suppose that it is.
The Tigers aren't looking to push their win total from 77 to 81, or 84 to 88. They're looking to be in the playoffs for the foreseeable future. The only way to do that is to pick up exceptionally talented players. But there are quite a few teams especially interested in those players, for the same reasons, and those teams are wealthy. The market says that the difference between a guy who adds 3 wins and one who adds 4 wins is greater than the difference between a guy who adds 0 and a guy who adds 1. If you want to be in the playoffs every year, you'll need some of those superstars, and to get them you'll have to pay a premium per win.

That's the economic reality. As Sabernar says, it doesn't really matter how much the wins are worth 'in the abstract'. What matters to a team is, where the team is now, where it wants to get, and what upgrades are available.

MGL is missing a big part of the equation. Those valuations only make sense when everyone is working with the same overall budget and has the same level of need. The average team may look at the contract as overvalued because it would hurt their ability to get other players (think ARod in Texas), but the Tigers have a bigger pie to cut up so the relative value makes sense in the context of their budget and need for marginal wins at the high end of the range (win #95 is worth more than win #80).

You can't value a contract based on what the league average value should be without factoring in the team's ability to make the offer and their need for marginal wins. Using MGL's logic, Jeff Loria is a genius and the Dumbrowskis and Epsteins of the MLB are the fools.