Labor-management negotiations have made progress. The two sides have reached an agreement on the start time and the next season's games. If there are no surprises, the new season will start on December 23, Beijing time. In addition, the key issue of the new season and the next season—salary cap—is basically settled. The salary cap for the new season will remain the same as the previous season's 109 million U.S. dollars. In the next few seasons, the salary cap will increase by 2% per season. This means that the salary cap for the 2021-22 season is approximately $111 million.
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You know, according to the original forecast, next season's salary cap will reach 116 million U.S. dollars, and the 2021-22 season salary cap will directly skyrocket to 125 million U.S. dollars. Affected by the new crown virus epidemic, the alliance has suffered huge economic losses, and the increase in the salary cap will not meet expectations.
In recent years, because the salary cap has increased year by year and the increase is huge, many big-name players have chosen to leave regardless of the salary difference between the left-behind home team and the team that signed him. The star migration is frequent. But now, the salary cap increase cannot meet expectations, and players have suffered great economic losses under the current background. In the next few years, the migration of big names may be much less. The home team has obvious advantages in retaining its core.
The difference is nearly 80 million US dollars. Is Antetokounmpo really bold to leave?
Like LeBron James in 2010 and Kevin Durant in 2016, Antetokounmpo is about to usher in a decision that will affect his career. His contract is worth $27.53 million with 1 year left. , He needs to decide whether to stay with the Bucks or switch to another team.
The current Antetokounmpo and James and Durant faced the same decision, but the situation is much more complicated. At that time, James and Durant did not have the concept of "designating a veteran maximum salary" when they became free agents. The transfer to his team was smaller than the contract signed by the left-behind home team, but the gap was not so exaggerated. But now it's different. The amount of the contract renewed by Antetokounmpo and the Bucks under the "designated veteran maximum salary" clause is nearly 80 million US dollars behind the contract amount signed by Antetokounmpo to his team.
The veteran designation clause was added to the agreement in December 2016. Stephen Curry was the first star to renew the contract with the veteran designation clause. After that, James Harden, Russell Westbrook, John- Wall (yes, you read that right) and Damian Lillard also enjoyed this treatment. According to the designated veteran clause, players who meet the harsh requirements of this clause can sign a maximum salary contract with a starting salary of 35% of the salary cap and an annual salary increase of 8% when they have been in the league for less than 10 years. Players who do not meet the requirements are only A maximum salary contract at this level can only be signed after 10 years in the league. The introduction of the designated veteran clause is to help the mother team retain their own players.
Antetokounmpo has been playing for the Bucks since he entered the league without changing teams. He has won the MVP in the past two seasons, which naturally complies with the regulations. If the salary cap increase in the 2021-22 season is 2%, and the specific salary cap figure is 111 million US dollars, then Antetokounmpo can sign a five-year contract with the Bucks with a starting salary of 38.85 million US dollars and a total contract value of 226 million US dollars. And if Antetokounmpo signs with other teams next summer, he can sign a four-year contract with a starting salary of 30% of the salary cap and an annual salary increase of 5%, so his starting salary is 33.3 million US dollars, and the total contract amount is about 150 million USD, the difference between the two contracts reached 76 million USD.
In theory, there is another way to sign Antetokounmpo's contract. If the NBA's economic situation improves quickly and the salary cap increase returns to normal by much higher than 2%, Antetokounmpo can suspend the signing of the long-term contract, but first sign the short contract and wait until the salary cap soars before signing the long-term contract. He has played in the league for 7 seasons and 3 more seasons. He has been in the league for 10 years and can also sign a maximum salary contract with a starting salary of 35% of the salary cap and an annual salary increase of 8%.
However, the annual increase in the salary cap for the next three years is likely to be only 2% (although the minimum 2% is said, but it is very likely that it will not exceed 2%), and if Antetokounmpo now renews his contract with a super maximum salary, He can immediately enjoy an 8% annual salary increase three years in advance. Now that he signs a super-maximum salary contract, his total salary in the next three years will be more than that of a three-year short contract, which can maximize his economic benefits.
No matter how you look at it, from a purely economic perspective, Antetokounmpo is the best choice to stay with the Bucks. The existence of the designated veteran clause will make Antetokounmpo suffer huge economic losses once he leaves the Bucks. A loss of this magnitude was not encountered by James and Durant, because they did not have this clause when they became free agents, and they have not been in the league for 10 years. In any case, they can only sign 30% of the salary cap. According to the contract, all that is lost by switching to another team is the annual salary increase of about 3%, and the specific loss is only two or three million.
With such a huge potential economic loss, Antetokounmpo will inevitably weigh it carefully when making a decision.
Maximizing economic benefits? Thick eyebrows have to sign a short contract first
Antetokounmpo has to consider whether to stay or leave, while "Brow Brow" Anthony Davis has to consider whether to sign a long contract or a short contract. Both are superstars at the maximum salary level. Davis is in a different situation from Antetokounmpo. Because Davis was traded to the Lakers by the Pelicans a year ago, he automatically lost the opportunity to sign in accordance with the terms of the designated veteran.
Davis wants to renew his contract and can only sign with the Lakers in accordance with Bird's terms. Because he has been in the league for 8 years and less than 10 years, he can sign up to 30% of the salary cap and 8% of the annual salary increase. Salary contract, he is now unable to sign a maximum salary contract with a starting salary of 35% of the salary cap.
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This year's offseason, Davis can jump out of his contract and become a free agent. With a salary cap of $109 million next season, he can sign a contract with a starting salary of $32.7 million and an annual salary of $35.4 million in the second year.
Davis only needs to play two more seasons to play in the league for 10 years, so he has enough motivation to sign a short contract. The salary cap for the 2021-22 season will increase by at least 2%. Davis may sign a 1+1 contract during the offseason this year. In the summer of 2021, he will jump out of the contract again and sign the 1+1 contract. Then he will be in the league for 10 years in the summer of 2022. Sign a long-term contract with a salary of 35% of the salary cap.
Alternatively, Davis can ignore the at least 2% increase in the salary cap of the 2021-22 season, and sign a 2+1 contract directly during the offseason this year, and sign a long-term contract in the summer of 2022. Signing the 1+1 contract and signing the 2+1 contract, the income difference is not large, it all depends on whether Davis wants to maximize the salary benefits of each season or avoid the risk of injury.
2021 free market year? Big names will not leave the team
Originally, the free agent market in 2021 was regarded as a big year, and many teams planned to set aside salary space to compete for the big fish in the summer of 2021. But now, the salary cap for the 2021-22 season is only slightly more than 111 million US dollars, far less than the original expected 125 million US dollars. The free agent market in 2021 is likely to be very deserted, and the big names will choose to stay at the home team instead of moving.
According to the original prediction, after the salary cap skyrocketed in 2021, stars like Kawhi Leonard, Paul George, Rudy Gobert, Zhu Hollodi, Victor Oladipo and others will become free agents. The opportunity of a skyrocketing salary cap is seeking big contracts. In addition to rebuilding teams such as the Eagles and Knicks, which already have plenty of room, strong teams such as the Heat, Raptors, and Mavericks are also looking for opportunities to leave room to compete for the big names. The premise is to hurt the salary space in 2021.
But the salary cap was not up to expectations. The Heat, Raptors, and Lone Ranger plans that were expected to free up enough salary space without any effort were disrupted, and they needed to work hard to make room. Like the Heat, they cannot renew Adebayor in advance, nor can they give Dragic and Crowder a long-term contract to squeeze the space for next year. Like the Raptors, they can't extend Van Fleet's contract more than $20 million. If they want to leave room for the summer of 2021, their lineup reinforcement next season will definitely be affected.
Originally, these teams that are likely to make room and have their own strengths are highly attractive to free agents. Now, they are likely to withdraw from the 2021 free agent battle. In addition, the economic situation is sluggish, and the economic losses between the left-behind home team and the transfer to another team are too heavy, and the big names are more likely to choose to stay. In 2021, the free market is likely to have a deserted scene where there is no room for strong teams and no big names in the market, just like the free agent market in 2020.
In this case, the trade deadlines of this year’s offseason and the middle of the new season are very worthy of attention. Some teams that did not plan to carry out early operations to squeeze next year’s salary space may abandon the competition for the free agent market in 2021 and advance. Perform operations.
For example, a team with a full mid-class value of 9.3 million US dollars may use a long-term contract to sign the strong players in this year’s free market, and some strong teams will also try to use long-term contracts to retain quality free agents in the team and give them what they want. contract. Like the Heat, if they change their plans, they may renew Adebayor in advance, and then use 2-3 years of contract to retain Dragic and Crowder, and retain the stability of the core team last season.
For example, if strong teams abandon the competition for the free agent market in 2021, some strong teams will attach importance to the competition for second-tier big-name players and achieve reinforcement through trades. Stars in trading rumors like Holiday, Oladipo, Bradley Beal, Chris Paul, etc. will be the target of those strong teams that aim to upgrade their strength to compete for the championship.
Conclusion
In a short period of time, the salary cap and luxury tax line will not increase as expected, and the enthusiasm of each team's operation and the desire of big names to leave the team will be much reduced. In the next period of time, the migration of big-name free agents to change the league's territory is likely to be very rare.