MLB Trade Rumors

In an important look at the state of free agency — this year and, perhaps, beyond — Jeff Passan of Yahoo Sports examines the underlying factors that have led to a stagnant player market thus far in the 2017-18 offseason. It is a must-read piece in its entirety.

Make no mistake: it has been stunningly quiet thus far. Just three players have signed onto 40-man rosters, with only one of those deals (between Doug Fister and the Rangers) involving even a modest guarantee. At this point last year, players such as Yoenis Cespedes, Josh Reddick, Kendrys Morales, Brett Cecil, Jason Castro, Eric Thames, Charlie Morton, Matt Joyce, and Sean Rodriguez had signed multi-year deals, with a few others inking larger one-year pacts than Fister’s. This year’s biggest trade thus far is likely the Ryon Healy–Emilio Pagan swap. In 2016, we had already seen trades centered around Jean Segura, Brian McCann, Cameron Maybin, Howie Kendrick, Pat Neshek, and other veterans.

Most broadly, Passan argues that front offices — now widely populated by similarly minded executives with significant analytical resources — have narrowing differences in player valuation and increasingly prefer not to build through the open market. Growing out of that executive trend, perhaps, is also an added recognition from teams that patience generally depresses prices in free agent negotiations. Enhanced discipline also allows teams to turn the new collective bargaining agreement’s luxury-tax penalties into what one agent describes to Passan as “significant salary depressors.” Meanwhile, he suggests, there’s a sense in some quarters that individual players are no longer quite as interested in gunning for top dollar.

These are all intriguing observations standing alone, but Passan is also able to support them with off-the-record quotes from upper-level executives. One general manager acknowledges that teams would “be stupid not to” cite the luxury tax line as a barrier in talks with free agents. The unnamed exec also stated that slowing the pursuit of free agents is strategic, explaining that players are “going to worry they won’t get a job and I’m going to get a discount.” In the final analysis, says one GM: “Teams are smarter. They know how terrible free agency is.” As MLBTR’s Tim Dierkes notes on Twitter, that’s perhaps also related to the fact that there are “fewer impulsive owners than ever.” These owners have not only assembled increasingly sophisticated front offices, but are perhaps more likely to listen to them than ever before.

Such broad structural factors are the true cause of what has thus far been a notably quiet signing season, argues Passan, not the fact that Giancarlo Stanton has yet to be traded or that Shohei Ohtani has yet to choose a destination (or be posted at all). If this particular year is special, Passan suggests, it’s because of greater-than-usual upheaval in the coaching and front office ranks.

Needless to say, there’s quite a lot to unpack and ponder here. With regard to the structural points, it’s worth emphasizing that agents that spoke with Yahoo also indicated they were pushing back by counseling patience in talks with their clients. That there’s a stalemate at present perhaps also indicates some resolve on the labor side. Passan says that teams may be looking to take advantage of smaller agencies, though certainly that seems to be a strategy that can be countered. And to the extent it has validity, it’s largely something that preexisted any other, recent changes.

What’s perhaps most interesting on the labor side is Passan’s argument that “some future stars prefer to hedge against both their own fallibility and the sport’s unpredictability” by seeking greater certainty rather than trying to drive the market northward in free agency. Perhaps that’s true to some extent, but this year’s group includes several players (Yu Darvish, Jake Arrieta, Eric Hosmer) that have seemingly spurned attempts by their prior organizations to work out long-term deals before they hit the open market. Of course, there are other significant players that aren’t available due to their own prior extensions.)

Beyond that, there’s a class of more recent mega-talents that has thus far foregone extensions — Francisco Lindor, Mookie Betts, Carlos Correa, Kris Bryant, etc. Some members of this group have even indicated their comfort with going year to year, with the presence of significant marketing opportunities helping to pad their accounts and reduce their risk even before arbitration. The general popularity of the game thus also serves to buttress those stars’ bargaining power. Analytical work generally suggests that aging curves have trended younger. On the one hand, that harms older free agents. On the other, it also suggests that teams will and should be more and more willing to promote prospects at earlier ages — a strategy that’s all the more appealing since it means realizing value from amateur investments and reducing reliance on major free agent outlays. But to the extent that comes to pass, those players’ service clocks will also start sooner, meaning they’ll likely reach the open market sooner than like players did in the past.

Indeed, this time next year, Bryce Harper and Manny Machado will each be available to the high bidder (barring an intervening extension) at just 26 years of age. Both are expected to land enormous contracts. That hints at one way in which a broader shift may settle out. As Passan rightly notes, next winter’s free agent period may provide “the best litmus test of free agency yet.”

But is it really the case that unique factors in this winter’s player market aren’t at least helping to cause the current delay? The coaching/front office “job shuffle,” as Passan calls it, may well have had some effect, though it’s also hard to imagine that modern front offices would truly be so distracted that they might be missing opportunities at achieving value. On the player side, though, there’s cause to push back somewhat on the notion that the looming presences of Stanton and Ohtani aren’t significant factors. Passan does cite a GM’s opinion in direct support of that point, but from an outside perspective, it stands to reason that both could be delaying things — as Masahiro Tanaka once did in a somewhat analogous manner.

Stanton is legitimately better, younger, and more expensive than any of this winter’s free agents and the Marlins very nearly have to trade him. Talks are complicated by many factors, including his full no-trade rights and opt-out clause. While only a few organization seem truly engaged on Stanton, those that miss on him would be major potential suitors for the top free agent hitters. And Stanton’s own preferences could conceivably force the Marlins to engage with other teams — possibly creating value opportunities that would be foreclosed by the pursuit of open-market alternatives. It also seems that organization is waiting to discuss its best affordable talent — Marcell Ozuna, Christian Yelich, J.T. Realmuto — until it has exhausted its options on Stanton. Those players would draw huge interest from any number of teams.

As for Ohtani, it’s true that he could simply slot into any organization’s payroll and roster given his absurdly low price, but teams that feel they have a legitimate shot to land him may prefer to see that process out before committing huge money to a free agent. One executive calls Ohtani a “$200 million Powerball in a 30-person town.” Given those odds and that payout, it makes sense that at least some organizations might forego the chase for a major starter — or perhaps even a lesser investment in a DH option — while waiting to see if they hit it big. The Ohtani opportunity is, from one perspective, simply a potential bonus. From another, it’s a strategy-altering possibility that might actually incentivize additional investment; whatever team lands Ohtani may then feel it has the available resources and increased likelihood of contention that justify moves in other areas. (Credit on that interesting point to Dierkes.)

Of course, there are limits to any Stanton/Ohtani explanation. For example, it’s hard to draw any line between their situations and the market for sub-elite relievers, which has not yet moved at all. No matter the true impact of those individual situations, there’s clearly some real merit to Passan’s overall points regarding the underlying structural movement afoot in the game. But it’s still quite difficult to know just what to make of them. There are many possible counter-effects that could come to pass, some of which are noted above, and broader trends that will need to be considered as well. Any market changes, after all, create opportunities to take advantage of any slight inefficiencies that might arise. Perhaps, in the end, this is in part a feeling-out period under the new CBA and in part an adjustment to some other trends.

Regardless, as we wait for the dam to break, it seems the building of tension has created the potential for quite a notable offeason — though we may have to wait a while longer to observe it and begin to assess its full meaning. With virtually all of this year’s free agent class stuck in neutral entering the month of December, it seems there could be something of a broader staring contest, making for a potentially fascinating situation with the Winter Meetings looming.