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Monday Money Matters
The Jay Cutler trade, as any big trade in sports, brought out instant analysis from all circles. As with grading team drafts the day after, these evaluations are meaningless and unfair and usually require three years to properly judge, although I understand the public craving for such immediate and instant gratification. Certainly in this case, the Bears are going to look like short-term winners, settling their most important position with an elite talent (although not yet an elite quarterback), while the position remains a question mark in Denver. However, as we all know, this trade cannot be adequately evaluated for years and years as we track the development of the picks acquired by the Broncos and the career of Cutler.
I was involved in a couple of such trades that looked like immediate losers for the Packers but now appear in a different light. In successive years, we traded Mike McKenzie and Javon Walker to New Orleans and Denver for second-round picks that turned into Nick Collins and Greg Jennings, respectively. At first blush, the trades looked one-sided for the Saints and Broncos, who acquired proven veterans while we got rookies from Bethune-Cookman and Western Michigan. The instant analysis of those trades certainly did not favor Green Bay.
Today, McKenzie is out of the league, recently released by the Saints. Walker lasted two seasons with the Broncos and caught 15 balls for the Raiders last season while collecting $13M. Collins was in the Pro Bowl a couple months ago, and Jennings may be a top 10 receiver in the NFL (he has 133 receptions the last two seasons compared to Walker’s 41). A bit different look for these trades today, no? …
What we can evaluate instantly, however, is the financial impact of the Cutler trade. From a cash perspective, the clear short-term loser is the Broncos. They have already paid Cutler the $12.16M in guaranteed bonus money and, with the price of those two No. 1 picks in the equation, the Broncos will pay approximately $5M more over the next two years than the Bears. That assumes, however, that Cutler continues to play under his existing contract, a contract that’s very reasonable these two years prior to hitting the massive escalators in 2011.
The Broncos also are losers in the Cap comparison of the trade as well. Due primarily to the acceleration of the unamortized portion ($4.7M) of Cutler’s substantial option bonus he received in his rookie contract three years ago, the Broncos are negative $5M on the Cap due to this trade when adding up projected Cap numbers for the picks, Orton and the charge left behind from Cutler’s acceleration.
Again, this picture could change with the negotiation of a new contract for Cutler, which, to this point, has not appeared as an issue. With the stunning package of compensation given to Cutler in the trade, it’s reasonable to expect a blockbuster contract in the next year as well. I’m sure agent Bus Cook will look at Cutler’s new rival quarterback – Aaron Rodgers, who replaced another client of his, Brett Favre, in Green Bay — as a starting point. Rodgers received an $11M average and $20M guarantee in October.
That’s how it looks from a financial perspective, a much more quantifiable analysis than from a personnel perspective. However, like all aspects of evaluating this trade, let’s check back in a couple of years.
The Jay Cutler trade, as any big trade in sports, brought out instant analysis from all circles. As with grading team drafts the day after, these evaluations are meaningless and unfair and usually require three years to properly judge, although I understand the public craving for such immediate and instant gratification. Certainly in this case, the Bears are going to look like short-term winners, settling their most important position with an elite talent (although not yet an elite quarterback), while the position remains a question mark in Denver. However, as we all know, this trade cannot be adequately evaluated for years and years as we track the development of the picks acquired by the Broncos and the career of Cutler.
I was involved in a couple of such trades that looked like immediate losers for the Packers but now appear in a different light. In successive years, we traded Mike McKenzie and Javon Walker to New Orleans and Denver for second-round picks that turned into Nick Collins and Greg Jennings, respectively. At first blush, the trades looked one-sided for the Saints and Broncos, who acquired proven veterans while we got rookies from Bethune-Cookman and Western Michigan. The instant analysis of those trades certainly did not favor Green Bay.
Today, McKenzie is out of the league, recently released by the Saints. Walker lasted two seasons with the Broncos and caught 15 balls for the Raiders last season while collecting $13M. Collins was in the Pro Bowl a couple months ago, and Jennings may be a top 10 receiver in the NFL (he has 133 receptions the last two seasons compared to Walker’s 41). A bit different look for these trades today, no? …
What we can evaluate instantly, however, is the financial impact of the Cutler trade. From a cash perspective, the clear short-term loser is the Broncos. They have already paid Cutler the $12.16M in guaranteed bonus money and, with the price of those two No. 1 picks in the equation, the Broncos will pay approximately $5M more over the next two years than the Bears. That assumes, however, that Cutler continues to play under his existing contract, a contract that’s very reasonable these two years prior to hitting the massive escalators in 2011.
The Broncos also are losers in the Cap comparison of the trade as well. Due primarily to the acceleration of the unamortized portion ($4.7M) of Cutler’s substantial option bonus he received in his rookie contract three years ago, the Broncos are negative $5M on the Cap due to this trade when adding up projected Cap numbers for the picks, Orton and the charge left behind from Cutler’s acceleration.
Again, this picture could change with the negotiation of a new contract for Cutler, which, to this point, has not appeared as an issue. With the stunning package of compensation given to Cutler in the trade, it’s reasonable to expect a blockbuster contract in the next year as well. I’m sure agent Bus Cook will look at Cutler’s new rival quarterback – Aaron Rodgers, who replaced another client of his, Brett Favre, in Green Bay — as a starting point. Rodgers received an $11M average and $20M guarantee in October.
That’s how it looks from a financial perspective, a much more quantifiable analysis than from a personnel perspective. However, like all aspects of evaluating this trade, let’s check back in a couple of years.
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