HARD BALL OFF SEASON

When the Braves won the World Series, baseball has less than a month left on its existing Collective Bargaining Agreement (CBA). The existing CBA expires on December 1st. There have been no reported movement between the players union and the league.

But there are still deadlines to meet.

Before December 1st, teams need to submit their qualifying offers to free agents to accept a one-year ($18.5 million contract) or hit full free agency (with a possible penalty to the new club in lost draft choice). 

Before the contract expires, teams need to finalize their 40 man rosters and submit them to the league to hold players out of the December winter meetings Rule 5 draft.

Also, teams have to submit arbitration notices to eligible players or lose them to free agency.

Some teams may also be looking to their financials to get under the luxury cap as it affects their future draft and international money pools. 

But all of those items are under the backdrop of uncertainty. No one knows what the next CBA will look like. The owners floated the idea of lowering the luxury tax (which is a default salary cap) which will be rejected by the players. The owners floated the idea of revenue sharing percentage with players, but players reject that notion because it does not include "all" income sources from affiliated enterprises such as parking, etc. The players will want to raise the minimum player salaries and stop GMs from manipulating service time so players free agency is held off an extra year. The union may want to reduce the years to get to free agency,which some owners will reject since that would adversely effect their bottom line. 

Teams are using younger players which means those stars hit free agency faster. Teams have started to "buy out" arbitration years in sweetened rookie contracts, but those rising star players may hit free agency TWICE during their career which could be problematic down the road as MLB must see that overall revenues are at a plateau.

As the NFL gets greedier by making deals with streaming services for games, it is yet to be seen if fans will actually follow those kinds of broadcasts. Likewise, MLB has hinted that it wants to get out of its own broadcasting venture (MLB.com). Many teams, including the Cubs, have found running their own team channel/network not the huge profit center that cable provided with super-stations two decades ago. 

It is probable that most teams will not make any big moves until there is a new CBA. Why commit to large payrolls or long term contracts if free agency is going to change or the unlimited payroll budgets could be significantly reduced to a hard cap?

The hard financial outlook will be the center of the tug of war. It is clear baseball is not growing revenues like it used to. MLB owners still want total control of their product (and profits) as it did in taking over the minor leagues. But there is only so much blood you can squeeze out of a turnip.

OFF-FIELD BALK

 Major League Baseball and all 30 of its teams are suing their insurance providers, citing billions of dollars in losses during the 2020 season played almost entirely without fans due to the coronavirus pandemic. But the vast majority of business cases involving the pandemic (contract clauses, payment issues, insurance claims) have failed to give aggrieved parties any relief.

The suit, filed in October in California Superior Court in Alameda County, was obtained Friday by The Associated Press. It says providers AIG, Factory Mutual and Interstate Fire and Casualty Company have refused to pay claims made by MLB despite the league’s “all-risk” policy purchases.

The league claims to have lost billions of dollars on unsold tickets, hundreds of millions on concessions, tens of millions on parking and millions more on suites and luxury seat licenses, in-park merchandise sales and corporate sponsorships. It also cites over a billion dollars in local and national media losses, plus tens of millions in missed income for MLB Advanced Media. It says all of those losses should be covered by their policies.

Since COVID-19 sparked government-ordered shutdowns in March, judges have dismissed more than four times as many business-interruption lawsuits as they’ve allowed to proceed, according to a preliminary analysis by the University of Pennsylvania Law School.

Industry executives say pandemic-related losses may be their biggest ever, and business-interruption claims will likely be part of that, even though many insurers added virus waivers to policies over the past decade following the SARS outbreak in 2003.

The Insurance Journal reports most of the cases tossed out so far had virus-exclusion clauses. When policies don’t have the exclusion, insurers are arguing COVID-19 can’t cause the physical damage or loss required for a business-interruption payout, like from a tornado or flood. And the industry is winning dismissals with that argument, according to the Insurance Information Institute.

“Business-insurance policies are meant to cover physical things,” said Sean Kevelighan, the chief executive at the institute, which has more than 60 insurance company members. “There’s a ways to go” in the legal battle over coverage, but “the beginning of it is encouraging,” he said.

A September win by Farmers Insurance Exchange in California typifies how some judges interpret “physical loss or damage.” A federal judge concluded a barbershop chain couldn’t show its business suffered a “distinct, demonstrable physical alteration.”

Other businesses have also struck out in trying to persuade judges to allow their claims to go to trial over policies that had virus exclusions. A federal judge in Arizona ruled Nov. 13 the Class AA Chattanooga Lookouts and more than a dozen other teams couldn’t overcome the exclusions.

BEING THE FIRST

Apple's Steve Jobs once said that it is better not to be the first pioneer in a new market. It is better to be an innovative second player. The reason? The pioneer has to go through much trial and error, failures, private and public criticism for a first generation product released with flaws.Jobs was anal-retentive about his products working perfectly right out of the box. You can learn from others' mistakes.

Professional sports leagues are meeting constantly trying to figure out how to salvage part of their pandemic lost seasons. The networks, starved of new content, believe there is a huge pent-up demand from fans for live sports. The owners are gnawing their teeth to get their revenue streams back. The players are not getting paid which puts a financial strain on most of their families.

There are some league commissioners who want to "lead" the world back into the sunlight. Sports give people hope. They want bragging rights that their sport knows what is doing and doing it better.

But this is a tricky matter. Things are outside of EVERYONE's control: government, scientific, and private communities. At least 18 U.S. states have lock down orders in place which restricts any type of public gathering, including sports events. In hard hit states like New York, California and Illinois, 9 of the 30 baseball clubs (30 percent) are banned from playing games.

But baseball owners continue to make proposals to the players union to re-start the season. For two days, the parties have discussed the medical and logistics of re-opening camps and playing of games. Owners believe that they can acquire enough testing materials to have multiple player tests per week. (Critics said that would take away from critical need areas as the coronavirus continues to spread.) The issue about a player, coach, umpire or staff member testing positive is hard to grasp. The CDC states a positive test should quarantine the person for at least 14 days. Anyone with contact with the positive test subject should also be quarantined for two weeks. That means an entire team would be suspended. Some Euro soccer leagues think that they can get around the "contact" person rule by immediately testing everyone and only putting positives into isolation. But even then, it may be too late.

Stanford did a study of 5,200 baseball personnel. It found that 0.7 percent infection rate. However, the reports did not state when the tests were done and what the average was at the time of testing. Massive outbreaks in NYC and Chicago have changed the numbers. U.S. officials have been saying that the nation has not reached "the peak," and that there will be a second wave later in the year.

Several players have been vocal about "risking their lives" to play under such conditions (including a biosphere proposal where the players would be isolated from their families.) Further insult to players, owners want to change the fundamental guaranteed contract structure to a 2020 "revenue sharing" plan. Players are already taking a prorated pay cut. If there is no revenue, the players get half of nothing.

But there will be players who want to play. And there will be players who will refuse to play. If the season opens and a player refuses to report, what would happen? In the past, the player would be suspended without pay. But in this case, would owners try to void the players entire contract (to rid themselves of long term dead money?)

The NBA shut down quickly after one player tested positive. Pro basketball is a contact sport. The court is small. The virus could spread quickly through teams and staff. But the NBA is thinking of ending its season with a large, confined to one location, super-tournament.

An unemployed person who is struggling to make ends meet may wonder why sports leagues are so hell bent on returning to action when the national economy is falling apart. Simple: money. There is no income without games. Some teams, like the Mets, have been for years in a financial mess. There is a possibility that many teams could face bankruptcy.

South Korea had 10 straight days of no new domestic virus cases. It had done so well in early testing, on a massive scale, quarantine outbreaks and voluntary isolation that it has a very low fatality rate. But last weekend, one man went clubbing in Itaewon. He later tested positive. He may have infected 800 or more people. Based on the fatality rate, 20 people could die from this weekend party time. As a result, South Korea has re-closed its bars and restaurants.

What happens if a league rushes to re-open and it is a disaster? Does that turn off casual fans because of perceived reckless behavior? Are owners willing to take a public relations hit? What if re-opening spreads the disease - - - is there a liability risk as well?

That is why leagues need to be super-cautious about re-opening. Yes, the world is getting cabin fever. People need to get back to work in order to get paid. The pandemic may be more panic than scientific fact in some circles, but at this point in time no one knows the nature, extent and aftermath of the virus.

SHOW US THE MONEY

The salvage show that is the 2020 baseball non-season continues to get strange.

MLB owners had been steadfast against revenue sharing (frequent in other sports). But since the 2020 season now seems to be getting shorter and shorter (if at all), owners have gone back to the union with another re-start proposal.

Prior to his proposal, the union had agreed to a $170 million player fund if the season was canceled. It was a way to settle any litigation over payment of guaranteed contracts, etc. In addition, the plan was to prorate existing player contracts over the number of games actually played in 2020.

But the roadblock to even this negotiated solution is the crippling effect of the shutdown. Individual states have different stay-at-home orders. Science cannot keep up with virus explanations or mathematical models of the contagion. Baseball has no revenue. The golden goose, broadcast TV, has gone sterile as advertising has dried up with most businesses closed or doing poorly.

The owners now want to change the plan to share 48 percent of the "revenue" with the players once the season starts. It is a significant change to the existing baseball payroll structure; a nullification of existing 2020 contract obligations. There is always been multiple account ledgers in baseball. Most teams now consider baseball "revenue" as only what the team pulls in from local TV rights, ticket sales (approx. 30 percent) and concessions. Owners believed that national TV rights, MLB.com and the development of alternative venue sources outside the ball park do not count.

Even if both sides could agree on what counts as "revenue," the owners must have determined that it will be exceptionally low. If you have no revenue, you share zero. If you receive only a fraction of the past revenue, then the players would only get a fraction of a fraction.

National broadcasters have had cable subscriber losses and huge ad revenue declines. There is no time frame for advertisers to return to baseball. Networks will demand concessions due to revenue losses. Owners have had their accountants flip their calculators around to find that prorated 2020 contracts with no significant revenue means massive losses to the owners. It would be better not to open the season.

We know that there are several clubs that were in a financial mess before the virus crisis. The Mets have been a mess for a long time. It is so bad that a vanity couple, A-Rod and J-Lo and their investors, quickly passed at buying the Mets because the financials were so bad. Playing a season could tip one or more clubs into bankruptcy, something that MLB fears the most since it would lose control over who would join their elite ownership club.

The union had stated that it already has a revised 2020 agreement in place with the owners. The union does not have to change its position. It is the owners who are scrambling to find a way to make a profit (and lessen operating expenses - - - salaries, travel costs, etc.).

The Illinois governor has hinted that the "peak" of infections may last through June 15. That means Illinois will remain in lock-down for another month. That would push the Cubs and White Sox back to a late July season start, if at all.An 80 game schedule turns into 65 games.  The longer the wait, the closer it is to a point of no return.

It is assumed that there a pent up demand from fans for baseball's return. But I am not so sure. People have been living without "live" sports for two months. They have found other things to occupy their time, including parents who are working from home AND trying to teach their children homework lessons since virtual classrooms are nearly non-existent in elementary schools. Steaming services have been doing well, but there has been a reported peak in new subscribers and a slow down in viewers. Cabin fever has turned into media burnout.

Even if baseball returns, there is no guarantee that fans will jump on board. There is no guarantee that fans will come back to the ball parks. There is no guarantee that TV ratings will be anything close to respectable numbers. The great unknown is harsh. The epidemic is going to gut the middle class; mom and pop businesses that have been closed may never re-open. People want to go back to work, but cannot. People are confused, angry and in choking debt. A surge a bankruptcies will happen. People will not have the disposable income (the shock of the value of their retirement account balances).

It is still a 50-50 chance that this year there will be any professional baseball.

EU TU, SEASON?

As most of the world is in lock down, MLB, the union, players, agents and media pundits are kicking the can (the 2020 season) down the road.

The owners want the most games for the revenue.
The players want the most games for service time toward free agency.
The fans want the most games for enjoyment.

But how many games will constitute a valid season?

If the shutdown continues through May, is four months of games enough to have a legitimate champion? An 108 game schedule (2/3 season) seems reasonable.

But it gets tricky after that point.

How many is too little?

You have 30 teams, 15 per division. In a shortened season, would it not be prudent to keep the games within your league?

If so, each club has 14 opponents. You would think each owner would want at least one "home and home" series. Three games two times 14 equals 84 games. Is this the bare minimum?

What if it a shortened two game series per club? 56 games played seems awfully light.

Some would say 81 games, half of a regular season, is the cut off point. There is some speculation that a drawn out wave of coronavirus spread across the US could shut down travel and gatherings throughout the summer.

Some have proposed that you can fatten the number of games played by increasing doubleheaders. But even with expanded rosters, multiple double headers during a week will grind pitching staffs down to the bone. Is it worth the risk for the long term viability of the game?

These are important questions for baseball, but for also other industries trying to cope with the uncertainty of this situation. As we now know, baseball is not an essential service. 

CONTRACT EXTENSIONS

 Everyone is trying to figure out the dynamics of a weak free agent market and the rash of player extensions. It may be a simple conversion of complex rational behaviors.

First, for the past several years, front offices have gone off the deep end on Big Data. Teams have figured out new statistics on spin rates, hit ball velocity and motion capture mechanics. Teams can break down their players into computer data. Now teams have more stats (good and bad) on their players to justify lower arbitration offers or free agency passes on veterans who used to be paid on past performance.

Second, while baseball is still generating record revenues, there are storm clouds on the horizon as attendance is down, TV ratings are down, TV advertising (and associated broadcast fees) have hit a plateau and demographics are trending to age out. Kids today would rather spend four hours playing Fortnite than watching a baseball game. In order to keep profit margins, teams are relying more on young, cheap and controllable players to fill major league rosters.

Third, the age of the super-agent is fading away. In the last two off-seasons, agents have missed the market trends, especially for the second tier free agents. Teams were armed with weaponized stats proving that older veterans decline in value after age 30. Teams were only going to pay for future performance, hence lower average annual salaries and contract years. Bryce Harper and Manny Machado got their deals because they were both 26, in their prime production years. Other veterans, including pitchers, still sit on the side lines without a job.

Fourth, veteran players and union officials are mad about the free agency market. They whisper collusion but cannot prove it. They are thinking about striking when the current collective bargaining agreement is over. But the prospect of a strike or a lock out does not sit well with a majority of baseball players. Hence, the surge in player extensions (usually at team friendly rates.)

Mid-February  25 contract extensions have been signed, notably by many young players including Ronald Acuña Jr., Blake Snell,  and Eloy Jiménez, who had yet to have a major league at-bat.  Acuña Jr. and Snell were last year’s Rookie of the Year and Cy Young Award winners while Jiménez could be this year’s ROY.

Acuña, Snell, and Jiménez’s teams locking them up this early in their careers has a two-fold effect: given how good they are (or, in Jiménez’s case, could be), they stand to potentially set salary records going through arbitration. Acuña, for example, was set to become eligible for arbitration for the first time in 2022. His extension is for eight years and $100 million, meaning he won’t become a free agent until after the 2026 season at the earliest. He will earn $15 million in 2022, and $17 million from 2023-26.

Compare that to Rockies third baseman Nolan Arenado (who also signed an extension). Arenado earned a $26 million salary going through his final year of arbitration eligibility. Arenado avoided all the potential drama and cross currents of a broken free agent system by taking the familiar guaranteed money of the Rockies. There is some value in the stability of staying with your current team (professionally and family situations).

Agent Scott Boras, who has had many clients getting paid less than he projected, is not happy with these young prospect extensions:

"Great young players are getting what I call snuff contracts. And a snuff contract is that they’re trying to snuff out the market. They know the player is a great player, and he’s exhibited very little performance. So they’re coming to him at 20 and 21, and I’m going to snuff out your ability to move, to go anywhere, to do anything, and your value. And I’m going to pay you maybe 40 cents on the dollar to do it. What’s my risk?"

Ken Rosenthal recent reported that the players believe team representatives are even circumventing the player and his agent by appealing to the players’ families, especially for players with poor and/or Latin American backgrounds. That may help explain why many young players are taking the guaranteed money.  Contract negotiations do not happen in a vacuum. A multimillion dollar guaranteed contract is life changing for most families.

By taking themselves out of the picture, Acuña and Snell cannot set the bar for the industry for players of their caliber, age, and service time, which makes agents jobs much harder to push the boundaries of free agent money. Craig Kimbrel and Dallas Keuchel have been caught on the other side looking in as the season started. By testing the free agent waters, Kimbrel and Keuchel have been swept away by teams signing younger players earlier.

But there still are puzzling aspects to contract extensions. The Cubs extended utility infielder David Bote for 5 years, $15 million. Bote is not even a starting player! He is a career .240 hitter. His career WAR is 1.0, not even the level of a AAAA replacement. Yet, Bote went to management and begs for some job security. The 24th man on the roster got his wish with a cash strapped club paying him five times what he was projected to earn in the next 5 years. Teams can still spend oddly in this new era of extensions.

THE NEW OLD SYSTEM

For the past week, team equipment trucks have been motoring to Arizona and Florida. Spring training begins in about a week.

But about half of the Top 50 free agents remain unsigned. And the prospects of mega-deal long term contracts are fading fast.

The new free agent dogma is actually the renewal of the old ownership system. Way back, teams used to be owned by individuals or families. The baseball club was their sole business. They operated it like a mom and pop store. If they could get by cutting corners (player salaries) to make a profit, they made a profit first.

Small market clubs still operate under that guide line. Low attendance, small fan base, and lower local television deals means these clubs are under financial pressure against signing a player to a large contract. But under the CBA and baseball rules, all the small market teams have enhanced revenue sharing from the league, and extra draft picks to acquire "cheap" young talent to remain "competitive."

General managers now covet draft picks because they can retain a player for six years (three in arbitration) at a relative small cost. The farm system is now the most important aspect of the operations. If you can draft and develop talent consistently, your team can be frugal, competitive and profitable.

In order to do so, teams now "tank" more often to obtain higher "can't miss" prospects. It is okay to tank if you have very little fans to complain (see, Marlins.)

You have now about one-third (1/3) of MLB clubs at the bottom in salary budgets, many whom have little desire but to tank to acquire top ten draft picks.

You have the top four spenders, big market clubs, who are at the luxury cap limit of $206 million. These previously annual big spenders do not want to go over the salary cap because of the financial and draft penalties. To take on a salary like Harper's $30 million/year $300 million total, it could cost a team over the cap as much as another $300 million in penalties over that ten year period. To avoid that, the team would have to off-set or cut $30 million a year for the duration of the contract (which some GMs would classify as three veteran players or four quality relief pitchers in value.)

The rest of the clubs position themselves to spend $100 to $150 million per year. If their division is weak, like the AL Central, they could be in contention most of the season (thus validating their "plan" to their fans). Fair weather fans might return so everybody is happy. But with an average starting pitcher making $10 million, a team could have almost one-third of their payroll in a rotation. That leaves an average salary of $4 million for every other player on the roster. That is why prospects being paid the league minimum ($555,000) are so important as they free up money to sign or retain veteran players (second tier).

Player agents may be late to recognize this new paradigm being the old system before steroid fueled free agency. Teams now have the MBAs, computer geeks and stat analysts crunching big data to find that players over 30 in the non-steroid era are not as valuable or productive going forward. So many teams have been burned by long term, dead money contracts to be gun-shy about signing another player demanding even more money.

It seems that Harper's foray (or folly) into free agent basically ended when he rejected the Nationals pre-free agency extension of $300 million/30 years. Machado has not formally rejected the White Sox $175 million offer, but it seems no one else has topped it. The Phils said they would spend "stupid money," and if that was the case Harper and/or Machado would have had last month a press conference in Philadelphia. Agents must be frustrated by the "take it or leave it" offers from teams (who are giving their best contract first without being pushed and pulled by other teams or the agent.) Free agency is no longer a live auction between teams. It is more like a Priceline value search.

THE FUTURE

There has been one constant throughout the history of baseball: owners desire to make a profit.

In order to keep a competitive balance (and profit sharing), MLB has a luxury tax on payrolls currently pegged at $195 million. The penalty for going over the ceiling is 50 percent to 92 percent. This is a soft salary cap where big market teams like the Dodgers and Yankees can easily absorb.

But the future is rapidly changing that overspend model. The Yankees sold most of their interest in the YES Network, which was the cash cow that fueled those free agent filled teams. The Dodgers got a billion dollar team network deal with TW, which turned into a bust when cable operators balked at paying high subscription fees.

The cable industry, the tinder for the rapid rise in profits and player salaries, is losing three million subscribers a quarter. The biggest reason was the surcharge of sports network fees on monthly bills.  The second reason was the internet and other means of consuming sports than television sets. The third, and possibly most glaring reason, is that the younger generation is less interested in traditional sports franchises. Young kids are more involved in their technology of video games and e-sports than play baseball in the park. In addition, teams have made it almost cost prohibitive for a family to go attend a major league game.

The outside profit center for many teams, the publicly financed sweetheart ball park deal, like the cable money is going to go extinct. Not one publicly financed sports stadium has created an "economic boom" for the municipality. In fact, the associated debt with those deals can be crippling taxpayers. With more and more cities, counties and states in massive fiscal holes and bankruptcy, the community revolt against such capitalism welfare projects will end.

But on the other side, star players are looking for massive contracts. Bryce Harper nears free agency with agent speculation that he will demand anywhere from $30 million to $50 million per season. ESPN opined that Harper could easily become the first $500 million player in sports history. When baseball franchises are worth at the high tide level of $1.5 billion, a superstar player's demand for a third of the team value makes the business model absurd.

Teams are no longer owned or controlled by millionaires looking to massage their country club egos with sports championships. Most teams are corporations who have to answer to shareholders. Investors demand return on their capital in the form of dividends, earnings and appreciation. The easy cost control item on a team is payroll.

In the near future, baseball as a game will fundamentally change. There are growing calls to eliminate much of the subjective, human element of game by turning ball and strike calls over to computer grid technology. In essence, the game will be played without umpires - - - merely sensors and real time play reviews at the league office. But even the elimination of umpires will not drastically alter the erosion of the economics of the game.

If the next generation of fans accept virtual reality for reality, then baseball will probably forge ahead to create a digital platform to replace the timeless past time. Whether it be 3D or holographic representation of past, present or computer generated players, baseball could morph into super computer super charged video game.

Fans like their fantasy leagues. They like their smart phone apps. If baseball was compressed into a graphic rich, high octane video game, many would watch. The elimination of players, ball parks, infrastructure costs, team travel, etc. is like a dream to a team accountant.  If the owners can keep a fan base happy without incurring normal costs, then it is virtual game on.

Since most states have privacy and image rights laws, the new virtual baseball game would probably be run by superstar programmers than old player profiles. Instead of expensive Bryce Harper batting third for the Nationals, it could be RobotOF127. The league could set input parameters for team programmers in setting up algorithms for player stats/performance guides. The league would then run on its own servers simulated games using those team rosters. Whether there would be an real time manager making decisions or strategy calls would be possible. It would also be possible that teams would employ a few gamers to act as pitcher, hitters and fielders to add a "human" element to the simulated game.

Simulated games could be played quicker than real ones. Simulated seasons could be finished rather quickly. Playoff games could be subscription or theater events across the country (or across the globe).

One could argue that this is merely a technological fantasy. That there will always be enough players wanting to play professional sports to field teams. That may be true, but in some sports there is a major shift on whether the health risks outweigh the playing time. More parents are taking their children out of contact football at earlier ages. Even professional players are retiring early because of the current research on the ramifications of concussions. Football could be the first major sport to have a serious personnel shortage. In addition, marketing executives note that in order to capture fans early, those kids need to appreciate the sport, i.e. have played it at some level. That is the fantasy connection between seeing your favorite player juke through the line for a touchdown then going outside to play football with friends.

The same could hold true for baseball. It is a time consuming and expensive spectator sport. The lure of going to the ball park for a game is that it was a social event. There was enough time between pitches to converse with friends. But in this internet age, people are less social. They don't see the need to spend three hours talking to other people at an event. They can poke, text or email them.

All consumption of all forms of entertainment are under fire. Baseball is just one option in this ever changing landscape.

THE CURSE REVIVED

The Cubs continued to bask in the glow of the championship.

But that light is turning dark.

The Cubs have lost 4 home games in a row for the first time in three years.

The championship hangover continues.

And then there is the weirdness about their diamond rings.

When shown after the ceremony, it was learned that on the inside there was an image of a goat.

Why is there a goat on a Cubs ring?

When Ricketts purchased the club, they were adamant that they did not believe in any curses. When Epstein arrived in town to run the team, he said he did not believe in curses - - - and he came from Boston, the home of the Bambino Curse. He said building a quality organization leads to championships. And he backed up his words with an aggressive and painful rebuilding program.

So by putting a goat on the championship ring, the Ricketts have directly acknowledged the mythical curse. There was no logical reason to do so. And some fans, seeing the Cubs are in a slow, bad baseball start, will believe that putting the goat on the championship ring has revived the curse.

But as gracious and generous the Ricketts family was at the ring ceremony, the Sun Times reported that there is an another strange twist in the Cubs championship. The paper reported:

The Cubs organization is handing out World Series Championship rings to players and other employees, describing the bling as a “priceless memento of the greatest championship quest in all of sports.”

In fact, each ring does have a price — $1, to be precise — even though appraisers say they could fetch anywhere from $50,000 to $250,000 on the open market.

That’s because the rings come with strings attached. The Cubs are discouraging ring recipients from selling the hardware. But if they get the urge, the Cubs reserve the right to buy each ring back for $1, according to a memo the organization is asking each ring recipient — including players — to sign.

“We regret the formal nature of this memo, and we do not intend for this information to overshadow our joy in being able to provide this ring to you,” the memo states. “However, we think it is important to communicate this information to you.”

Those planning to sell “or otherwise transfer your ring,” must give the Cubs written notice of “the proposed transaction and a complete accounting of the terms. If the Cubs elect not to purchase the ring, then you may transfer it according to the terms you provided to the Cubs; however, each subsequent owner shall also be bound by these terms in the event of a subsequent proposed sale or other transfer.”

The memo makes an exception for rings that are given as gifts — say to a child, spouse or grandchild. Cubs spokesman Julian Green stated that it was not unusual for this stipulation.

However,  Sun Times contacted the White Sox about their 2005 championship rings, The Sox said the rings given to players and staff had no conditions attached to them. The Sox said that the rings were gifts to the players who could do whatever they wanted with them.

And sports writers have never heard of this stipulation in past champions.

It seems like a petty power grab by the Ricketts to assert control over their players and their assets. The players "earned" those rings by performing at the highest level. The players success has directly increased the Ricketts' value of the club by approximately two billion dollars. So why are the owners trying to seize back the $70,000 ring if a player needs to convert it to cash?

It is the same reason why Crain's reported earlier in the year that the Ricketts push to control the surrounding Wrigley Field blocks is pushing old neighborhood merchants farther and farther away from the facility. By pushing away the competition, the Cubs are casting a monopoly upon fans coming to games with pre-game merchandise sales at their huge new store and beer or food stands outside the park. It comes down to the Ricketts continuing philosophy (that blew a part the rooftop settlement)  that only the family has the right to make any money off the Cubs. And this includes the players and their championship rings.

 We all know stories of players after their careers are over who become down on their luck. Many players do not save their wealth, or find themselves making poor investment decisions because their focus was on their career and not business. Many athletes get into bitter, expensive divorces where cash is the only way out. So the Ricketts have effectively "cursed" their future former championship players with a "generous gift" that is only worth $1 outside the family. Experts believe that a championship ring of Bryant, Rizzo or Lester could command $250,000 or more on the open, auction market. But instead, the Ricketts want fans to pay them  $10,000 for a cheaper replica of the ring.

The whole ring dynamic tarnishes the Cubs championship.
 

NEW DEAL

Selig's Folly is dead. In 2002, Commissioner Selig's All-Star blunder (of teams running out of players) of making the exhibition game "count" in the playoffs is no longer the case. Back to the basics of sports, the team with the best record will have earned the advantage in the World Series. This makes every game important.

The change of the All-Star game ramifications is part of the new collective bargaining agreement. The new five year deal tweaks various aspects of the old deal. MLB.com reviewed the new changes:

The most surprising twist is that home-field advantage in the World Series will no longer be tied to the All-Star Game, as first reported by The Associated Press. Instead, the pennant winner with the better regular-season record will get home-field advantage in the Fall Classic.

Free-agent compensation
Specifics on Draft-pick compensation are still being discussed. That said, qualifying offers -- which will still be calculated based on the average of the top 125 salaries -- can still be extended to free agents, but no more than once per player in his career. A player must still be on his club for the entire season to receive a qualifying offer.

Teams losing a free agent who received a qualifying offer will get a Draft pick only if the player signs a contract worth at least $50 million. After that, the pick depends on a team's market size, according to MLB Network Insider Ken Rosenthal.

Beginning in the 2017-18 offseason, teams will not lose first-round Draft picks for signing a premier free agent. However, teams exceeding the luxury-tax threshold would lose a second-rounder, a fifth-rounder and $1 million in international pool money.
 
If a club hasn't exceeded the luxury-tax threshold, it will lose a third-round pick.

Luxury tax threshold
Incremental increases from the current $189 million of 2014-16 to:
2017: $195 million
2018: $197 million
2019: $206 million
2020: $209 million
2021: $210 million

Tax rates for teams exceeding the threshold will rise from 17.5 percent to 20 percent for first-time instances, remain at 30 percent for second instances and increase from 40 to 50 percent for third-time instances.

There's a new 12 percent surtax for teams $20 million to $40 million above the threshold, 40 percent for first instances more than $40 million above the threshold and 42.5 percent for teams $40 million above the threshold a second time, according to The Associated Press.

International Draft
Rather than an international Draft, which owners had sought, the two sides agreed to a bonus pool system, with a hard cap on how much each team can spend. That pool is expected to be $5 million to $6 million per team. Under the previous CBA, the bonus pools were scaled based on record the previous year, with the worst teams getting a little more than $5 million and the club with the best record getting a bonus pool in the $2 million range. It was also a "soft" cap, meaning teams could exceed it, but had to pay penalties for doing so.

Cuban-born players who are at least 25 years old, with six-plus years of experience in Serie Nacional, will maintain exemption from the international bonus pool, according to MLB.com's Jon Paul Morosi.

Roster size
No change. Teams will have 25-man rosters for the regular season, expanding to 40 in September. An expansion to 26-man rosters for April through August had been discussed in exchange for a smaller roster expansion in September, but that did not materialize.

Disabled list
The minimum time for a trip to the DL will be reduced from 15 days to 10, according to The Associated Press.

Other items of note
• Beginning in 2018, the regular season will begin in mid-week to create additional off-days during the schedule.

• According to the New York Post, incoming Major Leaguers will be banned from using smokeless tobacco, but current players will be "grandfathered in" and still be permitted.

THE KEYS TO THE DEAL

1. The All Star league winner for home field advantage in World Series has been a thorn on many teams sides for years.  The idea that the best team should have home field advantage during the playoffs makes the most sense and will have the biggest change in the new deal.

2. The shortening of the DL from 15 to 10 days will have operational consequences. First, it makes it easier to activate players with day to day soft tissue injuries. Second, it is a compromise between the concussion protocol and the old DL time frame. Third, it will add additional player travel cost moving players from minors to the majors. Fourth, it really gives starting pitchers a quicker avenue to get back to the big leagues (missing 2 starts instead of 3).

3. The free agent qualifying offer compensation is still a quagmire of exceptions. The new deal allows second tier free agents (normally players in their late thirties looking for a final 2-3 year deal) to reject a qualifying offer for a one year deal (for this year's amount of $17.2 million) in order to get a higher guaranteed sum in a 2 or 3 year deal below the $50 million threshold.

4. The owners lost out on an international draft, but gained additional funds for the large market teams to equalize with the small market clubs. The hard cap makes it harder for international free agents to big up their bonus demands. It also stops teams from spending Round 1 bonus dollars on foreign teenagers, which makes U.S. high school and college prospects more of a scouting priority.