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To Make Whole or Make Partial -- THAT is the question (CBA & Lockout Discussion) XXV

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11-10-2012, 02:23 PM
  #201
Alesle
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Quote:
Originally Posted by mossey3535 View Post
Ok here's some numbers. These are numbers by year from Capgeek. Fehr's numbers in this memo are in brackets. My numbers are higher so they should be considered to be a more conservative estimate.

2012: $1.8B committed. 13% = $229M (231)
2013: $1.4B committed. 13% = $176M (162)
2014: $0.9B committed. 13% = $119M (97)
2015: $0.7B committed. 13% = $88M (65)
2016: $0.5B committed. 13% = $60M (37)

If you add up the sum of the monies that would be 'made whole':

229 + 176 + 119 + 88 +60 = $673M

If you take off the last year, it's $613M ($592M Fehr). I'm going to assume now that where the $600M figure comes from.

What the NHL is saying right now then is that it will put $149M in the first year and $62M in the second year. With flat revenue growth and 5% growth thereafter, the split with these numbers is 54%, 51%, 50% - the much heralded 'soft landing'. Note that to get year 2 numbers I assumed that the league would spend 100% of the available cap space - which they should under a linked system.

Under this scenario, year 3 players split should be $1.75B but $900M would have come off the books since then so remaining big deals should fit under the TRUE 50/50 cap. This is a certainty because the player dollars removed in UFA are absolute - revenue would have to shrink drastically to not accommodate that drop, and new player contracts would be under the new CBA rules .

Now what Fehr should have said is this (and I have been advocating for this since Make Whole came out) - guarantee that we will be made whole for any year in which 'old' contracts do not fit under the cap. We would be playing hockey right now.

Instead he says - well we don't get everything back (even though everything is guaranteeing money that doesn't need to be guaranteed) so let's go with de-linked again! Huzzah!
You numbers fit well with what I posted in the last thread. I also agree with your assessment regarding what Fehr should do.

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11-10-2012, 02:24 PM
  #202
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Originally Posted by Mr Wu View Post
Hockey players know where snow is. Buisnessmen seem to forget.
It snows in a Alaska! Let's put a franchise there!!!

Being warm or cold should literally have zero affect on whether a market is a viable hockey market.

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11-10-2012, 02:24 PM
  #203
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Originally Posted by Alesle View Post
12/13*13/1414/1515/1616/17
NHLPA offer 5M 5M 5M 5M 5M
NHL offer with 7 % growth 5M 5M 5M 5M 5M
NHL offer with 5 % growth 5M 5M 5M 5M 5M
NHL offer with 3 % growth 4,9M 4,8M 4,9M 5M 5M
NHL offer with 1 % growth 4,8M 4,6M 4,5M 4,6M 4,6M
NHL offer with 0 % growth 4,8M 4,5M 4,4M 4,4M 4,4M
*Assuming full season
And it's fair to assume there will be a couple years with 5% growth(not all, I'm sure some will only have 1-3% growth).

so really, we're not talking a huge monetary difference here, maybe a tiny loss year 1, but most definitely will be back at even by year 3-4.

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11-10-2012, 02:25 PM
  #204
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Dale Arnold ‏@DaleEArnold
Was told of an #NHL team that will MAKE $2 million if no season, and LOSE $20 million if season resumes. That's why Bettman has clout.

This again just shows that the NHL has ALL of the leverage here and is in no rush to get a season going.

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11-10-2012, 02:26 PM
  #205
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Although it is funny that the team in question is probably one of the southern teams that Bettman forced into existence.

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11-10-2012, 02:27 PM
  #206
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I would love it if it were legal for the NHL to say alright here is what we will do, 50/50 right away with make whole with 2 years interest, revenue sharing, pensions, etc.

And anyone who doesn't want a paycut with make whole can have their contract voided and free to sign with another league without facing IIHF issues.

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11-10-2012, 02:31 PM
  #207
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Guess no meeting today. sigh
Steve and Daly are meeting right now

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11-10-2012, 02:32 PM
  #208
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Originally Posted by Bruins71 View Post
Dale Arnold ‏@DaleEArnold
Was told of an #NHL team that will MAKE $2 million if no season, and LOSE $20 million if season resumes. That's why Bettman has clout.

This again just shows that the NHL has ALL of the leverage here and is in no rush to get a season going.
Yeah.. I'm not sure if I buy that math...

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11-10-2012, 02:32 PM
  #209
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Okay, so we now know a large portion of the nuts and bolts of what is on the table from the NHL.

Let's look at these very large numbers ona bit of a smaller scale.

What happens to NHL playerJohnSmith's contract? On July 2nd 2012 he signed a five year deal worth twenty five million bucks. It pays him five million in each of the five years. There is no bonus money involved. Straight salary.

What does his pay look like each year according to the NHL's projected numbers?

What does his pay look like each year according to the NHLPA projected numbers?
Quote:
Originally Posted by Alesle View Post
12/13*13/1414/1515/1616/17
NHLPA offer 5M 5M 5M 5M 5M
NHL offer with 7 % growth 5M 5M 5M 5M 5M
NHL offer with 5 % growth 5M 5M 5M 5M 5M
NHL offer with 3 % growth 4,9M 4,8M 4,9M 5M 5M
NHL offer with 1 % growth 4,8M 4,6M 4,5M 4,6M 4,6M
NHL offer with 0 % growth 4,8M 4,5M 4,4M 4,4M 4,4M
*Assuming full season
Thank you!

So why aren't we playing NHL games?

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Old
11-10-2012, 02:32 PM
  #210
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Quote:
Originally Posted by Alesle View Post
12/13*13/1414/1515/1616/17
NHLPA offer 5M 5M 5M 5M 5M
NHL offer with 7 % growth 5M 5M 5M 5M 5M
NHL offer with 5 % growth 5M 5M 5M 5M 5M
NHL offer with 3 % growth 4,9M 4,8M 4,9M 5M 5M
NHL offer with 1 % growth 4,8M 4,6M 4,5M 4,6M 4,6M
NHL offer with 0 % growth 4,8M 4,5M 4,4M 4,4M 4,4M
*Assuming full season
Close, but no. For a guy whose contract does not expire, he is GUARANTEED his money under make whole.

So this guy is under contract for 5 years. At 3% growth, the 50/50 cap split in Year 3 is $1.7B. Meanwhile, at this time only $900M of contracts are still committed, including this hypothetical player. He will get paid first, including deferments under Make Whole from the first two years. So his pay should go down in years 1 and 2 and then go up in years 3-5 when he gets his deferred payment.

It's all the other guys who are not under contract who will suffer - the money paid to this guy will be now unavailable to UFA's. Under 3% growth the player share doesn't get back to $1.8B until year 5 so it will be suffering for UFA's for a long time.

Again, here is Kopitar's situation with REAL numbers:

Kopitar (face value, old CBA): $6.8M + $6.8M + $6.8M + $6.8M = $27.2M

Kopitar (NHL 50/50): $5.9M + $6.2M + $7.5M + $7.5M = $27.2M


Under no circumstances will Make Whole reduce the total of the face value of the contracts. ALL it does is put off paying the money owed.

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Old
11-10-2012, 02:33 PM
  #211
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Ideal situation: a bunch of filthy rich investors/hockey fans get together and bring back the WHA, meanwhile the NHL cancels another season and eventually folds for good.

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11-10-2012, 02:33 PM
  #212
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Quote:
Originally Posted by NathanSeguin View Post
It snows in a Alaska! Let's put a franchise there!!!

Being warm or cold should literally have zero affect on whether a market is a viable hockey market.
Well, actually it does and it should. People in colder climbs where it snows and there is the possibility for ice outside are far more likely to embrace hockey as a pastime and a love. Why? Economics (being able to play without renting ice, all you need as a kid is skates a stick and a puck) and lack of activities for 4-6 months of the year (obviously kids in warmer places can do all of their summer activities: basketball, skateboarding, beach, etc. etc.)

Saying it should have zero effect on market viability is a little short-sighted imho. However, having said that, it isn't the end all and be all. If you are willing to build the sport up at a grassroots level, then you have a shot. Kids in colder places grow up playing the sport and worshipping their heroes. They end up becoming consumers of the NHL. It's a cycle.

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Old
11-10-2012, 02:34 PM
  #213
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Originally Posted by Gberg View Post
Yeah.. I'm not sure if I buy that math...
Well, you're wrong. The fact is that there are quite a few NHL teams who stand to be more profitable from a canceled season than a season being played.

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11-10-2012, 02:35 PM
  #214
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Quote:
Originally Posted by mossey3535 View Post
Ok here's some numbers. These are numbers by year from Capgeek. Fehr's numbers in this memo are in brackets. My numbers are higher so they should be considered to be a more conservative estimate.

2012: $1.8B committed. 13% = $229M (231)
2013: $1.4B committed. 13% = $176M (162)
2014: $0.9B committed. 13% = $119M (97)
2015: $0.7B committed. 13% = $88M (65)
2016: $0.5B committed. 13% = $60M (37)

If you add up the sum of the monies that would be 'made whole':

229 + 176 + 119 + 88 +60 = $673M

If you take off the last year, it's $613M ($592M Fehr). I'm going to assume now that where the $600M figure comes from.

What the NHL is saying right now then is that it will put $149M in the first year and $62M in the second year. With flat revenue growth and 5% growth thereafter, the split with these numbers is 54%, 51%, 50% - the much heralded 'soft landing'. Note that to get year 2 numbers I assumed that the league would spend 100% of the available cap space - which they should under a linked system.

Under this scenario, year 3 players split should be $1.75B but $900M would have come off the books since then so remaining big deals should fit under the TRUE 50/50 cap. This is a certainty because the player dollars removed in UFA are absolute - revenue would have to shrink drastically to not accommodate that drop, and new player contracts would be under the new CBA rules .

Now what Fehr should have said is this (and I have been advocating for this since Make Whole came out) - guarantee that we will be made whole for any year in which 'old' contracts do not fit under the cap. We would be playing hockey right now.

Instead he says - well we don't get everything back (even though everything is guaranteeing money that doesn't need to be guaranteed) so let's go with de-linked again! Huzzah!
So is the NHL making a fair offer in your opinion?

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11-10-2012, 02:35 PM
  #215
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Quote:
Originally Posted by Mr Wu View Post
Hockey players know where snow is. Buisnessmen seem to forget.
Snow is required for hockey? I thought it was a game largely played indoors

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11-10-2012, 02:36 PM
  #216
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Quote:
Originally Posted by Bruins71 View Post
Ideal situation: a bunch of filthy rich investors/hockey fans get together and bring back the WHA, meanwhile the NHL cancels another season and eventually folds for good.
Here's ideal: They get together all week, strike a deal in principle, call the players back from europe, one week camp with one or two preseason games and start the season for US thanksgiving.

More probable than your ideal and so not complicated it's scary.

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11-10-2012, 02:38 PM
  #217
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After the lunch today the NHL/PA will decide when they will meet next.

If they get back to the table after yesterdays so called "debacle" then there is still a chance.

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11-10-2012, 02:41 PM
  #218
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Quote:
Originally Posted by Bruins71 View Post
Dale Arnold ‏@DaleEArnold
Was told of an #NHL team that will MAKE $2 million if no season, and LOSE $20 million if season resumes. That's why Bettman has clout.

This again just shows that the NHL has ALL of the leverage here and is in no rush to get a season going.
Phoenix? I don't buy that argument because teams like the Rangers and Maple Leafs stand to lose a lot of money if there is no season.

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11-10-2012, 02:42 PM
  #219
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Originally Posted by Tra La La View Post
So is the NHL making a fair offer in your opinion?
Fair has nothing to do with it. I don't give two craps about fair. I think the players should be paid their face value (however, I don't care how it is accomplished so I am ok with escrow, etc), and that they should minimize the amount of games and salary lost to them.

This CBA will offer no deterrent for future lockouts, and will not benefit future players unless the term of the deal is >8 years and allows the team to achieve league-wide financial stability.

In financial terms, it is a no-brainer for the players to fight for maintenance of UFA rights (which is arguably their only contribution to future players) and take the Make Whole deal as stands with provisions for additional years of Make Whole if there are years with low revenue growth.

Take all the rest of the philosophical BS and shove it. The only person who cares about fair is Fehr, and he only cares about it because it's about him - not the players.

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11-10-2012, 02:42 PM
  #220
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Originally Posted by crapeze11 View Post
Phoenix? I don't buy that argument because teams like the Rangers and Maple Leafs stand to lose a lot of money if there is no season.
I think in subsequent tweets Arnold stated that it'n not Phoenix. If I had to guess I'd say maybe Florida or the Islanders.

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11-10-2012, 02:46 PM
  #221
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Snow is required for hockey? I thought it was a game largely played indoors
It's far more complex than that. It's like how baseball or football is in the States. It is bred into the population. It is part of the fabric. It is that way because you grow up playing it and loving it.

I am not one who believes all Southern franchises are failures... the experiment is dead, yadda yadda. I've been to Nashville, watched games. The sport is alive and well there. However, it wasn't always that way. They needed to build it. Nashville is also lucky in that there is only one competing major pro team and they only play once a week during about half the Preds season.

It`s not that it`s necessary to have snow to have a successful pro hockey franchise, its just that it helps because the grassroots is there.

At any rate I am hijacking the thread so I will stop

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11-10-2012, 02:47 PM
  #222
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Originally Posted by crapeze11 View Post
Phoenix? I don't buy that argument because teams like the Rangers and Maple Leafs stand to lose a lot of money if there is no season.
Sure, collectively the owners will lose money but not nearly as much as the players. And, a dollar lost to an owner doesn't hurt as much as a dollar lost to a player. This speaks to leverage.
+
There are no players who are making more money today now that there is a lockout (unless Campoli is getting paid for his work in the PA).

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11-10-2012, 02:47 PM
  #223
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Puckdaddy article about Fehr's negotiation strategy.

The only time Fehr really seemed bothered was when NHL refused to talk. He loves to sit in negotiations and do everything to prevent progress to gain concessions, it seems.

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11-10-2012, 02:48 PM
  #224
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I don't know if anyone here is pro-players anymore.
The players proposal to lower salaries: give us raises! There shouldn't be any support left for the players in this mess. They've given the same proposal 4 or 5 times now. Fehr has injected so much uncertainty in this negotiation that we may lose another season over small potatoes when compared to the issues of 2004. The players remind me of that picture of a cowboy riding a giant bomb.

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11-10-2012, 02:49 PM
  #225
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I think in subsequent tweets Arnold stated that it'n not Phoenix. If I had to guess I'd say maybe Florida or the Islanders.
Could be Carolina, they threw around so much money this offseason and they don't have great revenue streams or attendance. Wouldn't shock me with the NHL's willingness to sign deals on July 1 they don't intend to honor on September 15 if it was one of the teams that spent a lot this offseason (though not Minnesota cause they will have sellout crowds).

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