Saturday, May 10, 2008

The Franchise Fish

The Florida Marlins have reportedly opened up the purse strings, signing start shortstop Hanley Ramirez to a six-year $70 million extension. That is a great deal for the Marlins, as I'd say Ramirez will be worth around $20 million a year (he had a 7.4 WARP1 last year - Texas SS Michael Young recently signed a $16 million a year deal, and is about a 6 WARP1 player, so that's $2.67 million/WARP1 - 7.4 * $2.67 = about $20; plus is seems that his defense has been improving and he should be going into his peak, whereas Young is leaving his) and I think that figure is definitely on the low side, as there will be salary inflation and such. Also, this is a very simplistic way to value Ramirez - I don't feel like doing my due diligence.

In any case, for those six years he would get around ($20 * 40% for year one of arbitration = ) $8 + ($20 * 60% for year two of arbitration = ) $12 + ($20 * 80% for year three of arbitration = ) $16 + 3 * $20 = $96 million. Again, this is really a conservative estimate. Hanley's average annual salary of $11.667 million would place him fifth among shortstops, despite him probably being the top guy at the position. Even if he has to move to center field, Ramirez would still be getting paid less per year than Aaron Rowand. Great deal for the Marlins.

If Florida had to decide between signing Miguel Cabrera and Hanley, I think they made the right decision. If Ramirez really can become an average defensive shortstop, then his bat will be much more valuable than Cabrera's at first - and at half the total cost. Congratulations to Hanley on being set for life, and to the Marlins for locking up a franchise player. I guess this means that Nick should only take 6 years, $55 million (or seven/65, or such). Teams get good return by signing young players before they have to, and most of them are quickly realizing that.

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