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The Dish: Poor economy influencing trade decisions

By David Aldridge, TNT Analyst
Posted Feb 10 2009 7:17AM

A year ago, the Memphis Grizzlies were vilified by many around the NBA for seemingly giving Pau Gasol away to the Lakers to cut payroll.

A year later, a lot of teams are trying to do the very same thing.

Almost no one has picked up on the real story behind the shopping of Amar'e Stoudemire in Phoenix, and Tyson Chandler in New Orleans, and the impetus of many teams to be active before the Feb. 19 deadline. It has nothing to do with basketball, no matter what you hear about Amar'e's lack of defense and Chandler's history of injuries.

This year, the trade deadline is being influenced like never before because owners who've lost millions in the plunging U.S./global economy are determined not only not to be luxury tax payers, but to cut costs as much as possible as quickly as possible, with no intention of allowing their team's salaries to ever rise near the tax threshold in the foreseeable future.


A troubled U.S. economy could force the Hornets to deal Tyson Chandler.
Glenn James/NBAE/Getty Images

In the last week, I've heard of a half-dozen owners whose personal fortunes have been slashed significantly by the recession.

In one case, one employee of a team told me his boss has lost nine figures--more than $100 million--in personal wealth. In another, someone who's never been wrong in 10 years swears that another owner has lost $1 billion since the recession began. (Obviously, as I don't have each team's spreadsheet in front of me, or a month of free time to become an expert on tax shelter/tax write-offs policy, determining exact losses is an impossibility.) But owners aren't immune to the forces that have paralyzed the rest of the American economy.

"I don't think there's an owner in the NBA who hasn't lost money in this recession," one NBA team executive said Monday.

That reality has collided with the usual "one-player away" thought process that drives many deadline deals--a desire that should be even more acute this season, given the serious injuries to front-running teams like the Lakers (Andrew Bynum), Magic (Jameer Nelson) and Cavaliers (Delonte West and Sasha Pavlovic) that might make them more vulnerable down the stretch and in the playoffs.

"No question the economy is driving more basketball decisions," another team executive e-mailed. "Would hate to be a team dumping money while trying to remain competitive right now--everyone's trying to do it."

Enter the Hornets, with Chandler, who's got two years and $24.3 million left on his contract. It seems crazy for a size-challenged team like New Orleans to be shopping its only seven-footer, but the Hornets have made it clear, one of the execs said, that the goal in seeing what's available for Chandler is saving money. Which begs the question: if the Hornets are trying to save money now, when they're doing relatively well both on the floor and in the stands--three years removed from Hurricane Katrina--what would happen if the Bugs started going south at either end of the equation?

Make no mistake, it's happening league-wide. The already short-handed Bucks, having lost Michael Redd for the season and Andrew Bogut for two months, may still deal either Charlie Villanueva or Ramon Sessions before the 19th simply because they know it will be impossible to re-sign both of the rising free agents this summer--unless they can find someone to take Richard Jefferson. The Bulls have been shopping Andres Nocioni's remaining four years and $28.5 million as hard as they've offered Tyrus Thomas, Ben Gordon and Larry Hughes. And even though the Clippers have specifically denied it to me, I keep hearing they're still determined to repatriate Chris Kaman, figuring they can go 10-40 just as well without him as with his remaining three years and $33.9 million.

All of which must make Grizzlies owner Michael Heisley stifle a bit of a chuckle.

Heisley was raked over the coals last year when the Grizzlies insisted on expiring contracts, young players and draft picks for Gasol. The Lakers ultimately came up with now 24-year-old center Marc Gasol, guard Javaris Crittenton, a second-round pick in last year's draft and a 2010 first-rounder and Kwame Brown's expiring $9 million deal. (Memphis turned Crittenton into a future first from Washington in December.)

A year later, what is Suns president Steve Kerr looking for in exchange for Stoudemire?

Expiring contracts, young players and first-round picks.

"He's saying he has to get those things for a deal to be worth it," another team executive says. "I like the kid...but he does have serious flaws on the court for one...secondly, whoever trades for him has to accept that he could be walking in a little over a year from now (Stoudemire can opt out of his last year in 2010, when he's due to make $17 million)."

For his part, Heisley says other NBA owners are dealing with an economic system that he believes is not sustainable.

"We've got to be realistic," he said. "The only way for this league to really have financial viability across all of the teams is to have team revenue sharing like the NFL has...with current economic conditions and with the attendance and so on being what it is in Memphis, we're not going to indiscriminately spend millions and millions of dollars on players unless they take us deep into the playoffs."

Meanwhile, the haves, like Portland--whose owner, Paul Allen, still has a net worth of $16 billion or so after years of nine-figure losses, according to Forbes--still can make deals for basketball reasons. I'm told by a reliable source that the Blazers could lose another eight figures this season. But they'll still be active before the deadline and in the offseason.

The Blazers have the league's best expiring contract in Raef LaFrentz's $12.7 deal. (Yes, the Knicks have Stephon Marbury's $19 million contract, but at the glacial pace of negotiations on a buyout, no one on earth--save the New York Post, perhaps--believes Marbury will be bought out before the trading deadline. He may not be bought out before March 1, the deadline for setting playoff rosters. But that's another column.)

With insurance paying 80 percent of LaFrentz's salary this season, any team that picks him up for the rest of the season would receive, in essence, a cash benefit of almost $5 million. In this economy, that's huge.

Interest in LaFrentz "just went from about a two in the last month a to nine and a half," one Blazermaniac divulges, and the fact that having other teams read that is self-serving for Portland doesn't mean it's not true. The Blazers also have the kind of relatively inexpensive assets, from guards Jerryd Bayless and Sergio Rodriguez to swingmen Travis Outlaw and Martell Webster, to put in a package that would be attractive for any team looking to cut costs.

So, after threatening to sue any of its partners that had the temerity to sign Darius Miles, Portland could wind up playing financial savior for one of its lessers.

Life is not without its ironies.

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