Davis Signs With Baltimore (7/$161M, incl $42M deferred)

[Number5]

No one looks to be offering him a long term deal atm.

This.

Plus he and his agent probably took notice what hitting in OPACY did for Cruz the following winter.

[Machado13]

Would love to land cespedes short term. Let's hope either way they continue to add.

[WEAVERMAN]

Now that Davis has reached agreement, let's go out and get 2 SP. Fister and somebody else.

[24fps]

The true value of the contract is $161 million in January 2016 dollars. Davis' contract extends to 2037. No one has the slightest idea what the economic consequences of this contract will be much past 12 months from now. I'm not comfortable predicting the value of an invested dollar past a +/- 15% range over the next two weeks.

[Number5]

The true value of the contract is $161 million in January 2016 dollars. Davis' contract extends to 2037. No one has the slightest idea what the economic consequences of this contract will be much past 12 months from now. I'm not comfortable predicting the value of an invested dollar past a +/- 15% range over the next two weeks.

No, it really isn't. This is the total amount that will be paid over the entire time.

[MDtransplant757]

Would love to land cespedes short term. Let's hope either way they continue to add.

And add Latos.

[Teddy OBP]

Wonder how much this changes opinions about the deal?

It should change it a lot but you know how it goes...once a stand is taken there are often a bunch of rationalizations to justify keeping it.

Almost as though it makes sense to see all of the details before making a decision.

We went from $161M in 7 years and full NTC to what actually looks like a very favorable deal with only a limited clause. And from Boras stealing from the O's to DD and PA driving a pretty good deal.

[Teddy OBP]

My rough calculation assuming a 5% interest rate is that the present day value (compared to a straight $23 mm/yr) is only about $139-140 mm. Obviously, the interest rate assumption is key. The lower the rate, the less of a discount off the $161 mm.

So if rhe Treasury raises rates?

Industry standard is generally a 3% rate if you're looking at inflation as opposed to reinvestment rate, which is usually a bit higher. It's lower than that now but has been (sometimes much) higher in the past.

[24fps]

No, it really isn't. This is the total amount that will be paid over the entire time.

Amount is a number. The true value of a contract predicated on production that is likely to start significantly declining within the next three years but financed over the next 21 is a very difficult to predict. Rosy scenarios require a liberal application of snake oil. Perhaps another round of quantitative easing will help.

Is this what you meant to say?

[Number5]

Amount is a number. The true value of a contract predicated on production that is likely to start significantly declining within the next three years but financed over the next 21 is a very difficult to predict. Rosy scenarios require a liberal application of snake oil. Perhaps another round of quantitative easing will help.

Is this what you meant to say?

No, I meant to say that you are just plain wrong. $161 million paid over a period of years =/= $161 million today.

[24fps]

No, I meant to say that you are just plain wrong. $161 million paid over a period of years =/= $161 million today.

In an inflationary environment you would be correct.

[foxfield]

No, I meant to say that you are just plain wrong. $161 million paid over a period of years =/= $161 million today.

Ok 161 MM paid over a series of years. Lets say 25 years is not the same as 161 MM paid today.

Here is a little trick to prove it. If you think I am wrong please mail me a cashiers check TODAY for $10,000. Please give me your address as I will want to give your money back in 25 years. All $10,000 of it.

[crissfan172]

In an inflationary environment you would be correct.

I think you'd be looking at some historically unseen lack of inflation for the PV = FV.

[scOtt]

There are a lot of warning signs that Davis may not age too well. But that's a worry for the future. I don't like this deal in the long run. In the short run, I intend to enjoy the rest of Davis' prime years.

Exactly what I've been saying! Excuse my French shoot our wad now and deal with the end game later. We have a window to win championships NOW.

[schittenden]

MLBTraderumors.com

USA Today should talk to a tax attorney. MD is still going to tax the deferred money, as will every other state in which it was earned over the 7 years.

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