The following is a brief explanation of the two trade deadlines in Major League Baseball: the non-waiver trade deadline of July 31st, and the waiver trade deadline of August 31st. What follows is a real conversation – not edited for content, spelling, or grammar – between a friend (SS) and me (AD):
SS: i dont understand something....isn't the trade deadline over? b/c i thought i heard about two guys getting moved this week?
or is it if they are traded after the deadline they can't play in the playoffs?
AD: there are 2 trade deadlines
july 31 is the non-waiver trade deadline, meaning any team can trade any player to any team without restrictions
from august 1 to august 31, players can still be traded, but must pass through waivers first
so, if you wanted to trade brad lidge today, you'd have to put him on waivers
waiver priority is determined by divisional standings....AKA, the nationals would get first crack at him if they claimed him (they would have priority over say, florida, or pittsburgh)
SS: but wait
cant the team not trade to them?
like what if nationals aren't offering what they want?
AD: if washington claims lidge, the phillies have 3 options: release lidge for nothing; trade him to washington and only washington; or, pull lidge off waivers. if lidge is pulled back after washington claims him, then lidge is no longer eligible to be traded at all to anyone for the remainder of the season
if washington gets lidge, they are responsible for the remainder of his contract
so, in 2003 when the red sox put manny ramirez and his $20 million annual salary on waivers, not a single team claimed him
because they didn't want to assume his contract
SS: ok
AD: virtually every major leaguer is placed on waivers in august
and virtually every one is pulled back
for a player to qualify for a playoff roster, he has to be on his new team by August 31
so, august 31 is the last day a player can be traded
waiver trades DO happen EVERY year
SS: ok, i got it...kinda
enough to get by
haha
AD: thats why july 31 is so important
SS: right
AD: if the phillies wanted to trade ryan howard and get maximum value for him, they would want to be able to trade him to the highest bidder
but the waiver process allows teams to "block" other teams
like if lidge got on waivers
SS: so we put lidge on waivers....nats say we want him....we have to either work out a trade or pull him back...making him inelligble for any other trade
AD: its possible washington would ONLY claim him to keep him away from atlanta
we could also simply release lidge to washington without getting anything in return...with the catch being that washington has to pay the remainder of lidge's contract
SS: i dont much see the point in that but i dont really know to much about how their finances work
i get football more
AD: see the point in what? blocking?
SS: putting him on waivers and not trading, just releasing
is it just to see if you can do a trade?
AD: oh....well a recent example of that is alex rios
alex rios was an outfielder for toronto
he had a big year in like 2006 or something and the jays signed him to this INSANE contract that paid him like $15 mill a year
which is close to the top of the sport
rios has NOT performed to the level of his contract, by any stretch of the imagination
the blue jays are losing a SHITLOAD of money this year
so, the jays placed rios on waivers
the white sox claimed him
toronto let him walk for nothing........where nothing is a positive cash flow of the prorated portion of $15 million this year PLUS teh remaining years of the contract
by "releasing" rios to chicago, the blue jays saved themselves about $45 million bucks
so, they're not getting "nothing"
what they are getting is financial flexibility
SS: but what is the difference between just doing that and cutting him
or is that like cutting him
AD: well, here's the thing
its not like rios is terrible...he still has value
if a team wants to "cut" a player, they call it "designated for assignment"
when a player is DFA
the team has 10 days to trade him, send him to the minors (if eligible), or give him his outright release
SS: ok so if no one claims him....he's a free agent?
AD: within those 10 days, its possible that NO team would try to trade for the player, because they know they can simply sign him as a free agent at the end of the 10 day period
SS: ok
AD: so a waiver trade GUARANTEES that you will be able to at least TRY to get something back
SS: so now....chi is stuck with him in that contract though?
AD: yes but they wanted him
SS: right
AD: they need a CF for the next few years and the data indicate that rios is having a "down " year
SS: so their reward is not having to compete for him as a FA
AD: chicago's reward is they got a really good outfielder and they didn't have to give up any assets
chicago is a big market...more money....can afford a bigger salary
SS: just pay him a lot
right
AD: exactly
SS: ok i get it
Labels: Alex Rios, Atlanta Braves, Brad Lidge, Chicago White Sox, Flordia Marlins, MLB, Philadelphia Phillies, Pittsburgh Pirates, Ryan Howard, Toronto Blue Jays, trade deadline, Washington Nationals