Baseball trade deadline - some thoughts

The major league baseball trade deadline comes up on Sunday, so it seems to be as good a time as any to put together some thoughts on a how a team should proceed.  For teams like the Yankees and Red Sox, of course there really isn’t a decision; you’re always in the market to add.  The following is from the perspective of the Minnesota Twins but is applicable to other teams of similar means:

1. Let’s start with the most controversial.  I take it that as a GM your first obligation is to the owner and that the benefits of winning a championship are less than the costs of being really bad.  This is an insight from behavioral economics; that the cost benefit curves aren’t the same (losing five dollars makes you feel worse than finding five dollars makes you feel good).  Interest in a club is something of a habit which is formed over years of being in contention.  Re-establishing interest after you’ve been really bad for a couple of years is really difficult both on the field (players will gravitate towards success) and with fans.  See Twins, World Series champions in ’87 and ’91 and the talk of contraction (end of the 90’s ???)
2. Supply and demand applies to baseball just like everywhere else.  Teams are going to be extremely reluctant to give up on a season by being sellers when there is still a good share of that season to be played (neither the players or the fans are going to be happy with you).  In general I’d say there are likely to be more potential buyers than sellers, which means it will be a sellers market.
3. A typical deal involves the buyer trading future prospects for a current asset, usually at a pretty steep discount rate.  It follows from the present for future aspect of these trades that the more of these you make--that is the more consecutive years you’re a buyer--the more likely it is that your future success will be imperiled.  See point #1
4. Even the really good deadline/mid-season deals should give you pause.  In ’84 the Cubs picked up Rick Sutcliffe who pitched them to the playoffs.  But they gave up a young Joe Carter.  In effect the Cubs traded Joe Carter’s career for a few good seasons from Sutcliffe.  Similarly, in ’87 the Tigers picked up Doyle Alexander whose pitching allowed them to squeak by the Blue Jays to win the AL East (they lost to the Twins in the AL playoffs).  A great deal for the Tigers, except that they traded John Smoltz to get him.
5. Beware of what I would call the weak division trap.  This is when you are in contention not because you’re an especially good team or because you’re having a good season but because you are in a bad division.  The Twins this year are a perfect example of this.  They are 5.5 games out at the moment, but look at their record and the breakdown by division:

	Wins	Loss	Total	Win %
AL East	8	19	27	0.296
AL Central	22	17	39	0.564
AL West	12	10	22	0.545
National	8	10	18	0.444
	50	56	106	0.472

Against the current playoff teams the picture isn’t any brighter:

	Wins	Loss	Total	Win %
Tigers	1	8	9	0.111
Red Sox	1	3	4	0.250
Yankees	1	2	3	0.333
Rangers	4	3	7	0.571
	7	16	23	0.304

The Twins run differential is -82 the worst in the division, across all of baseball only the Astros, Cubs, and Orioles are worse.  So yes, at 5.5 games back you’re in contention, but you aren’t good.  The latter should take precedence.

According to today’s Minneapolis Star & Tribune the Twins are currently buyers rather than sellers.  I can see why the Twins officials would say that to the public.  I just hope they’re not telling the truth.