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Can the Matt Holliday trade be judged now?

Now that the Cardinals have agreed to terms with outfielder Matt Holliday on a record-setting new contract, is the jury in on the big trade that brought him to St. Louis in the first place?

Matt Holliday and John Mozeliak, 07/24/09In reaction to the mass emotion exhibited at the time of the St. Louis Cardinals’ July 24 acquisition of Matt Holliday and $1.5 million from Oakland in return for Brett Wallace, Clayton Mortensen and Shane Peterson, I wrote an article entitled, “Will the Holliday trade be good, bad or neutral?”

In it, I tried valiantly to remove the initial excitement, whether positive or negative, and develop a structured, rational view of how I would consider the trade, both that day and over the long haul. The idea grew out of a long discussion with the Post-Dispatch’s Derrick Goold in the press box of Philadelphia’s Citizens Bank Park that evening.

To that end, I prepared a detailed decision tree with multiple conditions. We now have two of the three answers to my questions:

  1. Win the 2009 World Series – no
  2. Holliday re-signs below market value – no
  3. One or more of the traded players become a star – TBD
    • If yes, my score will be that the trade was bad.
    • If no, my score will be that the trade was neutral.

Let’s take the points in order.

1. The Cardinals did not win the World Series. I doubt anyone would disagree that the driving force behind the trade was to improve the team in 2009. One step was to get the club into the post-season, then once there, improve their chances of going all the way.

For me, it wasn’t good enough to just make the playoffs. Though the Cardinals were in first place at the time of the trade, their lead was tenuous. No doubt Holliday played a key role in the 36-24 (.600) record posted by the club after his arrival. Yet the team went three and out in the NLDS, losing the pivotal second game on a Holliday error.

2. Holliday clearly did not sign below market value. That means the Cardinals conceivably could have pursued him just as doggedly this winter had they not traded for him first. Offering him $120 million was just as possible had he reached the open market as a most recent member of the A’s or wherever else he might have been traded last summer instead of St. Louis. One thing we know about agent Scott Boras is that he takes his players to free agency, no matter what team they are on or how much that club wants the player back.

There would have been an additional cost in losing their first-round 2010 draft pick for signing Holliday in that manner, but the Cardinals would still likely be ahead in the prospect side of the equation because they would still have the three players traded for Holliday.

Though supposedly disavowed by Holliday earlier in the fall, the Cardinals may have achieved some re-signing benefit through the comfort and familiarity Holliday gained as a player with the Cardinals and his family achieved in being a part of the organization. Was that the game-changer? Asking Boras, I can bet his answer would be “no”. In reality, it probably mattered, but not in a measurable manner.

Since we are talking about money, I want to delve into the terms a bit, as I am seeing a lot of mixed reports.

As I believe from multiple sources, there is a $17 million per year salary with $2 million deferred annually without interest. The eighth year at $17 million vests if Holliday places among top ten in NL MVP voting in year seven or there is a year eight buyout for $1 million. Full no-trade protection was provided.

The deal is stated as seven years/$120 million and could grow to eight years/$136 million. I have not seen mention of the deferral timeframe, but the AP said the present value of the deal is about $16 million.

Update: The AP has published the final details:

The Cardinals must decide whether to exercise the 2017 option within five days of the end of the 2016 World Series. As already noted, the option would become guaranteed if Holliday finishes among the top 10 in 2016 NL MVP voting.

Depending on whether the option is exercised, Holliday will receive $1.4 million or $1.6 million each July 15 from 2020 until 2029.

Holliday receives a full no-trade provision, a hotel suite on the road and the same award bonus opportunities that Cardinals teammate Albert Pujols has: $50,000 for election to the NL All-Star team, $25,000 for All-Star selection, $50,000 for division series MVP (an award that doesn’t yet exist), $100,000 for league championship series MVP, $150,000 for World Series MVP, $200,000 for NL MVP and $50,000 each for Gold Glove and Silver Slugger.

Let’s consider the winners and losers.

Boras originally wanted eight years, $180 million. It was alleged he later dropped his expectations to $18 million per year. Since the Red Sox reportedly offered Holliday $16.5 million per year and Jason Bay received that same average annual value (AAV) from the Mets, it provided the lower ceiling. It only seemed logical that the Cardinals could not skate by paying less than $16.5 million per year.

Like in Teixeira’s deal, Boras did not settle for lower annual values in the later years of the contract.  Therefore, Boras’ wins were there and in the term of the contract, as he ended up with seven, perhaps eight years.

The Cardinals seemed to want to hold to five years and around $16 million early on. Once they were willing to go seven or eight years, they were penned in.

Buster Olney from ESPN is one of the many questioning the deal, quoting a rival GM who said this, “They (the Cardinals) look like they spent about $30 million more than they needed to.”

To me, the viewpoint seems off base, as the AAV factor was not separated out from the number of years factor. I believe the former to be reasonable. What the other GM should have said is “The Cardinals look like they went two years too long, compared to other bidders.” That, I could understand, though the hotly-disputed rumor of Baltimore’s mystery bid of eight years, $130 million guaranteed may have been leaked to head off that avenue.

On one hand, paying $17 million for a 36- or 37-year-old outfielder is concerning. On the other, what will the 2017 market be like? What will $17 million in 2017 money buy? Will it be a bad contract then? Only time will tell.

Now to the final question.

3. Will any of the traded players become a star? It is still far too early to know.

Wallace has the best chance, but has been traded again and seems destined for first base, rather than third. His value is down since July 24. Mortensen had a very rough debut for the A’s, but it is still too soon to gauge. After the trade, Peterson continued to post a .730-ish OPS in the Texas League, a good home for hitters. He lacks size along with punch.

In summary:

  • Taking everything into account, if one of the three traded players becomes a star, I would consider the July Holliday trade gamble to have been a bad deal for the Cardinals.
  • If none of the three traded players come through, I will call the Holliday trade a wash.

Don’t get me wrong. I applauded the Cardinals for their bold move and still do. If the World Series was the objective, which I think it should have been, it was not achieved, however. Ultimately, the effort must be judged by the end result.

Assuming his new no-trade clause is not bought out later, Holliday will remain a Cardinal for the next seven or eight years. I believe that to be a good thing overall, but the trade itself may not have been the best precursor to secure the long-term contract.

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Brian Walton

Brian Walton runs The Cardinal Nation and The Cardinal Nation Blog, covering the St. Louis Cardinals and minor league system.
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