Your Team’s New Trade Asset

For fans of Carlos Marmol, it’s been a confusing few days, even beyond the usual confusion baseline. On Tuesday, Marmol was shipped from the Cubs to the Dodgers. On Wednesday, there were initial reports the Dodgers were cutting ties, but now it’s clear they simply intend to send him to the minor leagues for a little while, in theory to get him “straightened out.” Marmol, at some point, should pitch for the Dodgers, and they have more interest in him than they had in the now-departed Matt Guerrier. Cynics will note that the solution to an inconsistent Brandon League isn’t adding another one, but if the odds are X% that League turns it around, the odds are greater that one of League and Marmol turns it around.

Of course, Marmol was just designated for assignment. There’s not a lot there, beyond the strikeouts, the frequency of which is plummeting. Since 2011, among pitchers with at least 150 innings, Marmol ranks 14th-worst in OBP allowed, at .355. He’s hanging around the likes of Dallas Keuchel and Derek Lowe and Edinson Volquez, and though Marmol generally limits batting and slugging, his career isn’t on the way up. Marmol, probably, can be useful, but since 2011 he has a 105 FIP-. Guerrier has a 109 FIP-. Lots of relievers can be useful and Marmol isn’t going to pitch the Dodgers into first place.

As far as this trade is concerned, it’s Marmol who’ll draw most of the attention. Marmol is a popular guy to discuss. But it seems clear to me the Dodgers don’t value him all that highly, what with the sending him right to the minors and all. What interests me more than the players is the money involved. According to reports, the Cubs will save something like $0.5 million, while the Dodgers will add something like $0.5 million. But the Dodgers also get the Cubs’ fourth international signing bonus slot, worth just about $0.21 million. It seems to me this is what the trade’s really about, and this is a new thing. As of Tuesday, there are new kinds of trades.

Tuesday was July 2, which meant the beginning of the new international signing period. For the first time, teams were allowed different amounts of money to spend, according to a slotting system shown here. Money from these pools can be traded between teams, but you can’t just trade a certain amount of dollars — teams are allowed to trade specific slot values. The Cubs basically traded the Dodgers slot number 92, worth $0.21 million. They did so in exchange for immediate salary relief.

There were three trades on Tuesday that involved international signing money, with the Cubs in on all of them. They gave up some money in their trade with the Dodgers, but they added to their pool by trading with both the Astros and the Orioles. To quickly recap:

Cubs <—> Orioles
Orioles get Scott Feldman, Steve Clevenger. Cubs get Jake Arrieta, Pedro Strop, $0.388 million for international spending.

Cubs <—> Astros
Astros get Ronald Torreyes. Cubs get $0.785 million for international spending.

Cubs <—> Dodgers
Dodgers get Carlos Marmol, cash considerations, $0.21 million for international spending. Cubs get Matt Guerrier.

They’re three different kinds of deals. In one, bonus money was given up to offset a big contract. In another, bonus money was picked up for a prospect. In the last, bonus money was picked up effectively as a prospect substitute. But what they all have in common is that teams exchanged bonus pool money, which we hadn’t before seen. Not that people didn’t know it was coming.

This is something available to all teams — if they like, they can try to add to their pools, and if they like, they can instead give it up. My understanding is that you can elect to trade away your entire pool. However, you can only add another 50%, which is to say, if you go in with $3 million, you’re capped at $4.5 million. If you go in with $2 million, you’re capped at $3 million. It’s going to take a little while for teams to completely figure out what they’re dealing with, but what we’re seeing now is a market being set. How much is this money worth? We have more of an idea today than we did on Monday.

We know, first of all, that a dollar isn’t a dollar. International signing money is valuable, specifically because it’s limited, and because there are penalties for over-spending. Even if you have a team that doesn’t intend to be internationally active, just because they don’t care about their money doesn’t mean other teams don’t. Other teams will want those slot values, creating demand. The Astros, for example, aren’t going to make any big international splashes, but they didn’t give their money away to the Cubs. They got a decent player in return.

The most difficult trade to analyze is the Feldman move, just because of the number of pieces involved. The Cubs came away with Arrieta, Strop, some millions in salary relief, and international spending money. Even without the spending money, it wouldn’t have been that bad of a trade. There’s value in salary relief, and there’s potential value in Arrieta, perhaps as a reliever. But the spending money basically takes the place of a low-level prospect.

The other moves are simpler. The Cubs directly exchanged Torreyes for $0.785 million getting added to their bonus pool. We can assume that Torreyes is valued at more than that, but we can’t put a dollar figure on him. He’s 20, making him one of the very youngest players in the Double-A Southern League. He’s a little second baseman with more walks than strikeouts, and barely any power to speak of. Torreyes hasn’t ranked on any top-10 prospect lists, but there’s potential in a young guy holding his own at an advanced level, and there’s more certainty in Torreyes than there is in international signings. Torreyes is only two levels away from the majors. He has value in a system.

And then there’s the last one. If you just cancel out Guerrier and Marmol, you’re left with an exchange of about $0.5 million for about $0.21 million of international spending money. It’s probably not going to get much clearer than this, with an international spending dollar being worth a little more than two ordinary dollars. In reality it’s more complicated than that, and we can learn only so much from how two of 30 teams value these resources at this time, but there’s all your necessary evidence that it’s not cash for equivalent cash. The Dodgers are taking on more salary than the boost to their bonus pool. For the Cubs, it’s the opposite. Though the Cubs clearly have prioritized international activity, those dollars have a price, even to them.

Clearly, international spending money is more valuable than regular money. This is because one can spend internationally only to a point, and those dollars are limited. This much, we could’ve guessed. But the difference in value isn’t extreme, because, ultimately, a lot of the time you’re talking about talented 16-year-olds who are as far from the majors as you can get while at least having a contract. The majority of the players signed during this period won’t go on to achieve much, since there’s a high flameout rate, and because of the risk this money isn’t a team’s most valuable asset. It’s just an asset, that we’re going to see get involved in a number of moves. There are trades of big-leaguers, and there are trades of prospects. If you want, you can think of these as trades of sub-prospects, faceless players who are a long ways away. When you spend internationally, you’re spending for the long term. But it’s critically important to look out for the long term, so this money won’t be exchanged without careful consideration.