On Tuesday, Rany Jazayerli posted an article on Grantland entitled The MLB Prospect Bubble. The thrust of the piece was that teams who trade veterans for prospects are no longer getting top prospects in return. This certainly feels like it’s true. In 2007, players like Danny Haren and Mark Teixeira brought back giant hauls of value, while more recently Cliff Lee was twice traded for a few middling prospects. One of Jazayerli’s examples is the recent trade of Trevor Cahill, a young player with at least four more cost-controlled years left on his deal, for only one real prospect (and two throw-ins).
Is it true, though? Mat Latos (another young pitcher with 4 years of team control left) just got shipped from San Diego to Cincinnati for 2 top prospects, a useful veteran in Edinson Volquez and a throw-in (Brad Boxberger) who was better than either of the two in the Cahill trade. Maybe some teams value prospects more than others. Or maybe some general managers are just bad at making trades and give up too much value.
Rany focuses on five deals, two from this offseason and three more from the past four years. Though, he names the last decade as when prospects started increasing in value, he specifically cites the July 2007 trade of Mark Teixeira from Texas to Atlanta and the spectacular success of the prospects included (Jarrod Saltalamacchia, Matt Harrison, Elvis Anrus and Neftali Feliz) as a second turning point and the time when prospects really started being overvalued.
To try and suss out whether this is true or not, I will attempt to go over (briefly) every trade since then which included major league players on one side and top prospects on the other. I will try to find out if prospects are now being systematically overvalued and if so, when was the real turning point. (All prospect ranking come from Baseball America unless otherwise noted).
December 3, 2007 – Arizona traded outfielder Carlos Quentin to the Chicago White Sox for first baseman Chris Carter. Carter was not one of the top 100 prospects in the game. He ended up ranking 10th on the A’s list, which might have made him one of the top 200. Quentin was coming off a very disappointing injury-filled campaign, but was a year removed from being a premier talent and still should have been worth more than that. Prospect clearly overvalued in this trade, but is it the start of a trend?
December 5, 2007 – Florida traded pitcher Dontrelle Willis and third baseman Miguel Cabrera to the Detroit Tigers for outfielder Cameron Maybin, catcher Mike Rabelo and pitchers Andrew Miller, Burke Badenhop, Eulogio De La Cruz and Dallas Trahern. A huge return for one of the top talents in the game (and the D-Train). Maybin was the #6 prospect in the game and Miller was less than a year and a half removed from being the top amateur talent in the nation. The three pitching prospects were also fairly well regarded. No evidence that as of yet prospects were being overvalued, this was widely considered a very fair trade.
December 12, 2007 – Houston traded outfielder Luke Scott, pitchers Troy Patton, Matt Albers and Dennis Sarfate and third baseman Mike Costanzo to the Baltimore Orioles for shortstop Miguel Tejada. Albers and Patton were top Astros prospects and Scott himself may have been more valuable than Tejada by this point. Prospects clearly undervalued here, but Ed Wade made a bad deal so it can’t really be counted one way or another. This trade really blew up when Tejada was named as a former steroid user just hours after it went down.
December 14, 2007 – Oakland traded pitchers Dan Haren and Connor Robertson to the Arizona Diamondbacks for pitchers Brett Anderson, Dana Eveland and Greg Smith, outfielders Aaron Cunningham and Carlos Gonzalez and infielder Chris Carter. Clearly falls on the prospects are undervalued side of things. Anderson (36) and Gonzalez (22) were top prospects and Carter was worth Carlos Quentin. Cunningham also had value at the time, though the pitchers were pretty much throw-ins. With the way Anderson and Gonzalez panned out (Gonzalez after another trade), even though Haren was better than could have possibly been expected, it was still an overpay. It’s clear here that prospects are not yet being overvalued.
January 3, 2008 – Oakland traded outfielder Nick Swisher to the Chicago White Sox in exchange for pitchers Gio Gonzalez and Fautino De Los Santos and outfielder Ryan Sweeney. Swisher was a very good player with three years and an option left on his contract, but the return, two top pitching prospects, was too much for A’s GM Billy Beane to pass up. Again, a lot of young talent is given up here.
February 2, 2008 – Minnesota acquired OF Carlos Gomez, RHP Philip Humber, RHP Kevin Mulvey and RHP Deolis Guerra from the New York Mets for LHP Johan Santana. This is Rany’s earliest example and is a clear case of prospects being overvalued. Gomez and Humber were already verging on being big league busts and Mulvey wasn’t well regarded. That it only took one lottery ticket (Guerra) to get a year of the best pitcher in the game is clear evidence that prospects are overvalued here. But let’s take a step back. Two months earlier, Twins GM Bill Smith almost closed a deal with Boston for Jon Lester, Coco Crisp and another Red Sox prospect. He also had offers from the Yankees containing Phil Hughes. Lester and Hughes were top young talents, no longer prospects, and would have been good returns for Santana. (Lester turned into an ace, Hughes is still developing). Smith tried to play the Sox and Yankees against each other and ended up losing both. He settled for a bad deal, but was it a sign of a changing climate within the game?
February 8, 2008 – Orioles acquired OF Adam Jones, LHP George Sherrill, RHP Chris Tillman, RHP Kam Mickolio and LHP Tony Butler from the Seattle Mariners in exchange for LHP Erik Bedard. Another trade in which prospects are not being overvalued. When healthy, Bedard was an elite talent, but he was already having serious injury problems and was just off his best season by far. He still netted a large return, Tillman was a top prospect and Jones would have been but for a few too many MLB at-bats. Mickolio was highly regarded as a future closer and even George Sherrill had some value. Again, it’s not really fair to count this against the prospects being overvalued side, though. Bill Bavasi was a bad GM who got swindled; this one goes with the Tejada to Houston one as not being valuable evidence.
So, in that offseason, we have two trades (Johan Santana and Carlos Quentin) where prospects are being overvalued, two (Haren, Swisher) where they are being undervalued, one (Cabrera) that is fair, and two (Tejada, Bedard) where one GM got taken for far too much. Nothing to determine yet, let’s move on to the 2008 regular season.
July 7, 2008 - Milwaukee acquired LHP C.C. Sabathia from Cleveland for OF Matt LaPorta, LHP Zach Jackson, RHP Rob Bryson and OF Michael Brantley. When analyzing this trade, one has to consider that there was no chance Sabathia would re-sign with Milwaukee, so there were paying for three months (plus postseason) of him. Put into that context, it seems like a fair trade. LaPorta was the pre-season #23 prospect in baseball and Brantley had value too. Sabathia went on an insane run, picking up Cy Young votes despite the half-season and LaPorta never really developed, so the trade looks worse in hindsight, but it was a good deal for Cleveland at the time.
July 17, 2008 – Philadelphia acquired RHP Joe Blanton from Oakland for SS Adrian Carednas, LHP Josh Outman and OF Matt Spencer. Blanton was well regarded as a pitcher, but never actually that good. He pitched in the Coliseum in front of a good infield defense and his reputation increased more because he was one of the successful “Moneyball” draftees. Considering his actual quality, getting two of the Phillies top 4 prospects for him was a nice deal. Cardenas (76) never panned out and Outman’s been injured almost constantly, but the strategy at the time was clearly to acquire prospect talent. At this point, Billy Beane and Oakland have successfully traded three players (also Swisher and Haren) for minor league talent and are building a huge base of it.
July 27, 2008 – Yankees acquired OF Xavier Nady and LHP Damaso Marte for RHPs Ross Ohlendorf, Daniel McCutchen and Jeff Karstens and OF Jose Tabata. This is an odd trade. The Yankees acquired two complementary players and gave up a top prospect in Tabata (pre-season #37). Either the cost of role players has gone down since then, or GM Brian Cashman wildly overpaid, but it’s not often that you’ll see real talent (Ohlendorf was a valuable piece too) moved for mediocrity.
July 27, 2008 – Dodgers acquire 3B Casey Blake from Cleveland for C Carlos Santana and RHP Jon Meloan. If there is an argument to be made that prospects are still undervalued, then this trade is it. Though his trading (and in fact GMing) career has been mostly successful, Dodgers GM Ned Colletti will never live this trade down and has been widely pilloried for it Not only was Blake a mediocrity, but Santana was one of the top prospects (2009 #26) in the game and fully lived up to his potential.
At this point, Mark Teixeira is traded from Alanta to the Los Angeles Angels for Casey Kotchman and Stephen Marek. The difference in return is staggering and one of the reasons it seems like prospect values have soared in a year. Even for only two months of Teixeira, the Braves could have done better than a has-been and a never-was. This is a bad trade however you slice, it, but since they couldn’t get even one prospect for him, it would go down as prospects being overvalued.
July 31, 2008 – Three Way trade. Boston acquires LF Jason Bay. Los Angles acquires LF Manny Ramirez. Pittsburgh acquires 3B Andy LaRoche, RHP Bryan Morris, RHP Craig Hansen and OF Brandon Moss. We can break this down into two swaps. In the first one, Manny goes to LA for LaRoche and Morris. In the second, the four prospects are traded to Pittsburgh from Boston for Bay. For the first, it’s important to remember at the time that Andy LaRoche was a well regarded young player. For two months of Manny Ramirez (who badly wanted out and would have never played beyond the season with Boston, LaRoche and Morris are a decent return. In the second trade, though, the Pirates might not have gotten enough. Hansen and Moss were not prospects by this point, and Bay was signed for a year and a half. We can count this as prospects being overvalued and in the interest of fairness, will here.
So, four deals that deadline that qualify. In the Blake and Blanton deals, prospects are not being overvalued, so even allowing Bay and Teixeira, there’s still no systematic overvaluation.
November 11, 2008 – Washington acquires OF Josh Willingham and LHP Scott Olsen from Florida for 2B Emilio Bonifacio, RHP P.J. Dean and 3B Jake Smolinski. What happened here? Ignoring Olsen (who had recently run from and been tasered by police), Willingham was a valuable player with years left of team control and was given up for a middling prospect in Bonifacio and two throw-ins. If he couldn’t rate a decent prospect, maybe that’s a harbinger of changing times. Prospects very overvalued here.
November 12, 2008 – Oakland acquires LF Matt Holliday from Colorado for LHP Greg Smith, RHP Huston Street and OF Carlos Gonzalez. And here’s another weird one. Maybe Billy Beane could sense the changing valuation, or maybe the times had already changed, but the GM who loved being at the forefront of things and who had been collecting prospects for a year, suddenly shipped out a top one for Matt Holliday. Holliday was a very valuable player, so it’s not a clear overpay, but it is odd for what it meant to Oakland. They’ve been stuck in a rut since this trade; maybe Beane shouldn’t have given up on the total rebuilding process so quickly.
November 13, 2008 – New York Yankees acquire OF Nick Swisher and RHP Kanekoa Texeira from Chicago for 3B Wilson Betemit, RHP Jeff Marquez and RHP Jhonny Nunez. A third trade in three days and another one where the veteran doesn’t fetch enough return. Swisher had a terrible year, but it’s still interesting to contrast the two scrub pitchers pulled here with the two top prospects Chicago paid for him. It looks like prospect valuation has suddenly, and with no cause, flipped and they are now being overvalued.
December 4, 2008 – Atlanta acquires RHP Javier Vazquez and LHP Boone Logan from Chicago for C Tyler Flowers, INF Jonathan Gilmore, UT Brent Lillibridge and LHP Santos Rodriguez. This one is less clear cut. Three of the prospects are bit players, so it was basically Flowers (99th ranked prospect) for two years of Javier Vazquez. Blanton is the closest comp from earlier and he drew a better return. This appears to be part of an overall downward trend, but is still more of a fair deal.
December 31, 2008 – Cleveland acquires UT Mark DeRosa from Chicago for RHP Jeff Stevens, RHP Chris Archer and LHP John Gaub. Chris Archer blossomed into a real prospect, but at the time it was a year of a good player for three lottery tickets. Two years earlier DeRosa might have fetched one guy with more value at the time, still the prospects are barely overvalued.
This is an offseason that signals maybe things are changing. Carlos Gonzalez is now worth much more than he was a year ago, while Nick Swisher is worth much less. The price of prospects has gone way up. Is it possible that the Blake for Santana deal in July, by virtue of being so awful, is the catalyst?
July 22, 2009 – Boston acquires 1B Adam LaRoche from Pittsburgh for SS Argenis Diaz and RHP Hunter Strickland. LaRoche was a player with some value traded for two players worth nothing. A year earlier, Xavier Nady had netted real prospects, so this continues the trend of prospects being overvalued.
July 24, 2009 – St. Louis acquires LF Matt Holliday from Oakland for 1B Brett Wallace, OF Shane Peterson and RHP Clayton Mortensen. This is a severe downgrade from the package given up for Holliday, but it is for 3 months instead of a year, and not a clearly one sided trade. Again, this says more about Oakland, which reverses course for the second time in 7 months, now switching to rebuilding again.
July 29, 2009 – Philadelphia acquires LHP Cliff Lee from Cleveland for C Lou Marson, IF Jason Donald, RHP Carlos Carrasco and RHP Jason Knapp. Compared to every other trade Cliff Lee has been involved in, this one is fair, but it’s still a very good deal for the Phillies. In baseball, 4 quarters don’t make a dollar and if three of those quarters are actually dimes, they certainly aren’t worth it. It’s important to always get one really good prospect in a deal, and Cleveland didn’t do that. Overvalued.
July 31, 2009 – Boston acquires C/1B Victor Martinez from Cleveland for RHP Justin Masterson, LHP Nick Hagadone and RHP Bryan Price. The Indians got a better package from Boston, even though Martinez was a lesser player than Lee. Masterson was already a solid major leaguer, so this trade doesn’t really count for our purposes.
July 31, 2009 – Chicago White Sox acquire RHP Jake Peavy from San Diego for LHP Aaron Poreda, LHP Clayton Richard, RHP Adam Russell and OF Dexter Carter. This is the best package given up for a player in over a year. Aaron Poreda (63) and Clayton Richard were the White Sox top two pitching prospects. Poreda ended up a spectacular failure (he was recently taken in the AAA Rule 5 draft), but Clayton Richard has given the Padres value.
The 2009 deadline continues the trend started in the 2008-09 offseason. Top prospects aren’t being moved much anymore. Lee and Martinez (each with 1.5 years left on their contracts) were in comparable situations to Teixeira 2 years earlier, but neither one drew nearly as much return.
December 16, 2009 – Philadelphia acquires RHP Roy Halladay from Toronto for C Travis d’Arnaud, RHP Kyle Drabek and OF Michael Taylor. Halladay was a huge prize, the best player available for trade in years, but he did only have one year left on his deal. He netted three of the Phillies top 4 prospects (though two have underperformed since). d’Arnaud is now one of the top talents in the game, while Halladay remains beloved by Blue Jays fans despite now being a Philly.
December 16, 2009 – Seattle acquire LHP Cliff Lee from Philadelphia for OF Tyson Gillies, LHP Philippe Aumont and RHP J.C. Ramirez. This is the red-letter deal for the idea that prospects are now overvalue. Cliff Lee, fresh off the best pitched postseason in recent memory, was traded for three non entities. The claim was that the Phillies needed to replenish their system after the admittedly costly Halladay deal, but why was Lee worth so much less in trade than Doc? I think, considering, we have to write this off mostly as a terrible deal while allowing that it is still a deal where prospects are overvalued.
December 22, 2009 – Yankees acquire Javier Vazquez from Atlanta for OF Melky Cabrera and RHP Arodys Vizcaino. And then, a week later, prospect values are back down. Vazquez, at one year, at his salary, should not have been able to net a top talent considering the value of prospects for the past 13+ months, and yet, the Braves got one for him. Arodys was the #69 ranked prospect in the game and was only that low because of his youth. He has increased in value every year since.
That offseason was clearly the apex in terms of value for prospects, but there has not been a trade since that approached the Cliff Lee one. Things would start to turn soon, though not quite back to the level of the 2007 deals. If we mark the Carlos Santana trade as the first turning point, the second Cliff Lee trade (for being so horrible in the other direction) may have switched us right back.
July 9, 2010 – Rangers acquire LHP Cliff Lee from Texas for 1B Justin Smoak, RHP Blake Beaven, 2B Matt Lawson and RHP Josh Lueke. Lee moves for the third time in a year. This time, 3 months of him nets a middling return, but that’s only with hindsight that Smoak isn’t any good and Lueke is a convicted rapist. At the time, Smoak was a top prospect (preseason #13) and this was a package better than either of the two Lee had been traded for previously. The Mariners also had an offer from New York for ultra-prospect Jesus Montero (preseason #4), but turned that down.
July 25, 2010 – Arizona trades RHP Danny Haren to Los Angeles for LHP Tyler Skaggs, LHP Joe Saunders, RHP Pat Corbin and RHP Rafael Rodriguez. This is the third of Rany’s examples, but is less clearly a case of prospects being overvalued than the first two. Haren had three years left on his deal and thus had enormous value, and three of the players acquired weren’t much, but Tyler Skaggs is one of the top 5 pitching prospects in the game. One elite prospect will soon settle in as the new level for talent with 2-3 years of team control left.
July 29, 2010 – Philadelphia acquires RHP Roy Oswalt for Houston LHP JA Happ, SS Jonathan Villar and OF Anthony Gose. Houston quickly flipped Gose to Toronto for Brett Wallace. Happ and Villar were decent, and Wallace was well regarded (27), but if anything they were a bit overvalued in this trade, which was more about clearing salary. Houston is a poor judge of talent, though.
July 30, 2010 – Minnesota acquires RHP Matt Capps from Washington for C Wilson Ramos. Matt Capps is an average closer, which is a valuable thing for a contending team, but Ramos was a top prospect (58) and was clearly too much value to give up. Bill Smith continues his horrible trading career (his worst trade was Matt Garza and Jason Bartlett for Delmon Young, not mentioned here) and gives us a case where a prospect is undervalued.
July 30, 2010 – Chicago acquires Edwin Jackson from Arizona for RHP Daniel Hudson and RHP David Holmberg. Dan Hudson was the 66th ranked prospect before the season began and in the midst of blazing through the minor leagues. At the time of the trade, he was already a better pitcher than Jackson and since Arizona promoted him to the big leagues, he has been a more valuable player. Another trade where the prospect is undervalued.
The 2010 season is a mixed bag. Haren and Oswalt were acquired cheaply, but high prices were also paid for average players in Capps and Jackson. Things appear to be fluctuating as a new level is established.
December 6, 2010 – Milwaukee acquires RHP Shaun Marcum for 3B Brett Lawrie. Again, this is the established new level. Two years of a #2 starter for one of the top prospects in the game. Lawrie was ranked #40 at the time, but quickly climbed the charts and would be ranked in the top 5 today if he still qualified.
December 6, 2010 – Red Sox acquire 1B Adrian Gonzalez from San Diego for RHP Casey Kelly, 1B Anthony Rizzo, OF Reymond Fuentes and OF Eric Patterson. The Padres would have only had one year of Gonzalez, but he agreed to an extension with Boston before the trade went down so they were getting much more than that. Kelly (31) and Rizzo (75) were highly ranked prospects, though also widely regarded as overrated by some circles. On paper, the Padres got fair value, but Kelly and Rizzo had bad 2011s since the trade and former Padres GM Josh Byrnes (who gave Gonzalez to the Red Sox) now works for Theo Epstein. The whole thing is a bit fishy, and it’s hard to judge. In hindsight we can say the prospects were overvalued, and they probably were at the time too.
December 19, 2010 – Milwaukee acquires RHP Zack Greinke and SS Yuniesky Betancourt for SS Alcides Escobar, OF Lorenzo Cain, RHP Jeremy Jeffress and RHP Jake Odorizzi. The Brewers acquired two years of Greinke also. Odorizzi (69) is the top prospect, but the other three all have value (Escobar was a top 15 prospect a year earlier) and getting rid of Betancourt also has positive value. This is a fair trade.
January 7, 2011 – Chicago Cubs acquire Matt Garza from Tampa Bay for SS Hak-Ju Lee, RHP Chris Archer, C Robinson Chirinos and OF Brandon Guyer. Lee and Archer were top prospects both, but it was for three years of Garza. The Cubs paid a very high price, which a contending team might need to get that final piece, but it wasn’t the right time for them to do so. Even with Garza’s success, the team didn’t break .500 and now they’re starting over from scratch minus two valuable pieces. They’ll try to move Garza in the next few weeks.
2010 saw the leveling of a new value for prospects. No one was getting packages with four valuable players in them anymore, but there was at least one real prospect in each trade and most had at least multiple players with decent value.
July 28, 2011 – San Francisco acquires OF Carlos Beltran from New York for RHP Zack Wheeler. Wheeler (55) was a good return for two months of Beltran, especially considering that the Mets (and Giants) could not get draft picks when Carlos left as a free agent due to his contract. The Mets eschewed packages of 2 or 3 lesser players to get the best man they could.
July 29, 2011 – Philadelphia acquires RF Hunter Pence from Houston for 1B Jonathan Singleton, RHP Jarred Cosart, RHP Josh Zeid and OF Domingo Santana. Pence was in the middle of his best season ever and thus drew a package worth far more than his established level of play would have gotten. Singleton (39) and Cosart (70) were the Phillies top two prospects at the time of the trade and a pretty clear overpay for someone of Pence’s ability.
July 31, 2011 – Texas acquires RHP Mike Adams from San Diego for LHP Robbie Erlin and RHP Joe Wieland. Adams is a setup man and however much value he can provide he is not worth two top prospects. Erlin and Wieland will both rank in the top 100 prospects for 2012, Erlin quite highly.. This is more value than most of the top starting pitcher have been traded for recently. A case of prospects being hugely undervalued.
July 31, 2011 – Cleveland acquires RHP Ubaldo Jimenez from Colorado for RHP Alex White, RHP Joe Gardner, LHP Drew Pomeranz and 1B Matt McBride. Ubaldo is signed through 2014 so he has a huge amount of value and should have been worth a big package. Alex White and Drew Pomeranz are both top prospects, but the other two guys are throw-ins. Ubaldo bombed after the trade, making it look like a Colorado win, but it was fair or maybe the prospects were a bit overvalued at the time.
The Adams and Pence trades were the best ones (in terms of prospects acquired) since 2008. Things have swung almost all the way back to prospects being undervalued again, or at the least there are deals out there worth taking.
Then there are the two trades that Rany’s column is based on. On December 6, White Sox closer Sergio Santos (signed for four years) was traded to Toronto for B- prospect Nestor Molina. Kenny Williams has always had an odd record, though, and it’s possible he is just in love with Molina’s potential. Either way, this is the most overvalued a prospect in a while and appears to be an outlier rather than the continuation of a trend. The other option is the relievers just aren’t valued that much (Huston Street was traded recently for even less), but the Mike Adams deal would imply that they still provide value.
The Cahill trade is another one by an odd general manager. For three years, Billy Beane has been fiddling around without doing much of anything, and seemingly trying to win trades instead of build teams. Parker is a top prospect, and there is evidence that Cahill relies on his defense and ballpark for his success, but this seems like a pointless at best trade for Oakland. The team is also trying to move Gio Gonzalez for prospects so maybe they aren’t planning on contending in the next few years at all, but either way it’s a very high valuation of the prospects involved.
So, what’s the conclusion? The value of prospects changes, often and by a lot, over time. It will never again likely be where it was for the Haren and Teixieira trades, but it has not been steadily increasing or only going up since then. It changes in bunches because trade values are usually based on similar recent deals, but it goes down as much as it goes up. The (PHI->SEA) Cliff Lee trade was an extreme in the other direction and falls far outside any boundaries of regular. It cannot be considered a new standard at all. The recent Santos and Cahill trades value prospects quite highly, but the Mike Adams trade was just a few months ago and one of the lowest prospect valuations of the time period. The Latos trade netted two top prospects so maybe things have already swung again. We’ll see what happens with Gio Gonzalez and maybe Jon Niese.
The one thing that does seem to be a trend is younger (in terms of service time) players are being traded for prospect packages. Cahill has three years of team control left and Latos four. Santos has three, or four or five or six. Normally, these would be the kind of players prospect-hungry teams would be keeping or even acquiring. Maybe they’re being given up because the returns are just too good (Latos), but that doesn’t hold for the other two. And the White Sox at least aren’t tanking the next few season.
Possibly, teams are less willing to trade for veterans with only one or two years left, and so, if one wants a prospect, one has to give up young major league talent. But that wasn’t the case four months ago, and it’s not likely to hold for very long.
Since this was written on Thursday, Oakland has made another trade, sending Gio Gonzalez (four years of him) to Washington for RHP Brad Peacock, LHP A.J. Cole, C Derek Norris and LHP Tom Milone. This is an even better package than the one Cincinnati send for Latos and Washington certainly paid like prospects are being undervalued, not overvalued.
