There are some elements of the Kawhi Leonard trade talk that have puzzled me, and I thought I’d write them up and discuss some possible implications.
The reported bid-ask spread is implausibly narrow
In finance, the term “bid-ask spread” is used to refer to the difference between the price at which a security is offered (the “ask,” also sometimes, rather confusingly, called the “offer”) and the price someone is willing to pay (the “bid”). The term “offer” is confusing because you might think it means the highest offer, but, no, that’s the bid, the offer is the price at which the seller will sell, the bid is the price where the buyer will buy. So, if the most anyone is willing to pay for a share of Apple at a particular moment is $191.55 and the cheapest price at which anyone will sell is $191.63, then the bid-ask spread is 8 cents. Similarly if someone is willing to sell his house for $225,000 and the highest price anyone is willing to pay is $212,000, the bid-ask spread on the house is the difference, $13,000. One might wonder how any trading gets done as long as a spread exists. The better way to see it is that the reason there isn’t continuous trading by every market participant is that usually there is a spread. On 99.9+% of days, no one is willing to pay a price for your house that you’d be willing to sell for. Then on very rare occasions, either your ask becomes low enough or the bid becomes high enough (really, both at once) that the house is sold.
It has been widely reported that the Sixers were willing to give Robert Covington, Dario Saric, and the Miami 2021 pick in return for Leonard. It was also widely reported that San Antonio wanted a package of two players and three picks, and that the players do not include Simmons, Embiid or Fultz. So it’s been pretty much universally understood that the Spurs want Dario, Cov, the Miami pick, plus two Sixer first-rounders, presumably the 2019 and 2021 selections.
That makes the bid-ask spread the difference between those two, which is two Sixer first-rounders. Since no one trades unprotected picks anymore, the gap is thus two protected firsts from what promises to be an excellent team. And my comment on that is: if that were really the spread, a deal would have gotten done! I mean, even if the protections are only top-5 or top-10, given that the team will be running Joel and Ben and Kawhi out there, and even if Kawhi leaves we’d then have around $55M of cap space to sign compadres for Joel and Ben... those picks just are not all that valuable. To either side! The odds of a player taken in the bottom of the first round becoming an NBA star are tiny. Put it this way: it’s obvious that the difference between the 28th pick and the 33rd is extremely small — if 100 experts listed the guys they’d have taken at 28 this year, there’d have been two dozen names on that list, 80% of whom would still have been there at 33. And yet as we’ve seen high second-round picks have hardly any trade value, you can’t even use them to trade up a few spots when you really want to, or so it appears. So why should anyone kill a major deal over a pair of late firsts, rather than reach a compromise?
I mean, of course it’s always possible for a deal to founder over a tiny gap in price when neither side will budge an inch. But it just seems hard to believe that such a gap couldn’t be bridged. We could lightly protect the 2019 and more heavily protect 2021. We could heavily protect both but add in other useful assets like Richaun, whose non-guaranteed contract makes him valuable as a trade chip even if he doesn’t pan out as a player. We can do Miami plus one first and three seconds, or Miami plus two picks but top-1 protect the Miami pick as partial recompense... there are a million things that could be done to finalize once two teams are that close. I mean, I suppose if SA was demanding that all three picks be completely unprotected then that would be unreasonable, but it’s hard to imagine they’d ask that given the state of the league these days, when no team has traded its own unprotected pick in years.
So, basically, my belief is that one of those two reports was false (or misinterpreted): either SA wasn’t willing to do it for Cov/Dario/3 firsts, or the Sixers weren’t willing to do it for Cov/Dario/Miami 2021. Which one of those reports is the incorrect one — or could both be incorrect?! — I don’t know; you’re guesses are welcome!
Can we just keep Cov?
It is my personal belief, argued in detail in a previous post, that Robert Covington and his contract, together, constitute one of the most valuable assets in the NBA. Last year he was first in the entire NBA in RAPM and 7th in RPM. While he’s probably not actually a top-10 player — adjusted plus-minus stats can be affected by luck — I do think he is a top-30 player. And he has a long contract that is shockingly cheap for such a fine player. I understand that his performance against Boston was a disappointment. But as has been pointed out in an excellent Fanpost, he was responsible for only a small fraction of Jayson Tatum’s scoring. And as to his shooting, he took 24 threes, and at his normal very-good rate would have hit 9. Playing the best-in-the-league Boston D we might have expected 8 makes instead. In point of fact he made 6. Now, if two more of his shots had rattled in rather than out, it might have turned the series around, so those misses really were costly. But anyone who is judging a player’s worth based on two — two!! — misses should reconsider their analytical approach.
Fundamentally I’d say there are between 5 and 10 megastars who are so good that even on a one-year max deal they are worth more than Cov. LeBron a year ago, when being Cleveland meant you paid $35M for one year plus maybe a 40% chance to keep him longer for the same price, was worth far more than 4 discount years of Cov, because LeBron is the King. The same would hold for Steph and several others, I won’t make a list for fear of offending fans of players left off, but I will say there are no more than 10 such players. Then there are between 5 and 30 players who, depending on your tastes, you might think are better as players than Cov, a top-5 defender who is also solid offensively. The vast majority of these have contracts that are so much worse than Cov’s that they are obviously far less valuable than he as assets. Kemba Walker may, perhaps, be a better player than Cov, but Kemba on a one-year, $12M deal and very likely to leave when it ends is less valuable than Cov locked in for 4 years at around $11M per. Finally, there are some players who are not yet as good as Cov but who are on rookie deals that are cheaper than his, and who have upside because of their youth, and this combination makes them more valuable than Covington. Jaylen Brown is not as good as Cov right now, but he is arguably more valuable. It’s debatable whether Karl-Anthony Townes is, overall, a better player than Cov, but he is clearly a more valuable asset due to his youth, superstar potential, and rookie deal. Luka Doncic will almost certainly be worse than Cov this year but is a more valuable asset.
Add up these three groups, each of which probably has around 5-10 members, and Cov is probably one of the top 30 player-contract combinations in the league. But of course he isn’t seen that way. Defense is underrated, and so is Cov. Of course a player can be underrated league-wide, and properly-rated or even overrated by one specific team you’re in trade talks with. So if SA thinks Cov is the bee’s knees, and is therefore the centerpiece of the deal, then perhaps he needs to be included to get a trade closed (since, after all, a healthy Kawhi is solidly in the first group of megastars who, even on a one-year deal with uncertain re-signing prospects, are worth more than Covington).
But that doesn’t seem to be the situation here. There’s been reporting that San Antonio doesn’t like Cov and his contract all that much. Chris Sheridan says that if we do a deal Cov may be shipped to Sacramento. Now, again, maybe that’s essential to a deal, maybe SAC will pay heavily for Cov in the form of sending the Spurs an asset SA really covets. But I haven’t heard anything like that, and it’s hard to imagine what that asset would be; hard to imagine SAC sending out Fox or Bagley to get Cov, and hard to imagine SA being desperate for any of their other players.
I believe the SA-not-sharing-the-Cov-luv rumors because they didn’t match the very reasonable $9M/year offer sheet for Kyle Anderson. Anderson is not close to the shooter Cov is, but he is similar in that he’s a star defender with a solid offensive game who as a consequence delivers very strong adjusted plus-minus statistics. If SA didn’t think he was worth 4x$9M, it doesn’t surprise me to hear that they don’t attach a lot of value to Robert Covington at a somewhat higher price. Cov is superior, but perhaps not by so much as to go from “don’t want him” to “highly-valued asset we’ll trade a lot to get.”
But if the Spurs don’t attach a ton of value to Cov then... LET’S PUT SOMETHING ELSE IN THE TRADE INSTEAD!!
A better deal framework
A lot of folks around here think it’s no big deal to trade Cov because now we have Wilson Chandler, who plays the same position and seems similarly skilled. As best I can tell Cov is around a +4 player, that is, his team is 4 points better off per 48 minutes if he replaces an average player. Chandler is a -1. With Covington, there is some doubt; he was never over +3 until last year, and his playoffs were not great; it’s possible he’s just a +3 player, and there’s even a chance he’s “only” a +2. +2 is really good, but +2 makes you like the 50th-best player in basketball, whereas +4 is like 15th; it’s a big difference. The +/- stats last year had Cov up over +5 but as I say he was surely at least a little lucky. So let’s say good case he’s a +4 for real, bad case he’s a +2.
With Chandler, there really is very little doubt. You can look at +/- stats, at traditional stats, at anything you want, there’s just no way I can see to make the case he’s very far from a -1. I mean, he didn’t even score much last year (11 points per 36 minutes), so this isn’t a case of a guy who scores a lot but who I downgrade over defense. He’s just mediocre at both ends, a little below average at both ends. He’s a useful bench player, but comparing him to Cov is like comparing Richaun to Al Horford. It’s ridiculous.
So, replacing Cov with Chandler in the deal makes it a million times better for us. Hence it should make it a million times worse for the Spurs. But if they think Cov is nothing special, then they may not value Chandler that much less; they may see him as an expiring contract who fills the salary gap and is adequate as a player.
So my proposed answer to the rumored SA ask is: “You guys want Dario, Cov, and 3 picks. We’ve been saying no to that offer, and no one else made you any great proposals. How about this: take Chandler instead of Cov, and it’s a deal!”
Now, as i said above, we don’t really know if SA was willing to do the rumored deal. But if they were, then maybe this isn’t a big downgrade from their perspective, maybe they saw Dario and Miami as the prizes, and Cov as cap filler. Maybe they’d be happier, or as happy, or almost as happy to get an expiring deal that brings them cap relief for next year’s free agent bonanza.
And what’s great is, that deal is cheap enough from our perspective that we can sweeten it and still have it be amazing. We could throw in high seconds, or interesting young players like Bolden or Furkan or Shamet. I am on record as the world’s #1 Zhaire Smith backer, but I don’t think he would necessarily be untouchable in this setting; say SA came back with “Dario, Chandler, Miami ‘21, Sixers ‘19 and Zhaire for Kawhi” and we couldn’t get them to take Smith out no matter how hard we tried; I think I’d reluctantly pull the trigger on that, assuming Kawhi’s medical and willingness-to-play-and-perhaps-stay check out.
Where would that leave us?
So that’s my suggested framework — Dario and Miami as the centerpieces, Chandler to make the money work, and some combination of Sixers’ picks and young players to sweeten the pot; hopefully holding out Zhaire. That would create a core rotation for us as follows; I’ll follow each player with a reasonable expectation of his adjusted plus minus if fully healthy and engaged, based on recent play and, in cases like Fultz, my best guesswork.
C Embiid +5
PF Covington +4
SF Leonard +7
SG Redick +0
PG Simmons +3
Backup C Amir +2
Backup F Bjelica +1
Backup G Fultz +0
That is a formidable group! A +19 starting lineup with a net-positive bench mob. There really isn’t any reason to suppose that team, if healthy, can’t compete with absolutely anyone, even Golden State. Not saying we’d beat the Warriors, of course; they have the experience, and if Boogie miraculously returns to 100% form and fits in their system, they will probably be too much for us. Still, we’d be a legit contender if we can add Kawhi while keeping Cov.
Do the Spurs still really know what they’re doing?
The Spurs have been an absolute paragon over the past couple decades, the ideal of what a pro sports franchise should be (assuming we adopt the universal media practice of pretending the Spurs didn’t tank an entire season so they could obtain Tim Duncan!). But, lately... I don’t know...
- They’ve created such an awful situation with their superstar player that they may have to trade him for far less than he’s worth, and may even lose him for nothing.
- They rushed into free agency by offering real money, $6M, to Marco Belinelli, who is just not a good NBA player.
- As discussed above, they let Kyle Anderson go, even though he was a key reason for their success last year and was available at a bargain price.
- Las Vegas bookmakers recently concluded it was extremely likely they would trade Kawhi to Toronto, even though Toronto has almost nothing in the way of valuable trade assets. They have Kyle Lowry, who is terrific but who a) is old, b) has a worrisomely-long record of not delivering in the playoffs, and c) makes well over $30M. He is probably worth less than a mid-first-rounder given all that. There is DeMar DeRozan, who is treated everywhere like a giant star but whose terrible defense and good-but-not-super-efficient offense combine to make him merely a good-to-very-good player, not a great one and who at $27M/year is probably not worth his contract. I’d certainly much rather have Tyreke Evans, Kyle Anderson, Kyle O’Quinn and some remaining cap space than DeRozan! They have some interesting young players of whom the most valuable, OG Anunoby, is moderately valuable. They have no good picks to trade. There’s no way they could or would offer a package that would exceed what the Sixers have talked about And yet the insiders in Vegas think SA had, or has, serious interest in a Toronto deal. It’s crazy!
Brian Windhorst of ESPN says the Toronto is in the driver seat, and that indeed the Sixers may even be backing off of interest in a Leonard trade. Perhaps that’s not true, or perhaps it’s true and the Sixers are losing interest because of concerns about whether Leonard will re-sign or about his health. But if it’s true and the reason is that San Antonio likes Toronto’s assets better than Philadelphia’s, that would be a shame not only for Philly fans, but for San Antonio fans as well.
Basically it’s not clear the franchise has fully adjusted to the way basketball is played and won now. Of course Pop is a brilliant coach who can coax a winning record out of basically any group of players. But I do not assume that their judgments on player value are, at this point, infallible. And that’s why I say, if they fail to appreciate Robert Covington, let’s keep him and make him a keystone of our defense for the next half-decade — with Kawhi, Ben, Markelle and Joel around him, I don’t think we’ll need him to convert many dribble-drives! His combination of floor spacing and devastating defense will be a perfect fit once we have the right skill guys in place, and we could have them as soon as this season!