Saturday, April 22, 2006

Who's Worth More? The Yankees or the Yankees?

I was noodling around Baseball-Reference.com today looking at salary information. I was idly trying to figure out who the top career salary earner was in MLB history. I was actually going page-by-page through the guys I thought would be in the mix, Bonds, A-Rod, Manny, etc. and noticed that they were mostly Yankees. Eventually, I stumbled across the actual list of most career earnings, and found out I was wasting about half of an hour of my time. But one question did pop into my head - who was worth more, the Yankees as a franchise, or the individual players themselves (using only baseball earnings). It was one of those questions that could only be answered by a blog.

We "know" from the recent Forbes report that the Yankee franchise is worth
$1.026 billion, up 8% from last year. Baseball-Reference.com also has the salaries of all Yankees players, with a few first-and-second-year player exceptions. So the answer is knowable.

Based on the Baseball-Reference.com data, the Yankees franchise is at least currently worth more than the Yankee players combined. Here's the salary chart of career earnings through the end of 2005:

PlayerSalary through 2005
Matt Smith$0
Robinson Cano $300,000*
Chien-Ming Wang $300,000*
Andy Phillips $317,200
Scott Proctor $600,000*
Bubba Crosby $624,350
Tanyon Sturtze $2,588,500
Miguel Cairo $3,975,000
Shawn Chacon $4,735,000
Kyle Farnsworth $5,065,000
Kelly Stinnett $5,706,500
Mike Myers$8,413,166
Ron Villone $8,934,000
Jaret Wright $16,331,667
Carl Pavano $17,562,500
Hideki Matsui $21,000,000
Jorge Posada $41,058,500
Johnny Damon $45,189,000
Jason Giambi $57,773,283
Mariano Rivera $63,530,125
Derek Jeter $97,430,000
Bernie Williams $101,600,001
Mike Mussina $103,392,167
Gary Sheffield $119,010,002
Alex Rodriguez $126,027,000
Randy Johnson $127,687,500
Total $979,150,461

* denotes estimated amount.

So the Yankee players are still about $46.8 million behind the Yankees franchise.

But that will change. The Yankees players are set to earn
$198,662,180 in salary this year, meaning that they will pass the Yankees franchise during 2006. But when? I know you were curious, too. The easy answer would be $46.8 million divided by $198.7 million, or 23.56% of the way through the season. Precisely, that would occur before the first out is made in the bottom of the 4th inning of game 39 of the season, against Texas on May 17th at Yankee Stadium.

But the simple calculation assumes that the Yankee franchise would not appreciate during 2006. If we assumed the same 8% appreciation from 2005 to 2006 during the 2006 season, the Yankees would actually be worth $1.045 billion by May 17th. So you have to adjust for the Yankee appreciation.

Dusting off a little high school algebra, I get an equation of $979 million (career earnings) plus $198.6 million (2006 salary) times X equals $1.026 billion (Yankee worth) + $1.026 billion times 8% (franchise worth increase) times X, or

$979 + $198.6x = $1.026 + $1.026(.08)x, or
$116.5x = $46.8, or
40.2% of the 2006 season,

which is 65.101 games, which is 65 games and 5 outs, which is after two outs in the bottom of the first in the Yankees' game against the Toons on Thursday, June 15th at Yankee Stadium.

Aren't you glad you knew this?

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