Friday, March 30, 2012

Armchair GM: What Does the Future Hold for Matt Cain?

As frantic roster speculation furiously builds to a penultimate conclusion(I know! I'm trying to keep this a family friendly site), another, much more important drama is building, the Matt Cain extension negotiations. First of all, let me say that no one is a bigger Matt Cain fan than I am. I have a ball he autographed for my daughters from his Cal League days. My gameday shirt is a Matt Cain #43(his rookie #). Make no mistake, I WANT the Giants to sing Matt Cain to an extension. I still believe they WILL sign him to an extension.

Much of the discussion has centered around how much Matt Cain and his agents are demanding from the Giants and how much the Giants should sign him for. That's where we get off into uninformed and pointless speculation. If Cain does sign an extension, we will know for how much and how long and can debate that to death. If he does not sign, there will be furious speculation about what he was asking for and how much the Giants offered, but we will never know for sure.

If you were the Giants management, how much would YOU be comfortable paying Matt Cain for a contract extension and for how long? The Giants were on record early as not wanting to go beyond 4 years. We don't really know what Cain's camp is asking for, but it's safe to assume they want more than 4 years. Some reports have them shooting for a 9 figure total package and the Giants offering significantly less than that. It's pretty easy to read into that a difference in length more than salary/yr. One popular number that seems to keep cropping up over and over as a number the fans accept as a "fair" contract is 6 years/$120 M. I decided to analyze this number and see if we can get a handle on whether it is a safe deal from the Giants perspective.

There is an excellent Fanpost over on McCovey Chronicles by Ott entitled Is Matt Cain a Good Investment? I encourage everyone here to read it. I took a very similar approach in a recent Comments discussion and thought it might be worthwhile to repost that information here in case everybody does not read the comments.

One quite accurate way of measuring player value is through a calculated statistic called WAR(Wins Above Replacement). In the current baseball player market, the average market price for players is between $4.5 M and $5 M per WAR. We'll be generous and cover for some Magic Johnson fueled future inflation by rounding it to $5 M/WAR.

Matt Cain has accumulated 25 WAR in 6+ years of pitching. He has been remarkably consistent while putting up WARs between 3.5 and 5.2 over the last 6 seasons for an average of 4 WAR/year. In the process, he has been a workhorse pitching between 190 and 223 IP each season for a total of 1317. By today's valuation, Matt Cain has been worth almost exactly $120 M over the last 6 seasons. Why then, would the Giants hesitate to give him what he "deserves" for the next 6 year? Let's take a look at where Matt Cain will be on several all time lists if he continues to perform at his current level for another 6 years.

As he stands right now at age 27, Cain is #838 on the all time IP list He has 1 year left on the current contract. Assuming he stays healthy for the season, he'll add another 210 IP to his totals. That gets him to 1527 IP and #688 on the all time list. You can see that he is moving up quite fast. In order for him to earn 4 WAR/year for the next 6 years after that, he would have to average >200 IP. Say he duplicates his last 6 year and gets to 1317 again. that would put him at 2844 IP which moves him all the way up to #152. 152 pltchers in the entire history of baseball have pitched more innings than Matt Cain will have by the end of his proposed contract extension of 6 years/$120 M! In another way of looking at it, there are exactly 2 currently active pitchers who have recorded more than 2844 IP in their careers, Livan Hernandez and Tim Wakefield.

Sorry, I can't seem to get the full pages of Baseball Reference to come up right now, so I'll have to do this from memory. At his current 25 WAR, Matt Cain stands at approximately #143 on the all time list. Add 4 WAR/yr X 7 yrs and you get to 53 WAR. That's all the way up to #43 all time. with just 2 currently active pitchers having more, Mariano Rivera and Roy Halladay.

Matt Cain is a pretty unique guy. I don't dispute the Tom Seaver comps on bit. Heck, he might put up 5+ WAR/yr over the next 3-4 years and coast beyond 53! If he does that though, he will be challenging some of the elite pitchers in the history of baseball.

While it is imaginable that Matt Cain could give a return value equal to a 6 yr/$120 M extension, the odds are against it. That conclusion is supported by two different measures discussed here and by a different approach to the WAR data reviewed in the McCovey Chronicles Fanpost. While we all might be relieved and happy to see Matt Cain sign such a contract extension, we also might live to see the day when it does not look like such a good thing.

22 comments:

  1. And Barry Zito walks the first 2 batters followed by 3 ropes and falls behind 3-0 in the first inning.

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  2. This decision for me represents a crossroads for this organization. I think it boils down to a question that every Giants fan has asked themselves even though the thought of it alone makes us shake our heads in agony. Timmy or Cain? I know I have been asking myself for at least the last 4 years in anticipation of this moment right now.

    If a deal doesn't get done by opening day then it will be a foregone conclusion that Cain is gone. If that means the Giants chose to keep Timmy instead, it would be a hard pill to swallow but we would all continue to show up to the ballpark and buy freaky wigs. Is Timmy the right choice though? I know that 4 years ago I would have said Timmy without thinking twice but now I'm not so sure. In fact I am pretty sure that I would rather keep Cain.

    Durability is a risk and his price tag will be high but keep it in perspective, that is his market value and if we don't pay it then somebody else gladly will (losing him to the Dodgers would be very bad PR). Talent like Cain doesn't often come on the open market and when it does it comes with a hefty price tag. For equal money, who do you have more confidence in having a better career over the next 5-6 years, Cain or Timmy?

    Cain also happens to be a bird in the hand just like Holliday was a bird in the hand for St. Louis, they signed him to a big contract knowing that they may not be able to sign Pujols. The decision was a wise one because they probably couldn't have signed Pujols anyway even without Hollidays contract on the books. Timmy is the bird in the bush just like Pujols and my guess is he will be out of here after next year and if we lose Cain now and Timmy after next year, there goes the strength of this ballclub.

    You can't lose your super stars like that and right now we have a chance to lock one of them up for a while. Who knows if we can lock up Timmy after next year but we have a chance to lock up Cain right now. Whatever the money, it will be less years and dollars then they gave Zito and we still won a WS with him on the roster sucking up payroll. My guess is Cain will be far better then Zito in the twilight years of his contract. He is built for the long haul, his motion is smooth and his arm problems have never kept him on the DL or affected his pitching. I would go up to 5 years 115 million backloading it so that he gets most of it once Zito is off the books. Who else do we have signed past 2013 at this point anyway? Every recent contract has been for 2 years or less and all of the bad ones will be gone after next year. This is a good move and I really hope they get it right.

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    1. Just because someone else will gladly pay it doesn't make it a good thing to do. A bad contract is a bad contract. There may be a few teams who can afford to eat bad contracts, but the Giants don't appear to be one of those. It's not as bad as if they were a small market team but they can't afford to be making mistakes like the Zito deal and shrug it off(although, as I've said before, the Giants did win a World Series with the Zito and Rowand contracts contributing little or nothing).

      It's a complicated equation. I would have little problem with overpaying Matt Cain, and by quite a bit, for 3 seasons. Do you figure that in a 6 year contract you will accept 3 years of a bad contract in exchange for those 3 years you think he will be good?

      Personally I don't think the Giants should sign either Timmy or Matt Cain to the types of contracts they can probably get on the open market. Opem market contracts for elite pitchers have a very bad track record for very good reasons. There are other ways to building winning teams besides competing for elite talent on the open market.

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  3. Close the book on Zito...3 IP, 7 Hits, 3 BBs, 5 ER. That's just...uninspiring.

    I'll leave it to you stats guys to argue numbers.

    But know this:

    Cain is now worth much more than his numbers. For several reasons:

    1. The Giants traded Wheeler. For nothing. (I supported it...) If the Giants had Wheeler, Cain would be worth less to us. The Giants have done well with draft of late. But our recent drafted superstars are top 10 picks. Timmy, Buster, MadBum. Wheeler was, what, #6? The book is open on Wheeler, but there is a very good chance that he'll be very good. With him in the wings, the Giants could better justify a hard stance on Cain. We'd be more able to stand the loss.

    2. The financial landscape has pretty dramatically changed in the past couple of years. The Dodgers have announced their post McCourt rebound with authority. (The Giants had to have SOME idea of the impact of this. I consistently heard $1.5 Billion during the bidding process. Even at that "low" price, compared to the $2.15 Billion they sold for, the Giants had to know new ownership was going to have money to spend.) Add to that the Angels and Rangers TV contracts, AND the fact the MLB rejected McCourt's negotiated $3 Billion deal as being too light. There is a LOT more money floating around right now.

    3. Free Agency is getting thin: Teams prevent their elite players from entering FA in their at all during their 20's by signing them early to mega contracts. Tulowitski, Cargo, Kemp just in the West. That makes elite players that actually do enter FA in their 20's (Cain...Timmy) all the more valuable.

    4. Cain has signed team-friendly deals twice now. And he has delivered. Just in fairness, he must feel he's owed. Plus we just keep hearing that the Players association is pressuring Cain to sign at market value. Not below.

    5. If Cain leaves, the pressure to sign Timmy will be insane. Cain is the better pitcher. Timmy has the hype. Not to mention the Cy Young hardware. Timmy is going to get a contract that will be at LEAST twice as risky as Cain's. The Giants lose leverage with Timmy if Cain is gone. And of course Cain's people know this.

    You know Pato, it's funny you mention Pujols, because that's an interesting comparison to Matt. In terms of WAR, I don't think Pujols is going to live up to that contract. It's nuts to sign the guy until he's 41. And I think St. Louis kept thinking in terms of numbers, not value. The value of have Pujols as a Lifetime Cardinal would have been immense. The greatest player of his generation spending his entire career with one team. A HUGE statue out there. Trot him out to the ballpark for the rest of his life to doff his cap to the fans. (Just like Musial.) Pujols had value beyond his numbers. Especially to the Cardinals. And the Cardinals played hardball cheap.

    Now Cain is not anywhere near that level of star. But he has more value for us right now than his numbers. To me he is the lynchpin to the future. He's the longest tenured Giant. He's got the peripherals that are improving every year. He's the guy we build around.

    And if the Giants keep pushing for the sign-early discount they are going to find Cain insulted and then gone. Just like the Cardinals first offer to Pujols was for 5 years. That insulted his wife, fer Chrissakes.

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    1. I don't disagree with most of that. You make excellent points about the Dodgers' impact on FA values. They are now the black hole pulling everything else into their gravitational field, possibly even more so than the Yankees who seem to be in the process of scaling back their spending. You have to believe that Pujols' contract had everything to do with Arte Moreno trying to get a jump on the Dodgers' new ownership and get his brand embedded in the LA market before the Dodgers had a chance to make their own splash.

      Where I disagree is with the Lifetime Cardinal thing. Yes, it would be great and there is value in that. I just am not sure it's worth $125 M(what I think is the the approximate excess cost of Pujols' contract. You aren't going to get a ton of fans out to see Albert doff his cap if his contract is causing you to put a crappy product on the field for several years running. When Albert Pujols is struggling through the last 5 years of his contract and Magic Johnson is putting on Showtime at Dodger Stadium, these SoCal fans will all be out paying $500 per ticket to see the Dodgers and Arte Moreno is going to wish he had that $125 M to spend on a younger, better player.

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  4. I understand that you don't want to pay market value for Cain. You worry about the risk of that contract. I believe Cain will hold up. But I understand your concerns.

    but how do the Giants replace Cains talent. Immediate or in the future. How do they pull telent out of his leaving. You can't believe that a supplemental draft pick will do that. So trade him? (Would the Giants have the stones to do that?) Any trade would have be a trade-and-sign for the Giants to receive any real value.

    Anyway, trade Timmy. Trade the hype, hardware and greater injury risk for better return.

    Anyway, just wondering what, in your opinion, the Giants should do if Cain won't sign. Because holding on to him past the trade deadline this year without an extension is going to be brutal.

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    1. Oh, sorry, the above post was directed at you Doc.

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    2. I can't point to any single solution and say, THAT is Matt Cain's replacement. The landscape is not nearly as barren as you and others make it out to be though. Pitching is actually fairly plentiful in baseball right now.

      First of all, I expect at least 1 pitcher to emerge as a future ace from the Giants current crop of minor league talent. I don't know which specific one it will be, but they have a fairly large pool of pitching prospects who have a lot of upside.

      Next year's FA class is fairly strong in pitching. In addition to Matt Cain, there's Zach Grienke, Cole Hamels, Anibal Sanchez., Shaun Marcum, Colby Lewis, Francisco Liriano and several others. Maybe some of those names aren't in the same tier as Matt Cain, but maybe as more of the Giants young offensive talent emerges, they won't be as dependent on having a rotation full of elite starters.

      Trades are still a possibility. The Giants have enough depth at catcher to trade a Buster Posey for pitching. They could trade Pablo Sandoval for young pitching before his body gets the best of him.

      The Giants future is much more dependent on their continued excellence in scouting and player development than it is in re-signing Matt Cain to a potential albatross contract.

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    3. If Cain's contract is a potential albatross they have effected their future for the better by avoiding it. If Cain's contract is a potential bargain they have lost out on a huge opportunity. While I appreciate the draw the brakes on a mega contract, the market rate for Cain is the Giants best bet for FA success.

      Looking at those FA names, I just can't agree with your optimism. If they can't afford Cain, they can't afford Hamels or Grinke. The other pitchers are nowhere near the first tier of pitchers, and the middle market of Edwin Jackson, Shaun Marcum, the crazy lefties (Sanchez AND Liriano) looks fraught with danger of overpay in years and dollars. Colby Lewis is underrated, not sure if the Rangers are having a re-signing situation of their own or not right now.

      Sure we have some good arms, but they are way out. And they will most likely draft a bunch more this year. But that will not help in the near term. I would be much less afraid of the slight overspend on Cain than the potential of not only losing him but losing him to the Dodgers. The Giants have not thought this through, and are bumbling their way towards a big time mistake here.

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    4. One thing about Lincecum that I hadn't thought of: now that he's signed for 2 years, he will be age 30 during his first FA year, 2014. If the Giants can successfully re-sign Cain, I have to believe Lincecum's agents might have overplayed his hand. Seeking a 8 year deal to start negotiations would be ages 30-37. Now THAT is a bad bet contract.

      In that MCC fanpost I had the theory that fan rage could very well put the Giants on tilt and they will rush to give Timmy a 8/180-200MM contract. This could be outlandish, but its not that far out there. He has the hardware, the hype and the name. So which "mistake" would people prefer, signing Cain for a potential bust now or Timmy to a potential bust later. It seems we are focusing strictly on the downside of contracts in this post, because Mike Hampton, Barry Zito and Kevin Brown all didn't make the grade.

      I think there is a strong case for Cain being the rock that holds the rotation together. You have him, then you don't worry so much about Timmy leaving. If he really is true to his word and wants 2 year extensions, then giddy up. If its a story, and he wants the record breaking deal, then, and this pains me incredibly, there is your trade.

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    5. I am not suggesting that all of the potential FA pitchers I mentioned are in the same class as Matt Cain. What I am suggesting is you can get 1 or 2 of them for a lot less money and a lot less years. I am also suggesting that the Giants may be in a position very soon to rebalance their configuration to be less dependent on having 3 or 4 aces in the rotation due to an improved offense.

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  5. I'm all over your site and that MCC post spouting on Matt Cain, DrB, I've made my points. Kelly puts it down smooth up above. I'm not asking the Giants to go crazy, but I am in favor of paying the market rate. 6/120, anything above is crazy and anything below is gravy.

    I love your idea of overpaying in dollars in exchange for years. The years always get you more than the money.

    I try my best to keep it positive and support the team, I have some issues with ownership at the moment, and I feel like they are treading on the product on the field. Is that based entirely on proven facts? No it is not. But its a pretty informed hunch.

    Anyways, buckle in for the next few days. I really am looking forward to the season, even if its become rocky lately.

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    1. I couldn't agree more, with all that you've said here Shankbone. It will ultimately come down to Cain vs. Lincecum, and Cain is (imho) the better choice. 6/120 is steep, but if there ever were a Giants pitcher in my lifetime who justified such a contract - and I'm DrB's age - Cain is the guy that should get it.

      And once he's signed, as you said, Lincecum isn't as vital to re-sign, and his advisors may well have overplayed their hand. And I'd be very open to a trade of Lincecum this winter or next season - assuming we get back something of reasonable value (reasonable people may disagree about what is "reasonable value" I realize).

      And, again, as you said, there is no one out there in FA to replace what Cain gives us. And while I agree with DrB that someone currently in our minor leagues will turn out to be a useful starter in 3-4 years, that person will simply join Cain and Bumgarner in the rotation - Zito and Vogelsong will be gone by then, and possibly Lincecum as well.

      Is 6 years too long to pay for a starting pitcher? Yeah, probably so. Again, without Wheeler in the pipeline, we just aren't in a position to quibble over Cain's sixth year at the risk of losing him completely.

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  6. Cain's value is not a WAR issue, his value is a franchise issue (Kelly lays it out nicely above).

    Zito's value should have been a WAR/stats issue. The Giants mistake was paying Zito as a franchise issue.

    Zito's value is now bordering on negative - the roster space could be more valuable.

    I hope the Giants Brass can see the difference here. Sign Cain!!!

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    1. There is not such thing as a "franchise issue." Fans come to the ballpark to see winning baseball.

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    2. DocB be glad you are not in marketing or history.

      Zito's signing was all about a franchise issue. They had just lost the public face of the franchise, Bonds, to a very public and embarrassing storm of roids, wife and tax cheating. The Giants, specifically McGowan, needed a new "franchise face". SIGN Zito!!!! He is local, good looking, non surely, not on roids (maybe too bad in hindsight), and stealing talent from the rival As. He was a fresh marketing face of the franchise.

      The Giants signed him, bidding against themselves, for a $20+MM premium and 2+ year premium. The Giants signed despite all stats pointing to a steady decline and a possible cliff 3-4 years out. Zito was the essence of a "franchise issue" signing and not a winning baseball signing. Even in 2006 Zito's signing was about winning fans not winning baseball.

      More garlic fries, panda hats and Cha-Cha bowls anyone...

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    3. I think you've just proved my point. I would submit Zito as THE prime example of why you don't sign someone just to be the face of the franchise. Yeah I know, Barry Bonds was signed for that reason, but he was also one of the best, if not THE best player in the game and there was every reason to believe he would remain so throughout the length of his contract.

      Matt Kemp for 6 years/$120 M? No problem with me. I'd do that deal in a heartbeat! Cain for 6 years/$120? With the mileage he's already put on his arm? Not reallly in the same ballpark in terms of future value/cost.

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  7. Cain IS THE LYNCHPIN. If Cain is signed, let's look forward:

    Cain signs 5/$100MM ballpark. The stud is in the barn.

    2013:

    1. Decision Time. Either extend Timmy for 2 more years or keep The Beard. We will have 2012 results to guide the decision - do Timmy's stats decline? Does The Beard stay healthy/productive? I say we will shave The Beard. Hembree awaits. Sign and trade him to restock the farm and/or 5th starter.

    2. Extend Timmy for 2 years. Yes, $25MM/year. Timmy is cool with 2 years and it keeps the Giants risk low.

    3. MadBum has a breakout year. We may come to see him as the Giants best pitcher at age 22/23. Lock him up for 6 - 8 years, thru FA and maybe beyond. Escalating contract, but reasonable for the next 4 years. Besides how else do we keep the country boy in the City and have someone around to fix the team bus?

    4. Keep Melky or Pagan, if productive in 2012. Brown/Peguero comes in cheap for one of them. I think Melky for his power will be signed to a 3 year deal.

    5. Huff/Rowand/Wilson/Affeldt/Pagan/Sanchez $$$ coming off the books in 2013 and Zito in 2014 pays for Timmy and MadBum extensions and Melky.

    2014:
    1. Turnover BP arms to cheap rooks - Hembree/Otero/Bocjy jr./Rosin, etc. Keeps the BP cheap.

    2. Craw, Pill, Belt, Brown, and Panik keeps the SS, 1B, 2B, OF cheap and athletic.

    3. Find a 5th starter, Surkamp? Petit? The Giants have always seem the find a useful arm every year to fill in.

    4. Trade excess stud catcher and BP arms for farm restock.

    2015:
    1. Extend Vogie. 4th/5th starter. Giant for life!

    2. Rook starter arms begin to emerge. Crick, Surkamp, Osich, Blackburn, Mejia, others. One of these steps into 4th/5th starter and one into a top 3 starter. New cheap BP arms arrive as well.

    3. Giants trade or extend Timmy. Timmy is now age 31/32 (and maybe less studly) but will be $25+MM/year to resign for 2016 and beyond. Too expensive/too much risk. Most likely trade time. Restock the farm.

    Giants going forward have a core starter staff in Cain/MadBum plus great BP arms. Position players are still mostly cheap with Posey either a franchise face w/long term contract or a combo of Sanchez/Joseph/Susuc emerging as a cheap replacement.

    Looks okay to me -- IF Cain is signed.

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    1. 5/100 for Cain is getting closer to what I'd be willing to pay. I'd prefer a shorter contract with higher $$$/year, maybe 4/90 or 3/75, but adding the extra year for $10 M is probably quibbling. I'll take this scenario. That 6/120 is the part I'm having a lot of trouble with.

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  8. I have to drop one more scenario down. You are worried about 6/120. I appreciate everything you have said about the contract, Cain's downside and staying calm about this situation. With everybody coming at you, you have given rational reasons for the lay down. I appreciate that also. I think you are giving the Giants front office far too much credit, I think this is all about being cheap and not making the bold move. Here is the bold move.

    The Dodgers are set up to do the following: First, they re-sign Ethier. On its own, not a big move, he might be overrated. Then, they sign up Hamilton. Injury prone, has his issues for sure. On its own, not a big deal. Then, they pay Cain the 7/150 at one minute past midnight. Why? Because it turns the pitching power on its head in the NL West and makes a huge, immediate impact. They come with a 3/4/5 of Ethier, Kemp and Hamilton. They have a 1/2 of Kershaw and Cain. If that doesn't scare the bejasus out of everybody...

    All it takes is money. And the Doyers won't have any problem with overspending or worrying about sunk costs or bad ends to contracts. They want fans immediately, they want to make a splash. If the Giants ownership doesn't come to their senses and offer Cain what he's asking in the next five days, he is gone and the scenario outlined is in motion. You talked about how the Giants have to get something because they have Cain under contract. He is offering it to them right now - give me market rate before I go to market and it gets insane. That is the hometown discount.

    Baggs today apparently stated they are very reluctant for the 5th year and the 6th year is an impossible sticking point. This does not sound like Cain wants to leave no matter what, as has been the case with every beat reporters story for 3 months. It sounds like the ownership is gunshy and can't tolerate risk. Well, they are about to have the double barrel of intense fan rage coupled by getting skunked by the Doyers big time. Unless they do the right thing and muscle up themselves.

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    1. Shank, nice to wake up and smell the coffee of your latest post...needs some sugar. Sign Cain!!!

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  9. If it's 6 years or nothing with Matt Cain, I'd pass, personally. I'm right with the Giants on this one. 5 years is a stretch, 6 is a deal breaker unless it comes with a significant per year discount.

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