Esteemed colleague and possessor of a terrific first name, Jeff Long, recently wrote about why teams in contention might pay a lot for relievers, even though, as Long writes, “It’s a formula that the sabermetric community sometimes finds difficult to rationalize. Relievers pitch so few innings and are so volatile that their value is almost certainly lower than that of the prospects dealt for them.” As to why teams in contention do this anyway, Long concludes that when the playoffs come teams cannot simply accumulate WARP; they need to actually win individual games, and really good relievers help teams do so. That makes sense to me. It makes sense to me why teams add relievers to improve their chances of winning right now even if they are going to end up accumulating less WARP from a given trade. But what does still does not quite make sense to me is why Aroldis Chapman was so expensive compared to other relievers or other players traded at the deadline.

How expensive was it? Please find an email from me to Chris Crawford, and Crawford’s responding email below:

Email from me to Crawford:

Hi Chris- quick question for you. Which package do you think is better, the one the Yankees got for Chapman or the one the A's got for Hill and Reddick? And, to follow up, how close are they?

Email in response:

I like the Yankees package for Chapman substantially more. I like Holmes Montas and Cotton, but none of them offer the upside of what Torres offers, and McKinney has a chance to be an everyday outfielder or a really good fourth.

As far as how this compares to prospect returns other than the Hill/Reddick return, well, Chris is a busy guy and I didn’t want to bother him too much, so we are left with my far from expert, nearing on ignorant, based entirely on reports I read on the internet opinion on prospects. That said, I’d say that the Chapman return significantly bests the returns for Carlos Beltran and Mark Melancon. I’d also say that while it is less than the return for Andrew Miller, Miller comes with two extra years of team control and a percentage chance of being worth a qualifying offer. Compared to the Jonathan Lucroy and Jeremy Jeffress return, the Chapman return is certainly less, but the Rangers are getting two years of Lucroy and three years of Jeffress. Again, I get why the Cubs—an incredibly smart organization, maybe the smartest organization, and probably the best run organization we have seen this decade—traded for a reliever, even paid a premium for one, but why choose to pay the most expensive price (relative to what is being received) when other options were available? We’re gunna take some guesses answering this below.

1. Supply and Demand and Timing
The Cubs had no real need for a bat or a starting pitcher, but there was definitely room for improvement in the bullpen, particularly for a lefty. Unfortunately for the Cubs, and fortunately for teams with elite relievers, demand is high around the deadline for elite relievers because (i) every team in playoff contention can improve by adding an elite reliever and, maybe, (ii) the impact of elite relievers was on full display the last two postseasons with the Royals. Demand was high, so prices were higher than they would have been had demand been lower. Additionally, the Cubs were buying when supply was limited. When they decided to trade for Chapman, it was not clear whether Chapman was even available and it was likely that Miller was going to be kept. The same goes for Melancon. And it is even possible that the Brewers were holding onto Jeffress if they needed to bundle him with another player to maximize their return. Lastly, if the Cubs were set on adding a lefty in addition to Mike Montgomery, then the supply of solid lefties available drops to Will Smith and Chapman.

Not only did supply and demand drive up Chapman’s price, so too did timing. With, as mentioned previously, Miller and Melancon not yet on the market and sellers not as fully motivated as they likely would be at the deadline, the Cubs bought when supply was not at its highest. It is easy to say that they mistimed the market. This ignores, however, the composition of the MLB trade market. We cannot analyze timing the MLB trade market the same way we analyze buying a stock from an ETRADE account. We cannot do so because a stock market comprises thousands of buyers, very few of whom have enough might to sway an entire market, whereas the MLB trade market is made up of very few teams. The result of this is that demand lessons as soon as the Cubs leave the market, so the somewhat decreased prices paid by other teams is expected. Lastly, these negotiations (note: I am assuming here) are not like buying milk at the store. There is no set price, and, therefore, teams can charge different prices to different teams and may very well charge higher prices to teams that want or need a player more than other teams. That said, the Cubs know all this, so why not wait until another club pays up or until the sellers bring down their price? Well, that question brings us to an attempt to answer it below.

2. Loss Aversion and Decisions Framing
Waiting, like anything, comes with risk. There was a percentage chance that had the Cubs tried to time the market Chapman would have been dealt elsewhere, the Yankees would have decided to hold Miller, and the Cubs could have ended up paying a fortune for Will Smith or Melancon. Okay, but certainly the percentage chances of the worst case in this scenario do not make it worth having paid the price paid? That would be my guess, but I would also guess that such analysis is not of importance when a team can practically taste a championship.

Put differently, when it comes to strategy and decision making, how we frame a decision often matters more than the likelihood of the outcomes given the choices we make; the fact that there is a percentage chance often matters more than what is the actual percentage. In the case of the Cubs and Chapman, the chance that they could miss on a World Series victory that they have been building toward for four years because they decided not to pay up for a reliever at the deadline seems unpalatable when put that way.

And this brings us to our old friend loss aversion—the preference to avoid loss over seeking gains. Usually loss aversion, as it relates to trades, would be a deterrent because no team wants to be the one that gets burned and no one wants to be the general manager that gets fired because they got steamrolled in a trade. For a team like the Cubs, the pre-season and current favorites to win the World Series, the loss that they likely fear most and likely seek to avoid the most is doing anything that could prevent them from winning the World Series. In this case, the Cubs likely traded a hefty prospect haul for a rental because failure do to inaction, failure resulting from not bolstering the bullpen would likely be unbearable. When the decision is framed this way, almost any price that does not include talent that will help them win this year seems fair. Of course, when taken to an extreme (as would be trading four years of Kyle Schwarber) this can come to look very ugly, because while Chapman provides them with an avenue to avoid a particular regret, he still comes with no guarantees (the price for a guaranteed championship, I assume, would be much higher). But again, we have changed the way we framed the decision.

These are incredibly difficult strategic decisions, weighing short term and long term goals, and the Cubs front office is one of the best equipped (given their track record and experience) at making those decisions. It is also a position that their partner in trade, Brian Cashman, has quite a bit of experience in; and given how he timed the market (both with Chapman and Miller), it appears his familiarity with the situation allowed him to do quite well for the Yankees in being an outlet for the Cubs to pay a premium price to quell their fears.

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That it was the Cubs paying the price is what makes the Chapman deal so fascinating. If it were the D'Backs, we'd all just roll our eyes about them not understanding the value of prospects. But the Cubs clearly know what they're doing and they still paid through the nose.

As a Reds fan, I only wish they had the foresight to hold on to him and get that sweet trade deadline value.
What I find even more fascinating is 'moral price' the Reds paid. I doubt many Reds fans consider Chapman a bad guy yet the organization dumped him at his absolute lowest point out of what can only be thought of as negative association. Even though Cincinnati was by far the safest place for Chapman to be and resurrect his reputation. It was a knee jerk move at best and something were aren't supposed to talk about here at worst yet it severely damaged the team in terms of value. My point being that wishing for that kind of return is improbable if the Reds can't be objective about their players/assets.
Smart people make mistakes, both in baseball and real life. Dombrowski paid too much for a no-longer-the-best Kimbrel, Beane's Donaldson, Butler and Addison Russell deals range from "huh" to terrible and the Cubs brass lost here. "But if they win it'll all be worth it!" No, you're letting chance define process. And the fact he's a lefty seems pointless considering there hasn't been any evidence to show they aren't going to use him in non-closing situations. And they didn't even get the extension. Trading may be complicated and hard, but that doesn't mean you can ignore or make excuses for errors. Maybe that's why this article is written in the first place, because it's been made clear, by a lot of non-industry baseball people, that the Cubs clearly lost this trade.

Or maybe we're still all missing something bigger in high strikeout reliever's value to a team (despite above average defense).

[1] assuming ownership didn't tell him to cut payroll. It's hard to believe they were getting back more than $2M/PresentWin though.
I think the overpay was known and intentional. Theo set the market higher than it should have been, and the Chapman deal became the barometer for other deals. It made other contenders trades more difficult, and put the people with the best farm teams in the best position for deadline improvements. I believe this was factored into Theo agreeing to the asking price for Chapman. He was also the best player at his position in the market (and possibly in all of baseball) which I am sure also garnered a premium.
Are you sure Miller wasn't available when the Cubs traded for Chapman? Or was it that the Cubs weren't willing to give up Schwarber or Baez, thus not matching the Yankees demands? Seems to me Cashman was always shopping Miller, he just needed to get a deal that would be approved by ownership.

In giving up Torres and McKinney, the Cubs lost two pieces that likely never would have played at Wrigley, and if they did, it would have been in supporting/bench roles.

The loss of Torres has more impact on them trading for a young controllable starter this offseason or at the next deadline. Doesn't mean the Cubs can't or won't do that, it'll just leave their system that much thinner after it's done.
Miller got traded after Chapman, so it terms of chronology, he was available. Rumors on several Yankees blogs confirmed (in retrospect) that the Yankees were willing to part with Miiller for prospects and Schwarber (I hadn't heard about Baez).

Nevertheless, the Cubs are in a unique economic and historic situation here, are they not? Why would they want to part with offense (Schwarber, though he's got injury issues) for a marginal player like a closer (no matter how good)? While everyone is high on Torres, MiLB is stocked with players with a lot of upside who never see a MLB appearance. Sorry, but I'm not seeing the downside for Epstein here.
I may be mis-remembering the Miller - Chapman trade order - if so, I apologize, but rumors about Miller to the Cubs for Schwarber and prospects definitely preceded the the last week in July.
With Pedro Strop possibly out for the year and Hector Rondon hurting, the Cubs need more relief help. I see another trade or two coming.
I was discussing this with my Cub friend a couple of weeks ago. While we both agreed it was an overpay we also so the logic in it.

The Cubs needed a lock-down closer.

The Cubs have a glut of middle infield talent.

The Cubs have the best team in baseball.

The Cobs haven't one in... forever. The fan base is hungry for a title.

Now was the time for Theo to put all his chips in the middle of the table. Flags fly forever.

*Edit : The Cubs haven't won a World Series in... forever.