A Look at Carson Palmer’s Contract

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Obviously I had a lot of questions about Carson Palmer following his injury and in light of a report by Albert Breer concerning Palmer’s contract I think I can discuss it a bit more intelligently at this point.

Palmer’s new contract looks to be worth $49.5 million over three seasons. Of that $49.5 million he will receive $10 million this year, money that should all be treated as a signing bonus. That is the number I projected the other day as a reasonable figure. The bonus is actually split between a roster and signing bonus which likely only impacts the actual payment of cash and the forfeiture provisions in the event Palmer was to walk away without the blessings of the Cardinals.

Palmer has another $10.5 million that is guaranteed for injury in 2015 but will become fully guaranteed a few days after the Super Bowl. This is important for Palmer because we can consider this money now fully guaranteed. There is no way between now and early February that Palmer will be sufficiently healed from an ACL injury to actually pass a physical, which he would need to do in order to be released without the guarantee kicking in. Since the salary becomes fully guaranteed on that date Arizona has no ability to carry him until he is healthy enough to play and then release him.

Palmer has salaries of $12.7 million in 2016 and $16.3 million in 2017. The salaries are split evenly between a roster bonus and paragraph 5 salary, which basically gives Arizona until March in each year to release him. He won’t be covered by any guarantee those seasons. His dead money charge in 2016 should be $5 million so it is a reasonable escape point if they need it.

The cumulative new money cash flows of Palmers contract work out to be $20.5 million (Year 1), $33.2 million (Year 2), and $49.5 million (Year 3). Those are actually very reasonable charges for Palmer who whose two year totals trail Alex Smith ($37.7M) and Jay Cutler ($38M) by a significant margin. Palmer statistically has compared favorably to both but is also older which likely played a role. Palmer will also trail Andy Dalton over the two year period ($34.9M) but in theory could earn more if he was to see all 3 years of the deal and Dalton hits no contract escalators.

It would look as if Palmer’s 2015 salary cap charge will be $15 million in 2015. Until something is done with Larry Fitzgerald’s contract the Cardinals will have one of the worst salary cap positions in 2015.

Things could also get more complex with the Cardinals salary cap if backup QB Drew Stanton plays well in Palmer’s absence. It was widely reported in 2013 that when Stanton signed his contract that he could earn up significant incentives in his contract if he performed well in a starting role. Considering Stanton has already played a few games this year he will likely be the man taking the majority of snaps on a playoff team which is often one of those hurdles to unlocking contract money. If he was to earn a raise it could put the Cardinals QB salary allocations in a spot they did not anticipate being just one day ago.

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Cardinals Sign QB Carson Palmer to 3 Year Extension

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Arizona has locked up their starting QB Carson Palmer for another three years according to ESPN’s Chris Mortensen

While Mort didn’t give any contract details outside a range of annual values, it sounds as if Palmer will make $20.5 million in new money between now and 2015 and max out at $16.6 million a year.

Palmer is one of the more interesting quarterback. Palmer retired a few years ago when he wanted out from the Bengals who were making it known they felt they could go as far as they could with the former number 1 overall pick.  Palmer ended up being traded to Oakland where he was eventually asked to take a paycut from what was an already relatively modest salary. He refused and Oakland decided to trade Palmer to Arizona and instead go with Matt Flynn and later Matt Schaub as veteran replacements, two pretty bad decisions. Palmer has had two efficient years with the Cardinals and it was a given that they would need him to QB what is win-now contending type team for the forseeable future. Palmer had never been able to get over the playoff hump and may have the best chance of his career in 2014 to do so.

Palmer was likely able to leverage the teams strong record and the lack of good quarterbacks around the NFL into this contract. Palmer is certainly on the older end of the age scale and never had those Peyton or Brady-esque seasons that would limit those age concerns. Palmer did miss a few games earlier this season.

If the $20.5 million is his true new money number that would place him about $3 million less than Alex Smith in his most recent contract extension. The 3 year value should be just below what Smith makes over the comparable time period. This extension should push him beyond the three year value held by Andy Dalton who replaced him as Bengals starter in 2011.

Given the Cardinals current salary cap space I’d say a reasonable signing bonus for Palmer would be $10 million.  At that figure they can walk away from him in 2016 in the event the window closes and they want to get younger on offense. I would not be surprised if most of the guarantee was protected for injury only in the event the wheels fell off this year or Palmer was injured again and missed significant time.

The price sounds like a pretty reasonable one for Palmer who is a known commodity. Had Palmer been three years younger he would likely earn in the $19 million a year range as he is a superior player to Jay Cutler.  As long as he can maintain his levels of play he is a bargain compared to others in the same salary range.

I would think the next move for Arizona is to work with Larry Fitzgerald on a reasonable new contract. Fitzgerald has a monster cap hit and salary next season which is not really in line with his production. My estimates for Arizona, which already included a $10 million salary for Palmer, in 2015 had them with one of the five tightest cap situations in the NFL. Fitzgerald is really the key for them getting the books in order to improve further in 2015.

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Stock Down: Week 5

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Every Monday during the season we will take a look back at three players who are entering important stages of their contract that may have hurt their stock in upcoming negotiations with their play on Sunday. In addition we will also look at one player signed in the offseason to a new contract that did not live up to the expectations that his contract sets for the player.

Stock Down

Matt Schaub– Mentally Schaub is broken and it has carried over to the playing field where he looks nothing like the player he has been in the past. I don’t even know what to make of him. At times he is like Chad Pennington floating the ball and not showing the arm needed to get the ball to the sidelines. At others plays like he is down two scores with just 5 minutes left, even though it’s the first quarter of the game. Schaub is going to be in danger of being released from his contract and missing out on $11 million in salary in 2014 if this continues. The Texans are going to feel too much pressure to not do it and there is also a stigma growing around Schaub which is going to be reflected in free agency if released. I was sure if Schaub ever got released he would get a decent contract, but now I’m beginning to think it will be backup/prove it type money. That will not be $11 million dollars. He needs to turn this around.

Tyson Clabo Clabo had given up what may have been the most critical sack of the game when matched up against Terrell Suggs. He had been overwhelmed on the day and is on pace to give up 11 sacks on the season. Clabo was signed to a one year $3.5 million dollar contract  after his release from the Atlanta Falcons, who have their own line problems to consider. The Dolphins ground game has been unable to get on track and yesterday the team gained just 16 yards out of their running backs. While Clabo is not the only one at fault he is the one that will feel the most problems when the season ends as he looks for another contract. With teams in 2013 not really interested in him at a $3.5 million dollar tag why would anyone sign him for anything close to that in 2014 if this is what they will get?

Kenny Britt– The free agent to be Wide Receiver appears to be done with the Tennessee Titans. He’s a third string player at this stage and the Titans are now considering further demotion after a one  reception, multiple drop game on Sunday against the Chiefs. Britt now has just 52 yards on the season and is either not the same player following knee injuries or is mentally just not committed to the games with a team that does not want him. Either way other teams around the NFL are going to look at him poorly. He is most likely headed for a minimum salary contract next season as he has to now rehab his image in 2014.

New Contract Disappointment Of The Week

Carson Palmer– This is like bizarro world. A losing QB gets a “stock up” nod while a winning one gets the down nod, but Palmer has been awful and his team won in spite of him not because of him. For all of the talk about what Palmer was going to mean for the Arizona offense they essentially look no different than they did when John Skelton was the QB of the team. Palmer was a mess on Sunday throwing for just 175 yards and being picked off 3 times. Like the Panthers the Cardinals are going to waste a good defense this year because their offense is simply no good. It’s clear Arizona needs to draft a QB next season and begin re-tooling that offense instead of praying they can get something out of the current grouping. Palmer was supposed to fix that situation and he hasn’t.

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Report: Josh Freeman to Seek Trade

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According to CBS Sports Jason LaCanfora Buccaneers starting QB Josh Freeman is expected to ask the Tampa Bay Buccaneers for a trade. Freeman has struggled to earn the confidence of his head coach and there seemed to be a growing rift following the week 1 loss to the New York Jets in which Freeman struggled.

Asking for a trade during the season for a starting QB is pretty much unheard of in the NFL. The Bengals Carson Palmer had looked for a trade or his outright release from the Cincinnati Bengals in 2011, but that process began before the season.  Palmer had realized the Bengals were moving in a different direction with the drafting of Andy Dalton in the 2nd round which led to Palmer retiring for a brief period in 2011. Eventually the Oakland Raiders did trade for Palmer during the season when starter Jason Campbell was injured.  Freeman’s situation could be considered somewhat similar in that Tampa Bay seemed to draft an insurance policy in rookie Mike Glennon, a 3rd round selection in 2013.

Freeman is set to become an unrestricted free agent in 2014 and needs a big season to cash in on his first round value. Both Matt Stafford and Mark Sanchez, drafted ahead of him in the 2009 NFL Draft, have been able to cash in on their first round draft status and accomplishments, something Freeman will not be able to do if he gets benched or if the team does not trust him enough to be given the opportunity to show improved statistics.

It is hard to tell exactly what the market would be for Freeman. I have already seen many people say teams would not give up much for him because he is in a contract year, but that should be of almost no concern. Usually if you trade for a player you will immediately extend the players contract. Just this past season the Seattle Seahawks gave up a first round draft pick for Percy Harvin who was also in the walk year of his contract and they quickly turned around and signed him to a lucrative extension.

This has been very typical in the NFL when dealing with QB traded. Kevin Kolb had one year remaining on his contract when the Arizona Cardinals traded for him in 2011. They promptly extended him after the trade. The same occurred with Matt Cassel in 2009 when he was traded from New England to Kansas City as a Franchise player. The Bears added more years onto Jay Cutler’s contract after executing a trade with the Denver Broncos.

Teams also will consider the fact that even though he is a free agent the Franchise tag will always be an option for a full one year look at Freeman before committing big dollars to him.  So the term of the contract is not an issue.

What kind of value he has would be more of a problem. The going price for a player like Freeman would likely be a 2nd round draft pick, which Tampa Bay may not accept. They will likely want a 1st rounder which could be difficult to obtain. They could make it conditional and tie it in with performance or the signing of a contract extension, but if Freeman is indeed seeking a trade the Buccaneers may not have much leverage to execute the trade.

Freeman’s base salary this season is $8,430,000, so a team would need to have at least $7,438,235 million in cap room if they were to execute a trade next week. As of September 13 only 10 teams have the cap room needed to execute that trade. Of those teams the interesting names would be the Cleveland Browns and Jacksonville Jaguars. Both teams have poor QB situations and significant salary cap space to spend this season. The Browns are about $24 million under the cap and the Jaguars are close to $18 million. Other teams whose names could be linked to such a trade would be the Raiders and Vikings, but neither has the cap room to execute a trade without including players or restructuring contracts. The Vikings have just $2.2 million in cap room while the Raiders have $3.25 million prior to the extension of FB Marcel Reece. The Vikings, in theory, could extend DE Jared Allen to make the trade happen but that would seem unlikely. Oakland would have a much more difficult route with Darren McFadden being the likely candidate.  Teams could also consider a sign and trade type agreement, but that requires a fast extension for Freeman and many moving parts would be needed to come together for that to occur.

View Josh Freeman’s Contract and Salary Cap Page

View Josh Freeman’s Financial Charts

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Is Jay Cutler Worth Even Close to $20 Million a Season?

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Mike Sando had an interesting piece on ESPN yesterday looking at the big free agent QB’s and prices they may command (subscription required).  Unfortunately its an insider piece but since NFL.com posted some comments from it we’ll do the same here. Sando was able to get a cap manager of one of the teams to discuss some potential contracts for players. This was the one that floored me and everyone else:

Jay Cutler is going to eventually get $20 million no matter how much he deserves it. I think there will be a team desperate for a quarterback who doesn’t like the quarterbacks in the draft. Maybe they think they’re close and the GM says Jay Cutler is no different from Joe Flacco, that you can win a championship with him. It just takes one of 32 teams to make that judgment, and I think there’s a good chance someone will. Cutler can still be pretty darn good.

I have to admit I was stunned that a person in charge of managing the cap for his team would believe that Cutler would fetch $20 million dollars per year. Currently there are only four players in the $20 million dollar per year club- Drew Brees, Joe Flacco, Matt Ryan, and Aaron Rodgers.  Each is there for a number of reasons. Brees is a prolific passer who was a Super Bowl MVP. Flacco is considered to have tremendous upside and put together a tremendous stretch of games that culminated in his Super Bowl MVP trophy.  Its also worth noting that Flacco was only going to receive around $16 million a year before the Super Bowl win and the Ravens were not going to hand him $20 milion a year because “you can win with a guy like Flacco”. Matt Ryan is considered the best young passer in the NFL and looks to be on his way to becoming a 5,000 yard passer. Rodgers is the best QB in the NFL, putting up tremendous statistics and winning a large amount of games.  Cutler is not even in the discussion right now with these four players.

I think sometimes we forget that Cutler is not a young player anymore. There is an argument to be made that Matt Ryan was paid on the dreaded P word- “Potential”.  Now in Ryan’s case it was the potential to win a Super Bowl not be a great passer as he had already established himself as a passer. It is the same reason Philip Rivers became the second highest paid QB in the NFL in 2009. He had enough numbers and success to convince teams that he was going to win it all just like Eli Manning. Ryan and Rivers, in the season of signing, were both 28, right about to enter the prime of their careers. Jay Cutler will be 31 when he takes the field for a new team in 2014.

Potential doesn’t come into play over 30 and it should never cloud the judgment of a team. Cutler’s “potential” year came off his last season in Denver when he threw for 4,500 yards and looked like he had that Rivers/Ryan potential. The Bears traded for Cutler the following season and did extend him at just under $14.7 million a year in new money, which was near the top of the market at the time, but he opted for the short term extension assuming he would cash in after winning some big games for Chicago where Cutler was to be the missing piece to the puzzle. That money was based on potential.

Four years later and no potential was realized. His numbers have plummeted while the average QB numbers, in general, have risen. He has thrown for less yards in his last two healthy seasons than Mark Sanchez of the Jets.  You don’t go back to what a player did at 25 when he is 31 to come up with a pricing point.

It doesn’t mean Cutler has had an easy time of it in Chicago. They have had a revolving door of bad offensive coaches, bad decision makers selecting poor wide receivers and horrific offensive lineman. Cutler did himself no favors either as he carries himself with a bit of an attitude that rubbed many players, specifically veteran defenders, the wrong way. Players didn’t come to his defense and I don’t think he ever assumed a leadership role with the team.

The highest end comparisons you could make for Cutler are Matt Schaub of the Texans and Tony Romo of the Cowboys. Schaub was 31 when he signed his extension and Romo will be 33 this season. Schaub earns $15.5 million a season while Romo earns an inflated $18 million. Neither comes close to $20 million. One of the difficult items in comparing Cutler to other players is the pressure he deals with in Chicago. Last year Cutler saw pressure on 37.5% of his dropbacks according to Pro Football Focus. Romo and Schaub are closer to 30%. That said Cutler deals with it well and is one of the rare QB’s who has very limited decline statistically under duress, perhaps because he is so used to dealing with it. Last season Cutler completed 60.5% of his non-pressured passes and 54.1% of his pressure attempts.

Looking at the last two more or less healthy seasons of work for each QB and breaking things down into yards per pass attempt by throw distance you get the following look at the players:

Jay Cutler YPA

Cutler is considerably less effective than both Romo and Schaub passing down the field and for most QB’s this is where they get paid, not by throwing little dink and dunk passes. For what it’s worth the presence of Brandon Marshall did little to the results and his yardage totals actually decreased, significantly in the 10 to 19 yard category, in 2012 compared to 2010.  I often look at something I call incremental yards which more or less measures actual yardage produced by distance compared to the average NFL QB.

jay cutler incremental yards

Romo pretty much makes his living throwing the ball down the field while Schaub is an intermediate passer. Cutlers failures down the field have made him an average QB overall. Part of that is the Bears offensive design faults and some may be Cutler’s decision making. Romo completes over 40% of his passes over 20 yards. Cutler completes only 28.5%, yet Cutler’s pass selection sees 15.6% of his passes travel over 20 yards while Romo is under 12%.

Those decisions hurt Cutler even more than just yardage, but also in turnovers.  Schaub only throws 9.2% of his passes deep because there is no upside to him doing so.  Even though he completes over 36% of his down the field passes his interceptions per attempt are 8.7%. That works out to a 23.8% interception to completion ratio which is a ridiculous number, so the Texans just avoid it. Cutler is at 8.3% I/A and a whopping 28.9% I/C. Someone needs to just have him stop those passes. Despite the arm strength that is not his game in Chicago and may not be anywhere else.

The bottom line is that he is nowhere near as productive as your next tier of salaried QB’s. I think you can argue about Romo vs Schaub and make a strong case that Romo’s salary should be closer to Schaub’s, but I’m not sure the rationale behind arguing that Cutler should make as much as either of the 30+ year old players, let alone $20 million a season.

The most realistic data point for Cutler should be that of Carson Palmer. Palmer is one of the “potential” graded QB’s simply because of where he was drafted and how he played very early in his career. By the time his days were coming to an end in Cincinnati he was unproductive, even moreso than Cutler, but the distance passing results were nearly identical:

Jay Cutler vs Carson Palmer

The major difference is just the short yardage passing which helped him produce more productive yards than Palmer. Because of his limitations Palmer rarely threw the football deep(8.2% of his attempts)  as a Bengal, a model maybe the Bears should consider with Cutler. The Raiders ended up trading for Palmer in 2011 and then extending his contract for cap relief.

Palmer, a former number 1 pick that the Raiders had bet the farm on, only received a deal worth $10.75 million per year. The Raiders were, at the time, the worst managed team in football and that figure represented a 40% decline from Peyton Manning’s top of the market $18 million per year contract from the Colts. Palmer was 32 years old and 7 years removed from his draft when he signed with Oakland, very similar to Cutler’s situation next year. The Raiders traded Palmer in 2013.

If we bring those dollar figures into today’s salary market, Cutler should be looking at a deal worth $13.1 million a season, a far cry from the $20 million mentioned by the cap manager. Cutler is a bit better than Palmer so maybe we push that to $14 million, but that range is likely going to max out somewhere below $15 million. Those figures are assuming the Raiders contract with Palmer was considered legitimate in the eyes of the rest of the NFL. Given their history it may have been viewed as an inflated price tag.

Of course we can throw this all out the window if Cutler goes out and wins a Super Bowl and is named Super Bowl MVP. If that occurs he has something that Romo, Schaub and Palmer do not, and as we have seen with Eli Manning and Flacco, albeit at a much younger age, the Super Bowl trophy means big dollars to teams. I still don’t think this would bring him to $20 million a year but it may at least be a discussion since teams are certainly showing a willingness to spend big on the plus 30 QB. But without it there is no way a team can pay him based on what they have seen for 8 seasons.

Cutler will have another coach this year that is supposed to be an offensive expert. He has his old buddy Marshall again at Wide Receiver and they brought in Martellus Bennett to play Tight End. The team signed a new Left Tackle and Left Guard. They still have a capable runner and pass catcher out of the backfield in Matt Forte. Cutler is going to need to see his stats go way up this season and see the team go into the playoffs to bring himself into the Schaub/Romo conversation. If he continues to be the same QB we have seen I just can not picture a team going long term into Cutler at the upper tier price level.  Moderate price, sure, but the upper level is going to be very difficult for him to achieve without going on a tremendous run in 2013.

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Raiders, Seahwaks, and Cardinals Make Some Moves with Flynn and Palmer

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With accurate news of Quarterbacks Matt Flynn and Carson Palmer’s restructures in hand, I figured now would be a good time to look at the set of moves that landed Flynn in Oakland, Palmer in Arizona, and what it all means for the teams involved.

First the Seahawks, who shipped out last year’s usurped before he held the throne starter Matt Flynn. As well know by now, the Seahawks netted a 5th in 2014, and a conditional pick in the 2015 draft. Considering all the circumstances, I can’t imagine that pick being high at all. Still, it’s a decent get for the Seahawks for a disposed starter making decent money. It does, however, also leave Seattle without a capable backup, with all due respect to Josh Portis. The Seahawks will incur 4 million in dead money, the acceleration of Flynn’s signing bonus, but are off the hook for the guaranteed portion of his salary (the Raiders will cover that) and will gain 3.25 million in space, along with Flynn’s would have been salary of 5.25 million. The Seahawks, with more than enough comfort as it pertains to the cap, I imagine will use the savings to find a backup quarterback, and work on extending their own.

Next, the Cardinals, who gain Carson Palmer for a swap of a 6th for a 7th and a conditional 7th the next season. Palmer was never going to see his 13 million salary, and sure enough isn’t going to see it in Arizona either. If the recently reported numbers are correct (and considering Mr. Brian McIntyre’s usual excellent work, they should be), Palmer will not only give the Cardinals something more than a warm body at quarterback (apologies to another deposed not quite the starter Drew Stanton) but something at least league average from the position. Palmer should be a good fit for Arians downfield attack as his arm has looked much better than the last of his Bengal days. Part of that though also assumes they keep him upright, and in that vein it would not be surprising to see the Cardinals and Raiders connect on another trade for the #3 pick come draft night. For now though, Palmer sees his salary reduced to 2 million this year, and along with the proration of his new 6 million signing bonus, gives him a cap number of 4 million for 2013. For 2014, his cap number is 10 million, though if he flops, or wants to leave, or for whatever reason is no longer in the team’s plans, the Cardinals could release him and save 4 million against the cap once Palmer’s acceleration and guaranteed portion of his salary is accounted for. Palmer’s contract will void after 2014 currently, though there’s plenty of time before then. The Cardinals overall cap health isn’t drastically affected by the Palmer acquisition and remain in decent shape.

Finally, the Raiders. The Raiders give up a 5th rounder in the 2014 draft (which according to more than a few essentially equates to a 6th rounder in this draft) along with a still unknown conditional pick. Some may pan this move for the Raiders, but I think it’s a decent fit. The quarterback class has been viewed with skepticism this year, and Flynn still has some upside. General Manager Reggie McKenzie also is obviously familiar with Flynn from their Green Bay days. Flynn can come in and compete with Terrelle Pryor (I’d expect him to win based on contracts and reports, but one never knows) and either serve as a veteran backup, a stop gap starter, or flourish into something more. Considering the way some 3rd day picks are thrown away, I think it’s a worthwhile gamble. Reports has Flynn originally getting an increase in base pay this season along with a reduction next season, but this is not the case and never did make much sense as Jason noted. New numbers finally released today have him reducing his former base salary of 5.25 million down to 3.25 million, and in return he gets the additional 1.25 million guaranteed (originally 2 million from Seattle already was) and a 3.25 million signing bonus spread over 2 years. Flynn’s 2014 base salary also reportedly has been reduced from 6.25 million down to 5 million, putting his cap hit that season at 6.625 million. Essentially McKenzie took 2 million from Flynn’s salary this season, and 1.25 million next season and combined it into a signing bonus. This will save the Raiders only 375,000 against the cap this year, but they maintain future flexibility if Flynn doesn’t work out saving 5 million next season if they release him, being on the hook for only 1.625 million.

The other part of this trade for the Raiders was dumping Carson Palmer’s contract. Conflicting reports makes it unclear who exactly wanted out, but it’s safe to say both sides had likely grown tired of each other. Palmer was not going to be around if and when the Raiders had successfully rebuilt the team and reportedly wanted to play for a team closer to contention. Palmer will leave the Raiders with 9.34 million in dead money, though the Raiders will save a hair short of 6 million in cap space and 13 million in cash by trading him. The Raiders also managed to secure a higher pick in this draft, moving up from the 7th into the 6th, along with potentially getting an additional 7th next draft. It’s not much, but it’s better than the nothing that was due with an expected release. These moves put the Raiders roughly 9.8 million under the cap, which while I won’t expand on in this post, currently gives them more than enough flexibility to eat all of Rolando McClain’s contract this offseason if they so choose.

It’s safe to say I think everyone is mostly happy with the returns. Arizona gets a quarterback who fits their direction without giving up a ransom, the Raiders get one who fits their team and save cap space and money, and Seattle unloads a player who was not in their long term plans though I’m sure Seattle would like a set backup quarterback, though the team is in amazing shape. In the end though, only time will tell how these trades fare.

Jim can be reached by angry Seahawks and Cardinals fans who know more about their teams than he does at JimOTC@gmail.com