Keeper League Inflation and Mistakes That People Make

So this bit is obviously on keeper league inflation and why it is important. I will begin by stating that until writing this piece I have never ever worked out the actual inflation in my keeper league. Honestly I just ballpark it because I’ve seen owners make some pretty strange decisions based on their inflation calculations and I’d rather not go down that road.

I don’t want to get into the details of figuring out your league inflation rate so follow this link (inflation) and it will be explained. For the purposes of figuring our my league inflation this year I used Rotoworld and ESPN’s value for 5 x 5 AL only and then worked off the average between the two. For the most part the two are relatively close in terms of the projected dollar values but there are the occasional diversions which are large. For example, ESPN has Salvador Perez as a $10 player whereas Rotoworld has him at $18 so this yields an average value of $14 which is what I used.

Going into the auction I had postulated to a friend of mine that there might actually be some degree of deflation or closer to standard market pricing than we’d ever seen before. Looking at some of the keepers vs. their projected dollar values meant that dollars were being taken off the table instead of the opposite which is the goal of keepers. Max Scherzer, who I kept at $30, was the player with the biggest ‘overpayment’ by $13.50 over his average value with Dunn ($12), Cano ($11) and Longoria ($11) as the other biggest gaps between values. On the other end of things Mike Trout was far and away the best keeper at -$33. Next closest was Lawrie, Rivera and VMart. Of course both Lawrie and Trout had been brought up from the farm which explains the difference in their values while Rivera and VMart had been stashed on the IR by owners last year at reduced prices.  Scherzer and Dunn seem like the biggest leaps listed here but they both could produce near their prices. Cano and Longoria are two of the best at their positions and I don’t have too much of a problem with what they were kept at. The drop off at 3^rd in particular is huge after Cabrera/Beltre/Longoria.

So after crunching all of the numbers I came out with an inflation rate of 7.74%. Basically this means that adding 7.74% to the projected value of the available players would give you the value you should bid on them. For example if Miguel Cabrera is valued at $37 by ESPN then he should go for $40 after rounding up. What did Cabrera actually go for? $52 which is a whopping 40% over his $37 value as per ESPN. Justin Verlander was projected as $33 and went for $41 which is 24% over his projection. How is this explained? Well the reality is that 7.74% is just a number. It’s a number that explains the average inflation but some players will be wildly over this number and some will be wildly over that number. Getting back to the Scherzer example he was overvalued by 81% and Cano by 31%. By these metrics I made a horrible decision to keep Scherzer whereas Cano wasn’t nearly that bad. The point of this exercise is that no player will be exactly 7.74% more than his projected value. Truly elite talent will almost always have a higher inflation rate than the league average and you can often make your money back on lower/mid tier talent. Keeping Cano at a 31% inflation rate really isn’t that awful.

The problem with our auction was that after the elite talent started going off the board at highly inflated values (Cabrera 40%, Verlander 24%, Pujols 44%, etc.) everyone got gun-shy. The adjustment the owners made to these high prices based on a perceived lower inflation rate than in years past was to sit on our hands. The result was guys like Wieters went for a 58% reduction on his projected value and one owner actually ended the auction leaving $27 on the table. Obviously this is inexcusable. Hindsight is 20/20 but he missed out on any real pitching staff by not spending that money.

When the dust settled you had $6 guys going for $2 and $10 guys going for $7 but $25 guys went for $30. This isn’t that far off than what I’d expected but if I’d gone the extra few bucks on some positions my team would be far better off.  

The conclusion is to know your inflation rate but use it only as a guide. Simply applying that rate and bidding accordingly will mean you overpay for some and miss out on others. Get a feel for the auction, determine what positions are easier to fill than others and bid that way.