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The Rockets’ Decision to Let Chandler Parsons Go

Nate Duncan looks at the Houston Rockets’ decision to let restricted free agent Chandler Parsons walk this summer.

Nate Duncan



We will likely never know the Dallas Mavericks’ true motivation* when they signed Chandler Parsons to a three-year, $46.1 million offer sheet on July 10. How much did they want Parsons, and how much did they want to torpedo the best-laid plans of Houston Rockets general manager Daryl Morey? At the time, Houston was the beneficiary of Parsons’ relatively low cap hold and the fact that it held his Bird rights. Houston’s plan was to use salary cap space to sign additional players and reach the salary cap, then use Parsons’ Bird rights to exceed the cap for his contract. By signing Parsons to the offer sheet, Dallas put a three day clock on the Rockets’ ability to use their cap space–if they planned to retain Parsons. Once the Rockets matched the offer sheet, Parsons’ $14.7 million would be on their books. If the Rockets did not use their cap space before this, it would be wiped out. With LeBron James’ indecision essentially extending the NBA’s moratorium, the Parsons offer sheet drew ever closer to the witching hour.

*Nor will we know for certain why the Rockets let Parsons out of the fourth year of his contract to become a restricted free agent to begin with. Speculation is that Parsons’ agent, the powerful Dan Fegan, secured the Rockets’ agreement to let Parsons out of his contract as part of the price for Dwight Howard signing in Houston a year earlier, although no one has actually be able to confirm that was the case.

But when James decided to sign with Cleveland on July 12, it appeared the stars were aligning once again for Morey. With James leaving Miami, the signing of Chris Bosh was suddenly considered nearly fait accompli by many observers on that frenzied day. To facilitate the potential signing, the Rockets bribed the Los Angeles Lakers with a protected first-round pick to take Jeremy Lin’s $8.4 million cap number* into their cap space. But with James gone, Miami immediately increased its Bosh offer to a five-year maximum contract. Bosh agreed to it, leaving the Rockets in a lurch.

*The protections on that pick: Lottery protected in 2015, top-10 protected in 2016 and 2017, top-five protected in 2018 and 2019, top-three protected in 2020, unprotected in 2021. Part of the reason for the high price was the fact that Lin’s actual salary in 2014-15 was nearly $15 million, a result of the odd offer sheet with which the Rockets had initially poached Lin from the New York Knicks.

Now, Houston had a difficult decision on whether to match Parsons’ contract. Before getting into the particulars, it is important to assess where Houston was as a franchise. The biggest factor in all of this analysis is the ages of the players involved. Parsons will be 26 years old by the start of the season. Unlike fellow maxee Gordon Hayward (24), it is unlikely he will improve significantly throughout the life of his contract. Parsons is also an awkward fit with James Harden, who really needs more of a wing stopper next to him due to his well-publicized defensive lapses. Meanwhile, Dwight Howard turns 29 in December. Unlike someone like Shaquille O’Neal, he does not have elite size for a center. Since he is largely dependent on athleticism, Howard realistically has two years left as an elite player, and possibly only one. And while Harden is only 24, he is not someone who seems to have the greatest fitness regimen. He could well reach his prime sooner than normal as a result. Therefore, Morey’s goal should be to maximize the Rockets’ championship chances over the next two years, the only two in which a team with Harden and Howard as the two stars would be likely to compete for a championship.

The Parsons Plan

Back to the offer sheet. The structure, as with many offer sheets, was extremely unpalatable to Houston. It included a 15 percent trade bonus* and a player option for the third year. Morey called it “one of the most untradeable” contracts he has seen, and he may be right. Parsons is now wildly overpaid for a player who is probably below average as a third banana on a contending team. Moreover, even if a team believed in him enough to trade for him from the Rockets, it would have to deal with a potentially even higher salary as well as the fact he could leave almost immediately as soon as the summer of 2016.

*Relevant only if the maximum salary increases by more than Parsons’ 4.5 percent annual raises per year.

For Morey, the decision of whether to match “came down to a bet of Harden, Howard and Parsons being the final piece, because we would have had no ability to do anything after that.” Here is what the Rockets’ cap situation would have looked like after a Parsons match and some other assumed moves, such as the recently announced signing of draftee Kostas Papanikolaou to most of the mid-level exception.*

Rockets with Parsons match

 *Note that figures in italics are based on assumptions, including the future cap numbers.It is unclear exactly how much the cap will go up based on the new national television deal in 2016-17, new local TV deals and overall rising revenue league-wide. The owners may also attempt to limit the shock to the system by slowly ramping up the increases in TV money over the life of the deal rather than having it implemented all at once. Nevertheless, $75 million seems a conservative estimate for the increase in the cap by that year. Also the trade of Omer Asik for Trevor Ariza, while it technically could still have been made, would not have happened if Parsons had been kept.

As the Rockets retained their top three players, that team would have looked a lot like last year’s team. Papanikolaou* projects as a physical, high-effort defender (if not a lockdown guy) who can knock down threes. The hope is that he will be a superior backup wing to anyone else on the roster last year, and that he can also enable the Rockets to play smallball with a third wing who is actually good. The Rockets would have retained the $2 million Bi-Annual Exception (for which they have yet to find a taker), as well as the $8.4 million Lin trade exception through next summer. They could also likely count on improvement from Terrence Jones in his third year. Since the team ranked fourth in offense and 12th in defense last year, one could argue that incremental improvements might be sufficient to put Houston right in the Western Conference mix.

*It is possible that the Rockets might have succeeded in paying Papanikolaou less in the first year by guaranteeing more money later on, which they were unwilling to do to preserve 2015 cap flexibility in the current scenario.

That said, the loss of Lin and Omer Asik would really hurt the depth, as there are no proven backup point guards or centers on the roster right now. If Patrick Beverley were to get injured again or Howard misses time, the Rockets would be in trouble. All told, it seems like the team would be about as good as last year, unless it could acquire another point guard or big man with the Lin trade exception during the season. Given the team’s first-round loss and complete inability to stop Portland* in the playoffs, it is hard to see the Rockets in the same league as the San Antonio Spurs, Oklahoma City Thunder or Los Angeles Clippers in the West.

*One possible upgrade Houston apparently has not explored is at coach, where Kevin McHale’s defense underperformed last year. With a defensive taskmaster involved, perhaps a realistic scenario would emerge in which Houston could have contended with the current core.

The problem then, as Morey sees it, is the difficulty in upgrading the team over the next two to three years with Parsons on the roster. With him untradeable in Morey’s eyes, opening up additional cap space by moving salary like in previous years would be impossible with $53 million tied up in Howard, Harden and Parsons. The Rockets would project to have middling cap space at most next summer, and even that would require dumping potentially valuable players. They might have room in the summer of 2016-17 if the cap goes up with the new TV deal, but by then two more years will be on Howard’s odometer and he will likely opt out to pursue a new contract as well. If the Rockets have not contended by then, perhaps Howard would look to go elsewhere, or require a larger contract than Houston were willing to pay.

Aside from the fruits of the Lin trade exception, Harden, Howard and Parsons would likely be the major players on the team over the next two years if they had kept him.

The 2015 Plan

The Rockets did recover from the Parsons loss with the signing of Trevor Ariza. While he is not the passer or driver that Parsons is, Ariza provides about the same level of spotup shooting and far superior defense. One can make the argument that Ariza was a better player than Parsons a year ago, especially considering the Rockets’ desperate need for someone who can play defense on the wing. Now Ariza will likely decline this year from career-best shooting numbers, and Parsons could get slightly better. But the starting lineup might actually be superior to a year ago for Houston.

The same cannot be said about the bench though, where the unproven Isaiah Canaan replaces Lin as backup point guard and the backup centers are currently Joey Dorsey and raw draftee Clint Capela. Overall, the Rockets project to be a little worse during the regular year due to the lack of depth, especially if injuries hit. In the playoffs, however, the bench matters less. They could also acquire another player via the Lin trade exception down the stretch, assuming he were not owed too much long-term money.

Nevertheless, the team should not be that much worse than a year ago.  Indeed, it is possible the Rockets could carve out an elite defense with three excellent defenders in Ariza, Beverley and Howard along with actual effort from Harden.
Meanwhile, this is the Rockets’ current cap forecast after letting Parsons go.

Rockets 8.12.14 Actual

The Rockets only have a nominal $5.3 million in cap space for next summer, but that becomes $10 million if they waive or trade the non-guaranteed Papanikolaou. They could potentially open up another $2.3 million by declining the fourth year option for 2015-16 on Donatas Motiejunas (which would have to occur by October 31, 2014), leaving an approximate $12 million in space. Beverley will be a restricted free agent after his third year and will command a healthy raise as a restricted free agent, but his qualifying number will be low enough to enable the Rockets to add more salary first before he is re-signed.

The real trump card for the Rockets is a potential trade of the newly-signed Ariza. His contract starts at a hefty $8.6 million, but declines each year to $7.4 million in 2017-18. That is not a great contract considering Ariza will be 32 during the last year of it, but it is not immovable considering the rising cap and the scarcity of two-way wings. Assuming he does not have a disastrous year, trading him without a sweetener could be possible. And were one required the Rockets have adequate assets in hand, including a first-rounder from New Orleans in the Asik trade, Capela, Motiejunas (if his option is picked up) or even Jones if necessary to induce a team to bite.

Moving Ariza next summer would open up a potential $15 million or so in cap space to pounce on the following free agents, with potentially even more available for some of the big boys if they want to move Jones or the cap rises more than anticipated:

Here are some potential free agent targets in 2015:

Kevin Love
LaMarcus Aldridge
Luol Deng
Rudy Gay
Paul Millsap
Arron Afflalo
Jimmy Butler (RFA)
Kemba Walker (RFA)
Kenneth Faried (RFA)
Draymond Green (RFA)
Kawhi Leonard (RFA)

Not all of these players will be available, and there is no guarantee they will take the Rockets’ money if they are. But you can make the argument that all of these players are superior fits to Parsons on the Rockets’ roster, while many of them should be more cost-effective as well. And, this of course opens up the possibility of getting another star player to pair with Howard and Harden, remote though that is.

Ultimately, the choice on Parsons was between the likelihood but not certainty of a slightly higher chance of contention this year, and the chance to get a third star or a better fit than Parsons in the summer of 2015 while the Howard and Harden combination is still good enough to attract one. Morey has famously commented that high-risk transactions are required to maximize a team’s ceiling when only one of 30 teams can win the championship each year. Letting Parsons go for nothing would seem to be such a risk. But perhaps the greater risk would have been betting that Parsons would improve enough at age 26 to constitute a championship core with Howard and Harden.

Nate Duncan is an NBA analyst and attorney. He writes regular features for Basketball Insiders and chats weekly at 11 Eastern on Tuesdays.


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NBA Daily: Checking In With Terrance Ferguson

Oklahoma City Thunder rookie Terrance Ferguson talks to Basketball Insiders about learning from his teammates, earning minutes and being mentally tough.

Ben Nadeau



Before he reached the NBA, the Oklahoma City Thunder’s Terrance Ferguson was once often referred to as a man of mystery. After changing course on two different programs in a two-month span, Ferguson ditched the typical one-and-done collegiate season for an adventure on the other side of the planet. But even after the Thunder selected Ferguson with the No. 21 overall pick in last year’s draft — the questions still lingered. How would a teenager with one season overseas adjust to the world’s most physical basketball league?

Not many rookies can contribute to a 40-plus win squad out in the cutthroat Western Conference so quickly — but down the stretch, here Ferguson is doing just that. With the Thunder locked in a tight playoff battle with six others teams, the 19-year-old’s hard-working personality has fit alongside the roster’s three perennial All-Stars — Russell Westbrook, Paul George and Carmelo Anthony. And although his rookie season has come with some growing pains, Ferguson is earning meaningful minutes and making the most of them.

“I think it’s my work ethic, I come in every day with the same mentality,” Ferguson said. “I work my butt off — inside the game, being physical. Even though I’m a skinny guy, as everyone can see, I’m still everywhere on the floor being physical. I think [the coaching staff] really likes that, especially on the defensive end.”

Skinny or not, Ferguson is one of the league’s youngest players, so the 6-foot-7 guard has plenty of room to grow — literally. But for now, he’s playing an integral role on an Oklahoma City team looking to protect its high postseason seed. Late January brought the unfortunate season-ending injury to Andre Roberson — an All-Defensive Second Team honoree in 2016-17 — so the Thunder have needed both new and old players to step up in bigger roles.

While those candidates included the three-point shooting Alex Abrines, veteran Raymond Felton and the newly-acquired Corey Brewer, Ferguson’s recent rise in the rotation has arguably been the most interesting development. Since the calendar flipped to January, Ferguson has featured in almost all of the Thunder’s games, tallying just two DNP-CDs and one missed contest following a concussion. This steady diet of opportunity comes as a stark contrast to the 15 games in which he received no playing time, spanning from the season’s opening tip to the new year.

Of course, playing time is not always indicative of success, but Ferguson himself isn’t surprised that he’s carved out a crucial role ahead of the playoffs.

“Not really, it’s all up to coach’s decision,” Ferguson told Basketball Insiders. “I’m just here playing my part, staying ready at all times and some minutes came, so I’mma take them and play to the best of my ability.”

Back in October, Basketball Insiders’ own Joel Brigham spoke to Ferguson about his unconventional path to NBA and the choice to spend a year grinding with the Adelaide 36ers, an Australian outfit. In the land down under, Ferguson averaged just 15 minutes a night, considerably less than he would’ve likely received as a highly-recruited prospect here in America. Some five months later, Ferguson’s early-season stance on the move still stands out.

“I’m living the dream now, right? I must have done the right thing,” Ferguson said.

Today, it’s hard to disagree with Ferguson’s decisions considering that they’re currently paying off. In 2009, Brandon Jennings became the first to skip college and play in Europe before being drafted, with Emmanuel Mudiay most notably following in his footsteps six years later. While those two point guards both were selected in the top ten of their draft classes — at No. 10 and No. 7, respectively — it still remains the road far less traveled.

Considered raw by most pre-draft evaluations, an early expectation was that Ferguson would spend much of the season with the Oklahoma City Blue, the Thunder’s G-League affiliate. Instead, Ferguson has played in only three games with the Blue, where he has averaged a commendable 14.7 points, four rebounds and 1.3 steals per game.

But as of late, the Thunder have found somebody that’ll always work hard, learn from others and do the little things that don’t show up in the box score.

“I’ve learned a lot more from when I first started,” Ferguson told Basketball Insiders. “I got great teammates — I got Nick Collison, I got Russ, PG, Melo, so just picking their brains. I got Corey now, so just the work ethic they put in, just picking their brains each and every day about what I can do better, watching game film, it’s a lot of things.”

When he was drafted, Ferguson had a reputation as a skyscraping leaper with the athleticism to become an elite perimeter defender. Although his current averages with the Thunder understate his innate potential, Ferguson knows he can contribute without scoring — even noting that he can make up for it “on the other side of the court.” Playing defense and competing hard every night, he has slowly made a name for himself.

And while Ferguson has tallied far more single-digit scoring outings than his 24-point breakout performance in early January, he’s earned the trust of head coach Billy Donovan and his veteran teammates, which is something the rookie will never take for granted.

“Coach believes in me and that means a lot to me,” Ferguson said. “But my teammates believe in me, so I’m not gonna let them down. I’m gonna go out every day and play my hardest, compete and try to get the win each and every night.”

One might assume that his year abroad in Australia helped to mentally mold him into the high-flying, hard-nosed rookie we see today. Ferguson, however, contends that he’s had that edge from the very beginning.

“I’ve been mentally tough, it wasn’t overseas that did that,” Ferguson told Basketball Insiders. “I had to be mentally tough just to go over there — so I’ve always had that mentality, the [desire] to just dominate, play to the best of my ability and compete.”

And now he’s doing just that in the NBA.

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Is Kyrie Irving’s Second Opinion a Cause for Concern?

Shane Rhodes breaks down the tough situation the Celtics are in with Kyrie Irving.

Shane Rhodes



The Boston Celtics are in one awful predicament.

With a third of the roster out due to injury, Brad Stevens has been forced into the impossible task of maintaining Boston’s championship aspirations with some subpar talent; while they have performed admirably, the likes of Abdel Nader and Semi Ojeleye wouldn’t see the same run they are currently on with most contenders. Gordon Hayward has missed the entire season, save a few minutes on opening night. Kyrie Irving, Jaylen Brown, Marcus Smart and Daniel Theis are all currently out, some for the year and others not. Key contributors Al Horford, Marcus Morris and others have missed time as well.

It couldn’t get worse, could it?

Well, it may just have. Reports surfaced Tuesday that Irving, who had missed time this season — including the last four games — with left knee soreness, is seeking a second opinion after a lack of progress in his recovery.

In the wake of the Isaiah Thomas fiasco and his ailing hip last Summer, an injury that lingered deep into this season, the Celtics will likely be more than cautious with Irving, whom they gave up a haul (the rights to the 2018 Brooklyn Nets first round pick, most notably), to acquire. But one can only wonder if these persistent issues — Irving’s left knee was surgically repaired after he sustained a fractured kneecap in 2015, and he reportedly threatened the Cleveland Cavaliers with surgery this offseason before his trade to Boston — are a cause for concern for general manager Danny Ainge and the Celtics.

The situation presents the Celtics with a quandary, to say the least.

Knee injuries aren’t exactly a death-knell, but fans need not look far for to see the devastating effect they can have on NBA players (e.g. Derrick Rose). They can snowball and, over time, even the best players will break down. Regardless of the severity, Irving’s knee issue presents problems both now and in the future.

The problems now are obvious: the Celtics, already down Gordon Hayward, cannot afford to lose Irving if they are at all interested in making a Finals run this season. Boston struggles mightily on the offensive end when Irving and his 24.4 points, 3.8 rebounds and 5.1 assists aren’t on the court. In a playoff atmosphere, especially, the team would sorely miss his scoring prowess.

Looking ahead, if Irving is dealing with these problems at the age of 25, what could the future hold for the All-Star guard? Knee issues, most lower body issues in general, are often of the chronic variety, and constant maintenance can wear on people, both mentally and physically.

Just a season separated from a likely super-max payday, will the Celtics want to commit big-money long-term to potentially damaged goods?

If there is a silver lining in it all, it is the fact that 20-year-old rookie Jayson Tatum must now shoulder the scoring load, something that should go a long way in building on the potential that made him the No. 3 overall pick last June. And, should Irving miss the remainder of this season, exposure to the fires of the playoffs should only temper the Celtics’ young roster. In the event that Irving’s absence isn’t prolonged, time like this could only serve to strengthen the roster around him.

Still, Ainge brought Irving to Boston for a reason: he was meant to lead the Celtics into battle, alongside Gordon Hayward and Al Horford, in their quest for a title. Obviously, he can’t do that from the bench. Without Irving at 100 percent, the Celtics are not a championship caliber squad, healthy Gordon Hayward or not. That fact alone will make Irving’s situation one to monitor going forward and for the foreseeable future.

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NBA Daily: Houston Has It All

Deciphering whether Houston is a contender or pretender is tough, but they’re making it easy.

Lang Greene



It is very easy to get caught up in the NBA regular-season hyperbole. The past is littered with a plethora of NBA teams that looked like world-beaters in the regular season only to pull up lame in the playoffs and emerge as a bunch of pretenders.

So when it comes to the Houston Rockets, it’s no surprise many pundits and fans of the game fall heavily on one side or the other. The 2017-18 Rockets are a polarizing squad in that respect. On one side of the fence, you have the folks that are struggling to get behind Houston until they see how the franchise performs in the playoffs under the brightest of lights and on the biggest of stages. On the other, folks that place a great deal of weight on the 82-game regular season and the ability to sustain consistency throughout the marathon.

As always, the truth is somewhere in the middle.

At the top of Houston’s lineup are two future Hall of Famers in James Harden and Chris Paul. The latter was a perennial star in his heyday and is still a top-tier talent in the league. Harden, on the other hand, is closing in on his first MVP award and had serious cases for winning the honors in prior seasons, as well. Both Harden and Paul are criticized for their past playoff failures.

Paul entered the league during the 2006 season and has been dogged by the ever looming fact that he’s never reached a Conference Finals. Harden has been to the NBA Finals but has been dogged for multiple playoff missteps and shaky performances that remain etched in everyone’s memory. But something about this season’s Rockets team (57-14) seems different as the duo closes in on 60 wins.

One way to measure the true greatness of a NBA team is evaluating how many ways the roster can win playing a variety of styles. From the eyeball test, Houston checks the boxes in this category. The team sustains leads during blowouts. They have an offense built to erase large deficits quickly. The team possesses the talent to employ an array of versatile lineups to withstand top heat from opposing teams. Head coach Mike D’Antoni has shown the ability to adjust on the fly during certain situations. Houston is seemingly comprised of a bunch of guys that are selfless and ready to sacrifice at this stage of their respective careers.

Time will tell on all of those aforementioned aspects, but the Rockets are built to compete and win now. On paper at least, the team fits the criteria.

Floor Generalship

Paul has a chance to go down as a top five point guard in NBA history .His court vision is unquestioned and his big men always seem to end up being in the top five of field goal percentage each season (i.e. Tyson Chandler, DeAndre Jordan and now Clint Capela). In years past, the Rockets faltered down the stretch of games because the entire system ran through Harden. But this year’s club has the luxury of taking some of the on-ball expectation away from Harden and by giving the rock to Paul who naturally thrives in this role the squad doesn’t take a step back on the floor.

This is going to be big for Houston which has seen Harden gassed late in playoff games from carrying the entire load.

Small Ball Ready

Presumably standing between the Rockets and an appearance in the NBA Finals are the Golden State Warriors. The Warriors turned the NBA upside down with their free-flowing offense, long range accuracy and the successful ability to push the pace while playing small ball.

At the height of Golden State’s success they employed the “death lineup” which places All-Star forward Draymond Green at center. In different variations this gives the Warriors five guys on the court who can dribble, drive, pass and shoot. Versatility is important and if you look at this year’s Rockets team they have the ability to match the death lineup with their own version. Veteran forward P.J. Tucker would be able to guard Green in this scenario at center or Houston could just rely on the athleticism of Capela.


When it comes to defense, the Rockets will never be confused for the bad boy Detroit Pistons of yesteryear, however, the team has an assortment of individually capable defenders on the roster. Paul has all defensive team honors hanging on his mantle during his time in the league. Small forward Trevor Ariza made his bones in the league by placing an emphasis on defense. Before Capela emerged as a double-digit scorer, he was relied on as a defensive spark off the bench. Luc Mbah a Moute has a reputation and consistent track record of being a very willing defender.

Shooting, Versatility and Experience

All of this success, leads to the variation D’Antoni can put out onto the floor. The versatility to go with a small ball lineup or a lineup heavily skewed toward defenders is a luxury amenity. Houston also features five guys with 125 or more three-pointers made this season with Harden, Eric Gordon, Ariza, Paul and Ryan Anderson leading the way. A sixth, Tucker, should join the +100 club before season’s end. Veteran Gerald Green has only played 30 games with the franchise but has already knocked down 76 attempts from distance.

Experience is key as well. This year’s Rockets team features only one player under 25, receiving 25 or more minutes per night in the rotation. Look at NBA history, title winning teams are full of veterans not second or third year players.


Again, the Rockets will never be confused with the late 80s or early 90s Pistons but the team has more than a few guys that don’t shy away from contact or physical play. The collection of Nene, Tucker, Green and Ariza have had more than their share of shoving matches when things get heated on the floor.

With the start of the NBA playoffs (April 14) under a month away, the Rockets continue to build momentum toward a title run. Will Harden and Paul’s playoff demons from the past emerge or is their first true shot at greatness with a complete team? These questions will soon be answered.

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