Friday, July 19, 2013

Market Fantasy #4 - Ghost of the Machine


Many of you are aware of the Dow Jones Industrial Average. It is one of the most watched and oldest stock market indices available. When people refer to movements of “the market” they are generally referring to movements of this index. Originally created in 1885 and composed of 14 companies: twelve railroads and two other industrial companies. In 1896, the index was rearranged to include twelve purely industrial companies. Amazingly, General Electric was part of this original index. Currently, the Dow contains 30 publicly traded companies across a wide spectrum of industries like; tech, telecom, retail, finance, consumer goods and others. When the Dow was founded, it was originally a dollar average of the component stocks. Today, the formula for computing the index value is a little more complicated than that.

Throughout its long history, the component stocks of the Dow have changed 52 times over the years. This happened most recently in September of 2012 when Kraft was replaced by United Health Care. In fact, since the beginning of the financial crisis, six companies have been dropped and replaced in the Dow (which makes hysteria of the current record highs of the Dow overblown, but that’s a different story).

This brings us to our discussion today. Two players have forced their way into the FOW while two players have played their way out. Today, the board of the FOW has made the executive decision to replace Albert Pujols with Chris Davis and Ryan Braun with Carlos Gonzalez. We (really just me) feel this decision will boost the value of the FOW and better represent the performance of the fantasy baseball economy.

Let’s start with first base. It’s clear that at age 33 (37? 48?) Albert Pujols is a shell of his former self. For 13 years, the man nicknamed the Machine used to deliver an average of 41 homers, 124 RBI and a .321 batting average. Simply put, he was a boss. A top three pick every single year. Even in his first year in LA last year, a down year by his standards, he still managed 30 homers and 105 RBI with a decent, not great .285 BA. Pretty solid numbers any way you look at. This year, however, the Machine has come unplugged. He is currently on pace for only 26 HR and 101 RBI with a paltry .249 BA. While those aren’t terrible counting stats, you want an early pick first baseman to produce more than that. Enter Chris Davis. A former top prospect approaching bust status, he has broken through in a big way in his age 27 season with Baltimore. He currently leads all of baseball with an absurd 37 HR and 97 RBI. He is also hitting a career best (by far) .315. He currently is the number two player in fantasy behind only overlord Miguel Cabrera. The changing of the guard is happening right before our eyes.

In the outfield, we’re replacing one first rounder with another. Ryan Braun is currently the 56th best OUTFIELDER right now. This is a guy who was a consensus top three pick. A guy with a career average of 36 HR, 117 RBI, 22 SB and .313 BA. Currently, he has a paltry 9 HR, 36 RBI, 4 SB despite a very respectable .304 BA. Currently battling a thumb injury and embroiled in his second PED scandal in as many years, it was an easy decision to replace him with the current top ranked OF: Carlos Gonzalez. While talent has never been a question for CarGo, health has. With 25 HR, 64 RBI, 16 SB and a .302 BA, Gonzalez is putting up the season we expected of Braun. Finally healthy, he is enjoying that sweet thin Coors air.

With that, the new FOW looks like:

Player
Position
Value
% Change
Santana, Carlos C CLE
C
 $    18.99
-9%
Posey, Buster C SF
C
 $    23.10
13%
Davis, Chris 1B BAL
1B
 $    28.10
224%
Votto, Joey 1B CIN
1B
 $    14.88
-22%
Fielder, Prince 1B DET
1B
 $    14.58
-17%
Cano, Robinson 2B NYY
2B
 $    29.39
12%
Pedroia, Dustin 2B BOS
2B
 $    23.92
1%
Kinsler, Ian 2B TEX
2B
 $    13.35
-43%
Cabrera, Miguel 3B DET
SS
 $    43.04
61%
Longoria, Evan 3B TB
SS
 $    19.64
3%
Wright, David 3B NYM
SS
 $    19.11
19%
Tulowitzki, Troy SS COL
3B
 $    25.70
-30%
Reyes, Jose SS TOR
3B
 $    10.53
-48%
Castro, Starlin SS CHC
3B
 $       9.48
-47%
Gonzalez, Carlos LF COL
OF
 $    32.63
44%
Trout, Mike CF LAA
OF
 $    35.93
21%
Kemp, Matt CF LAD
OF
 $    15.35
-48%
Stanton, Giancarlo RF MIA
OF
 $    14.32
-48%
Hamilton, Josh CF LAA
OF
 $    17.52
-34%
McCutchen, Andrew CF PIT
OF
 $    25.10
6%
Bautista, Jose LF TOR
OF
 $    26.50
14%
Kershaw, Clayton SP LAD
SP
 $    48.00
7%
Verlander, Justin SP DET
SP
 $    36.69
-8%
Strasburg, Stephen SP WAS
SP
 $    31.23
-21%
Price, David SP TB
SP
 $    19.18
-49%
Sabathia, CC SP NYY
SP
 $    33.20
-10%
Hamels, Cole SP PHI
SP
 $    27.05
-22%
Kimbrel, Craig RP ATL
RP
 $    40.69
2%
Papelbon, Jonathan RP PHI
RP
 $    27.82
-7%
Rodney, Fernando RP TB
RP
 $    29.46
16%
Index Value

 $  754.47
-7%


What do you think? Do you agree with these changes? I’d love to hear your comments!
Thanks for reading everyone!

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