Calculating Inflation

Anonymous asks:

I'm trying to figure the inflation value in my keeper league. Can you please give me the equation for that?

The equation for calculating inflation is the amount of money left to spend in your auction divided by the value of the players you're buying. If your league has $1,600 left to spend on $1,400 worth of players, raw inflation would calculate to 14.3%.

If you want, you can do this for every player and be finished quite quickly with this exercise (assuming that you take rounding into account and make sure that the bids still add up to the amount of money your league has left to spend).

However, some owners prefer to tweak their inflation bids after they've calculated them (see my earlier posts on this subject here, here and here).

I'll summarize some of the tweaks from those articles that you might want to make to your inflation bids.

• Limited earnings ceiling on stars. Even in 4x4, Alex Rodriguez "only" earned $53 while Hanley Ramirez "only" earned $51, and these earnings came in what few would dispute were career years. Inflation might increase the raw bid prices for these players, but there is an actual ceiling on what these players can earn. If your raw bid price on A-Rod is $45 and inflation sits at 30%, A-Rod is a $59 player with inflation. If your freeze list is very strong, paying $57 for A-Rod might make sense for you, but you're going to take a loss and - if he "only" earns $37 like he did in 2004 you're going to take a huge loss. Reducing the inflation bids on the superstars decreases your risk of taking these kind of value hits.
  
• "Split" inflation on hitters/pitchers. This theory is disputed by some visitors to the site, but some leagues wind up coming very close to the $175/$85 per team cap on hitters versus pitchers. This is due to the fact that in leagues with stronger pitching freezes, some teams insist on paying for pitching, even if that means paying $20 for (gulp) Dontrelle Willis so that they'll have the innings they need to compete. If your league is like this, you'll need to skew your bids so that you have enough money to fill out your pitching staff. The same principle applies the other way in the rare event that your hitting inflation is higher; in some leagues, owners will skew their hitting prices so that they can fill in a $175 offense to stay competitive.
  
• High inflation increases bid variability in the middle. Paying full inflation for the stars in a high inflation league doesn't make sense because the raw bid limits on the middle players fluctuate far more than on the guys at the top, leaving you out of bargains in the middle rounds. The example I used in one of the links above was if you bought three pre-inflation $40 players (let's say Jose Reyes, Matt Holliday and Hanley Ramirez) at $50 apiece in a league with 30% inflation. Each player is a $2 bargain in this scenario, but that would leave you tapped out until the crapshoot. Meanwhile, minor differences in pre-inflation prices can have a huge impact, making the bargains available in the middle rounds. If I have Luke Scott listed at $11 and you have him listed at $15 pre-inflation, for example, my 30% inflation bid would be $14 while yours would be $20. If he went for $17, you'd feel like he was a bargain while I'd think you overpaid. Higher inflation will lead to greater bargains on these second-tier and third-tier players, so make sure to adjust your bids so that you don't wind up blowing you budget on two top players and getting stuck with a team full of holes.
• Position or Stat Scarcity due to Freezes. If Miguel Tejada is the best SS in your N.L. auction and Jack Wilson is the second best, you might want to tick Tejada up a couple of dollars past his inflation price. If you need a closer and all of the top-tier closers are frozen except for Billy Wagner and Francisco Cordero, you'll want to move the bids past the inflation limits for these guys. This can work the other way, too: if there are a lot of outfielders out there and you already have three good ones frozen, you might want to tick some of your prices down.
  

Keep in mind that all of these suggested bid tweaks are guidelines, and you're the best judge of whether or not you should make these adjustments, based on the spending habits of your league. More importantly, you should start off with sensible bid limits before you calculate inflation. If you have Jake Westbrook with a raw $15 bid limit, knowing what the inflation rate is isn't going to do you a bit of good.