In case you woke up 10 seconds ago and opened this article before doing literally anything else (which, thanks!): the Knicks traded Robin Lopez, Jerian Grant, and Jose Calderon to the Bulls in exchange for Derrick Rose, Justin Holiday, and a 2017 2nd round pick. Seth gave us a quick reaction and Joe broke down the trade's impact on the roster, so I'm here to explain its effect on the Knicks' salary cap situation.
Below is a nice little chart looking at the next three seasons:
All salaries come from HoopsHype. I used CBA FAQ in calculating cap holds, and ESPN and Bleacher Report for the cap projections. One important thing to remember: the CBA will be renegotiated after this season and lots of things will change. Unfortunately, I can only work with the information I have now.
Okay, let's break this down! Looking first to the upcoming season, you'll see that I included cap holds for Derrick Williams, Lance Thomas, and Cleanthony Early; I did so because I imagine there's at least somewhat of a chance that the Knicks look to re-sign them. If that's the case, they won't want to renounce their cap holds, as that would mean they can't go over the cap to re-sign any of them. Anyway, it's worth noting that the trade didn't do much with respect to this year's outlook. The outgoing salaries added up to about $22.5 million, while the incoming salaries add up to about $22.3 million. But where there's real change is for the two years after this one. (Side note: you've probably seen a lot of people say the Knicks will have $36 million in space this summer, but that doesn't include any of the cap holds I included or Langston Galloway's Qualifying Offer.)
For both the 2017-18 and 2018-19 seasons, the Knicks will have much more money than they could have anticipated before the trade. Assuming they renounce their rights to Rose (which they will, as Rose's cap hold for 2017-18 is going to be something like $30.5 million; no matter how well he plays, he won't be worth that) and Holiday, they'll have about $14.5 million more in space next summer than they would have had they not traded Lopez and Grant. Two summers from now, they'll have about $16 million more in space.
Does any of that make this a good move? No, I don't think so. As the salary cap rises, so do salaries. Robin Lopez and Jerian Grant were bargains at their salaries; it's unlikely that that money will be spent on someone who offers a better bang for the buck. But for those of you who have dreams of max free agents, this will allow the team to theoretically hand out two max contracts next summer with money to spare. And if you'd prefer the Knicks be a little more discerning in handing out contracts (as I would), well, there's more money for that now too. Silver linings!