The Rising Dollar is the NBA's Revenge

Note to NBA players thinking of signing overseas: be sure to negotiate your salary in U.S. dollars. The strength of the euro is the biggest reason why European owners are able to throw lucrative contracts at NBA players, but when the economy shifts and the dollar regains strength, that salary isn't quite as attractive as it once was. As Ross Siler of the Salt Lake Tribune notes, that's already started to happen:

Take [Josh] Childress, for example. His contract with the Greek club Olympiacos was reported as a three-year deal worth $20 million after taxes. That averages out to $6.7 million dollars a season or about 4.25 million euros, according to exchange rate July 23.

On the day Childress signed his headline-making deal, 1 dollar was worth 0.6366 euros, according to www.x-rates.com. As of Wednesday, the dollar had strengthened such that it now is worth 0.6821 euros.

That might not seem like much, unless you're owed millions of euros like Childress or the other American players. Those 4.25 million euros that Childress will make this season (if he's not guaranteed U.S. dollars) are now worth more like $6.23 million.

Put the abacus away: that's a difference of $435,000 a year. Granted, $6.23 million is more than Childress could have earned in the NBA (especially when you consider taxes have already been accounted for), but it's still a hefty chunk of change that disappeared into the ether.

Fortunately for Childress, this is all hypothetical: his contract does in fact guarantee U.S. dollars (as pointed out by the first reader comment under Siler's article), but from the sounds of it, that's not necessarily the hard and fast standard for all players.

Of course, the opposite is also true -- the dollar could lose value against the euro, meaning Childress is leaving money on the table -- but that's no more of a gamble than simply signing to play in the NBA.