UPDATE, 9:04 p.m.: Mike Jones provides some great insights in his latest blog post.  It turns out Gilbert's trip to China is actually the first leg of his journey.  In the second leg, he's going to Berlin and Barcelona to promote the Wizards' preseason October Europe tour.  Why would he do that if he really was going to leave? 

More importantly, there's this:

Agent Zero knows he isn't hurting for money. He has a $35 million deal with Adidas and knows that gives him flexibility to sign for less. He is aware that he could take much less and go to a championship contender, but this is his city, in his words, and he'd rather try for a title alongside two other All-Stars, playing for an owner that loves him and a general manager that loves him. And that's why he will wait until the salary cap figures and luxury tax figures come out next Tuesday to decide what to sign for. The cap is expected to be somewhere around $58 million and the luxury tax could come out at about $69 million. The Wizards can go over the salary cap to sign players. But if they spend more than $69 million, they will have to pay dollar for dollar every dollar that they go over that luxury tax ceiling. So, Gilbert wants to help by making sure whatever he signs for gives the team some room to sign someone else in addition to him while avoiding exceeding the tax.

If Gilbert is really waiting to see the cap figures for next year, it shows that he's taking his comments about taking less money to avoid strapping the team's payroll very seriously.  That's a sign of maturity, and it's something Baron Davis, for example, didn't demonstrate.

Of course, if the tax is really going to be as low as 69 million this year, we're already screwed, but I'm going to choose to focus on the positive instead of the negative.  You're free to do the opposite, of course.

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UPDATE, 5:56 p.m.: Just a reminder to those suggesting the Wizards use Gilbert's money on someone like Emeka Okafor, Josh Smith or Monta Ellis, they can't.  This comment and this post explains it all, but to recap:

The Wizards already used a lot of their potential cap space to sign Antawn Jamison.  If they let Arenas go, they'd have about four million dollars in cap room and about 17 million dollars under the luxury tax, but could only sign another team's free agent outright with the remaining four million, the mid-level exception (about 5.75 million) or the low-level exception (about 2 million).  You can't combine exceptions.

That puts us out of the price range for Okafor, Smith, Ellis, Corey Maggette, Elton Brand, Baron Davis and possibly even Josh Childress.   The only way we get one of those guys is in a sign-and-trade.  We would have to give up players on our team to properly match salary (though it wouldn't have to be exact because of our four million dollars of cap space).

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UPDATE, 1:35 p.m.: Adrian Wojnarowski is reporting that Abe Pollin has OK'd a 6 year/$125 million deal.  He's also saying that it looks like the Warriors are "losing hope" of bringing him back.

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UPDATE, 12:26 p.m.: Well, Abe just gave Gilbert the "You're my guy" treatment.  So much for negotiation.

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UPDATE, 12:08 p.m.: Mike Jones says Gil is "close" to accepting a max contract offer, then says two paragraphs later that Gil will likely sign for less than the max to free up cap flexibility.  I'm confused.

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Yesterday, I wrote a ton about how the Wizards needed to wait on Gilbert Arenas, because the market wasn't there.  My, how I was mistaken.

Seriously, screw Baron Davis.  If Davis does what he said he was going to do, we wouldn't even have this problem.  Davis decided to opt-out into a market that doesn't have much money available, even though his current team is showing little inclination to re-signing him.  Because Davis opted out, Golden State had enough money to offer Arenas the max, thereby driving up Arenas' market. 

(By the way, I'm not concerned about the Sacramento angle.  They'd have to give us players to get Gilbert, which isn't the worst alternative)

Now, we are kind of stuck.  Like with Jamison, there is a very real threat that Gilbert leaves to go somewhere else and we get absolutely nothing to show for it.   Even worse, we won't have very much cap room to show for it now that we've re-signed Antawn. 

All because Baron Davis wants to play for the Clippers.  Goddammit.

Anyway, Ernie is trying to get GIlbert to accept less than a max deal to leave us room for other free agents.  How could that work?

As Truthabout wrote, for Jamison to sign a 4 year/50 million dollar deal with 10.5 percent raises, his first year would be for 10,694,000.  Using Sham Sports' salary page, we would have 54,019,317 currently committed to our roster for next season once you subtract Gilbert's old deal and add Antawn's and JaVale McGee's.  If Truthabout's rough guess at the luxury tax (just over 71 million) is correct, that gives the Wizards about 17 million dollars in cap luxury tax space for next year. 

Gilbert has previously said he won't accept a contract that will pay him less than 15 million in the first year.  If that were to happen, we'd have only 2 million dollars of wiggle space under the luxury tax next year.  That's definitely not a lot to keep Mason, and I doubt we'd be able to find anyone worthwhile for that amount of money.  For Gilbert to sign a contract that allows us to use our full mid-level exception (for between 5 and 6 million dollars), his first year would have to pay him only 12 million.  Adding in 10.5 percent raises, and his final contract under that scenario is for just over 81.5 million dollars.  Something tells me he won't accept that one.

And that's just this year.  Add in everyone's raises, plus a new rookie, and we're probably over the tax threshold next year as well, unless we dump one of our mid-level contracts.

We'll just have to wait and see, but our cap flexibility stinks no matter what after this deal.  I'm hoping Gilbert signs a deal that allows us to use about half our mid-level exception, but even that doesn't give us much room under the tax.  If Abe really wants to improve this team, he might have to bite the bullet and go over the tax.  That's our predicament right now.

All thanks to Baron Davis.