NEW YORK (CNN/Money) -
The panic that gripped Yankee fans in April and early May has largely abated.
There's nothing like a 10-game winning streak to lend an air of dominance to a team, even one that is still barely over break-even for the season.
But even if the Yankees' recent run is a sign that they'll be back playing October baseball for the 11th straight season, there's reason for Yankee fans to be concerned about the future -- and Yankee haters to rejoice.
Although the Yankees have far more revenue than any other team, even this franchise appears to be running up against budgetary constraints. And an inability to find bargain players could hurt the team's on-field performance in coming seasons, if not this year.
"Just because you have all the money in the world doesn't mean you don't need undervalued assets," said an executive on another team's player evaluation staff.
In the past, the Yankees have been unwilling to sign or trade for promising, but unproven, younger players.
"It's a problem endemic to any organization that has a lot of money. They become risk averse," said the executive.
The strategy can backfire, however.
"You look for guys with long track records, never paying attention to the fact that a long track record is the biggest risk factor," he said.
That's left the Yankees full of many older players with long-term contracts that no other team will take off their hands. Many of those players are performing no better than a lesser-known player might do.
Of course, being a collector of undervalued talent doesn't assure success.
The Oakland Athletics, whose "Moneyball" philosophy of using statistical analysis to build contenders on a shoestring, are in last place in their division this year. (Five of the Yankees' 10 straight wins came at their expense.)
But the A's are likely to to improve much more quickly than the Yankees because their young and somewhat raw players have much more upside than the Yankees' creaky roster.
"The question is how many positions can they fill with expensive veterans," said Gary Gillette, editor of the Baseball Encyclopedia. "The Yankees have a chance to buy and shrewdly deal to avoid a potential collapse of the team, but they also have the ability to go over the cliff, and they could have a long period before they get better."
The Yankees seem to have finally discovered that there is no such thing as unlimited resources. With its payroll already topping $200 million, the Yankees decided this past winter to take a pass on Carlos Beltran, the 28-year old All-Star center fielder who reportedly was willing to sign with the Yankees for less than what the cross-town rival Mets were offering. Beltran signed with the Mets instead.
The payroll picture isn't going to get significantly better any time soon. The Yankees already have committed $144 million to 11 players with guaranteed contracts for next year. They're likely to spend more than $100 million on seven players on the current roster in 2007 -- when those players will be an average age of 35.
So the Yankees may be forced to keep spending $200 million a year on players. If they continue to spend available cash on veterans on the downside of their careers, this year's struggles will become the norm.
Part of the problem is that the organization has not developed a solid core of minor league players lately. The farm system has been left bare by the team's well-known tendency to trade prospects for stars.
They also haven't identified the undervalued major leaguers on other teams' rosters who are worth a gamble. Those types of players -- like Graig Nettles and Lou Pinella in the 1970s and Paul O'Neill and Scott Brosius in the 1990s -- formed the core of some of the championship teams of the last 30 years.
Much of the blame, obviously, has to go to owner George Steinbrenner. It's no coincidence that the foundation of the team's championship runs in both the 1970s and 1990s were built while he was serving suspensions and unable to meddle in personnel moves.
Steinbrenner's freespending ethos must been seen as an advantage for the team. But its biggest disadvantage is the owner's repeated pursuit of players with the biggest name over ones with better value.
Unfortunately for the Yankees, the team is in a division with other teams that are doing a better job of finding underappreciated talent. Two of those teams -- the Red Sox and the surprising first-place Baltimore Orioles -- would be considered large-revenue franchises anywhere outside of the Bronx.
It's too soon to write off the Yankees as playoff contenders. As regular readers of this column know, I'm a Yankee fan myself, and I'm not ready to give up.
But the years ahead are starting to have the look and smell of the 1980s. That was when the Yankees spent enough money to stay competitive, but were never good enough to win a championship.