For hockey fans, July 1 is considered a day of renewal and opportunity. It’s a day when their team has the chance to reinvent themselves. With a whoosh of negotiation, paperwork, and signatures from player to general manager to owner, teams move one step closer to the ultimate prize: the Stanley Cup.

Well, at least that’s the theory on how it works, but it is not as simple as that. Teams can long do their homework well beforehand and the chips don’t always fall where they want them to. Pressure begins to mount and they feel they must make a signing somewhere as other teams are upgrading.

There is a certain insanity that comes with July 1. This insanity leads to teams giving out contracts for which they later regret; the highest form of buyer’s remorse. This free agency period will see many teams dole out long term contracts in excess of six years and clearing $50 million, all with the purpose of creating a cap hit that will keep them in compliance with the salary structure of the NHL.

Already, we’ve seen two teams in Philadelphia (nine years with Ilya Bryzgalov) and Buffalo (10 years with defenseman Christian Ehrhoff). But in many ways, the contracts that will really get teams into trouble will be the ones given out to players who in stronger free agency periods would not have commanded such salaries.

This will be due to the fact that the NHL salary cap floor has been raised $9 million above what the original cap ceiling was when the 2005 lockout ended. While this can be interpreted as a good thing; that the league has grown and become more viable, it also unnaturally inflates a “fringe” player’s values. And again, it’s not just about the salaries, it’s about the length of the contracts.

To wit, RW Tomas Kopecky, late of the Chicago Blackhawks, gets traded to the Florida Panthers and signs a 4 year, $12 million contract. Yes, the same Kopecky who scored 15 goals, 42 points, and was a minus 13 on a pretty talented Blackhawks team. While these were career highs, will he have the same production in Miami? Is he a $3 million a year player? In this insane market, he is.

Take a trip down NHL Free Agency memory lane and wince as you think about the impact these free agents signings would have had in the salary cap era: Bobby Holik, 5 years, $45 million by the New York Rangers or Alexei Yashin’s 10 year, $87.5 million with the New York Islanders.

The smart general managers know to stay in control and when to recognize an opportunity that has the greatest value. The key is to make sure you get the most value, to recognize where a player best fills a need, and to not splash out for crazy contracts. Swings and misses happen, but the best make sure that the damage doesn’t completely cripple their team’s chances of competing for a Stanley Cup.

While others may criticize Flyers’ GM Paul Holmgren for the length of the Bryzgalov contract, he was smart not to get involved in the Steven Stamkos bidding war. As talented a player as Stamkos is, an offer sheet had the potential to cripple the franchise going forward.

But Holmgren also has to watch out for getting into a bidding war for a player whose value isn’t necessarily worth what the market is bearing. That is the challenge he and other NHL GMs faced yesterday.

Again, the market opened yesterday as of 12:01pm et, the frenzy started but when the dust settled the biggest fish still remained -- Brad Richards is expected to make a decision on Saturday. It brings to mind the Joker in the Dark Knight as all hell breaks loose in Gotham: “And…here..we…go!”