Reports have explained roughly what's going on with Mo Williams, but I want to throw my hat into the ring. Per Brian Windhorst, Mo Williams backtracked on his retirement announcement because he seems to think that the Cavaliers didn't act with his best interest (and health) in mind when they allowed him to keep playing on an injured knee. He never actually signed his retirement papers, is now owed $2.2 million, and is on the Cavaliers' opening day roster as the team tries to figure out what to do with him. They've reportedly been shopping him and Jordan McRae — a key reason in why McRae played so much in the preseason — and are having minimal luck in finding a backup point guard.
There's a lot going on here.
With Mo Williams taking up a roster spot, the Cavaliers don't have the luxury of filling that spot with another guy who will get mop-up duty and earn some NBA minutes. While Kay Felder made the team and there is general optimism around him, he is unlikely to be the backup point guard on this team anytime soon. If McRae is on the trading block — which the rumors are suggesting — then there's not any backup point guard on this team at all and Williams is almost holding the position hostage.
With Mo Williams taking up a roster spot, the seemingly small numbers on his salary take on a bigger role. The $2.2 million that Mo earns costs the team somewhere between $5 and $6 million with all the tax penalties. Obviously, Dan Gilbert has openly talked about being willing to pay the tax penalties, but I'm sure he'd like to avoid it where possible. Again using Felder as an example; his contract is for three years and $2.5 million, meaning 1/3 of Williams's cost. If the Cavaliers had another rookie they liked, they'd be paying less than the Williams cost. If they had a veteran minimum signing, they would come out at a lower price again: Birdman and James Jones are each making $1.5 million this year. After penalties, that small salary difference saves ownership a few million dollars.
Another piece of the puzzle: Is Mo Williams actively trying to screw over the Cavs? I can't guarantee an answer to this, but it has been pointed out by critics because of a few choice words he made when posting photos of his surgery. He seems upset with the Cavaliers. Obviously, part of that is the aforementioned idea that the Cavaliers knew he was unwell and chose to have him continue playing last year and cause further damage to his knee.
On the other hand, his last year has gone pretty well. He contributed to a championship team, he's got a ring, and he probably has some extra endorsement money from the title fallout. In the meantime, he had a surgery that is probably covered by the NBPA.
There's one problem: The news that the Cavs were "scouring" the league for a backup point guard doesn't make any sense to me. They thought Mo was retiring and were fine with the people that they had on the roster. They were going to move ahead with who they had as backup point guards (McRae and Felder) when they thought Mo was retiring but suddenly with Williams down they need to scramble and replace him? That doesn't add up. If they believe in McRae or Felder - or if they were planning on trading McRae - then Williams should have next to nothing to do with that.
In the end, I think the Cavaliers will make a trade, but I don't think it'll happen yet. They have a few trade exceptions in their corner thanks to the whirling dervish of trades made to clear space for LeBron (is Brendan Haywood's contract still hanging out there for us?) and could reasonably come up with a backup PG, although I'm not sure it's necessary.
Try out Felder for a couple months in sparse minutes. If it looks like he can hold his own, let it ride. When the playoffs come, there are enough lineup options that LeBron will be the nominal point guard while Kyrie sits anyway.