What are the Sacramento Kings Thinking?

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During the NBA free agency, the Sacramento Kings chose not to resign starting point guard Isaiah Thomas and instead signed former Los Angeles Clippers backup point guard Darren Collison to be their new starter for $16 million over three years.  Meanwhile, Thomas has signed with the Phoenix Suns for $28 million over four years.  It gives the Kings a $7 million trade exception and the team is also saving $2 million a year.  However, by looking at their stats, Thomas is obviously the superior player.  Last season, Thomas averaged 20 points per game, shot 45% from the field, 35% from the three point line, 6 assists, and a 20 PER.  Collison's averages as a starter were 15 points, 48% FG, 42% 3PT, 5 assists, and a 16 PER.  PER stands for player efficiency rating.  Under the PER scale, a 16 is third option on a team, while 20 PER is borderline All-Star.  Why would anyone let go a potential All-Star caliber player for a third option?
The Kings were also pursuing Detroit Pistons forward Josh Smith, who currently is making $13.5 million and has four years left.  Smith has regressed considerably since he joined the Pistons last season.  The Kings already have forward Rudy Gay, who is making $17.8 million and has two years left.  Gay was a gunner that both the Memphis Grizzlies and Toronto Raptors realized was detrimental to the team, yet the Kings traded for him.  Surprisingly Gay did have better number with the Kings than the Raptors and the Kings believe a change of scenery will do wonders for Smith too.
Most teams look for good players with cheap contracts, so the players are more valuable.  The Kings appear to want "good" players despite their bad contracts.  Hey Brooklyn Nets, the Kings are willing to trade for Joe Johnson and his massive $23 million contract because they think he'll be better in Sacramento.
The Kings were looking at Smith because they wanted a defensive presence.  There are two undrafted big men that were great defensively in college, UNLV's Khem Birch and Florida's Patric Young.  They would be better and cheaper options compared to trading for Smith.

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