Compared to what the Bulls could've done with their flexibility going into this offseason, this move is unimaginative, lazy, cheap, and likely for the wrong reasons. We'll be hearing more about Kirk's 'experience', 'comfort', loyalty, familiarity with the organization, how he took potentially less money, basically...a lot of things that have little to do with how it helps the Bulls get over the hump towards an NBA Championship. Plus fans like him, which somehow adds to the annoyance of it all.
There's also the comparison of what this move looks like in a water-treading vacuum. The Bulls are likely going to waive CJ Watson (more on that later), with Hinrich replacing his role. To which I say: meh. Kirk hasn't been the same player since leaving the Bulls, and though one can argue system or injuries being the cause of that, moving away from your prime years (he'll turn 32 next season) may be as well, and that's not changing. Kirk potentially can do a lot of what the Bulls need from a guard acquisition: take the starting PG role while Derrick Rose recuperates, with the ability to move to SG once Rose returns with his ability to defend both positions.
However when looking at that skillset, 'can' may become 'once could' if Hinrich keeps the downward trend of his past two seasons. Especially defensively: Hinrich would still likely have an edge over Watson in defending big two-guards, but Hinrich's athleticism has slipped to where defending the point is no longer his forte. I think that over the past two seasons, Watson has proved to be the better option in the backup combo-guard role. It's also likely a closer contest than those who either are sick of Watson (after his performance in the playoffs, which we can blame injuries too) or those sick of Kirk (after being a Bulls fan the past decade) are ready to admit on either side of the argument.
[Now, if we're talking the way KC Johnson 'sees it', with Hinrich as the starting SG in 2013-14 when Rip Hamilton departs...that is just a horrifying proposition. The SG spot, or a second shot-creator in general, is what the Bulls need most to improve to become a championship team. I think CJ was better for a 1-year option given their self-constraints monetarily, but neither he nor Hinrich is a difference-maker.]
In the future, we'll hopefully get to more of analyzing Kirk's actual play (instead of what the signing represents), and how he compares to Watson. We may have the time to do so, as there are few other moves available to the Bulls.
To figure that out, we'll go with KC's report of Hinrich taking a 2-year deal starting at $3m next season. That figure is significant as it is what the 'taxpayer' (a.k.a. mini) MLE is. At that number, the Bulls total '12-'13 salary is not in the luxury tax yet (assuming waiving all NG deals and signing replacements to the rookie minimum, ~$1m under). That means that they're also not above the 'apron' ($4m over the tax) where they'd lose their other exceptions (rest of 'full' MLE, BAE) . So the Bulls could've signed Hinrich to more first-year money, however that would've effectively given them a hard cap at that apron, which, among other things, wouldn't allow them to retain Omer Asik.
In other words, by limiting the contract to that mini-MLE, the Bulls have maintained 'flexibility' (ha) to match Asik, and potentially go well into the tax. If they match Asik, they can only sign free agents making the minimum. If they decline to match Asik, they could use the rest of their 'full' MLE ($2m) and BAE ($1.9m) to sign other free agents, though they'd wouldn't be able to go over the apron for the entire season.
The other way for the Bulls to acquire players is through trade. Alex Kennedy of Hoopsworld (who reported the CJ Watson-to-Bulls signing way back when) reported that the Bulls indeed won't be guaranteeing Watson's contract for next season. Kennedy also included the possibility of the Bulls trading Watson 'before then', but this doesn't actually make sense: teams can't make trades until after Watson's guarantee date. You can hold out hope that the Bulls maybe would guarantee the deal (which is affordable: 1 year, $3.2m) with the intention of trading it. However that unlikelihood (the Bulls taking on more salary?) soon won't be possible, as KC Johnson has since reported that Watson's been told that he'll be cut. Ronnie Brewer hasn't been 'told' something similar yet, but like Watson he can only be traded if the Bulls want to have to guarantee his 2012-13 deal first.
As discussed before, Kyle Korver has no guarantee date (outside of the league-wide one in January) so he can still be dealt to a team who'd just be looking for cap savings in cutting him. Bulls Confidential went into some tricky ways the Bulls can keep Korver and do a before-or-mid-season deal that could at least get them a trade exception.
But the Bulls may also just take the simple, cost-effective way out, and waive all three contracts. If they indeed also let Asik go, and fill in the rest of the team with minimum salary players, that keeps them under the luxury tax going into the season, again. Yet they simultaneously gave Kirk Hinrich a 2-year deal starting at only slightly less than what Watson would've made for a single season. Thus, the Bulls have squandered some of their much-beloved flexibility with these reported moves...which is why they're so weird: sometimes they can't even be 'cheap' correctly. However, there are still a few outs, starting with (but not limited to) their Asik decision, to actually improve the roster's standing going forward. They also have the option of 'treading-water'...actually getting a lot worse. I think there's reason to be discouraged.