Since Denver and New Jersey need a third team involved in any trade involving Melo, Indiana would seem to be an excellent third partner. Larry Bird is in a make or break year as GM, and needs to make a bold move. Here is the scenario:

Denver Trades:

Melo, JR Smith

Denver Gets:

Troy Murphy, Derrick Favors, and Mike Dunleavy (and a #1)

New Jersey Trades:

Troy Murphy, Devin Harris, Travis Outlaw and Derrick Favors

New Jersey Gets:

Melo, JR Smith and TJ Ford

Indiana Trades

TJ Ford and Mike Dunleavy

Indiana Gets

Devin Harris and Travis Outlaw

This works on the RealGM Trade Checker - #5699926

Denver gets two solid big men and versatile small forward in Dunleavy (Dunleavy and Murphy have expiring contracts). Jersey gets their star in Melo (who will sign the extension because he gets to live in NY and stay with his homey JR), and some outside shooting/scoring with JR Smith. Indiana unloads TJ Ford and gets a solid PG in Harris and scoring forward in Outlaw. Bird saves his job!

We will have to wait until December 15 to do the deal due to Outlaw, but this seems like a no-brainer for all 3 teams. Let's get this done!