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Summer Baseball and Scouting: A Primer for Players and Parents

July 15, 2018 / Tom Bonetto

If you don’t follow The Arizona Diamond Report and Ron Benham, you really should. Ron is one of the “go-to” guys on the prep baseball scene here in Arizona and beyond.

His site exists to give college coaches a reliable source of player information. The majority of the area’s MLB scouting personnel also frequent The Diamond Report.

His site is one that I visit regularly, and I recommend that you do, too.

His recent blog post is called “Here Comes the Summer: A Primer for Parents and Players”. It’s a must read – please do click on the link and read the entire piece.

With that said, here area a number of key items that stand out to me – and I really hope players and parents follow this advice:

Players

First off, if you expect to get much bang for your buck at these tournaments, you will hopefully have been communicating with colleges beforehand. If not, you won’t be on a follow list, and you generally become background noise.

This is so cliché, yet at the same time so true: You never know who’s watching.

Even at an event that has few to no college coaches, there may be someone in attendance who can have an impact on your future. The baseball world is a small place, with relationships that stretch across the country. Don’t make the fatal mistake of taking pitches off.

Catchers: I say this every year, and yet this remains one of my biggest pet peeves. Please show me your arm in between innings. You may not have a live game opportunity to flash that hose, but in between innings we are paying attention. Chuck that rock like your life depends on it.

This also goes for infielders. We don’t see you in pre game like in high school, so in between innings show off that cannon.

Please run out ground balls. It’s amazing to me that in an event that is supposed to be a “showcase” , I continually see players half-assing their way down the line as I stand there stop watch in hand. Running times are a vital piece of the evaluation process, don’t ignore this.

Body language is another incredibly important piece of the puzzle. Remember, baseball is a game of failure. Players that fail in MLB 70% of the time are called All Stars. The key is how you respond to failure. Throwing your helmet, tossing your bat in disgust etc, are sure ways to get your name crossed off by coaches.

Pitchers: it’s inevitable that you will encounter an umpire with a postage stamp sized strike zone. It happens in college too. However, the worst thing you can do is to react negatively to a questionable strike zone. Treat it like it is a part of the game and show that you are in control of the situation.

Act like you are serious about the game. College coaches have a job to do. Their job is to win baseball games. They are looking for players who can help them do that. If you look like you are not a serious player, coaches can’t treat you seriously. Don’t goof off in the dugout. Many of you look like you are only out there to hang out with your buddies and have a good time. Play the game and conduct yourself like you mean business.

Parents

It’s amazing to me how things have changed in regard to ballpark decorum. I watch the way parents interact with their players during games and I just shake my head.

If I were to design a baseball field, it would have dark shades from dugout to dugout to prevent parents from placing their chairs right next to the on-deck circle. Unfortunately, virtually all the fields in the summer are wide open, and mom and dad have been sitting there for tournaments for the better part of a decade.

If you insist on being that close to the action, please try not to interact with your son during the game. He doesn’t need coaching. He doesn’t need you to break down the pitcher for him.

Your player should be mature enough to ensure that he has proper hydration for the game, so you shouldn’t have to hand drinks and snacks to junior in the dugout. It’s just a really bad look.

Don’t be that parent who constantly complains about balls and strikes and questions every call on the field. We will find out who you are and who belongs to you.

Finally, acting like a fool during a game puts unneeded stress on your young player. Baseball is a very difficult game to play. It becomes almost impossible when a player is nervous or stressed out. Don’t contribute to this.

The Latest on Interest Rates for 2018 and 2019

July 5, 2018 / Tom Bonetto

The Federal Reserve lifted the federal funds rate last month by a quarter percentage point to a range of 1.75 percent to 2 percent. The Fed has indicated that there will most likely be two more rate hikes this year.

Most financial experts expect the Federal Reserve to raise rates at least 3 times in 2019, as well.

Mortgage interest rates don’t necessarily move in step with the federal funds rate, as they are more closely tied to the 10-year Treasury Bond. So, borrowers today looking to get a mortgage aren’t directly affected by the latest Fed hike.

However, the federal funds rate does contribute to the longer-term trends of the 10-year Treasury, and long-term fixed mortgages as a result.

With the Fed likely lifting rates multiple times over the next couple of years, the trend for long-term mortgage rates is up.

Many experts are forecasting that mortgage rates could move near the 6% range sometime in 2019.

Why is the Federal Reserve raising rates?

Well, it’s a bit complicated, but there are some very good reasons – and they are all designed to help foster stable, economic growth.

‘Quantitative Tightening’

Between 2009 and 2014, the US Federal Reserve created $3.5 trillion during three phases of what was called “Quantitative Easing”. It was the Federal Reserve’s response to help reduce the dramatic market swings created by the recession about 10 years ago.

This seems to have helped the economy avert disaster, but their impacts were far from ideal. Nonetheless, the economy slowly lifted off as consumers rebuilt their balance sheets and asset values rose.

Today, the Fed is slowly reversing this stimulus program. They’re raising short-term rates and shrinking their bond and mortgage back securities portfolio.

The consensus thinking is that the Federal Reserve members fear that inflation will take hold if they keep interest rates artificially low.

Historically, when the bonds owned by the Fed mature, they simply reinvested the proceeds into new bonds. It essentially keeps the size of the balance sheet stable, while having very little impact on the market.

However, when quantitative tightening began in October of 2017, the Fed started slowing down these reinvestments, allowing its balance sheet to gradually shrink.

In theory, through unwinding its balance sheet slowly by just allowing the bonds it owns to mature, the Fed can attempt to mitigate the fear of what might happen to yields if it was to ever try and sell such a large amount of bonds directly.

Essentially, the Federal Reserve is changing the supply and demand curve and the result is a higher yield in the 10-year treasury note.

Inflation and Interest Rates

Inflation is beginning to inch up as the labor market continues to improve. Most indicators suggest inflation has been climbing in recent months. If you look at both the Producer Price Index and the Consumer Price Index, you will see the trends.

This is a general reflection better economic data, rising energy prices, and increased employment.

Rising inflation is a threat to government bond investors because it chips away at the purchasing power of their fixed interest payments. As mentioned earlier, the 10-year Treasury yield is watched particularly closely because it is a bedrock of global finance. It is key in influencing borrowing rates for consumers, businesses and state and local governments.

Positive labor and economic news keeps coming in (as predicted over the last 6 months), and the prospect of inflation will put pressure on bonds and interest rates.

What It All Means

So, it is safe to say that we will continue to see pressures in the bond market and mortgage interest rates overall. These increases do look to be gradual for the time being, but consistent and into 2019, for sure.

With that said, home prices are increasing nationally at nearly 6%, so the increase in interest rate will be more than offset by the increasing value of one’s home!

Secondly, home buying power is still extraordinarily high, despite rising home prices and rate hikes. Find out more about that here.

In reality, now is a fantastic time to purchase. Contact me for more information, as it would by my privilege to help you.

A Great Hitting Lesson – An Analysis

June 10, 2018 / Tom Bonetto

Two of my favorite and “go-to” mental guys in the baseball world are Dr. Ken Ravizza and Tom Hanson. I’ve mentioned them before – and I’d highly recommend that you read their book, Heads-Up Baseball 2.0.

I’ve worked with Ken for 30 years…he’s made me a better teacher of the mental game and helped me help players become better at being what I call ‘present moment guys’ – Joe Maddon

You can also go here to learn more about them and their other content.

Their latest article has to do with a great hitting lesson that they were a part of – and here’s the link to the complete post. I’d invite you to check it out in full.

The Anatomy of a Great Hitting Lesson

Here are a few key highlights:

Yesterday I, witnessed what I considered to be an outstanding hitting lesson. I’ll take a few moments now to explain what made it so powerful. The bottom line: The player came in feeling frustrated, a bit lost, and out of sync with himself. He left feeling excited, renewed, re-connected with what makes him good, and highly confident.

Before the first swing was taken, the coach took the time to connect and listen to the player. “What’s been going on?” “How have you been feeling?” “WHAT have you been feeling?” Questions like that… and then he took the time to hear the player’s responses, and ask follow up questions.

This put the player at ease, made him feel respected, and gave the coach essential information. The dialogue made it less likely that the coach would pile additional thoughts on top of what the player was already thinking.

Here’s the secret sauce to the whole thing: The player likes, respects, and trusts the coach. Contributors to this are all of the elements listed above that address how the coach relates to the player, plus the coach is a “learner” who is open-minded and always looking to get better (as opposed to a “knower” who has all the answers.

“It’s the relationship, stupid” is a worthy mantra for coaching. Not a buddy, like “lets catch a movie after the lesson,” but a respectful, adult-to-adult relationship. As Joe Maddon said: “With a great relationships, anything is possible. With poor relationships, almost nothing is.”

Home Buying Power Still High, Despite Rising Prices and Rates

June 10, 2018 / Tom Bonetto

I’m receiving calls and questions all the time regarding mortgage qualification and home buying in today’s changing interest rate and price appreciation marketplace.

Your home buying power is the result of several variables – but there’s great news today when you consider increased income and historically low mortgage rates.

I’m linking today to an article by Amy Hale of The Mortgage Reports that really nails the answer. Go here for the entire article – and I’ve highlighted the key pieces below.

Are home prices really that high?

It might seem like home prices just keep rising, but according to the historical numbers, today’s housing is actually very affordable. “Real” home prices—those adjusted for income and interests rate changes—are currently 32.5 percent below their housing boom peak from 2006.

Home buyers still hold the power

According to the latest First American Real House Price Index, which aims to measure overall housing affordability by considering changes in income, interest rate and actual home prices, consumer home buying power is still strong.

“While unadjusted house prices have been on the rise since the end of 2011, nearly a seven-year run, consumer house-buying power has also increased by 14.3 percent over the same period,” said Mark Fleming, First American’s chief economist.

“House-buying power, how much one can buy based on changes in income and interest rates, has benefited from a decline in mortgage rates since 2011, and the more recent slow, but steady growth of household income.”

Buying power is actually up significantly from 2011 because real wages have actually increased over that time – household income has risen nearly 20% over the last 7 years. Also, mortgage lenders have relaxed some of the tight requirements and ratios for qualification. This combination makes it a great time for buyers and borrowers.

The real story on home prices

Overall, “real” home prices aren’t even close to their historical peak. In fact, according to Fleming, they’re currently 32.5 percent below July 2006’s prices and 9 percent lower than in January 2000.

Don’t let sticker prices fool you. American home buying power is still high. Want to get in on the market? Reach out to me for some answers, as it would be my privilege to help!

Rents Continue To Rise – Is It Time To Consider Purchasing Instead?

May 14, 2018 / Tom Bonetto

According to a new report, if you’re renting a house in hopes of saving money, you might want to re-think that strategy. Amy Yale at The Mortgage Reports shows that single-family rents are up significantly over the year –particularly on lower-end properties.

You can access Amy’s article in its entirety here….

According to industry expert CoreLogic and their Single-Family Rent Index, rents on single-family properties are up 2.8 percent over the year.

On lower-priced properties (those with a rent lower than 75 percent of the regional median), rents have risen nearly 4 percent in the same period.

The Reason

Molly Boesel, CoreLogic’s principal economist, says growing demand for entry-level homes is the single largest factor:

“Single-family rent price growth remained solid in January,” Boesel said. “High demand and low supply for entry-level properties drove lower-priced rentals to have faster price growth than higher-priced rentals, revealing affordability pressures in this segment of the rental market.”

Hale also states that Phoenix showed over-4 percent gains in rent over the year.

The reason for these regional increases? Per Hale and CoreLogic, it’s strong economic growth, low levels of new construction, and increasing employment opportunities.

“Phoenix experienced 4.5 percent year-over-year rent growth in January 2018, driven by employment growth of 2.7 percent,” CoreLogic reported. This is compared with the national employment growth average of 1.4 percent, according to data from the United States Bureau of Labor Statistics.

This nationwide problem threatens to get worse before it gets better. Apartment builders are building more units, potentially creating supply that is beginning to crest. With that said, demand still exceeds the supply, especially for affordable housing.

Continuing The Trend

The relentless shortage of housing has lead to dramatic increases in rental rates – and the implications of high rent, and declining home ownership, could be profound over time.

“Almost all the housing demand in recent years has been filled by rental units,” says Sara Strochak, a research assistant with the Urban Institute. She also states that single-family rentals have gone up 30% within the last three years.

The trend began with large firms buying up cheap homes during the recession and turning them into cash-generating rentals—often rented by families who’d lost their own homes or who could no longer qualify for mortgages.

As is always the case with the supply and demand curve, high number of renters has caused rents to increase significantly – in many places, high enough for buying to become the better option.

The Solution

With rents continuing their upward climb, it might be time to consider buying or building a home.

One of the great underlying opportunities here is that buying a home can actually be cheaper than renting. Renters interested in reducing expenses and collecting tax benefits should absolutely talk to a mortgage lender prior to signing that rental contract.

Current market trends this summer really should encourage home ownership – find out more here….

Mortgage uunderwriting guidelines have been slowly loosening and those that were denied for a mortgage last year may qualify this year. There are also multiple down-payment assistance programs for borrowers with little to no down payment available.

Again, the first step should be contacting your local mortgage professional and work on pre-qualification. Next, contact your real estate agent and begin your home search!

The Lending Coach