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WSJ: Looking For Yield? Try Stocks

Saturday, June 25, 2011 - 6:35 AM
From the Wall Street Journal:
So, what makes for a good dividend yield? One simple benchmark is the 10-year Treasury, which currently yields about 2.9%. It isn't hard to find stocks that yield more than 10-year Treasurys

With there being no end in sight for this record low interest rate environment, this is one alternative. Of course there's the risk of falling stock prices and falling dividend payouts.
3
Ken TuminKen Tumin5,442 posts since
Nov 29, 2009
Rep Points: 123,688
1. Saturday, June 25, 2011 - 7:58 AM
That's exactly what the Bernanke Fed wants savers to do. Take their funds and place them on the equity table in the big casino. Once the Goldman Sachs boys, et al, have all our money the plug will be pulled. Running for the exits will be futile once again. No thank you, I'll just learn to live on a lower income and not worry about pull-backs, corrections or crashes.
7
ShorebreakShorebreak2,368 posts since
Apr 6, 2010
Rep Points: 12,625
2. Saturday, June 25, 2011 - 10:33 AM
I was a sucker for stock market in the 2000 era, not any more in the 2008 drop; now I have no appetite for stock/equity any more; agreeing with Shorebreak fully -- It is a casino.  I would further add: It is a "manipulated" casino that most, if not all, of us will turn out to be losers.
4
51hh51hh1,461 posts since
Jan 16, 2010
Rep Points: 6,350
3. Saturday, June 25, 2011 - 11:33 AM
To make things even more unfair for those who prefer the safety of banks, the top tax rate for most stock dividend income is only 15%.

It would be better to get rid of this and replace it with what Canada has, the Tax Free Savings Account. That way everyone could get some tax shelter (outside of IRAs and HSAs) regardless of what investments you choose.
6
Ken TuminKen Tumin5,442 posts since
Nov 29, 2009
Rep Points: 123,688
4. Saturday, June 25, 2011 - 7:38 PM
My late Father warned me about the stock market back in 1966. He said "never buy stocks, the game is rigged against the small investor." He was right on the mark. I didn't follow his advice and lost a portion of my IRA in the 2000 dot-com crash. Now that I'm retired I can't afford another mistake like that. Prudent fixed-income savings is the key. Live within your means and be satisfied with the hand life has dealt you. Greed in taking undue risk wishing to attain the lifestyle of the rich and famous is most always going to end badly. Interest rates will sometime revert to the normal. Then you will be thankful you didn't indulge in rampant speculation.
2
ShorebreakShorebreak2,368 posts since
Apr 6, 2010
Rep Points: 12,625
5. Sunday, June 26, 2011 - 6:47 AM
We had something like the Canada account mentioned by in the olden days.  It was called an All Savers Certificate circa about 1981.Kind of a flop.

The key for me is diversity and it definitely includes dividend-paying stocks.  If you are concerned about loss of capital, put in stops.  No greed involved - just the possibility of helping my money provide 4% for as long as I live.

If interest rates revert to "normal", it'll be normal all of the map. I'm happy to borrow all I can get at the current rates but fine if the rates paid to me soar. Isn't that what made retirees happy in the late 70s ?
3
indenverindenver3 posts since
Jun 1, 2011
Rep Points: 16
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