If you had a lot of cash money on the sidelines, where would you put it for income??

some folks saying the REITs-mortgage are doomed ... looking back to 2008/9

worth a look at CIM or CIM-PB

 

I never get the "dividends are safe" mentality. First, they're not fixed in any way, they can and have been going down or being eliminated. Second, that doesn't really matter because net/net they have zero impact on you financially....the stock pays a $1 dividend the stock price drops by $1 on the ex date. Unless you're in a country where you can somehow do a tax arb on that, the whole exercise is rather pointless.
At the end of the day if your dividend stock is in a company getting whacked by the current economic situation, the fact that it pays a dividend in no way makes you any better off with it than with any other company getting whacked by the current economic situation. And vice versa.

 

Granted they can cut the dividend at any time, but for a conservative investor, say someone who works at the same company for 30 years, DRIP's have historically been a great tool for building a comfy retirement on top of any pension. Didn't work out so well for GE and a few others, but there are lots of examples of steady eddie companies where it does work out. And times like now, if they don't cut the dividend, you'll get more shares. Didn't Einstein or someone call compounding the 9th wonder of the world? Someone did. I'll have to check one of @dealmaker 's threads.

Speaking of GE... I need to take a peek at them. Never know. More to follow on that perhaps. (in another thread of course)

 

The point is that those were good choices because of the strength of the underlying company. The fact they paid a dividend was really irrelevant, paying a dividend doesn't make you a strong company and vice versa. You're just using the dividend as a proxy for the strength of the underlying company, which is OK I guess but I'd maintain that it's not the best way to ascertain that when you could just look at the strength of the underlying company instead.

 

Yeah I didn't read the whole conversation, certainly all valid points.

 

Exactly. My old parents have drunk the kool-aid of their financial advisor on this topic. They hold onto their 'safe' dividend paying stocks even during this downturn.