Anyone still insisting on fighting the Fed will be out of
capital (i.e. shorting equities or commodities) in no time. Ben
Bernanke's comments following the non-rate move all but laid out
the current environment of a weak dollar will continue. Stocks and
metal prices spiked following the comments.
Two big M&A deals were announced this morning with both
Johnson & Johnson (
JNJ
) and CenturyLink (
CTL
) initially pulling back, but rebounding toward the end of the day.
These are two of our former recommendations that we are still
watching closely. CTL has a 7% dividend yield, and we are concerned
the current dividend payout could be at risk following news of this
morning's acquisition. The company reports next week, so we'll be
seeing if there are any updates from managements.
Elsewhere, earnings were front and center. Winners included
Moody's (
MCO
), Wellpoint (
WLP
), Tupperware (
TUP
) and Dr. Pepper Snapple (
DPS
). On the flip side, sellers hit shares of Broadcom (
BRCM
), Rockwell Automation (
ROK
), National Oilwell Varco (
NOV
), Parker-Hannifin (
PH
), and Stanley Black & Decker (
SWK
).
We added a new name to our recommended list, so be sure to check
out the
post
if you did not read the e-mail alert we sent out today. Also, check
out the big number of dividend hikes reported yesterday in this
post
.
The common theory you hear all the time with money is that it
takes money to make money. While essentially true, many make the
mistake of assuming the people that have money all started with a
big sum. That's not the case. The majority of us will build our
fortunes from a small starting amount.
I have seen through the years the amount of pride individuals
who have built their own riches display. There is no hoopla, but
just real advice to be gleaned from years of experience. From a
satisfaction standpoint, it means a lot to anyone who builds
something from the ground up. One of my older Italian uncles would
often show us buildings he helped build whenever we were in the car
driving. The pride he would have in his face was unforgettable. The
language barrier didn't stop him from becoming successful with the
skill-set he possessed. You can apply this same concept to
investing, knowing that every one of us possess the skills needed
to build dividend wealth - as long as we stay consistent with our
efforts.
One area I see investors roll the dice in too often is their IRA
account. Too often we see investors experiment with the capital
they first put in ($5K a year is the normal contribution limit
unless you are over 50 years of age, which you can then fund an IRA
with $6K a year). Money you lose in an IRA is a total loss, as you
can not write off tax losses in an IRA account.
You will often hear me mention compound interest as the biggest
weapon we dividend investors have at our disposal. Just look at the
example of some one who has not invested a dime yet and just turned
55 years of age: if they follow the dividend investing discipline
we talk about on Dividend.com, they can start investing $5K a year
at age 55, and by the time they reach 75 years of age, their $100K
invested over 20 years will be worth over $800K (based on historic
dividend annual returns of 11% a year (stock price appreciation +
dividends reinvested)). The market has been acting very well the
last couple of years, and the returns we have been seeing for our
Best Dividend Stocks List
continue to justify the efforts we make at Dividend.com on a daily
basis.
Many of our readers truly have put into practice my message of
taking charge of your own nest egg. All you need is an online
brokerage account, the discipline to save money and deposit it into
the account (automating this process works best), and the right
research to help guide you when it's time to put that money to
work. I will continue to repeat myself because it is so true: no
one will ever care more about your money and financial well-being
than YOU!
As I sat around with my relatives this past Easter, I told them
the same thing I say in this daily newsletter. The key to being
wealthy is buying assets that produce income (dividend-paying
stocks, multi-family real estate, owning businesses, and investing
in the skills (education) you need to move up the corporate
ladder). On the note of investing in yourself, even if you are out
of college, you need to keep your skills as sharp and up-to-date as
ever. Don't stop learning, ever!
Thanks for reading, and I'll see you tomorrow! P.S. Please pass
this e-mail on to someone you think can use some financial
motivation as well as being kept in the financial news loop that
could affect them. Thanks again!
Be sure to visit our complete recommended list of the
Best Dividend Stocks
, as well as a detailed explanation of
our ratings system here
.