Nice SocGen expression of how the search for yield has manifested itself in different asset classes:

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Click to enlarge

Source:
Societe General – Cross Agent Research
The Global Income Investor
January, 30, 2012

Category: Dividends

Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.

9 Responses to “Dividends Are All The Rage – The Clamour For Equity Yield”

  1. Bob A says:

    I looked but don’t find how they’re defining ‘high’ and ‘quality’ ?

  2. gordo365 says:

    Investment thesis – anything that pays more than CD will be bid up by retiring boomers.

    Just like Greenspan chased risk-averse investors into risky asset classes – The Bernank will do the same.

    I have this conversation over and over with my parents in their 70s – No don’t take money from CD roll over to buy gold stocks – Netflix – whatever else they hear about on cable news.

    Fixed income crowd being led to slaughter. I hope there is a special place in hell for Fed Reserve Chairmen who punish savers.

  3. [...] Dividend investors should focus on companies with that can increase their dividends.  (Marketblog, Big Picture) [...]

  4. bgad says:

    Thank you Gordo, it’s about time that somebody thought about the savers in this world!

  5. Pantmaker says:

    One decent market plunge and the boomers are committed to cash until death do they part. A 2% dividend from a stock they just lost 25% in ain’t gonna look too great.

  6. rd says:

    Gordo365: I agree with you. I also agree with Mark Cuban’s quote above.

    This thing won’t be done until savings and money market yields = CPI and S&P dividends >3% consistently. I don’t know what the route to this will be, but it probably won’t be pretty. However, I do expect it within 5-10 years – too late for many of the early Boomers

    PE multiples of 15+ indicate that people expect a stock to be around quite a while and pay dividends in the long run. Many of these tech stocks have shot up in value at various times over the past 20 years but then their technologies and concepts became obsloete and they shrunk or vanished. In the long run, why would I want to own a stock that never actually returned a dime to an investor except as a capital gain selling to a greater fool? Our stock market has been a manic-depressive pump, dump and run cycle now since the late 90s with no focus on a company’s ability to do anything other than jack its earnings over the next 12 months.

  7. DaveLee says:

    Looking at the graph, it appears that most differential in gain happened in 1990-1993. I wonder how the graph will look if the starting point is 1993.

  8. “…Our stock market has been a manic-depressive pump, dump and run cycle now since the late 90s with no focus on a company’s ability to do anything other than jack its earnings over the next 12 months…”

    not that this..

    http://search.yippy.com/search?query=Jay+Gould+Watered+Stock+History+of+Wall+Street&tb=sitesearch-all&v%3Aproject=clusty

    was the, definitive, Start..but, it’s been going on a might longer than ~15 years..

    Gould’s (& Co.) ‘era’ was ~150 years ago..

  9. robertbolandian says:

    I hear investors speaking of dividends and yields like they are guaranteed, which is clearly not the case. Additionally, many investors somehow lose sight of the fact that they can actually lose more in the underlying stock on a mark to market basis or realized basis, than the dividend itself. The reach for yield is alive and well. Owning quality stocks with high dividends and reasonable payouts can certainly be a profitable long term strategy, but investors should be mindful of potetnivolatility along the way.

    Robert Bolandian