It blows me away that folks still think high interest rates will be around forever. Truth is, rates are already starting to fall!

But no one’s really paying attention (yet!). Which leaves us a brief window to lock in some sweet 8%+ dividends from one of our favorite utility-focused funds. This bargain-priced buy soars when rates drop.

Look Beyond the Headlines for the Real Rate Story

Remember January, when all the talk was about how rates would be cut six times this year?

Poof. Those hopes were history before winter—such as it was—ended.

Nowadays, futures traders have almost completely thrown in the towel—they’re calling for just two rate cuts between now and January.… Read more

Every now and then in income investing, we get a sweet setup where a “boring” high yielder absolutely soars—practically overnight.

I recently saw such a scenario play out with a closed-end fund (CEF) called the BlackRock Municipal Income Fund (MUI). I bring it up now because what happened with MUI has a lot to teach us about how we can get stock-like gains from a so-called “boring” income play like this.

Despite its sleepy-sounding name, MUI is what I consider a “triple threat” investment because it can pay us in three different ways:

1. Its dividend, which yields a high 5.5% and has been remarkably stable, even throughout the low-rate 2010s.

Small-cap stocks are on sale. We can buy select names for just 8.8 times earnings and 83% of book value.

Large cap stocks rarely sell this cheap. That is the problem with popularity! Which is why we’re looking small but thinking big, eyeing payouts between 7.3% and 13.8%.

(Those dividends are no typos. The beauty of being nimble individual investors means we can fish in these small but potentially lucrative ponds.)

Now small cap stocks aren’t always this cheap. Traditionally, smaller firms trade at a premium to their large-cap counterparts given their outsized upside potential. But today, small caps are less expensive by just about every valuation measure.… Read more

One of the biggest retirement-investment mistakes you can make is to make things more complicated than they need to be.

Funny thing is, Wall Street actually makes it easy to fall into this trap! Case in point: A new “financial product” from a group of companies, including BlackRock, that combines target-date funds and annuities.

We’ll get into why this isn’t a strong retirement option for those still working in a second. Then we’ll stack it up against a “straight down the middle” 9.2%-paying closed-end fund (CEF) that gives you the dividends, liquidity and growth necessary to fund a more comfortable retirement—maybe a lot sooner than you think.… Read more

DoubleLine Income Solutions (DSL) took its biannual trip to the bargain bin a few weeks ago. It was a short stay, as usual.

By mid-April, vanilla investors had worked themselves into a hysterical state. They somehow convinced themselves that the Federal Reserve was going to continue raising rates.

Let me repeat—they worried that, in an election year, the Fed was going to keep on hiking. Unlikely.

Even Bloomberg lamented that traders saw “no relief in sight for bonds.” A hopeless howl that piqued our contrarian interest. No doubt, relief was just around the corner.

Indeed it was in the form of Chairman Jay Powell and his soothing postgame pillow talk.… Read more

“Don’t fight the Fed” is my top investing rule—but what the heck do we do when Jay Powell says one thing and then does another?

We buy bonds! Below we’ll dive into a bond fund kicking out a sweet 9% yield and sending payouts our way every month.

But first, let’s get to the heart of the Fed chief’s doublespeak.

Did you watch Powell’s press conference last week?

If you’re like me, you probably weren’t surprised by most of it. He did his usual tough-guy talk on rates. But then, almost as an aside, he said the Fed is slowing its campaign to shrink its balance sheet—known as “quantitative tightening.”… Read more

An unusual trend has hit Silicon Valley that’s running far below the radar: a big shift toward paying dividends.

We’re going to take full advantage by grabbing something unheard-of, even for die-hard tech investors: A 9.3% dividend that grows. 

That’s a real eye-opener for tech, to be sure. Because while more tech stocks are paying dividends these days—even long-time holdouts Meta Platforms (META) and Alphabet (GOOGL) now offer payouts—most of these are still tiny. (Meta and Alphabet both yield just 0.5%).

Of course, there are tech-dividend stalwarts that pay at least a bit more and offer long histories of payout growth, too, like Microsoft (MSFT) and Cisco Systems (CSCO), which yield 0.7% and 3.3%, respectively.… Read more

Stock market rallies climb walls of worry. Well, we have no shortage of such worries today!

A few days ago, Bloomberg lamented there was “no relief in sight for bonds”. This was ironic because relief—the catalyst for the next big bond rally—is hidden in plain sight. Despite the despair, 10-year Treasury rates are still a ways off from their recent 5% highs last October:

Reality Check: Rates Still Lower Than Last Year

If they put in a “lower high”—as I’m expecting they will, thanks to a slowing economy and labor market—it will be wildly bullish for bonds (which trade inverse rates.)… Read more

If you’ve been following the AI space lately (and honestly, who hasn’t?), you’ve probably seen stories about tech investors feeling a bit shortchanged on the profits they’re getting.

That’s actually good news for the rest of us—a sign the market is maturing and ripe to be tapped for income.

Specialists Often Miss the Bigger Picture

Experts make this mistake all the time. There are a few reasons for this, but probably the biggest is overreach: You can be a wizard at technology, you can even be a genius at investing in technology, but you can still be wrong if growth happens differently than you expect.… Read more

“If you own dividend-paying stocks, you’d be a fool to not be using Income Calendar,” my man Mark P. from California writes.

Tell ‘em, Mark!

We are devoted to retiring on dividends here at Contrarian Outlook. But a little bit of work in retirement is OK. As income investors, we should be able to, well, project our income.

Note that I said a little bit of work. Not a lot! I am not interested in fiddling with spreadsheets until the end of time, and neither is my man Mark.

That said, I’m springing a pop payout quiz on you.… Read more