Author Archive: Brett Owens

As we head towards the most telegraphed recession in recent memory, US Treasuries are receiving a lot of attention. And rightfully so.

In recessions, interest rates go down. This boosts bond prices (which trade opposite rates).

But not all bonds are created equal—especially during recessions. Slowdowns tend to make the safest bonds the most attractive.

After all, it can be a slippery slope from slowdown to meltdown, so many investors prefer the safety of Treasuries. In 2008, for example, the S&P 500 sank 38% but US Treasuries rallied sharply. The iShares 20+ Year Treasury Bond ETF (TLT) delivered a 28% gain for the year:

In 2008, T-Bonds Did Great 

I don’t think we’re in for a repeat of ’08, but this “buy Treasuries before a recession” trade has worked superbly since we called it in November.… Read more

Worried the economy is teetering on the brink? I don’t blame you.

Rather than running for the hills, let’s focus on recession-resistant dividend stocks. Big payout growers. We’re talking 25% to 56% dividend growth (yes, that’s no typo).

The safest dividend is the one growing the fastest. Take UnitedHealth Group (UNH), the largest health insurance carrier in the US. Its business is beautifully recession resistant. As a result, UNH is one of the most consistent growth stocks out there. Mark it down for 10%+ gains, per year, every year.

Gains in what? Every metric that matters. UNH’s sales soared 13% year-over-year.… Read more

We’re all about the dividends here at Contrarian Outlook. Often we take it for granted that we’re not looking to lose 17% in just a few weeks while we collect income!

BAC Reaches (and Reaches!) for a Bottom …

The share-price chart for Bank of America (BAC) may appeal to dividend dumpster divers. And heck, it may work, as BAC stands to gain as more people pull their savings from regional banks and plunk them into “too big to fail.”

Why deal with this nonsense? This is exactly why we’re fading “cardiac” price charts like BAC’s and shifting toward the smooth and steady growth of dividends:

… While We Climb the “Dividend Staircase”

That’s more like it!… Read more

Looking to profit from oil-powered dividends? Look no further than this discounted payer dishing 9.6%.

Oil prices had plunged in recent months on recession fears. However, there’s still no recession. Oops. One point for the energy bulls.

Meanwhile, OPEC said enough “cheap” oil. On Sunday the cartel announced production cuts. Oil prices popped.

Will OPEC’s move prompt the Federal Reserve to raise rates even higher to cool demand for oil? I don’t think so because the Fed has a problem. It broke the banks! Higher rates could do more damage.

High oil is painful, but a banking crisis is worse.… Read more

I hate to see folks trying to time this banking mess with regular stocks like JPMorgan Chase & Co. (JPM). Especially when they can easily swap their big-bank stocks for “preferred” dividends yielding 8% and up!

That’s a far sight better than the magic trick mainstream investors are attempting, as they try to dodge into big banks like JPM at just the right moment.

JPM Looks for a Bottom

Worse, JPM only yields 3% today. And you and I both know that markets can thrash around for weeks looking for a bottom.

That’s why, instead of squinting at price charts, we’re calmly picking up some sweet “backdoor” dividends from these very same banks, but with a yield that’s 173% bigger.… Read more

It doesn’t get any better than monthly dividends. Getting paid every 30 days aligns nicely with our monthly bill schedule.

Today we’ll discuss three monthly dividend stocks yielding 5.4% to 14.6% per year. Yes, that’s right, 14.6% per year!

Worth it? We’ll discuss that shortly. First, an ode to the monthly payment.

Below I’d like to invite you to choose your own retirement adventure. These are the same dividend payments except the top set is paid only quarterly.

The bottom, meanwhile, is paid monthly.

Same total payments but a much smoother retirement ride with the monthlies.

Where do we find monthly dividend payers?… Read more

The Federal Reserve tightened until it broke something: the small banks. Classic Fed!

Meanwhile, here at Contrarian Outlook, we’ve been waiting patiently for a big buying opportunity. Biding our time. So… is this our moment?

Bank runs are textbook “blood in the streets” moments. There’s fear. There’s loathing. This is usually our cue to spring into action.

So, should we contrarians simply “hold our noses” and buy?

Regional bank stocks haven’t been this cheap since the summer of 2020. Sure, Silicon Valley Bank has gone to zero. But many small businesses, mine included, still prefer to bank with the folks down the street.… Read more

There’s a “delayed reaction” dividend play (for tax-free 5% yields) waiting for us in municipal bonds right now—and it’s not going to last.

I know, I know. “Munis” don’t exactly get most folks’ hearts racing. But the fact that this corner of the market tends to lag behind stocks, bonds and the rest is exactly what’s behind our opportunity here.

Plus, we get to buy cheap and get our dividends monthly when we buy our munis through a closed-end fund (CEF). That’s because most muni CEFs pay monthly—including a 5.3% payer called the Nuveen Municipal High Income Opportunity Fund (NMZ), the particulars of which we’ll delve into below.… Read more

Is it time for us contrarians to “buy the dip” in bank stocks?

We’re drowning in big bank-scare headlines. Silicon Valley Bank (SIVB) knuckled under in days, Signature Bank (SBNY) wasn’t too far behind, and across the pond, Credit Suisse (CS) needed a buyout bailout from rival UBS (UBS).

The next bank run, however, won’t be with the big boys. Too big to fail, baby. Here, we’ll find not only government help but also secure yields of up to 5.1%—trading at a discount, no less.

Why the big guys? Well let me show you. Last week, my software firm received this email from one of our vendors:

“Brett, Just wanted to give you our new banking details.

Federal Reserve Chairman Jay Powell is scared. First, it was UK pension funds. Now, the entire banking system has liquidity issues.

Fourteen years of quantitative easing is a tough habit to break! We are one year into the Fed’s attempt to tighten monetary conditions.

Should we buy bargains? Or sell now and go shopping later?

Fellow contrarians want to know! Our Contrarian Outlook customer service line has been hot. Today, we’ll put on our short-term thinking caps and discuss your dividend trading questions.

Q: Do you see any good buys among the regional banks where the “baby got thrown out with the SVB bathwater?”… Read more