Historically speaking, it’s best to avoid bonds when your central bank is printing money like crazy. More cash can lead to inflation, which can lead to higher interest rates—and put a damper on any fixed-rate holdings.

But not all bonds are bad ideas. Some have their coupons tick higher with rates. Others can even provide you with the upside of a stock! Let’s review US-centric fixed income, starting with the “outhouse” and working our way up to the “penthouse” quality bonds paying as much as 8% today.

US Treasuries: For 0.5%, Why?

Ten-year Treasuries pay just 0.5% or so as I write.… Read more

I don’t know why you’d try to cobble together an income stream with miserly ETFs when there are plenty of closed-end funds (CEFs) trading at big discounts, even after the huge market rebound we’ve seen since March.

What’s more, many of these CEFs are throwing off life-changing 7%+ payouts!

Why are we seeing some great deals in CEFs now? Because the folks who invest in these funds tend to be slower to react to events than the jumpy crowd holding the typical S&P 500 stock. That lag gives us a nice opportunity to buy while these funds’ prices are still deeply discounted from the value of the assets in their portfolios (a figure known as the net asset value, or NAV).… Read more

I’m going to show you a dividend portfolio that gets you an incredible 9.5% payout—and you won’t have to take on stomach-churning risk (which, let’s face it, no one’s keen on doing now) to get it.

Imagine what a 9.5% dividend could mean. Take a $300,000 portfolio and you’ve suddenly got $2,375 in passive monthly income. A million bucks? You’re talking about almost $8,000 a month—miles ahead of the $1,500 a month you’d get if you just put it in an S&P 500 index fund.

Here’s the kicker: the investments in this five-fund portfolio, all closed-end funds (CEFs), invest in the same companies that make up the S&P 500.… Read more

“Money printer go brrrrrrrrr!”

This humorous investor war cry making the social media rounds these days is all you need to know about the Federal Reserve’s tactics to fight off the coronavirus. Jerome Powell is printing money like there’s no tomorrow.

In fact, since March, he’s created more than $3 trillion fresh dollars! This has been the largest money creation event in the history of the planet.

Powell Prints, Money Supply Soars

More money is lousy news for each outstanding greenback. The US dollar is starting to tailspin lower thanks to a flood of supply:

More Dollars Means Each One is Worth Less

What dividends do we buy when the dollar is weak?… Read more

Stocks have (shockingly) broken into the green for 2020 … but few folks are celebrating. That’s understandable: coronavirus cases are surging and another wave of lockdowns is a real possibility.

But there is good news here.

First off, I’ve found a “heads-you-win, tails-you-win” fund that’s perfect for these times. It pays a 7.5% dividend and boasts a portfolio of stocks we know well: Microsoft (MSFT), Apple (AAPL), Amazon.com (AMZN) and MasterCard (MA) among them.

Before we get to this fund, we need to take a close look at this levitating market so we can see exactly what it means for our portfolios as we move into the unpredictable back half of 2020.… Read more

“Brett, how you hanging in there?” My CPA leaned into his computer on our latest Zoom call.

“Well, every time Gavin Newsom talks, my life seems to get a bit worse.” (The governor of California had just announced that public and private schools would not open in the fall.)

He cracked up. “That comment reminds me of a column you wrote years ago about (then Fed Chair) Janet Yellen. Something about Yellen yapping and closed-end funds (CEFs) rising?”

“Right. Poor Janet. She sure was level-headed compared to (current Fed Chair) Jay Powell. Every time Powell speaks, gold pops!”

The reason is obvious.… Read more

These days, everybody’s looking for the one magic indicator that says when an investment is overbought—or better yet, reveals if it’s a terrific bargain.

Of course, no signal is right 100% of the time, but there is one that gives us the next best thing and unlocks high, “crisis-resistant” dividends, too.

The Perfect Crisis-Investment Indicator (for 7%+ Dividends)

The “bargain alert” I’m talking about is a figure called the discount to net asset value (NAV). And you’ll only find it in a high-yielding investment called a closed-end fund (CEF).

Before we venture too far into financial-jargon land, let’s unpack this, because what I’m about to show you is the simplest, most effective way I know of to grab steady 7%+ dividends and predictable upside in any market.… Read more

Preferred stocks are hands-down the most ignored investments in this crisis. That’s too bad, because they’re one of the best ways to get a high, safe income stream. And you can supercharge their dividends by purchasing these “dividend unicorns” through preferred-stock closed-end funds.

Before I go further, let me say that if the term “preferred shares” has your eyes glazing over, I get it: most people feel these investments are too obscure to bother with. But stick with me, because preferreds are actually perfectly suited to today’s contradictory economy, with its high numbers of bankruptcies and a rising stock market.… Read more

Quick income quiz—what’s the longest running bull market powering dividend payers? It may be the multi-decade run in healthcare spending.

Dividend stocks that are providing products aligned with this megatrend have the types of payouts that we’re looking for in a retirement portfolio:

1. Secure cash flows, with
2. Rising profits to support future dividend growth.

At a time when we can no longer take dividend payments for granted, this type of “megatrend support” is becoming a must-have.

We’ll talk specific stocks in a minute. First, let’s get into the trend and spend. The Centers for Medicare & Medicaid Services provides estimates of US health care spending by sources of funds, such as private healthcare insurance, Medicare and so on.… Read more

Here’s a critical mistake anyone can make while hunting for big dividends in a market like today’s: you can buy the right stocks at the right times—and still lose money!

2020 is a good example: even though the S&P 500 is back now positive on the year, you almost certainly suffered some degree of the following wipeout, no matter which stock you would have bought at the start of 2020:

The Headache of Going All in on Stocks

Ask anyone and they’ll likely say the market has been totally unhinged this year; bulls will say stocks shouldn’t have fallen as far as they did in March, and bears will say they shouldn’t have recovered so quickly.… Read more