Income Investing Secrets System
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THE BEAR MARKET IS NOW OFFICIAL -- THE DOW JONES JUST SANK TO 11,215!
What, My Mother Worry? Not When She's Cashed Checks Thru Every Bear
Market, High Tech Bubble And Investing Fad Since 1955 . . .
OLD-FASHIONED -- YET NOW REVOLUTIONARY -- \"GOLD EGG\" INCOME
INVESTING SECRETS OF AN ALTON ILLINOIS WIDOW AND GRANDMOTHER OF TWO
IF YOU CAN BUY A FEW SECURITIES (FOR SOME OF THEM, YOU WON'T EVEN
NEED A BROKER), YOU CAN USE THESE SAME TECHNIQUES, NOW UPDATED FOR THE
21ST CENTURY, TO PULL AN EVER-GROWING STREAM OF CASH FROM THE MARKETS
FOR THE REST OF YOUR LIFE
SO LONG AS PEOPLE DRINK SODA, TALK ON THE PHONE AND CHEW GUM!
For A Quick Look At Investing For Income, Watch This Short (1:20 Min)
Video Now:
Right now, you probably think investing is finding stocks that go
up, and then selling them -- or having mutual funds do that for you.
I'm here to tell you, THERE'S A BETTER WAY!
I didn't know it, but I started learning different when I was only
two years old . . .
. . . Ike was President back when my grandfather, an accountant for
Ralston-Purina, helped his newly widowed daughter invest the life
insurance money she'd received from my father's death in an automobile
accident.
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"From 1871 to 2003 97 percent of the total after-inflation
accumulation from stocks comes from REINVESTING DIVIDENDS. Only 3
percent comes from capital gains."
-- Dr. Jeremy Siegel THE FUTURE FOR INVESTORS
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Knowing the future of his daughter and two grandchildren were at
stake, Grandpa used a SIMPLE, COMMON SENSE -- to him -- approach . . .
that most investors, brokers, financial advisors and investment
writers have now forgotten (or DELIBERATELY IGNORE, because it's not
in their best interests for you to understand this).
See, although my grandfather collected Social Security, he was born
and raised BEFORE SOCIAL SECURITY EXISTED. People back then invested
for income, because they couldn't assume they could depend on
government checks.
Like this boy, I'm riding on my Grandpa's shoulders -- and so can
you!
When they bought stocks and bonds, they held on to them -- so they
could collect dividend and interest checks FOR THE REST OF THEIR
LIVES. That's what they depended on to pay bills and eat.
Chances are, up until now you've been investing for capital gains,
or pushing the responsibility for picking "growth" stocks onto your
mutual fund manager.
That's okay -- IT'S NOT YOUR FAULT YOU DIDN'T KNOW ABOUT INCOME
INVESTING. The media financial experts don't tell you about it. Your
broker won't tell you about it. Other financial writers won't tell you
about it. Everybody, including the government (I'm required to tell
you that past performance doesn't equal future performance, even
though I'm not promising ANY capital gains "performance" in your
portfolio -- don't want you to care!), assumes that making money from
investing means buying and hoping for a rise in price.
We've all lost money in stocks and mutual funds. We all lost money
in the Dot Com Bust. WE'VE ALL BEEN BRAINWASHED AND HYPNOTIZED BY THE
MIRAGE OF FINDING THE NEXT \"TEN-BAGGER.\"
You STILL HAVE TIME to build a secure, long-lasting financial
foundation that pays you ever-growing checks.
WHATEVER HAPPENS TO THE SOCIAL SECURITY TRUST FUNDS (IN EUROPE,
CANADA, AUSTRALIA AND JAPAN AS WELL AS THE U.S.!) WHEN 82 MILLION BABY
BOOMERS RETIRE (AND THEY'VE ALREADY STARTED!), YOU CAN ASSURE YOURSELF
OF AN EVER-GROWING INCOME THE REST OF YOUR LIFE
The world keeps changing, but PEOPLE'S BASIC NEEDS HAVE STAYED THE
SAME SINCE WE LIVED IN CAVES. Clearly, if you want a secure income you
can depend on, you want to invest your money so it'll help supply
people with those fundamentals: food and shelter. Water and fire.
McDonald's and Pepsi-Cola. Apartments and houses. Water and electric
utility companies.
You want to invest safely, because 82 million American baby boomers
are going to retire in the coming years. (The first one filed her
Social Security retirement claim in October 2007.)
Many experts predict this is going to depress the financial markets.
I don't know. INCOME INVESTMENTS BASED ON BASIC HUMAN NEEDS WILL
CONTINUE TO SEND OUT CHECKS. That's all I need to know and care about.
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"If you're not going to sell a stock, what happens to its price is a
matter of indifference."
-- Peter L. Bernstein AGAINST THE GODS: THE STORY OF RISK
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WHAT IF . . . EVERYTHING YOU THOUGHT YOU KNEW ABOUT INVESTING IS . .
. WRONG?
Yes, sometimes the market prices of "growth" stocks do go up -- but
you can't profit from those price rises unless you sell the stock, and
then YOU DON'T HAVE IT ANYMORE, and therefore you lose out on all
future price increases. (Plus, you must cut Uncle Sam in on your good
luck by PAYING CAPITAL GAINS TAXES.)
Simple logic, right?
Yet brokers (who make a commission when we sell stocks), mutual fund
managers (who charge hefty fees for running up your tax bill) and the
talking heads on TV (who'd bother to watch these shows if they didn't
care whether the market went up or down?) all encourage us to buy
investments for growth. Hey, "value" (or "contrarian") investing is
really JUST ANOTHER WAY OF CHOOSING STOCKS YOU HOPE WILL GROW MORE
QUICKLY THAN THE MARKET.
Wall Street wants you to keep buying and selling so they keep raking
in commissions and fees. THEY KNOW THAT TRADING MAKES YOU A LOSER --
the market is just too efficient to beat.
Spend a happy, carefree retirement with your loved ones. Just try
out the Income Investing Secrets system.
Mutual fund managers want you to keep sending your money to them.
They make millions by trying to convince you that they're better stock
pickers than you can be. The truth is, their track records --
documented by hundreds of academic studies -- are WORSE THAN THROWING
DARTS AT A NEWSPAPER . . . and they jack up your income tax bill.
But you may ask, won't you have to pay taxes on your income from
investments? Unfortunately, that's true . . . but here's the
difference --
When you sell a security and pay capital gains taxes on the profit
(assuming you have one, which is a BIG assumption), you NO LONGER HAVE
THAT SECURITY.. You just "ate your seed corn." You've just dumped your
financial future -- and reduced your investment capital.
When you pay taxes on dividends and interest, you STILL HAVE THE
UNDERLYING SECURITY! It'll keep on sending you more checks. YOU
HAVEN'T TOUCHED YOUR INVESTMENT CAPITAL.
A few voices of Wall Street sanity do urge you to "buy and hold" --
but they forget to tell you that you can buy and hold -- AND ALSO
RECEIVE REGULAR CHECKS!
How can you spend your portfolio's value, without selling any of it?
WHY CHASE AFTER HI-TECH BUBBLES THAT POP AND \"GROWTH\" STOCKS THAT
DON'T PUT CASH BACK INTO YOUR POCKET? INVEST IN THE BASIC NEEDS OF
PEOPLE AND YOU TOO CAN BE FINANCIALLY SECURE -- SO LONG AS PEOPLE TURN
ON ELECTRIC LIGHTS AND LIVE IN HOUSES AND APARTMENTS
Look, I'm just an another guy with a job I have to go to every day
to pay my bills. I don't have tons of money. My broker doesn't call me
up to offer me the latest IPO deal. Yet I want to retire in comfort
and enjoy a few of the luxuries I've earned.
So I have spent years studying investing and trading, hoping to find
a way to "get rich quick."
I tried many things -- buying options, buying "growth" stocks,
putting on commodity option spreads, gold, silver, currencies, index
funds . . . if a trade had a 90% success rate, I'd put it on just
before the world financial markets nearly melted down.
I failed to get rich, quick or slow. Yet, one day recently I had a
revelation -- one of those "things I learned in kindergarten but
didn't think they applied in adult life" sudden insights.
YOU CAN'T HAVE YOUR CAKE AND EAT TOO!
That is -- when you buy stocks for "growth," you can't put actual
cash into your pocket until you sell the stock.
And then you don't participate in its future growth, which is why
the most honest investment advisors, such as Warren Buffett, advise
you to never sell.
BUT IF YOU NEVER SELL GROWTH STOCKS, YOU NEVER PUT CASH BACK INTO
YOUR POCKET!
It's a Catch-22 only your broker (because they get paid commissions
whenever you buy and sell), mutual fund managers (because most people
send their money to mutual funds to avoid thinking about this very
problem) and the IRS (because you will owe them capital gains taxes)
can win.
Besides, I couldn't help but notice that Warren Buffett himself
likes CASH-RICH BUSINESSES SUCH AS INSURANCE COMPANIES (GEICO) AND
COMPANIES THAT PAY DIVIDENDS (COCA-COLA).
Not only that, I knew enough about modern research by financial
scientists to know that the markets are nearly unbeatable. I hate the
word "efficient" -- but they are UNPREDICTABLE.
So I began learning all I could about stocks that pay dividends,
bonds, preferred stock and so on. I learned that there're many more
income-paying investments than I'd ever heard of -- some of them
paying out TERRIFIC YIELDS to their investors.
After I began my research into investing for income, I was helping
my mother organize her paperwork, and she showed me the original
notebook where Grandpa wrote down the stocks he bought for her with
the life insurance money from my father's death.
As I looked through it, I wanted to slap myself silly! The secret to
successful investing had been under my very nose all along, but I'd
been too busy reading all the books by "experts" to realize . . .
In 1955 my Grandpa put together a TOP-NOTCH INCOME PORTFOLIO FOR MY
MOTHER!
Thanks to him, my sister Nancy and I had food to eat and clothes to
wear.
All I had to do was follow his lead, update it for the modern
financial world, and ORGANIZE IT INTO A SYSTEM ANYONE CAN EASILY LEARN
AND FOLLOW.
\"MY BROKER KEEPS TELLING ME ABOUT STOCKS HE SAYS WILL GROW A LOT IN
20 YEARS. I TELL HIM, I WON'T BE AROUND IN 20 YEARS.\"
I hope my mother's wrong about that . . . and I don't want you to
invest with the expectation you're going to die any time soon -- but
the truth is, it does only make sense to benefit from your investments
RIGHT NOW, instead of waiting 1, 5, 10, 20 or more years.
The official Wall Street line is that companies that don't pay
dividends use that cash to grow their businesses, so their stock
prices will go up further and faster in the future than stodgy,
boring, dull companies that actually treat their shareholders as
partners in the success of their businesses.
That's a logical theory -- but REAL LIFE RESULTS TELL A DIFFERENT
STORY.
Arnott and Arness studied the relationship between dividend payouts
and corporate prices for the years 1871 to 2001 and reported on their
results in FINANCIAL ANALYSTS JOURNAL. They found that corporate
profits rose fastest in decades following the highest dividend
payouts, and were lowest in the years following the lowest dividend
payouts.
So much for the "keeping cash makes a company grow faster" argument.
THE HISTORICAL RECORD SHOWS THAT DIVIDEND-PAYING COMPANIES ARE THE
BEST LONG-TERM INVESTMENTS . . . GROWTH STOCKS ARE ONLY BETTER DURING
MANIAS, AND THEN ONLY IF YOU'RE ONE OF THE FEW WHO SELL OUT BEFORE THE
BUBBLE BURSTS
From 2000-2002, the S&P 500 stocks that didn't pay dividends fell
33.19%. S&P 500 stocks that paid dividends ROSE 10.4%. The 3-year bear
market just SLOWED the dividend paying stocks. And don't forget, THOSE
SHAREHOLDERS STILL RECEIVED THEIR QUARTERLY DIVIDEND CHECKS!
Since 1926, dividends have made up 42% of the total return of the
S&P 500. If you invested $1000 in the S&P 500 in 1926 and reinvested
dividends, you'd now have $3,326,000 -- but if you didn't reinvest
dividends, you'd have only $117,590. That means that the S&P 500
stocks that didn't pay any dividends had pretty punk "growth" compared
to reinvesting in the companies that did pay dividends.
Just because YOU CAN'T REINVEST DIVIDENDS IF THE COMPANY DOESN'T PAY
ANY.
The Mergent large cap index of dividend paying stocks outperformed
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HERE'S SOME OF THE STOCKS GRANDPA CHOSE FOR MOM:
* Midwest Piping
* American Investment Company of Illinois
* Wrigley Gum
* Black and Decker
* Ralston Purina
* R.J. Reynolds Tobacco
* Stix, Baer and Fuller
* Stokely Van Camp
* Borden
* Hershey
* Guaranty Trust Company
* J.C. Penney
* Phelps Dodge
* AT&T
Notice how boring this list is, even for 1955. Chewing gum,
industrial pipes, financial services, cigarettes, chocolate, and that
all-time favorite -- hog mash.
My grandfather did NOT buy IBM, even though he was seeing the
introduction of mainframe computers and, working for an international
corporation, must have known how important they would be to modern
businesses.
No, he put my mother's money in the "Old Reliables" . . . not
computers -- PORK AND BEANS!
AT&T was as high-tech as he went, but back then that was a regulated
utility, and it met the basic human need of talking to each other.
Mom doesn't have most of these stocks anymore, to tell the truth.
For example, she and Grandpa gave in to the tobacco scare, and sold
R.J Reynolds. And since its 1984 split up, AT 1966-1981; and
1999-mid-2008 it was the ONLY way to make money from the stock
market!)
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Disclaimer:
I am not a financial advisor. I am not a broker. I am not a
financial planner.
I have no professional licenses.
I am a wide reader and an independent thinker and this site gives my
opinions on the subject of income investing.
Nothing in this site is to be construed as professional advice.
I am not responsible for the results of your investment decisions.
Past results are no guarantee of future returns.
You must read, think over what I say, make your own investment
decisions and take responsibility for your own life, including the
results of your investment decisions.
Continuing to stay on this site implies your acceptance of these
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Copyright 2008 by Richard Stooker and Gold Egg Investing LLC. All
rights reserved.
Thanks to my cousin Steve Jacoby for taking the great picture of Mom
and I.
130G Ballwin Manor Dr
Ballwin, MO 63011
(636) 394-2052
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