What Happens to Non-Dividend Paying Stocks When The Federal Reserve enacts Normal Interest Rate Policy? – December 14, 2021,

So as many people know, the Leftists or maybe it’s better I say the control freaks, have more at stake with the fiat monetary system than anyone else. If you want to know the TRUE Conservative view of money, look no further than Bitcoin, Gold and Silver when you’re Conservative money could be seashells, we don’t a sh*t because money is nothing more than a convenient form of barter.

Conservatives like their money DECENTRALIZED even when many of us purchase stocks, we don’t as much care about the fiat price of the stock, we care about the management of the company, because financial systems crash all the time, but a business system if left alone by the government if properly constructed can last longer than most nations.

There are private entities as an example that have been around longer than North and South Korea, it’s not abnormal for a private country to outlive a country, but in a normal interest rate environment, it’s important to remember that horribly run businesses get quickly exposed because if your business can’t cashflow, no entity is going to lend you money.

 

Inflation is out of control. It’s time for the Fed to raise interest rates | CNN

Personally, I try to avoid going into debt, you’ll notice that I don’t write much about real estate investing on this blog, I don’t like real estate investing, I find it boring. The real estate investing market as an example is saturated and the current mood of the world is that real estate prices can’t collapse? Maybe this is true, I’ve personally bought a ton of REITS, I like investments that cashflow, but I don’t invest heavily in any one sector, because even though my overall investment portfolio is in the Green, I have quite a few stocks that are in the Red.

Why do Dividends rise when central banks raise interest rates?

I like to buy when the house is on fire, but what I think people forget about Dividend-paying stocks is that dividends actually rise when the Federal Reserve raises interest rates. Why because the stock market is in competition with the Central banks. There’s nothing NATURAL about a central bank, central banking is actually communistic, but to stay on topic if I can get cash flow by leaving my money in a bank, dividend-paying stocks will have to compete that.

I’m not not going to spend new or keep old money in the stock market if the bank is paying me a decent rate of interest on my money. Furthermore, in this environment, if interest rates rise for a prolonged period of time, and the government attempts to put them back to zero, it might cause some serious anger.

With that said, if interest rates spike, stock prices will come down, and if your stock doesn’t pay a dividend and it has a massive sell-off, don’t be surprised if it stays dead for a prolonged period. A lot of people have become accustomed to capital gains instead of cash flow, during a higher interest rate cycle, capital gains become harder to come by. Because after all the average investor will say why take the risk if I’m getting a decent return on my money?

The dividend-paying stocks, will likely up their dividend because now they have more competition, so although in the shorter term I expect all stocks to decline, I expect that SOLVENT dividend-paying stocks are going to start paying even more than they are now, even if the overall value of the stock declines. So for myself, I will be looking at the numbers/balance sheets of a lot of companies if there’s a massive sell-off.

 

I do think some dividend-paying companies will halt paying if there’s a massive sell-off but will resume wants the dust settles. Regarding the non-dividend paying stocks, there will be some winners of course, but I don’t think the appetite for non-dividend paying stocks will be as great as it is now if interest rates are normalized.

 

The reason we’re talking about raising interest rates is because of SHORTAGES, more and more people are beginning to understand that printing money can’t solve SHORTAGE problems. When I write about shortages, let’s ignore retail shortages and think about LABOUR SHORTAGES, that’s a serious problem for the economy and it’s actually a problem created by governments’ response to Covid-19.

Even if you’re pro-lock-downs and you demand everyone gets vaccinated, shortages are shortages, there’s no getting around it. One of the problems during slavery was rebellious slaves or smart people refusing to be productive. In North Korea, they have constant blackouts, even if you’re a genius that lives in North Korea, whether it be fear or principle you might opt not to be as productive as you could be, why? Because what’s your reward? More responsibilities that might cost you your life?

During slavery times, sure there were some productive slaves, but most could care less, looking for all sorts of ways to be unproductive. If I were a slave, the master would have to name me “Know-nothing” because I’d pretend I was dumb, or smart enough not to get whipped. People in labour unions as an example don’t work overtime and might exhaust all benefits at their disposal, when the people in change force you to do things you don’t want to do, you’ll rebel.

Rebellions don’t have to be loud and outlandish, do just enough so you can survive another day. If the slave master is pure evil, this obviously leads to massive deaths. whether it be suicide or otherwise.

The excessive regulations the government has put on the economy has created a situation that might lead to profitability for people who invest for cash flow. I personally think Western governments really screwed up this time and if we don’t normalize interest rates and enact austerity measures we’re headed for a depression.

A reminder to people reading this blog not everyone suffered during the great depression, the people who suffered were the people who never saw it coming. Wage controls and social security should have been obvious signals for a prolonged depression, well in this era, carbon tax and their variations, as well as covid-19 regulations on the economy, should be obvious signs of a looming global depression.

The Federal Reserve is expected to take a very big step toward its first rate hike | CNBC

Interesting times ahead!