In every industry there are companies which are debt free and they have greater opportunities when markets go down. We have seen stock markets loose all the value they gained while the President was in office. It is almost like people woke up from a bad dream, however being debt free and having interest rates near 0%, mean there are companies that when the coronavirus is seemingly over, they can do acquisitions. Just because there are bargains does not mean every merger will work, but if there are valid reasons mergers can work well. This means doing your homework to see which companies can be acquired and equally what companies will be doing the acquiring.

Linking to dividend paying stocks, for quality companies there are always many more opportunities than there are management abilities to acquire companies. As you examine your investments, see how disciplined they are in past acquisitions. How did it work out? where they buying for growth or to run in the same spot? is the industry growing or stabilizing? will customers pay higher prices? What is the debt load?

There are more questions than answers, till the next time – to raising questions.

When the coronavirus appeared in China, the government had the ability and did shutdown China. It was hard for the people, but for a country which has spent the last 20 years with great growth rates, the effect has very tough economically. There was good news, the pollution levels in China went down and that is a good thing. The bad thing was the economy was down, in an article by Nathan Vanderklippe of the Globe and Mail – fixed asset investment for January and February was down 24.5%; industrial production was down 13.5%; automobile output was down 46%. Retail sales was down 20.5%, new property starts was down 45%; 5 million people lost their jobs and unemployment rose to 6.2%.

China was the first country to experience the virus and is depending on exports and sales to bring things back to normal. The problem with exports is given the effects on the virus to the countries where the goods are sold, at the moment only specialized exports are needed.

Linking to dividend paying stocks, often times these companies unless they have a monopoly like situation such as utility, have diversified revenue streams. For example, P&G has 20 products which typically bring in $1 billion for each item. Will they take a hit, yes, but people still need to use the products think Tide, Crest, Olay, Pampers and the list goes on. The downturns test us to ensure personally we are reasonably diversified in our outlook. As an investor, downturns offer quality companies at a discount. If you can nibble away to buy more, because when the normalcy of the world comes back, quality stocks will tend to lead the rebound.

There are more questions than answers, till the next time – to raising questions.

As the coronavirus spreads through the US, all economic sectors are trying to figure out how the business can continue as normal as possible. In an article by Erwin Seba and Gary McWilliams of Reuter, they examined the energy industry.

The major companies Exxon, BP, Kinder Morgan, Shell all emptied their office buildings by having people work for home. The Pipeline companies which need to monitor their pipelines were working with the federal regulators to ease work rules, but still monitor the pipelines. Work at refineries, offshore rigs where people have to be in close quarters were being monitored with health checks.

On top of the virus, the other major concern is the falling price of oil and falling demand as people stay closer to home. Demand has fallen by 2.5 million barrels per day.

The refinery belt is in Houston, Texas area as well as in Lousiana, which are located in the hurricane path. Companies are used to dealing with hurricanes and have draft similar plans to deal with the virus. It is good to know most refineries can operate with half their normal staff, anything less means cuts in production.

Linking to dividend paying stocks, one of the advantages of investing in a large company is they have gone through many economic cycles and normal weather changes. The virus is different for no one knows when the end date is, but we are are hoping that measures to prevent the virus work and the affect is sooner rather than later. It is good the summer season is coming.

There are more questions than answers, till next time – to raising questions.

The cornavirus is sweeping though the economy and the first priority is your health. The second priority is to make money or not lose money. The stock markets were on a wonderful upward spiral, assets under administration (AUM) was increasingly at the individual and institutional levels and then the market went down and the economy changed. In the weeks that the US has seriously dealt with the crisis, economic activity has slowed. A great part of the economy is service and people going out to spend money – from sports to entertainment to travel, and those areas are on life support. The fall of the price of oil has not helped the economy, it helps the environment, but not directly the economy.

In an article by Tracy Rucinski and Rachit Vats all the airlines threw their 2020 forecasts into the garbage and unveiled sweeping capacity and cost-saving measures in response to fewer people in the seats. Thousands of conferences and events have been cancelled or postponed and revenue is expected to fall 70% in April and May.

Chicago based United raised $2 billion in new capital to have $8 billion and slashed 2020 expenditures by more than a third to $4.5 billion. President Scott Kirby said Hope is not an option. The company expects a loss in the first quarter and does not see a good rebound for 2 or 3 years.

Delta Air Lines saw net bookings fall 25 to 30% and could see more. Delta is cutting domestic capacity by 10 to 15% and internationally by 20 to 25%. It is freezing hiring and encouraging people to retire early.

The good news is at this time, the US airlines had strong balance sheets, lower debt than normal, and sizeable cash reserves.

American airlines had $73 billion in available capital and was eyeing cost savings.

If you live near an airport, the airport is a large driver of the economy of the area. From the planes to the airport and the people that serve the travelers, airports have been a traditional good mini economy for the cities in which they are located. A shutdown hurts many people.

Linking to dividend paying stocks, the good news is when the coronavirus is relatively over the dividends of your shares will pay for inexpensive flights. There will be plenty of low fares offerings to get people in the seats to fly again. The bad news is there will be some pain along the way. As a consumer we love bargains, with the downturn of the stock market have patience and pick up some bargains along the way. Start with the high yield dividend stocks and take your time to ensure you have peace of mind and good health along the way.

There are more questions than answers, till the next time – to raising questions.

If you think about the news of the past month, one of the stories which will come forth is people on a cruise ship being stuck off Hong Kong and San Francisco and the number of coronavirus infections doubling. The air filter systems ensure air is flowing but for a virus that will also mean the air systems enhance the problems. It was not surprising, all the cruise operators had to suspend operations. If you were taking a cruise the names Princess Cruises which is owned by Carnival, Royal Caribbean Corp, and Norwegian Cruise Line Holdings have ceased operations for the next 2 month.

In an article by Uday Sampath Kumar of Reuters, the cruise lines and all tourism operators have been hard hit by the coronavirus. Part of the solution to stop or slow down the virus is for people not to be near each other or less socializing. Governments around the world have made travel to the ports very hard by closing borders; the travel and tourism industry being very dependent on a ship docking for people to enjoy themselves on land has meant unemployment will rocket upwards, which is why the government is trying to help out.

Linking to dividend paying stocks, the cruise lines were good solid companies because they serve a need and as long as the weather is good, they are a wonderful method to go to various countries and enjoy the warm weather. It is impossible to plan for a virus, outside of having rainy day funds, because the virus changes normal life for hundreds of millions of people. As countries shut down normal operations for month or two, it is very different than one week such as when public schools shut down for a week. If you own shares in companies such as utilities, while the amount of power consumed maybe less, all those in homes where they are isolated are using more or the company is still making money. We all love capital gains, but as long as the company can pay a dividend, there is still hope in the economy.

There are more questions than answers, till the next time – to raising questions.

When analysts discuss how large companies have built in advantages, most people tend to agree, but is harder to define all the built in advantages. Sometimes the advantages have to do with logistics, the credit and cash flow of the company, in many cases quality of management, but often overlooked is the ability to affect the regulatory or legal judgement. Courts are expensive, they are time consuming, often finding methods to delay can be as good as a win, the courts are biased towards large companies. Some and all can be true, although in class action cases sometimes big companies lose.

One method to look at the regulatory advantages is to examine how prior to the civil rights era, the overwhelming advantages of the legal system was in favor of the whites. One such book is called race against time – A reporter reopens the unsolved murder cases of the civil rights era, by Jerry Mitchell, published by Simon & Schuster, NY, 2020.

Many people in the northeast, where this writer lives, we know things happen but unless you live in the area you do not necessary understand all the underlying reasons. In the southern states, slavery was the norm for a 100 years plus, and with slavery came the rationale that blacks were less than whites. It was preached at the churches, it was made institutional into all aspects of life. It was very hard to get around it, for although whites came into some contact with blacks, the thought was individuals were different than all. You might like person A or B, but not everyone. In terms of institutions, voting is when people are equal – we have a secret ballot, no one is supposed to know who you vote for, unless you tell them. To keep an equality of voting, the whites made it difficult for blacks to vote. You might read that the regulations are still being challenged in the latest elections.

When one group treats another group as less than equal, it is very easy to overlook a violent act, because one can easily rationale they had it coming. In the book, some whites shot and kill blacks who were advocating for the rights of everyone else. When the one group has all the advantages and resources of the government and another group asks for a bigger slice of the pie, it stands to reason the dominate group will tend to make things difficult. The easy way to do that is through the courts and law system because police carry guns lawfully. The police have the right to do things or also given that they are people, will also not other actions. The courts are suppose to be blind to have equal treatment before law, but when the odds are stacked against you, it is not equal treatment before the law. In the book, whites formed committees to combat giving away power and one of groups is the KKK or Klan. The Klan started as a social club but evolved into something very different, as a social club most whites were members; as it evolved to what it is now, it is composed of a minority of people. When most whites were in the Klan, that included members of the legal department. Why is a case opened? how is it treated? did investigations look for the truth or satisfy a concern? some courts give payoffs to witnesses or it was relatively easy for the court to be corrupt. If a white police officer said it was true, that it was true whether it was plausible or not – in the case involving one of the killings, the person who shot the gun, the police said he was 90 minutes away and they remembered seeing him. Further questioning of when did you see him before or what was special about that occasion? proved the officers lied.

Linking to dividend paying stocks, what is trying to be examined is large profitable companies tend to have more regulations tilted in their favor than do smaller companies. The playing field is not equal, the larger companies tend to say they do not like regulations, but actually love them because it makes the competition spend more money to compete against them. Larger companies help set the standards or how to protect the consumer while protecting themselves. It is very similar to creating a moat, it is always possible to cross the moat, but there are very few bridges and they are protected. As an investor you like see the moat, because the company can deliver consistent profitable results to pay their dividends and reinvest in the business.

There are more questions than answers, till the next time – to raising questions.

In the age of Queen Victoria of England or the Victorian Age, one of the features of society was attitudes toward sex. When people meet there are some who people find attractive too, it has been that way likely ever since the first humans. In Victorian Age – monogamy was important in the upper income classes as opposed to France where mistresses were expected. In the theater world, particularly ballet and opera, the ladies were often shown great affection while their career was on stage. In France, it was not unusual for wealthy patrons to have a mistress from the theater, For it those days, dresses were long, but at the ballet seeing legs are important and ballet shows off the wonderful legs of the ladies.

From the book The Beauty of her Age by Jenifer Roberts published by Amberley Publishing, Gloucestershire, England, 2016 focuses on one of the beautiful ballet dancers of the early 1800’s. Yolande Duvernay danced for the Paris Opera/Ballet in the 1830’s and she was beautiful in person and sexy in some of her roles which made the men droll. Many patrons sent her flowers, but one fell in love.

Stephen Lyne Stephens inherited a vast fortune to make him the richest commoner in England from his father and grandfather. The Stephens worked as a merchant in Lisbon, Portugal in the glass business. For reasons of their own, english merchants in Portugal were laden with privileges. Under several treaties, they were exempt from domestic taxes, from the jurisdiction of Portuguese courts, and most commercial regulations. Portugal was dependent on trade for basis goods – imports of textiles, wheat, fish and other foodstuffs which it paid in gold and diamonds from its colony Brazil. British merchants handled much of this trade.

The Stephens had been given ownership of the royal glass factory. He also received privileges – exemption from all domestic taxes, a monopoly of glass supply in Portugal and its colonies; freedom to set his own prices; free use of fuel from the royal pine forest or raw materials for the heat required in glass making. This resulted in the Stephens amassing an enormous fortune.

In addition to the fortune, the Stephens made money on Wellington campaign in the Peninsular War, the government bought gold. The Stephens through their connections to the Brazilian gold, supplied it to the government for a healthy fee.

The book is about Stephen viewing Yolande at the ballet, taking her as a wife, she had to retire from the stage and as he was older than she, he died after 20 years of marriage. He was 58, she was in her 40’s. She was the wealthiest widow in England, she was also Catholic – the largest church in Cambridge – Our Lady and the English Martyrs was funded by her. (Protestant England was not happy). She did not marry but had a permanent love affair with a man who was married with 6 children.

Linking to dividend paying stocks, the royal glass factory was a license to print money. If you see an opportunity like it, buy shares and let the rewards flow to your bank account. You may not know why the situation is what it is, but the history books show the Stephens were a good employer.

There are more questions than answers, till the next time – to raising questions.

One of the few countries in the world that was blessed by natural resources and managed to save the money is Norway. Many countries around the world have natural resources, but somehow very few of them have created wealth funds which can benefit their citizens. Norway wealth fund has over $1 trillion dollars which means the needs of all Norwegians are meant and the fund continues to grow.

In an article by Gwladys Fouche of Reuters, the Council on Ethics has recommended the Norway Wealth Fund which owns 1.5% of the world’s listed shares, due to climate change which is going on divest the fund of the worst polluters including the oil and gas companies, and steel companies.

The Council on Ethics recommends then the Central Bank of Norway which operates the funds slowly sells the shares off, the emphasis is not overnight because in a trillion dollar fund, the holdings are in the $13 billion range. The Council on Ethics had previously recommended and been accepted by Norway’s parliament the fund is not to invest in companies that produce nuclear weapons, landmines, tobacco, or violate human rights.

To avoid selling the shares, Norway Central Bank will determine how a company will adapt to climate change with very specific criteria. The bank will look at speed, time, and capital allocation. We want to see how they walk the walk, not just talk.

Linking to dividend paying stocks, for generations oil and gas stocks have been a staple of the economy, think the Rockerfellers and Standard Oil, however climate change is here and it has to be dealt with. In your own investments, you may want to own oil companies such as ExxonMobil, BP, and a host of other oil and gas companies because they tend to generate very good cash flows which translates into profits and dividends. As an investor there are alternatives. The sun shines and the wind blows in many areas of the globe it does it everyday and cash flow can be made. Institutions tend to have a harder time because they need to keep up with their peers to make the correct return, as individuals we have more alternatives.

There are more questions than answers, till the next time – to raising questions.

A number of years ago, Jack Nicolson and Morgan Freeman starred in a movie called the Bucket List. The movie featured two people who had terminal disease, although still active, starting talking about the things they always wanted to do and said why not now. They did things on their bucket list.

If you are a sports fan, you have a bucket list – from watching the team play in the finals of whatever sport you like to visiting the stadium, ideally to watch a game. Years ago, in a remote town the only TV came from a Detroit Superstation, it was not surprising that year people became fans of the Detroit teams. It used to be a function of where you live, the TV and radio would carry teams in the region, now with the internet whatever team catches your interest you can be a fan. For example, even though the writer lives in the Northeast, my favorite NFL team is New Orleans Saints.

In the book the Sports Bucket List by Rob Fleder and Steve Hoffman, published by HarperDesign, NY, 2018, it has beautiful pictures of sporting events which captures the beauty of the event. Looking through the book, many of the sporting events are timed to happen the same time every year, which helps them be in the news. For example:

opening day of the Major League Baseball is held at the Great American Ball Park in Cincinnati, Ohio

the first Saturday in May is the Kentucky Derby

the second week of the Texas State Fair is the Red River Showdown at the Cotton Bowl which is a college football game between Texas Longhorns and Oklahoma Sooners. Given these 2 teams tend to be ranked in the top 10 nationally, the winner has an opportunity to be rated in the top 5 teams.

Linking to dividend paying stocks, one of the things you can do with your dividends is ensure your bucket list gets fulfilled. Whether you go one in a lifetime or every year, the issue with the sports events is they happen on a consistent and regular time. If you invest in dividend companies, you can expect consistent and regular earnings going to your account and have the choice to reinvest or ensure your bucket list gets smaller every year. The key is to have one a list for that means hope and expectations.

There are more questions than answers, till the next time – to raising questions.