Now you are adding stocks in sectors that
will add volatility to your portfolio.
Next
industry I would look at is the Financial sector. If you can’t beat them join them. Buying a bank stock without a dividend is
like riding a bicycle without a seat.
Painful at times. Banks and
Governments are joined at the hip; the big banks that were going to fail have
failed already. The Government is not going
to let another one fail, due to the Volker rule.
Even
though I think the managers of banks are not honest with their shareholders, I
think you should buy a bank stock. You
could look at regional or local banks. I
like U.S. Bancorp (USB), it has a nice dividend yield of 2.5% as of the time I
am writing this. But you may have a bank
you like better.
The money
center banks are interesting although no or little dividend yield in some
cases. I do believe the bankers will try
to raise their dividends as a method to prop up their stock prices so they can
give themselves options and big bonuses.
There is Bank of America (BAC), Goldman Sacks (GS), Morgan Stanley (MS),
Citigroup, Inc. (C) the people who caused two depressions one in 1929 and one
in 2007, Wells Fargo & Co (WFC). I
like BAC just because Karen Finerman on Fast Money bought it.
The
political cartoon below is what happened to collapse our banking system. Bankers sat by our congressmen and rewrote the
banking laws. Remember Canada’s banks
are still regulated. Their banks did not
collapse.
If you
would like to buy a bank but feel uncomfortable buying one of the US money
center banks. Buy a Canadian bank. Canadian banks have a tail wind considering
Canada is in a good long term position because it owns a lot of
commodities. It also believes in
regulating banks, taxing the wealthy, and supporting the middle class.
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