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Gold/Mining/Energy : Big Dog's Boom Boom Room

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To: CommanderCricket who wrote (103671)	6/25/2008 11:14:11 AM
From: Wyätt Gwyön	Read Replies (2) of 206093

i have a large position in COS but nothing in SU or CNQ. is there any reason to prefer one over the other? in my own case, i am a sucker for a good dividend, hence my COS position. but i am curious why others might like or even prefer SU and CNQ, at these relative levels. COS runrate dividend over 8% now, supportable with crude down to $100 or so and i expect significant dividend raise if these CL levels are sustained. personally, i think all companies with mature operations should pay a significant dividend. i think that's what equity holders are owed and should demand. until 1958 the SPX dividend yield always exceeded UST 10yr yield. since then, US CEOs have expropriated more and more corporate wealth for themselves without providing additional benefit to shareholders. this has led to a situation where large parts of the market, literally trillions, trade on pro forma fantasy earnings without ever delivering significant cash to shareholders. this is just as insane as the housing bubble imo. since it is not in shareholders' interest to have a low dividend, i think the only logical explanation is the huge shift toward equities in investor PFs over the past couple decades. more investor dollars chasing the same limited pool of corporate profits, plus a secular change leading to greater permissiveness toward CEO kleptocratic behavior. as baby boomers retire and there is a net extraction of money by investors, there will be less investor interest in equities. cos will have to compete for investor dollars by once again offering attractive dividends. someday i expect all companies will again have to pay a real dividend. why not get an early start?

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