Tuesday, March 31, 2009

Rogers purchase

Today I purchased shares in Rogers Communications inside my wife's RRSP account.

Here is a post I wrote on Rogers for The DIV-Net, where I described it as one of the companies that will make up the 'Future of Canadian Dividend Growth'.

I am extremely confident holding Rogers for the long term due to their market positioning in Canada, and potential for further growth as they cater to those who crave the latest technology and media experience. Their dividend growth has been stellar and I see no reason for this to stop. This is one company that I believe will outperform even in this tough economy. Cell phones and cable services are sacred to many Canadians and Rogers has the pricing power to inch rates up year over year.

Monday, March 23, 2009

foster & a frugal bachelor

I haven't had much of a chance to blow through my Google Reader lately, until today. Here's what I found:

I wanted to point out a blog that I've been reading that I find quite interesting: Frugal Bachelor 's writing is actually offensive at times, but it certainly makes you stop and think. I have thoroughly enjoyed several of young Texan's posts. He bills his blog as 'personal finance without family values'.

Normally sane Canadian personal finance icon, Canadian Capitalist has gone Derek Foster mad. The "Stop Working, Here's How You Can" author has recently sold all of his dividend paying stocks and he has personal finance circles chatting once again. At the danger of heaping more publicity on top of all the current froth, Canadian Capitalist has been all over Foster in a series of posts lately. One of the posts contains a link to a Foster interview on CBC's The Hour in the comments section.

I read Foster's fist book and I did enjoy it. I especially liked his comparison of dividend income to employment income. I always wondered why he would attempt to live off of dividends from stocks that were the exact opposite of recession resistant. He talks about Colgate Palmolive and Enbridge on The Hour, however I believe a large part of his income was actually coming from trusts that were much more economically sensitive. Trusts like Canadian Oil Sands just didn't make sense with his strategy to me. Living solely off of pay outs from 100% of the riskiest asset class was asking for failure. The man has a talent for marketing and seems to be quite proficient at selling books and getting time with the Canadian press. Currently, it is not clear whether as an investor he suffers from severe over confidence or extreme fear.

Friday, March 20, 2009

'special' income from investments

To quote the eloquent US president Barack Obama, my income from investments has been 'like Special Olympics or something' lately.

Husky Energy (HSE), Bank of America (BAC), and General Electric (GE) have all cut their dividends over the past few months sending my portfolio income spiralling. Yes, the third earner in our family has taken a 6% pay cut. He is however, still pulling in 99.5% more money than he was at this time last year. Our current dividend income sits at $3,271.29, or $8.96 per day. This is down 6% from a high of $3,479 in December of 2008.

If we were living off this income I might consider switching from Australian to Chilean red wine, but since this income is supplementary and gets reinvested anyway I am not concerned and am sticking to my knitting. The financial crisis will have many casualties, including my income from investments. I am not surprised to see it decrease in the short term. I still do expect the generous yearly raises to continue in the mid and long term. The rewards for putting our money at risk are potentially much greater now that the market has suffered as it has. Well-managed companies with strong brands will continue to grow and raise their pay outs to investors in the years ahead.

Wednesday, March 11, 2009

net worth update, march 2009

I'm releasing net worth results early this bi-monthly period.

Results for the 2 Months Ended March 11, 2009:

  • Debt/Asset ratio rose to 0.56 from 0.54
  • Net Worth moved down 7.0%
  • Total Assets declined 2.5%
  • Total Liabilities increased 1.3% (highest since July 2006)
  • House Value/Total Assets rose to 70.3%
  • Non-Registered Portfolio declined 12.5%
  • Calendar Year to Date Gain/Loss: -7.0%

What a crappy two months it has been. This is our second largest two-month net worth decline ever. Once again the markets were the main culprit as the S&P 500 index was down 18% over the same period. Our net worth is now back at January 2008 levels. Our savings levels have also been weak lately as we are going through a planned period of extra spending. Unless something miraculous occurs we will be down in our fiscal year May 2008 to May 2009 on the next update.

This is all to be expected as we are highly leveraged to the stock markets and they have been terrible. We'll take our lumps and keep looking to the long term. Keep your head up...

Sunday, March 8, 2009

sunday links

I always like authors that find ways to simplify and get to the heart of a complicated issue. Michael James on Money presents A Thousand Foot View of The Credit Crisis. This is a very interesting post, and really inspires some thinking about the future.

Frog of Finance's Net Worth was down 3.8%, for the next few months he'll be concentrating on debt reduction.

My friend, Nurseb911 at Triaging wonders if this is the Bottom For Canadian Bank Stocks

Friday, March 6, 2009

still shovel ready

Well it has been one week and I haven't posted a single thing on the moneygardener. I haven't been on vacation, I've been where I always am, working my 9-5 and tending to my young family. My wife and I are finding ourselves very busy lately as we juggle our full time jobs and daycare commuting. I think I may have a little writer's block. Or maybe I am feeling like a deer in the headlights.

I'm still following business and the stock market daily, as depressing of a practice as that is becoming. I have a feeling that after this credit crisis/bear market is over nothing will phaze me as an investor.

I really can't get over how bad things have become in such a short time. This past week alone jobs are being shed all over the place including in my own backyard at US Steel in Hamilton and Chrysler in Windsor, Ontario, Canada. Dividends are being slashed and the S&P 500 continues to slide to new lows day after day. The light at the end of the tunnel has not appeared yet.

I still have some more funds that I would like to throw at the stock market but I want to try to avoid the mistake of becoming insolvent before we really see the toilet flush on this whole thing. The best I can do right now is hunker down and continue to watch things play out. I am looking forward to an upcoming vacation in Las Vegas and still keeping a keen eye financially to the long term. the moneygardener is still 'shovel ready'.