BDCs… They’re Not Underwear. But They Do Pay Dividends.

For The Ladies... Remember this ad?

No, it's not underwear we're talking about. That would be BVDs - which, thanks to the wonders of information-age Wikipedia, stands for "Bradley, Voorhees & Day, the New York City firm that initially manufactured underwear of this name for both men and women." Not talking 'bout neoprene BCDs, either.  You scuba divers, PTF down*.  No one's interested in hearing you drone on and on about the merits of one Buoyancy Control Device brand over another, and your YOLO scuba-diving trip to Belize. No, BDCs are Business Development Companies, a class of dividend investment as unknown as REITs were in the 90's. Raise your hand if you're a personal finance blogger and you've heard of them before. Anyone?  Bueller? OK, here we … [Read more...]

A Hoedown with Redneck Dividends


Rednecks can sure have throw themselves a party... 4-wheelin' in the mud, shootin' clays, cases and cases of Bud make for a hootin' hollerin' good time. That sub-set of dividend-paying stocks in our retirement portfolio with a certain piquant rednecky taste have been on a tear of late.  The whole mess of 'em are up about 10% since the last update October last year. That's only a few percentage points better than the S&P500, allowing for re-invested dividends.  Not enough to crow about, but enough to be smug about when dogging on the uselessness of mutual fund managers. There's a few more mullet haircuts bellying up to the bar: Southern Company got the nod simply because of its name. How's that for irrational … [Read more...]

Why Air Products and Not G.E.? A Heart Warming Dividend Story…

A typical turbine silencer... big stuff.

Why invest in Air Products and Chemicals and not General Electric? One, a not-so-very-well-known producer of industrial gases, and the other the bluest of blue chip stocks, originator of the Six Sigma management system, and former home of His Excellency El Jefe Guruswamy, Jack Welch? Is it because the numbers are better with APD versus GE?  No, ADP is only slightly better, and its dividend yield is even less than GE.  PE about the same (17.85 for ADP vs. 16.07 for GE), net income roughly equal (GE gets the nod, although they enjoy a lower tax rate), and dividend payout also the same, slightly over 50% for both. Is it because General Electric is an unabashed crony-capitalist political entrepreneur and "perennial government ward" (to … [Read more...]

Political Entrepreneurship, or: How I learned to Stop Worrying and Love Obamacare (Part II)

Top Accident and Health Insurers

  Continuing on with a two-part series on what defensive strategies to take in dealing with the new or modified reality of Obamacare. Part 1 can be found here. Definition of political entrepreneurship, by author Thomas DiLorenzo as quoted on Wikipedia: "a political entrepreneur succeeds primarily by influencing government to subsidize his business or industry, or to enact legislation or regulation that harms his competitors." He says, in contrast, the "market entrepreneur succeeds financially by selling a newer, better, or less expensive product on the free market without any government subsidies, direct or indirect." Cui Bono? In the context of political entrepreneurship, or entrepreneurship alone, it's just about the … [Read more...]

Investing In Fatties, Or: How I Learned to Stop Worrying and Love Obamacare (Part 1)

"Doctor's Visit" - Jan Steen, 1663  (not that we'll ever see house calls ever coming back)

Obamacare is on its way, no two ways about it. In fact, let's just stop calling it Obamacare, and call it for what it is, GovCare.  Purported conservatives in the political swamp are learning to defend this provision or that measure or this footnote within this mammoth thousand-page (or two-thousand page, whatever it is) piece of ordure legislation, cherry-picking as it suits.  And for good reason, from the logical perspective  of the politician.  Whatever the majority of the people want, give it to 'em:  shovel out the pork and bacon drippings with both hands, lard it up, baby! And people do want it, apparently.  Maybe not all of it, maybe only this bit or that bit, but in the end, it's like getting only a selective part of a … [Read more...]

Undertaking A New Investment


We occasionally stumble on  an industry which was heretofore unheard of, and think, hey now, this might not be a bad place to plunk down a few hard-earned simoleons.  Or not. It's All Immaterial Industrial material handling is a numbingly dull non-subject to most people. Try bringing this up at a dinner party of your regular group of friends, and see how fast the topic changes in favor of which Hollywood male lead will get to play Christian Grey. To manufacturing geeks like yours truly it carries some measure of interest, in the sense that I've taken more of an interest in fundamental stock analysis, and manufacturing is about as fundamental as we can get.  The foundational strength of an economy is making stuff. Tangible goods and … [Read more...]

You’ve Got Rail!

Deep discounts on standing room only

Don't like nasty oil and gas pipelines?  Pipelines in Alaska are bad for caribou populations (or not) and downright lethal for underground aquifers. Well, hope trains filled with millions of tons of crude rolling through your community are more your bag. Here at USA Financial Service, we --- "we" in the pretentious "royal We" sense, inasmuch as there's only one regular contributor (me), and I'm the emperor of this domain --- take a practical view of conservation, energy and the environment.  Alternative energy is interesting, has some good potential and is generally just swell, but so is air conditioning and motorized travel. So until we can find a way to power vehicles from unicorn farts, coal and nuclear and oil and gas pipelines are here … [Read more...]

Wall Street Hates Wal-Mart

Screen Shot 2012-05-01 at 5.14.22 AM

After running a just-for-fun post a while back on  a Redneck-themed stock portfolio, some readers suggested adding Wal-Mart (WMT) to the mix. The portfolio is composed of a certain type of company active in sectors that cater to the great underbelly of America:   beer, salty snacks, trailers parks and smokes.  Another thing, they all  pay a reasonable dividend. Wal-Mart certainly fits this criteria. Within its neat aisles, there is everything a good ole boy could want:  cheap threads, fishing gear, guns, fine particle-board furniture and home decor items, and of course, beer. As a value investment, WMT isn't too shabby:  reasonable price to earnings, good return on equity, and good prospects for growth. However, on … [Read more...]

To Peak Oil or Not To Peak Oil?

Pumpjack in Glennpool oil field, Oklahoma

The world is running out of oil... so might as well buy a few shares in the companies that make it and move it around. Having had some cash free up in the retirement account, I went shopping for some Oklahoma oil and gas companies.  Locavesting, as it were. ConocoPhillips (COP) I talked about in this post a few months ago, where I was vacillating between ENI, Total, Statoil, Petrobras and COP.   In the end, I ended up with Petrobras, giving COP a pass for the time being.  A few weeks ago, I took a nibble with 30 shares at around $77. OneOK Partners LP has just announced that they will build a two-billion dollar pipeline from the Bakken oil play to Cushing OK. That's good, it unlocks more domestic oil production, sending down to … [Read more...]

More on Investing in the Basics: Chocolate

Nothing but chocolatey goodness (photo by Wikimedia - Andre Karvath)

Ask any lady about the bare necessities of life, and chocolate ranks way on up there. Food, fire and shelter... and fudge brownies. That could be one sexist statement unencumbered by cold hard facts, but sure, Valentine's Day was just but a scant week ago.  It's not for nothing that flowers *and* a box of chocolates do much to generate goodwill among the genders.  Not flowers and broccoli, not flowers and a toaster, but a dozen roses and some tasty truffles. In keeping with this site's model dividend portfolio, it's all about investing in the basics:  food, beer, smokes and now chocolates. Rocky Mountain Chocolate Factory has been in operation since the early 1980's, with delicious chocolatey offerings and a tasty dividend yield … [Read more...]