Route A138

     About 55 years ago, at the age of 12, I owned my first business. I bought the local newspaper, The Evansville Press, wholesale and sold the papers to my retail customers. This involved picking-up the papers at a gas station about 3 miles from my house every day after school and folding, packing and delivering them to each house on my route. I had 100 customers during the week and about 65 on Sunday. Some days the papers were so heavy that I couldn't get off my Huffy bike because the bike would flip over. At the time (about 1964) every bank would pay 5 1/4% interest on your money. Inflation was running about 1 1/4% so your real rate of return on safe money was about 4%. Back then, people expected to get a decent return on their money. So what happened?  It all started with gold. In 1933 FDR effectively took the US off the gold standard by ordering all gold coin and bullion to be turned in to the US Treasury for $20.67 per oz. Then he raised the price of his hoard to $35 per oz, effectively inflating the dollar. Then in 1971 Richard Nixon totally removed the US from the gold standard. Now our government was free to print money without any constraints. At the same time our Federal Reserve was free to manipulate short term interest rates to promote full employment and control inflation. So here we are with a fiat currency and nearly full employment and very little inflation but interest rates are nearly zero. Treasury bonds are in such high demand from investors across the  world that they have pushed the yields to historic lows. So what should I do to get a decent yield today? In a word: stocks. It's about the only place where you can find dividend yields approaching that 5 1/4% of yesteryear. With a wild and volatile market like this, a little more due diligence is required. Buy large US companies with lots of cash and little debt. Avoid sectors that have been heavily damaged by the Corona virus such as travel, cruise lines, energy, and retailers. Above all do not panic and sell stocks for distressed prices. Like many crises before, this too shall pass. Long term holders of quality stocks that pay dividends almost always win in the end.