Your bills are due every month. I know mine are. Most of you have to pay rent or the mortgage and utilities. You may have to make car payments and pay insurance premiums. You probably have to pay your credit-card bill, too.

Yet the majority of income investments pay less frequently. Stocks generally declare dividends quarterly. Treasury securities and nearly all municipal bonds send you interest every six months. First Financial Fund (FF), a high-yielding closed-end fund that mostly owns bank and insurance stocks, distributes cash just once a year -- around Christmas -- although virtually all of its holdings pay quarterly dividends.

Last Thursday (6/12) in New York City, I attended a corporate presentation given by Formation Capital (FCO) CEO Mari-Ann Green and President Scott Bending. FCO is a Canadian cobalt producing company headquartered in Vancouver with their cobalt mining operations in Idaho. I purchased FCO shares last August, when the whole mining sector including FCO got hammered by the subprime sector and credit crisis. I thought I bought them at the right time, but FCO along with the whole junior mining sector have been range bound since then for almost a year now, with FCO now not a lot higher than my purchase price.

I come to that last conclusion by seeing treasuries continue to strengthen against the S&P as well as gold and silver. Worst hit by credit fears, as could be predicted, are small caps, who are obviously most likely to be hit by more stringent credit standards.

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Bond Portfolio

There are several reasons why I believe in doing this. While I think the dollar is generally headed lower, slowly over time there will be periods where it is strong (bonds from other countries is one way to benefit from a weak dollar). The strategy here needs to be one of looking at the long term. Also, the blending of assets from different countries tends to reduce volatility. This especially makes sense when you consider that the middle of the US curve is very low by historical standards. I think it makes sense to expect that the curve will normalize at some point, and when it does I think intermediate and further out maturities will be higher in yield and shorter maturities will be a touch lower.

Many income investors are looking for monthly dividend payments to support their income during retirement. Other pre-retirement investors want monthly dividend stocks for their IRAs for faster compounding.

This list is now up to 150 different stocks, CEFs, REITs, floating rate funds, and oil income funds [such as Canadian royalty trusts], all of which are traded on the New York Stock Exchange or the American Stock Exchange. I've added over twenty new securities since the year-end update, reposted the yields, kept the readers' recommendations of sorting by yield with the highest first, and identifying the Canadian companies [due to tax withholding issues].

On interest rates, we have clearly been wrong, believing that in a finance-based economy the Fed would stop its rate-ratchet around 3.5% - 3.75%. Hereto, despite the pickle-pundits’ cries that the “Fed is done,�? it appears to us as if the Fed is going to continue raising rates until there is an “accident�? consistent with its historic modus operandi. While such action should be bullish for the dollar, we continue to expect the dollar to lose its tailwinds (foreign earnings repatriation, Homeland Investment Act, Europe raising rates, etc.) this year. And, last week China fired another “shot across the dollar’s bow�? when it intimated that it was going to diversify more of its reserves out of U.S. dollars. Maybe that is one of the reasons our anti-dollar investment in 6.8%-yielding Aberdeen Asia-Pacific Income Fund (FAX/$6.14) has rallied 5.9% since December 30, 2005, yet still trades at a 5.2% discount to its net asset value.

Any ETFs or Closed-End Funds that we haven't covered that you think we should? Leave a comment below.