jimmy46

Ackman Shorts Realty Income, But Is It a Good Idea?

"more amazingly, offer stock in lieu of cash dividends (imagine cash income investors voluntarily accepting more of a stock as a dividend of a company that can't afford to pay the cash dividend that you invested in the company for):"

REIT's are required by law to distribute 90% of net income every year. Because the credit markets weren't working well this year,
the IRS made the decision to let them pay 90% of the dividend in stock.
This allows them to maintain their status as a tax favored REIT.

For the last 20 years the FED has bailed out the stock market after every crisis, now that so many people are underwater with their home mortgages, I believe gov. policy is to inflate real estate prices so people won't walk away from their houses.

This inflationary policy is evidenced by the stock market going up in an extraordinary manner the last 7 months.

Also in inflation in metal & oil prices.
Gold over $1,000, copper over $3, oil over $80

Companies with real assets and a lot of debt will benefit from this trash the dollar policy.

As long as interest rates are low, this will continue.
When the FED starts raising rates, it'll be time to reevaluate.