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BlackRock Exec: Stay in Stocks

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  • Description

    BlackRock Managing Director Bob Shearer gives tips for investing in stocks.

  • Duration 3:36
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Absolutely by let's talk investing now -- for a moment.

And what's a better value stocks or bonds -- the age old question to take a look at this chart.

-- -- look at fairly closely goes back since the recession ended the earnings in the value of stocks keeps going up which will be the latter end of this.

Chart and the yield on the ten year treasury continues to tumble which we talk about just about every day by the way which represented there in the stock side of the earnings yields.

Earnings divided by the price of the index that's what you're you're basically looking off pat but you're better -- stocks -- bought shares of managing director BlackRock.

Portfolio manager for their equity dividend fund -- you're getting paid more.

-- stocks.

The body is it's -- uninteresting because -- -- -- if he just didn't know anything about the markets and I told about all the problems that are out there's all Europe's blown up and more worried about this more worried about that you say.

What interest rates must be.

Way up may be.

And then they're not seen since you're making more money in stocks the question we're gonna try to -- -- -- how Long Will that continue how Long Will that chart.

Look as it does right now.

Well right now the Fed has talked about extending.

Financially easing through 2013.

In the evening and -- 2014.

Right so I think we're looking and extended period of time that.

We have these historically low yields.

Because at some but it's it because at some point what the Fed is doing what other central banks -- doing a simple just printing money printing printing printing.

That becomes inflationary right admitted at at some point.

We have to deal with ramifications of that SO try to get out in terms of timeframe and I know you're an advocate of stocks over bonds.

I would think for -- on the long term but explain how long -- continue for.

Well I think -- -- long term we see stocks.

And in his inflationary times have been able to keep up and actually expand.

Their dividend growth faster inflation even when we had inflationary times so I think this is something that we're looking for -- extended period of time.

In a special the demographics and people needing retirement income.

I think the demand will be there for companies to continue to increase their dividends interesting because logically you would say -- and getting close to retirement let me shift so my portfolio percentage wise -- -- bonds -- you're seeing fewer and fewer people will see that as a viable.

Option and already are seeing -- -- -- not much of a viable option.

-- -- especially if you're have any duration honor bonds you're gonna have a big loss when those rates start to -- -- up I mean you could lose have to value of saw a long dated bond.

Over your retirement period shall stay in stocks now in stocks.

Of all kinds or a stocks of particular -- -- just looking at the ones that -- the highs dividends.

Well not not the highest dividends what we focus on our companies that have dividend growth.

-- over you know the long period of time so.

We're looking -- on companies to solid balance sheets that are low cost producers that can weather another downturn in the economy.

-- by focusing on those companies.

We think you -- beyond that you know Roy your income in -- -- into retirement OK -- broker wrapped that up that's good because of people were what were paying attention today get a checklist almost.

And and you continue to do filters on line if you look at you and your checklist for what for a quality company would be what the three or four items that you put on -- -- -- -- day.

I mean companies that have strong leading brands there are number one or two in their category.

Well and I'll balance sheet strength thud you will debt to cap under 50% for most everything outside of utilities and financials.

And -- -- -- cost producers slowest court -- cost production.

-- that's good very specific information advice -- share from black rockets up very nice to have you on hopefully we'll talked against him thank you thanks much.

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