4 Cash Cows for Bad and Good Times

Focus: DIVIDEND

Neil George Image Neil George Editor-in-Chief, Income Publication and Products, Agora Financial

Knowing you have solid investments that will cruise through hard times and blossom in good times is the greatest base you can build as an investor, writes Neil George of Liberty Investor.

Nothing will be immune to massive short-term selling when everyone is betting on the worst parts of the Bible unfolding on any given trading day. And when seemingly every next day brings just more of the same doom-and-gloom selling, few investments beyond cash can hang on.

But no one can retire and live on cash. Not unless you have a whole lot of it and enjoy burning through it to pay your bills. Instead, we all have to work with the markets.

But what happens when the markets seem to be completely unworkable? The key is to know your stocks and to be sure that they will be able to continue to keep paying you even as the rest of their peers run into a genuine Apocalypse.

This doesn't mean that the prices on even the best companies' stocks backed up with solid, cash-generating assets won't take hits. They have and they will.

Take, for example, one of my long-term favorites in the petroleum pipeline businesses: Enterprise Products Partners (EPD). The company has continued to serve its investors by building up assets and revenues and paying the lion's cut to shareholders from day one. Yet, if you look at the performance of the stock, it has not been without some big price drops now and again throughout its history.

But as the cash has continued to be generated and paid, it hasn't affected near-term price gyrations, since the performance has been anything but a huge success.