New insights on DGI:

So much for go away in May, huh.... The pundits are saying we're at a peak and trouble is coming.
Certainly something is coming; election, lame duck session of congress, tax measures expiring, perhaps another collision with the national debt ceiling. The sky has been falling in Europe for literally months now...China's economy slowing to a veritable crawl at 7% per year; the sky must be falling somewhere, after all.

I'm a bit more comfortable with the idea of staying invested, since I'm trying harder to keep my eye on a different ball; not the portfolio value ball, but the rising dividend payment ball. Yields go up and down as the valuations go up and down. Hopefully, company revenues and profits continue to go up, on average, so dividend payments will also go up, and up at a higher rate than inflation. If that happens, my savings and DRIP plan will yield what I am aiming for; enough income in retirement to live off dividends, and not spend down capital positions.

I just read and memorized the single most important quote I have read in years: capital gains don't compound.  Remember that compounding interest is the 8th wonder of the world, the single most powerful financial force in the world.  How do you inject this force into market investments? You find investments where something is compounding!  There's no doubt that capital gains are a powerful engine for wealth accumulation. They generally make up about 2/3 of value appreciation in a position. However, if you add a multiplier that captures increasing amounts of that value appreciation, your overall gain skyrockets.  That's the secret sauce in Dividend Growth Investment over time. It's why the tortoise beats the hare. The hare has capital gains as it's only engine. The tortoise may not have legs like rockets, but dividend reinvestment puts more and more legs to work and each one piles on more capital gains force, and a bit more dividend capture force into the investment.

I continue to read about other investments; after all, my emerging market bond funds are still the strongest performers I own over the last 4-5 years. However, they have a similar component of capital appreciation as well as compounding as I re-invest the interest payments(dividends) into larger positions in the funds.  More secret sauce...

work beckons...