hey there HoHoFoo,
i'd say 'dividends' are a symbiotic relationship rathen than a parasitical one.
the % of companies that even pay dividends is small.
but the companies chose to pay dividends so their share value might
other companies generally get into stock-buy-backs to decrease the # of shares outstanding, so their share value might
both methods have their following, that is up to the boards-of-directors to determine...both business models 1st desire their market share of
product/service to expand,
myself, I only invest in 'dividend paying stocks', for many reasons,
one reason being that in the last 3-5 years the public has realized that
'dividend paying stocks' , being un-glamorous, had/have a better record
of increasing and sustained value.
On the other hand, what Yarcofin said;
...And it would take a heck of a lot of shares to live entirely off of dividends, anyway.
is an important element- - because the average dividend rate is somewhere around 3-4%, and over most other, historical, 5yr investment terms
it would have been better to invest money in higher yielding Money Market Certificates of Deposit issued by banks than just getting 3-4% from
[if you figure for example Ralph Nader who lives on $26,000.yr
the investment required to receive $26k in dividends would be enormous,
LNCE, the snack cracker co. pay .64per year per share, shares sell for ~$24.oo
that means Nader has to own 40,625 shares of Lance Inc
that means Nader had to spend $975,000.oo to receive that income
**in the meanwhile, he risks losing it all, thru bankruptcy, business failure, the Boad deciding to no longer pay dividends, absolutely none of that
$975K is FDIC insured]