Correction Territory - Earnings: BCE, T, EIF, AQN

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Reliable returns from dividends and interest provide welcome income, and it helps to support share prices during periods of rising interest rates. Higher interest rates make growing earnings, dividends and share prices more difficult.

As share prices sag of late, this effectively increases yield. An inflection point for dividends is estimated around 6%, and for top rated government debt using the US 10 year benchmark bond yield, not much over 3%. At this point buyers start showing up.

In addition to the yield, the security or credit quality has at least equal importance on values. A 6% yield for one company may only need to be 5% for another. This can be judged reviewing financial statements. Central banks are now in a panic to raise interest rates. This has cheapened markets for both bonds and stocks.

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