While many of these companies have American Depositary Receipts in the U.S., Thornburg owns shares in each company's respective domestic market.
Brady says investors often discount the prospects of telecom stocks because they're growing by 5% to 10%, half the pace of many growth stocks. Yet, many of these names are yielding as much as 10%. "Add those two things together and compound that income over time, and it starts to get pretty interesting," Brady says.
Leaning on income in tough times is a solid defensive strategy, especially with so much unknown in the market. Brady notes that Standard & Poor's was looking for a bigger deal that more concretely addresses spending issues, which could lead to a downgrade of the coveted triple-A rating for the U.S. "To what degree the market penalizes the U.S. for getting downgraded, that remains to be seen," he says.
And with expectations of GDP growth above 3% as stimulus programs expire clearly off the table, Brady wonders how the market will react in the aftermath of incentives that haven't worked.
"The scariest thing about this discussion is that we're spending a lot more than we're taking in," Brady says. "We've put this massive amount of stimulus in and a really scary thing would be if it was working. We're talking about cutting that back notably, so you'd have a very slow growth economy or in a recession without that government spending. Look at the GDP number from Friday."
-- Written by Robert Holmes in Boston
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