If the herd all heads in one direction too long you know what will happen? It will come to the end of the road or the edge of the cliff or to the shores of a large body of water.
If the herd doesn't stop before it's too late it will fall over the cliff or plunge into the ocean in panicked frenzy. The results are never pretty.
With today's herd of investors and traders, the ones who are chasing stocks with decent dividend yields are getting closer to the proverbial end of the road.
You'll also notice that since Microsoft is a technology company, it has gone the way of Intel and Cisco (CSCO) and moved downward in share price. The herd feels safer on the plains of Wal-Mart than in the cyber-world of Microsoft, as the chart below illustrates with unmistaken clarity: And so the Masters of The Stock Market Universe, as well as the Titans of Financial Management and Monetary Policy have made it very tempting for the herd to continue to chase yield. Here's where the caveat comes in. History shows us time and time again that just as the entire herd assumes it can feed safely on the shores of "The Sea of Dividends," the predators begin to circle.
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