The definitive way to tell if we are in a Depression

The definitive way to tell if we are in a Depression is relatively simple. The unequivocal indicator is when the top Fortune 500 companies, like GE, announce “No Dividend”. The CEOs and board of Directors of top companies would sell their first born, followed by the rest of their children and spouse before allowing this to happen. A “No Dividend” announcement is saying the company is “dead man walking” (moving toward the final terminal execution). This also means the company is beyond a bankruptcy or merger/acquisition salvation.

A “No Dividend” situation warns Investors they have money tied up that is not making a “ROI” (Return On Investment) or no profits. Investors need access to their non-performing money back “in-play” (investments generating profits) to survive. This is especially true with the loan market frozen as a source of temporary funds. The Investors will “short” the stock of these companies (sell it immediately despite tax liability) to unlock their money.

So far the only major publicly traded company to announce “No Dividend” is the New York Times Company. They technically call it a suspension. If a trend of “No Dividend” starts and cascades throughout the Fortune 500 companies, the “D” word becomes a fact that you can not “spin” away.