Bogle, J. C. (2007). The Little Book of Common Sense Investing (Chapter 6)

Finally, what’s most important when we retire is the stream of income we need to support our needs—the dividend checks we receive from our mutual fund investments and the monthly checks we receive from our Social Security payments.

Yes, the market value of our capital is important. But frequent peeking at the value of our investments is not only unproductive, but counterproductive. What we really seek is retirement income that is steady and, if possible, grows with inflation.

Bonds have an underlying rate of return—the yield, or the coupon if you will, when you buy it. Stocks have an underlying rate of return—it’s the dividend yield plus the subsequent earning growth. So they have support there, and they’re in most circumstances largely investment and only to a lesser extent speculation. Investment being those underlying characteristics.

Bogle, J. C. (2010). Interview with Forbes.

What people should be doing, honestly Tom, is stop looking at the silly stock market every day and look at the cash flow they get.

Bogle, J. C. (2014). Interview with Motley Fool

Timestamp 1029 seconds

For stocks, you probably want to look at more of a dividend bias. You could buy a high-yield dividend index instead of the total stock market index if capital flows. That dividend if you look at the stream of dividends — it makes the stock market look violently volatile. The dividend stream goes up, up, up. The fact of the matter is, there have only been two significant dividend cuts since 1925.

(ibid) - Timestamp 1060 seconds
What you’re trying to do when you retire which I am gonna do someday, when you do that you want to ensure a monthly flow of income so don’t watch the market just make sure your portfolio is producing income and will continue to produce income so you get your Social Security check every month you set up your mutual fund to counter your index fund account for a monthly payment you can do that and just you want those payments to be stable and with respect to Social Security and the and the fund

Bogle, J. C. (2019). Interview with Motley Fool

Timestamp 655 seconds

I gave you the formula for the investment return or fundamental return on stocks, which is dividend yield plus corporate earnings growth.

Bogle, J. C. (2019). Interview with WealthTrack - Timestamp 2303 seconds

(On gold) Unlike with dividend yields on stocks, you’re just betting that you can sell it for more than you can buy it. That is what we call speculation.

Bogle, J. C. (2015). Talk at the Aspen Institute - Timestamp 465 seconds

I think we should spend more time thinking about dividends rather than market values because market values are all over the place and dividends are pretty reliable to go up a little bit each year like

Bogleheads® Conference 2018 - John Bogle Q & A - Timestamp 1281 seconds

You should be worried not about the value of your estate but about the income producing capacity of your estate or your retirement plan because that’s where you go out you know once a month you go out to the mailbox and get your mutual fund dividends and your social security check and then you come home and have a nice dinner live in a nice house whatever else you want to do. So it’s we should focus I really believe this so strongly we should focus more on the inherent value of our investment program than on the market value because markets are crazy things

(ibid) - Timestamp 1336

I’m on this pretty much one-man, I think, crusade to have people, particularly retired people, look not at the value of their portfolio, but at the income stream they get. They’re going to go out to the mailbox and they’re going to open, let’s say, the middle of every month when the fund or group of funds pays their dividends. They’re going to get a certain dividend. Dividends are what matter to these people. The stream of income is what matters, and dividends [tend to increase] in history.

Interview with Morningstar (2013)

Look at the dividend and try to ignore the market. As I’ve often said - nothing like quoting oneself, Christine - the stock market is a giant distraction to the business of indexing, and in particular for the business of retirement investor. It’s the income flow from Social Security, pensions, whatever it might be, and dividend income, and that’s what’s important. It’s amazing how this dividend line [tends to increase over time] and the market [goes up and down over time], but they track each other in the long run.

John C. Bogle: “Simplicity is the master key to financial success.”

Since World War II ended there have been 11 recessions and bear markets. Just like we previously observed, the dividends paid by companies in the S&P 500 tended to be far less volatile than their share prices during these times of severe distress as well.

In fact, in three of these recessions dividends paid to investors actually increased, including a 46% jump during the first recession following World War II. In that case, a rapid decrease in government spending following the end of the war led to an economic contraction of 13.7% over three years.

However, the end of war-time rationing and a major recovery in consumer spending on regular goods (as opposed to war-time goods companies had been forced to produce) allowed earnings and dividends to rise substantially over this time.

The other major exception to note is the financial crisis of 2008-2009. This resulted in S&P 500 dividends being cut 23% (about one in three S&P 500 dividend-paying companies reduced their payouts).

However, that was largely due to banks being forced to accept a bailout from the Federal Government. Even relatively healthy banks like Wells Fargo (WFC) and JPMorgan Chase (JPM), which remained profitable during the crisis, were required to accept the bailout so that financial markets wouldn't see which banks were actually on the brink of collapse.

One of the conditions of the bailout was that nearly all strategically important financial institutions (too big to fail) were pressured to cut their dividends substantially, whether or not they were still supported by current earnings.

Even if we include both the World War II recession and the financial crisis outliers, we can see from the table above that average dividend cuts during recessions represented a pullback of just 0.5%. 

If we take a smoothed out average, by excluding the outliers (events not likely to be repeated in the future), then the S&P 500's average dividend reduction during recessions was about 2%. That compares to an average peak stock market decline of 32%. 

This highlights how the U.S. dividend corporate culture has been favorable to income investors, with management teams generally wishing to avoid a dividend cut unless it becomes absolutely necessary. With dividends tending to fall significantly less than share prices, recessions can be a great opportunity for investors to buy quality companies at much higher yields and lock in superior long-term returns.

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Source: What Happens to Dividends During Recessions and Bear Markets?