The Rising Influence of Rising Affluence

[DewDiligence]

CLF is getting hammered again today because management didn’t defend the dividend on yesterday’s CC.

Based on what was said on the CC, I would now say there’s a 35% chance of a dividend cut in the next quarter or two.

Although I didn’t buy CLF for the dividend yield, a dividend cut so soon after implementing the new “shareholder-value” policy in Mar 2012 would be a loss of face and would reduce management’s credibility with a consequent negative effect on the share price.