No surprise here:
"Dividend payments by companies in the Standard & Poor’s 500 Index may plunge 10 percent this quarter, the biggest decline since 1958, as bank failures and slowing economic growth stifle payouts, S&P said.
The firm also cut its estimated 2008 dividend from all S&P 500 companies to $28.05 from $28.85, representing the slowest annual growth since 2001, according to a statement. Financial companies in the index reduced their payouts 35 times in 2008, almost triple the past five years combined, said Howard Silverblatt, the senior index analyst at S&P."
For the banks, this is a good thing, They need to hoard their capital, and stop sending $30-40 billion a year off their books.
For everyone else, its a sign of financial distress, and a protracted recession. And it points out how dangerous it is to buy something merely due to a high dividend.
S&P 500 Dividends to Fall Most Since ’58 This Quarter, S&P Says
Bloomberg, Oct. 21 2008