When my grandfather of blessed memory, Jack Miller, started teaching me about investing over 30 years ago, he explained to me that investors invest in stocks for a couple of reasons:

1. Potential for stock appreciation
2. Corporate payouts in the form of dividends

When he died earlier this year at the ripe old age of 95, he left behind an investing legacy that witnessed numerous bulls and bears, the Great Depression and many fads that came and went. He was a purist: investing in good companies at good prices. To his last days, he was still managing his portfolio and even learned to use the Internet to conduct primary research.

My own investment style tends to skew towards technology investing. Tech companies have traditionally chosen not to return money to investors in the form of dividends but rather invest corporate profits back into the company to bull-up on growth opportunities.

What happens when growth slows? My grandfather taught that companies should begin to pay out more money to compensate investors for lower growth prospects.

So, Grandpa would have appreciated today's WSJ article reporting that this is actually beginning to occur.

The WSJ reports that "the falling market has intersected with rising corporate payouts, bumping the dividend yield on the Standard & Poor's 500-stock index above 2% for the first time in years. And when you count the billions being sunk into stock buybacks as well, the "cash-back yield" on the S&P 500 is more than 6% -- the highest level in modern times."

Though stock buybacks don't put cash directly into the hands of investors, they do take it away from management and show a bullish sign that the companies, generally the best arbiters of their own value, believe their own stock undervalued.

Grandpa was right ... again.

Zack Miller is the Managing Editor of IsraelNewsletter.com and a former equity analyst for a leading multinational hedge fund.