We've seen history in the making today, but in the run up to inauguration, the Obama administration was engaged in a kerfuffle with Congress over whether the second installment of Troubled Asset Relief Program (a.k.a. TARP) funds would be disbursed.

Seems the folks on Capitol Hill wanted more transparency into how this round of moola would be doled out. Who can blame them? As I see it, the need for greater oversight and accountability is just as obvious as our rickety economy's need for additional monetary stimulus.

The excellent news, then, is that our elected officials got it together to get the job done in advance of the new president's first day. Good for them -- and us.

As I wrote earlier, the recent spate of governmental bailouts seems well warranted, coming as they do amid a period that even the congenitally calm Warren Buffett has characterized as the financial equivalent of Pearl Harbor.

Crazy Warren?
Buffett supported the $700 billion bailout plan because "we were very, very close to a system that was totally dysfunctional, and would have not only gummed up the financial markets but gummed up the economy."

He was right about that, and he's right about this, too: It's time to go stock shopping again.

As the Oracle of Omaha recently pointed out, stocks in general look attractively valued just now. If, as he advises, you aim to "be fearful when others are greedy, and greedy when others are fearful," now's a great time to spring into action.

Wal-Mart (NYSE:WMT), IBM (NYSE:IBM), and Coca-Cola (NYSE:KO), for example, all trade with price-to-earnings multiples below their five-year averages, despite long-haul track records of thumping the broader market. That's also true of Chevron (NYSE:CVX), PepsiCo (NYSE:PEP), ConocoPhillips (NYSE:COP), and McDonald's (NYSE:MCD).

In my view, all these companies are significantly undervalued, and while there's of course no guarantee that they'll deliver the biggest bang for your investing bucks, the margin of safety they're currently enjoying suggests investors won't be sorry, particularly if -- as I suspect -- the next bull market phase begins with a stampede into higher-quality fare.

Plus, they're each handing out free money.

No, really. Each of the aforementioned pays a dividend, passing back some of their earnings to shareholders in the form of cold, hard cash. In addition to price appreciation, then, investors in these firms can enjoy returns juiced as well by regular income payments. Sweet, no?

How sweet it is
Indeed, over time, a dividend kicker can add up to quite a chunk of change. Indeed, according to Standard & Poor's, between January 1926 and December 2007, the S&P 500 cranked out an annualized gain of 10.43%. Dividend payments accounted for fully 40.59% of that return.

Doing the math, we find that -- without factoring in the impact of dividends -- the benchmark cranked out an annualized return of 6.2%. With dividends kicked in, it delivered the full 10.43%. Here's how that difference adds up in dollars-and-cents terms: Sans dividends, $10,000 invested at the beginning of that period would have grown to $1,387,000 by the end. With dividends reinvested, however, that same initial investment would have ballooned to a gargantuan $34,130,000.

That, fellow Fools, is the miracle of compound interest at work, and the higher the rate of return that's compounding, of course, the more miraculous the results.

The Foolish bottom line
When you can buy high quality on the cheap -- and swim in a stream of regular income as well -- why take on the additional risk that comes with the market's more speculative fare?

That said, it's important to bear potential pitfalls in mind when mulling the market's income payers.

Specifically, find out whether a company you're considering has the ability to keep on keeping on with the payments. A slashed dividend -- or one that's completely abandoned -- can serve up a double-whammy: Cutting off your steady streams of cash while wreaking havoc with your holding's stock price, too.

These days, moreover, there's regulatory risk to consider as well, with the government mulling a mandatory dividend limit for some companies that avail themselves of bailout moola.

If you'd like some assistance when it comes to separating dividend-paying studs from potential duds, consider giving our Motley Fool Income Investor service a risk-free spin. Take 30 days to peruse the insights II uncorks each month free of charge -- insights that include timely recommendations of high-yielding companies poised to beat the market with a formidable one-two punch: price appreciation and regular cash payments. Call it a two-for-one, and click here to grab your free guest pass now.

Shannon Zimmerman runs point on the Fool's Ready-Made Millionaire service. At the time of publication, he didn't own any of the companies mentioned. Wal-Mart and Coca-Cola are Motley Fool Inside Value recommendation. Pepsico is an Income Investor choice. You can check out the Fool's strict disclosure policy by clicking right here.