Don't assume that just because most folks were taking losses, that everyone was taking losses last year. And, quite a few public companies are still issuing dividends.
Enough people and funds (and hedge, sovereign, private equity, et al) are taking losses that the number of people “sitting tight” is a rapidly declining number.
The people “sitting tight” may very well have no gains to show for their efforts after this year, too. If the market continues down, they might well crack and sell too. Everyone has their breaking point.
Quite a few companies are issuing dividends, but the dividends are getting slashed, as I said. A big chunk of dividends in broad indexes like the SP500 came from the finance sector - like just over 30% in 2008 before the crap hit the fan. Those dividends from the finance sector are now down to about 15% of the SP500 dividends - and are probably headed much lower (like to near zero).
Those dividends from financials and banks have held on for FAR too long — and one of the things I think you’ll see in the next TARP round, or coupled onto the executive pay limitation proposal, is that banks who receive TARP funds must eliminate the dividend on the common. When that happens, there’s another chunk of the dividends on the SP500 gone.
Right now, div payouts on the SP500 are at their lowest point in 50 years. This is not your garden-variety recession.