Warren Buffett 01 (May 08 - Jan 10)

[-dol-]

WB is so deep into this mess and quite a beneficiary of the Fed/Treasury's stance.

I would not count on CONgress to do much about the Dollar's destiny - what or how can they do it?

Many things still left unsaid and no concrete suggestions - I think WB can do much better than this - but can he?

[winston]

Warren Buffett doubles down on housing bet From 24/7 Wall Street:

Warren Buffett is positioning Berkshire Hathaway Inc. to profit when the housing and property market returns to more normal levels. Now, he is teaming up with what many investors consider a “Buffett rival.” Berkshire Hathaway Inc. (BRK-A) is teaming up with Leucadia National Corp. (LUK) to acquire the North American mortgage and servicing operations of Capmark Financial Group Inc.

The Capmark deal is said to be valued at roughly $490 million. Some may question this, but many believe a return is taking shape of at least some normalcy in the housing market.

Capmark is said to be looking for a debt restructuring and also looking at options for its business holdings as it has discussed bankruptcy protection as a possibility.

http://247wallst.com/2009/09/03/buffett ... d-low-usg/

[-dol-]

Either this is the all-clear to play the same old games or there is simply no other choice.

[winston]

Buffett Moving From Stocks To Bonds By: Julie Crawshaw and Dan Weil

Warren Buffett's Berkshire Hathaway pushed spending on stocks its lowest level in more than five years, and the company was selling more stocks than it was buying by the end of the second quarter.

Though Buffett is still buying some carefully selected equities, he’s buying more corporate and government debt these days.

During a recent interview, Buffett refused to comment on where stocks are headed, The New York Times reports, but did warn extensively about the dangers of investing with borrowed money, or leverage, which proved disastrous when the crisis hit.

“It has been an incredibly interesting period in the last year and a half. Just the drama,” Mr. Buffett said.

“Watching the movie has been fun, and occasionally participating has been fun too, though not in what it has done to people’s lives.”

Asked if anything was keeping him awake at night, Buffett replied there was not.

“If it’s going to keep me awake at night,” he said, “I am not going to go there.”

The struggle between the bears and the bulls shows up clearly in the gulf that separates the opinions of economists from those of Wall Street analysts, says Christopher R. Wolf, managing partner and co-chief investment officer, Cogo Wolf Asset Management.

“The prospects for high-yield bonds as attractive investments rest in the middle of this gulf and will be dependent on whether default rates and recovery rates rise or fall over the next twelve months,” Wolf writes at Financialplanning.com.

Not surprisingly, Wall Street’s biggest bond houses are jettisoning Treasury bonds and stepping out on the risk curve instead.

Treasury holdings among the 18 primary dealers that trade directly with the Federal Reserve reversed to a net short position of $10.5 billion last month from a record net long position of $93.6 billion in June, according to Fed data cited by Bloomberg.

That’s the fastest turnaround since the Fed began compiling the numbers in 1997. So the bond houses clearly aren’t afraid of risk, despite the fragile economic recovery.

“It’s money going back to work again in some level of riskier assets,” Donald Galante, chief investment officer of fixed income at MF Global, told Bloomberg.

“Panic has receded and you are in a more normal world, with dealers starting to take on a little bit more leverage. They are taking on some inventory in the corporate world and hedging with Treasuries again.”

To be sure, August’s net short position of $10.5 billion was nothing compared to the average net short of $63 billion in the 10 years before the collapse of sub-prime mortgage loans in 2007.

But on balance, “dealer behavior in the fixed-income market has begun to return to normal,” Joseph Abate, a money-market strategist at Barclays Capital, told Bloomberg.

Not everyone sees the trend continuing.

Gold could rise as high as $1,250 an ounce next year if risk appetite falters, Nick Bullman, managing partner of hedge fund Bullman Investment Management, told Reuters.

http://moneynews.newsmax.com/headlines/ ... 57809.html

[winston]

Berkshire’s Wertheimer Seeks Japan Trip for Buffett (Update2)
By Betty Liu and Andrew Frye

Sept. 10 (Bloomberg) -- Berkshire Hathaway Inc.’s Eitan Wertheimer, who has called himself Chairman Warren Buffett’s “travel agent” for finding opportunities outside the U.S., said he wants to bring the billionaire investor to Japan.

“I hope in a year from now to bring Warren over,” Wertheimer said today in a Bloomberg Television interview.

“When Warren Buffett gets out of bed in the morning there’s one thing on his mind, ‘What’s out there that will be an attractive addition to our universe of subsidiaries,’” said Frank Betz, a partner at Warren, New Jersey-based Carret Zane Capital Management, which owns Berkshire shares.

Fixed-Income Holdings

Berkshire has been buying securities issued by governments outside the U.S. The company held about $11.1 billion in foreign government bonds in its insurance units as of June 30, compared with $9.6 billion three months earlier, Berkshire said in a regulatory filing on Aug. 7.

The value of holdings in U.S. Treasuries and so-called government sponsored enterprises slipped 5.3 percent in the three months ended June 30 to about $2.5 billion.

Buffett said in a New York Times commentary last month that the massive amounts of “monetary medicine” that have been pumped into the financial system pose threats to the U.S. economy and its currency.

“Unchecked greenback emissions will certainly cause the purchasing power of currency to melt,” Buffett said. “The dollar’s destiny lies with Congress.”

http://www.bloomberg.com/apps/news?pid= ... 4GvFwvlAo0

[winston]

Warren Buffett's wisdom on when to sell
By Dan Ferris in Extreme Value:

The Wilshire 5000 - an index of all U.S. publicly traded companies - is selling for right around 30 times earnings and paying a cash dividend yield of less than 2%.

It's no small wonder I'm not finding any cheap stocks. More and more, the best investors I know are either selling stocks and raising cash as their holdings approach or even exceed fair value... or they're selling stocks and increasing the size of their short positions.

On Friday I spoke with a very wealthy and experienced investor who says he's selling some "lower conviction" stocks and raising cash. He reminded me of an old Buffett idea for deciding if it's time to sell:

Look at each stock you own and ask yourself if you'd rather see it rise in price so you can sell... or fall in price so you can buy more. If you'd rather see it rise in price, you should consider trimming the position or selling it out entirely.

Ideally, you want to find yourself holding an entire portfolio of positions about which you have a high sense of conviction. Those are the ones you wish would get cheaper, so you can buy more of them.

[winston]

Buffett: Economic Storm Has Passed By: Greg Brown

Billionaire investor Warren Buffett says the economy has passed its lowest point and, while recovering slowly, is clearly on the way back up.

"I am not sure about exact quarters or anything of the sort. Who knows about next week or next month?

“We made enormous progress since a year ago. We had a real panic. And if you didn’t panic, you didn’t understand what was going on,” Buffett told Business Wire in an interview.

Buffett credits the outgoing Bush administration for making the right moves in the fall of 2009 and into the transition to a new government to keep the financial system from completely collapsing.

“While the governmental authorities malign things sometimes, they fortunately did some very right things, very important things. They did them properly, and they kept us from going over the cliff.”

He also said that, while problems remain, the basic capitalist system underneath is healthy and in no need of significant reform.

“If you look at this country, we have gone through the Great Depression, we have gone through world wars, we have gone through civil war, and we have progressed like no country in the world. We have the right system,” Buffett said.

“It doesn’t avoid all the problems, but it overcomes all the problems,”

Buffett said that he does not see consumer spending rebounding short term. He noted that the unemployment rate would like continue to be high, since job creation always lags a recovery.

While he welcomes financial reforms being made in the federal level, Buffett warned that government’s role, while important, is naturally limited by human nature.

“You can’t rule out human emotions. When people get greedy as a pack, strange things happen. When they get fearful as a pack, strange things happen,” he said.

“Rules will help us avoid some of the problems. They’ll help us modify some of the problems, but they won’t eliminate all future problems.”

As for stocks, Buffett declined to predict that they would be higher in a year, but was more positive about five to 10 years out.

Source: Newsmax

http://moneynews.newsmax.com/headlines/ ... 74874.html

[LenaHuat]

I recall he said in crisp language and clipped mode : "The patient (banks) were in intensive care. They are out of it but won't be leaving the hospital soon".

[LenaHuat]

2nite at 9 pm, Eastern time, Warren Buffet and Bill Gates will be conducting a town hall meeting with MBA students at Columbia University, Warren's alma mater. I always find Columbia 'august' and wish our SMU could have been like it.

Becky Quick is hosting the program.

[helios]

Interesting.

Lena Jie, any possible way to access this programme?