Don’t be buying financial stocks until the oracle of omaha does. Them arabs is dumb money.
I done agree with you, sort of. Them Dubais are buying a ton of convertible preferred stock. Citi is trading low, and they will exercise if and when it bounces up. But Bank of America is a silly billy for buying a company that will be $0 in just a short time. Ouch. Today we open higher, and close HARD a bunch and bunches lower. Mark it and trade it.
did i miss something? what did bofa buy?
I think he is implying that Buffet hasn’t; hence we shouldn’t. I’m inclined to agree, perhaps because I’m reading “When genius failed” and Buffett largely avoided that shenanigan.
i think he’s talking about the CFC investment. looks like a bad trade now, we’ll see how it turns out adia, however, got a pretty attractive piece of paper today
Didn’t Buffett want to buy the assets controlled by LTCM but he was stuck in Alaska with Gates?
Buffet only buys businesses he knows he understands, and he buys them for the very long term. Given that the trouble is in these complex derivatives that practically no one understands, my guess is that Buffet may not be buying them in his lifetime, unless the price is so low that its a good buy even if everything risky fails.
Yes, I believe he has referred to them as “financial weapons of mass destruction”
Both bchadwick and CFA are spot on about what Buffet has said. However what the oracle says and what he does are two different things. His comments came after he got burned on an investment in a reinsurer with significant derivative exposure. http://online.wsj.com/article/SB119422251636481981.html?mod=googlenews_wsj
I guess the lesson is that this stuff - like powdered anthrax - once it’s out there, just gets over *everything*.
Meanwhile he just sold massive amounts of long term SP500 Index puts. So I guess he’s not totally opposed to them.
Anyone read this book: Traders, Guns & Money: Knowns and unknowns in the dazzling world of derivatives (Paperback) by Satyajit Das (Author) It looks interesting and relevant to this conversation. Thanks
HSBC putting $45 billion worth of SIV on its books. Hohoho, won’t be touching financial stocks till the stink ball drops out.
Maybe Buffett will not invest at all and see it as it really is: Glutonous wasteful Americans can’t afford to fill the tank on their big ass cars and so they gave the Arabs their home mortgages as payment.
Are we giving them our home mortgages or our homes? If the former, we got out cheap… if the latter, maybe not.
We’re getting off cheap! The Chinese & Japanese are buying treasuries that yield 3.82% and Arabs are buying real estate loans secured by houses that are, ahem, a tad overpriced.
What a joke, the fed more or less admits we are looking at a recession and the market goes up nearly 3% because they are excited about “rate cuts”. This is of course after another 2% gain the day before because the country’s largest bank and a Dow 30 component gets bailed out. Some stocks were definetly cheap, and I expected a bit of a deadcat rally after Monday’s slaughter, but I’m pretty surprised at the extent to which stocks have rebounded. Just my 2