Canadian Money Forum banner

1 - 15 of 15 Posts

·
Registered
Joined
·
38 Posts
Discussion Starter #1
Warren Buffett is currently placing his investment bets:

"But now, only a year after the crisis struck, he seems to be worrying that the broader stock market might falter again. After boldly buying when so many were selling assets, his conglomerate, Berkshire Hathaway, is pulling back, buying fewer stocks while investing in corporate and government debt. And Mr. Buffett is warning that the economy, though on the mend, remains deeply troubled."

http://www.nytimes.com/2009/09/08/business/economy/08buffett.html?th&emc=th

Interesting article.
 

·
Registered
Joined
·
546 Posts
Personally, I am fed up with all the hero-worship of this guy.

His investments in the recent dark days ( and also in the tech crash) were on better terms than available to anyone else - because he has big chunks of money to deploy - not because he was the only one willing to invest. The public response to most of those investments was envy. They WOULD have loved to have the same opportunity.

When he buys companies, he does not buy 100 shares, he buys controling interests. He gets a seat on the Board, while I cannot even get basic data from companies. His returns may well be attributable to that control, rather than portfolio management.

If in fact he is negative on the markets at these levels, then he should be writing down the value of those derivative he underwrote, on his own Balance Sheet, that depend on the markets rising still.

I recently re-read the re-issue of Benjamin Graham's "The Intelligent Investor" that he introduced. I was amazed at all the stuff in it that I DO NOT agree with. And I label myself as a value investor emphasizing fundamentals.
 

·
Premium Member
Joined
·
2,686 Posts
If in fact he is negative on the markets at these levels, then he should be writing down the value of those derivative he underwrote, on his own Balance Sheet, that depend on the markets rising still.
I don't understand your point here. Warren Buffett explained in BRK annual report that the value of equity market derivatives is marked down per GAAP. He also explained why he doesn't think the accounting treatment is right and why he expects to make a profit on these derivatives.
 

·
Banned
Joined
·
701 Posts
Personally, I am fed up with all the hero-worship of this guy.

His investments in the recent dark days ( and also in the tech crash) were on better terms than available to anyone else - because he has big chunks of money to deploy - not because he was the only one willing to invest. The public response to most of those investments was envy. They WOULD have loved to have the same opportunity.
"People would love to have the same opportunity"? I call bullcrap. People don't know opportunity when it hits them in the face (which it does as a matter of fact)!

With regards to opportunity let's be brutally honest. If a person can't see opportunity when house prices dropped by 50% in the early 90s (finally reversing their downward spiral in 1996), the NASDAQ going from 4500 to 1400 in 2000-2002 and the DOW going from 14000 to 6000 in 2007-2009 they're definately not going to see any opportunity whatsoever!

The market has always given people opportunity. I've taken advantage of each of those 3 aforementioned opportunities. I'm sure there are thousands of lesser opportunities that I've completely missed. Opportunities are everywhere! People don't know anything about opportunity (I mean, in late 2008 and 2009 I hear people talking about stuffing their TFSAs with bonds, GICs and cash...I mean WTF?)

When he buys companies, he does not buy 100 shares, he buys controling interests. He gets a seat on the Board, while I cannot even get basic data from companies. His returns may well be attributable to that control, rather than portfolio management.
Then focus on his techniques when he didn't have enough money to buy controlling interests. Simple enough. Why study things that aren't applicable?

I read what he did when he was able to buy control. It's interesting. But I understand that it doesn't apply to me. So what? Is this a big deal?

I recently re-read the re-issue of Benjamin Graham's "The Intelligent Investor" that he introduced. I was amazed at all the stuff in it that I DO NOT agree with. And I label myself as a value investor emphasizing fundamentals.
Some of the ideas and techiques I agree with and I use. Other's I don't agree with or they're not applicable so I don't. Some people worship him like "God". So what? Is this a big deal? Is that really all it takes to get you "fed up"?
 

·
Registered
Joined
·
38 Posts
Discussion Starter #8
....and here is how the rest of the rich are currently behaving with their money:

"In a down economy, what are the wealthy doing with their money?

Experts who work with the wealthy and observe their spending habits say rich folks are sitting on their cash. Just like the rest of us, they're worried about the future. Suddenly uncomfortable with the nation's financial volatility, the wealthy are revisiting their investment and savings strategies, says Chris Geczy, director of the Wharton Wealth Management Initiative at the Wharton School in Philadelphia.

"They're consuming less and saving more," Geczy says."


http://finance.yahoo.com/focus-retirement/article/107694/how-the-rich-save-today.html?mod=fidelity-buildingwealth


"
 

·
Banned
Joined
·
701 Posts

·
Registered
Joined
·
2,953 Posts
I am fully invested!! Am I nuts or what??

Last week was a buying opportunity. This week, the Dow just had it's best week of the entire year gaining 5.28%. The Nasdaq was up 5.00% and the TSX gained 3.34%.

For those sitting on cash, how much did you make?
 

·
Banned
Joined
·
118 Posts
I am fully invested!! Am I nuts or what??

Last week was a buying opportunity. This week, the Dow just had it's best week of the entire year gaining 5.28%. The Nasdaq was up 5.00% and the TSX gained 3.34%.

For those sitting on cash, how much did you make?
I just checked, and all of the equities i sold 2 weeks ago (profit taking), dipped and then regained to exactly where they were when i took the profits in June. So it could be said that i am up over the last 2 weeks, a gain in 'interest', from the cash in the bank. :D

Do i think your nuts? That depends on if you have a good reason to take on ever increasing risk right now. I assume you do.
 
1 - 15 of 15 Posts
Top