Warren E. Buffett Thanks 'Uncle Sam'

[jazzbo]

.. but what the heck does he know.

The New York Times Op-Ed: http://www.nytimes.com/2010/11/17/opinion/17buffett.html

[Khun Jean]

He knows people. Helps a lot.

[lannarebirth]

Mr Buffet was able to make substantial investments during that period that were implicitly backstopped by the US Treasury, ie. the Us taxpayer. Very few other investors were accorded the same level of "security", so I fully appreciate his comments with regard to his own investments. I'd be grateful too.

[cloudhopper]

You can assess a state culture by its heroes.

[jazzbo]

Buffett donated 80+ % of his fortune to the Gates Foundation in 2006

[lannarebirth]

Buffett donated 80+ % of his fortune to the Gates Foundation in 2006

So you're saying he's down to his last 10-12 Billion? Anyhow, good for him, perhaps the last of a breed. I doubt very much, that when the 20 richest people in the world are Chinese, indian, Arab and Russian that any one of them will do a f'ing thing to improve the conditions of their fellow man (or even recognize them as fellow men).

[Jingthing]

Buffett is totally correct. Pretty much the only good thing George Bush did either.

I don’t know precisely how you orchestrated these. But I did have a pretty good seat as events unfolded, and I would like to commend a few of your troops. In the darkest of days, Ben Bernanke, Hank Paulson, Tim Geithner and Sheila Bair grasped the gravity of the situation and acted with courage and dispatch. And though I never voted for George W. Bush, I give him great credit for leading, even as Congress postured and squabbled.

[Chunky1]

Buffet has been very politically lately. He is well known to be good friends with Obama. Who knows what his real motivations is or what he really believes. You hear Obama on TV talking about "How far the economy has come", total lies.

[canuckamuck]

I am so happy Mr. Buffet caught a break.

Warms the cockles of me heart it does.

[maccaroni man]

Buffet has been very politically lately. He is well known to be good friends with Obama. Who knows what his real motivations is or what he really believes. You hear Obama on TV talking about "How far the economy has come", total lies.

warren buffet owns brookshire hathaway, which owns many many many companies such as scott paper but it's number one invetsment is insurance, hence imo that is the obama link, warren stands to double his income with the obama programs.

[jazzbo]

Mr. Buffett went on record saying that the US government's "...actions were remarkably effective" . ... it is always fun to read just who knows better.

[Chunky1]

Effective at creating a short term inflationary boom at the expense of the hardworking tax payers in favor of the Banks that committed massive fraud and wall street insiders who are selling at the highest rate since god knows when? What a wonderful experiment in nationalizing losses and privatizing profits. I guess every American should be thanking the Fed for that much needed inflation! It really helps to have higher prices when 10% of the population is unemployed.

He sent the US gov a thank you note, maybe he should send out 300 million apology notes to the America people. Oops, don't forget the Europeans who followed the American lead in nationalizing their banks losses.

[Chunky1]

Dear Uncle Sam,

My mother told me to send thank-you notes promptly. I've been remiss, but you know, with my firm's revenues up 30% and its net income up nearly threefold since the Crisis struck, I thought I'd better be careful in case anyone considered my praise was a little less than disinterested.

Just over two years ago, in September 2008, the country faced an economic meltdown. Fannie Mae and Freddie Mac, the corrupted, corporatist rent-seekers you had long encouraged to disrupt the proper allocation of scarce means in the mortgage system in the lust for venal political advantage, had been forced into 'conservatorship' (i.e., they were permanently battened on the teat of the long- suffering tax-payer). Several of the largest commercial banks were teetering as a result of their leaders' blind pursuit of short-term gain in the regime of extreme moral hazard instituted by you and your central bank. One of Wall Street's giant investment banks had gone officially bankrupt, and the remaining three were poised to follow (at least until you allowed them to practice the legal fraud of what I then called 'mark-to-myth' in assessing their net worth) — but, of course, the full impact of flouting the eternal capitalist imperative of loss- avoidance and profit-seeking could not be allowed to be borne by them, now could it? Fortunately, the fact that AIG, the world's most notorious mispricer of credit risk, was at death's door offered you a way to make those same investment banks nearly whole through the back door. I believe the gamblers-in-charge who needed such unheard of levels of assistance are largely still in place and still making out like bandits at the expense of everyone else. Way to go!

Many of our largest industrial companies, foolishly over-reliant on hot-money, short-term financing via a commercial paper market that had disappeared up the tail-pipe of the mythical 'global saving glut' were weeks away from exhausting their cash resources. Indeed, all — well, many — oh, alright: some of the most badly run - of corporate America's dominoes were lined up, ready to topple at lightning speed. My own company might have been the last to fall — since I am not only a recognised investment genius, but very thick with a number of your more influential servants - but that hypothetical distinction provided little solace with even my stock price back at 1998 levels, before reckoning for inflation or the weaker dollar.

Nor was it just business that was in peril: 300 million Americans were in the domino line as well and it is, of course, not just a constitutional right, but a precept of natural law, that you must act as that vast, tutelary deity of whom de Tocqueville spoke when you were still little more than a lad and so spare the improvident, the indolent, and the plain unfortunate the consequences of their actions, even if it costs the thrifty, the industrious, and the innocent very dear in the process. Just days before, the jobs, income, 401(k)'s and money-market funds of these citizens had seemed secure. Then, virtually overnight, everything began to turn into pumpkins and mice — but, then again, if you take my strictures (q.v., below) about 'bubbles' into account, maybe they were nothing more than Bibbedy-bobbedy-boo all along (except where they held shares in MY company, of course). There was no hiding place. Thanks to your misplaced efforts in trying to keep a lid on the volcano for at least the previous decade (some would say ever since the early 1930s), instead of allowing it to depressurize in its own good time, a destructive economic force unlike any seen for generations had been unleashed.

Only one counterforce was available, and that was you, Uncle Sam. Yes, you are often clumsy, even inept (allow me a little euphemism here: I'm trying to be nice). But when businesses and people worldwide race to get liquid, you are the only party armed with the printing press and primed with an utter disregard for the long term consequences of using it and so can take the other side of the transaction. And when our citizens are losing trust by the hour in institutions they once revered — institutions which you fostered, pretended to regulate, and from which you continue to take hefty political contributions - only you can prop up a house of cards of your own construction.

When the crisis struck, I knew you would not waste the opportunity to expand the role you could play — Crisis and Leviathan, and all that. But you've never been known for speed, and in a meltdown minutes matter. I worried whether the barrage of shattering surprises would disorient you. Absent any guiding principles, drunk on the unbridled power of executive privilege, and utterly contemptuous of due process, you would rush ('like a fire-engine going the wrong way down a one way street') to improvise ill-thought out - and often conflicting - solutions on the run, violate legal boundaries and avoid constitutional inconveniences, like Congressional hearings and studies. You would also need to get turf-conscious departments to work together in mounting your counterattack. Ah, well, better luck, next time! The challenge was huge, and many people thought you were not up to it - who says you should always discount the consensus?

Well, Uncle Sam, you delivered. Oh boy did you deliver! People will second-guess your specific decisions; you can always count on that, just as you can count on the resulting uncertainty about exactly what stunt you're gonna pull next to paralyze entrepreneurial decision-making and so prolong the slump far beyond its natural span. But just as there is a fog of war, there is a fog of panic and under its veil you certainly did a number of things which would not stand up to scrutiny in the unlikely event you ever honoured a FOIA appeal to reveal exactly who did what to (or for) whom and why. Overall, your actions were remarkably effective in taking the failure of a few egregiously over-leveraged, private- sector companies and magnifying it into a global collapse, passing the losses of the billionaire financier class onto the individual saver and the small businessman, wherever they might be found.

I don't know precisely how you orchestrated these - certainly, the noise that came out was much more Berg than Bach. But I did have a pretty good seat as events unfolded (don't I always?), and I would like to commend a few of your troops. In the darkest of days, Ben Bernanke, Hank Paulson, Tim Geithner and Sheila Bair finally grasped - after much prior public denial - the gravity of a situation in whose development at least the first three had been actively instrumental. As for dear ol' Dubya, I give him great credit for leading, even as Congress postured and squabbled, for if there's one thing that sells tickets in this Theatre of the Absurd, it's Leadership (capitalized, naturally, just like Fuhrerprinzip), even if too few care to check quite where they are being led until it's far too late to do anything about it.

You have been criticized, Uncle Sam, for some of the earlier decisions that got us in this mess — most prominently for not battling the rot building up in the housing market (though to limit ourselves to this narrow field is to deny much of the discredit due you). But then, few of your critics saw matters clearly either (even though several of them now tediously hog the headlines by pretending that they did) since, they, too, are all Neo-Keynesian, macroeconomic-aggregate astrologers with no real grasp of economic theory. In truth, almost all of the country became possessed by the idea that home prices could never fall significantly - a mania which never could have taken hold had we had abolished the Fed and put in place an honest monetary system, of course. (Since you ask, my S&P put shorts and my bearish USD position are again doing quite nicely, thanks).

That was a mass delusion, reinforced by rapidly rising prices that discredited the few skeptics who warned of trouble. Delusions, whether about tulips or Internet stocks, produce bubbles. And when bubbles pop, they can generate waves of trouble that hit shores far from their origin. This bubble was a doozy and its pop was felt around the world. Thank the Lord, you've been trying might and main ever since to reinflate a new one on the wreckage of the old (see my comments about pumpkins and

mice, above).

So, again, Uncle Sam, thanks to you and your aides. Often you are wasteful, and sometimes you are bullying. On occasion, you are downright maddening (this is meiosis, not euphemism, in case you were wondering). But in this extraordinary emergency, you came through — and the world would look far different now if you had not. What a shame we'll be picking up the multi-trillion tab for that utterly ill-advised intervention for many a long year to come (I use the term 'we' loosely, of course, since I'm reaping what I did not sow as per usual).

Your grateful nephew, W

PS: Do I get my nice, shiny new medal now, please?

PPS: Please excuse the shocking punctuation, left largely unamended by the editorial staff at the nation's premier newspaper.

by Sean Corrigan

[jazzbo]

... like I said although a link to Mr. Corrigan at Diapason would have sufficed... I guess these days all you have to do is pull out that Neo-Keynesian label and your case is made... next time I want a real grasp of economic theory I'll give you guys a call.

[jazzbo]

... and yet just a little over a year ago the 'Financial Crisis' mongers couldn't wait to trot out the 'Sage of Omaha' with Buffett's then NY Times comments such as :

Some not-so-fun facts from Buffett's editorial today in the New York Times:

• Congress is now spending 185% of what it takes in
• Our deficit is a post WWII record of 13% of GDP
• Our debt is growing by 1% a month
• We are borrowing $1.8 trillion a year

Posted 2009-08-21 11:21 by one of the Mongers-in-Chief

[Chunky1]

i have no clue <deleted> you talking about apparently you think its all unicorns and rainbows from here because the gov printed a couple of trillion dollars and gave it away to the banks. thanks for your perspective. we are all crazy, etc.

jeez you know, it's a real shame the us gov didn't realize that it could print its way to prosperity a bit earlier. imagine if we were already on QE45, we'd all have lambos in the driveway in multiple colors by now!

[jazzbo]

jeez you know, it's a real shame you're not back in Washington DC to advise the government instead of sitting on your a-- in Thailand

[canuckamuck]

What's your point Jazz? Are you taking Buffet at his word then? You think he is pure as the driven snow?

C'mon a little cynicism would probably be in order here.

[jazzbo]

My point is simple: Last year when Buffett was saying things the crisis crowd wanted to hear that was great.

Now that he sounds a little bit Pollyanna and giving some credit across 2 administrations every thing is on dump ...

BTW Buffett gave over 80% of his wealth to The Gates Foundation ... the remaining 19% or so went elsewhere leaving him and his heirs with 1% which is still about half a billion dollars ...

[canuckamuck]

I am unable to comment further as my concept of the actual nature of these foundations, such as the Gates foundation, will only serve to brand me a conspiracy theorist. Suffice to say, I believe buffet is serving his own and other elite's interest/agenda under the guise of philanthropy.

[Chunky1]

of that list of things he said previously, which of those has improved? so all his past criticisms are still relevant? lol

[jazzbo]

so all his past criticisms are still relevant? ... Beats me ... ask him: WBuffett at berkshirehathaway.com

Edited November 19, 2010 by jazzbo

[Chunky1]

i dont have to ask him. i know that things are even worse. which makes you wonder why he is changing his tone. senile?

[jazzbo]

i dont have to ask him. i know that things .... I'm sure you know lots of things.

[Chunky1]

economic data on debt is not based on opinion.

[jazzbo]

I guess then Mr. Buffett is confused and just doesn't have access to the same economic data as does yourself ...

[Chunky1]

Get as much USD and shares of GM as you can Jazzbo.

[jazzbo]

Thanks ... I'm humbled to receive advice from someone who realizes things that the entire US government does not... I'll be sure to pass it on to the Wealth Management advisors.

[Chunky1]

Question: If the US gov is so knowledgeable, how come we suffered the financial crisis? If your boy Ben is such a genius, why did he say that sub prime was not a big deal and that home prices never decline just before the entire ponzi scheme collapse?

[jazzbo]

If the US gov is so knowledgeable... Beats me... and he's not my boy ... he was George W. Bush's boy ... but I guess you will soon take on the hardship of straightening the US Government out.

Cue Mighty Mouse Music:

Here I Come To Save The DA-A-A-Y ...