Disclosure: Was long BNI, as I sold my position on todays news.
So Buffett does a mega deal today with Burlington Northern today. And then Buffett goes on and says how he is making a bet on the American economy. I guess it is sort of like that sound bite that Buffett did last year on how he liked prices, and so on.
What happened? The economy and stock market tanked further, and everybody thought the old man was done for. Yet now here we sit with Buffetts 115 USD warrants on Goldman (GS is trading at around 170), and what do people say?
“Oh I agree with Buffett, BUT…”
And it is yet again that BUT that shows that people are still scared! They want to agree with him, but they only see the fear the problems, and the issues. They are so scared that they would rather not do anything but complain.
Of course they always say, “hey its Buffett he can afford it.”
Well folks want to know why Buffett can afford it? Because he makes bets that in hindsight look REALLY GOOD. But at the time of the deal look really bad. He is the only one willing to make those deals and hence he makes money!