Pessimism of the Intellect, Optimism of the Will     Archive   Favorite posts   Twitter: @steve_hsu

Thursday, October 02, 2008

Buffet on the credit crisis



Charlie Rose interview

Skeptics will claim he is talking his own book, with the recent GS and GE investments. But I agree with most of it. Buffet says that if he could take a 1 percent stake in the bailout (investing $7 billion), he would. He thinks the bailout will make money investing in distressed mortgage securities at current market prices.

"I love to buy distressed assets... I just don't have $700B to do it with." (At about 13-14 minutes into the hour long interview.)

Bubble logic: "Innovators, Imitators and then the Idiots" (20 minutes)

"Confidence in markets and institutions is like oxygen... when you have it you don't think about it... but you can't go 5 minutes without it." (24 minutes)

"Beware of geeks bearing formulas!" (takes a shot at quants at 27 minutes)

Upper income people should pay more taxes (basically endorses Obama's tax plan) (42 minutes)

"It is terrible that income from investments (capital gains) should be taxed less than income from labor." (against regressive taxes) (44 minutes)

"If AIG had to unwind their derivatives book, it would have hit every institution in the world." (50 minutes)

"The Fed structured the AIG deal very well. They are very likely to get their money back or more." (51 minutes)

blog comments powered by Disqus

Blog Archive

Labels

Web Statistics