Many in finance think we're headed for deflation. If that's the case, dumping equities for cash is a sensible move. He may be expecting chaos in the banking sector as bankruptcies roll in, and these mortgage fund fraud allegations gain traction. It's going to be a wild decade. Watch the government use this to vastly expand surveillance powers, too. Not going to be good for the average American.
> Many in finance think we're headed for deflation
Many in finance think we're headed for deflation. If that's the case, dumping equities for cash is a sensible move. He may be expecting chaos in the banking sector as bankruptcies roll in, and these mortgage fund fraud allegations gain traction. It's going to be a wild decade. Watch the government use this to vastly expand surveillance powers, too. Not going to be good for the average American.
The positions in GS and WFC have been reduced over the last few quarters, these sales should not be interpreted as "dumping equity" - besides the large private holdings (insurance, rail, energy, lots of manufacturing, retail etc), Berkshire still holds $200bn worth of equity.
Wasn’t the WFC reduction you keep BRK under the 10% limit for banks?
If you know more than people managing hundreds of billions of dollars, you should consider getting into finance. Shorting the market before February 19th 2020 was quite brilliant. I suppose that few people predicted that this crisis would hit America so hard
Half of the people managing hundreds of millions of dollars fail to outperform the market once they start managing those hundreds of millions of dollars.
He lost a huge pile on Kraft Heinz, and that was pre-Corona. Didn't yet realize those losses AFAIK. He lost a pile on the airlines and even decided to realize those losses. He lost a pile on that petroleum company that I forgot the name of, but which crashed and burned recently due to oil prices plunging. He hesitated a long time with tech stocks and lost a lot of money in the last decade due to opportunity cost. His…
Warren Buffet is currently overrated because he doesn't invest in a lot of tech stocks because he claims to not have a complete understanding of the business.If you look at his record from the 70s-90s, you will realize he is the greatest investor ever. We all have our strengths and weaknesses, don't judge a fish on its ability to fly. I think its great that he doesn't invest that much into tech and is very public abo…
> Warren Buffet is currently overrated because he doesn't invest in a lot of tech stocks...
He's also overrated because of all the insider trading he engages in....he would be a lot poorer if the SEC had the resources/will to investigate his moves.
Maybe it's because I'm an amateur musician and hear some truly awful music, but by EDM standards, that's at least mediocre, not "bad".
The only thing you're missing is the requirement to hate anything a banking CEO produces, no matter the quality. He could cure cancer, and angry people online will complain he contributed to overpopulation.
Oh I have nothing against the fact that he's a bank CEO, I just thought his music was pretty bland and generic. Maybe I was too harsh. You would think that bank CEOs would be the kind of person to not really have any hobbies or interests outside of work, so I guess it's kind of cool that he's putting himself out there like this
> move into retail finance Whistleblower: Wall Street Has Engaged in Widespread Manipulation of Mortgage Funds [1]. Commercial real-estate was already going to absolutely hammered. > Some of the world’s biggest banks — including Wells Fargo and Deutsche Bank — as well as other lenders have engaged in a systematic fraud that allowed them to award borrowers bigger loans than were supported by their true financials, acc…
So this was a solved problem with the Glass–Steagall Act (1933) brought in after the, you guessed it, great depression [1]. It was of course repealed (by Bill Clinton), as we'd learned our lesson thoroughly and completely. This led to 2008. And 2020. So naturally, given the broad-based success of the repeal, there's no interest in reviving it. [1] https://en.wikipedia.org/wiki/Glass–Steagall_legislation
Congress passes laws, not the President.
The repeal passed the Senate on a near party line vote (R over D), sponsored by 3 Republicans, and passed the House will nearly all R and 2/3 of D.
Clinton could have vetoed it, though, since the Senate didn't have a two-thirds majority.
Not sure why 1998 is relevant to a stake Berkshire bought in 2008.
Because GS has never been about having a "brain trust". It is about proximity to power. That peaked in 1998 when Time magazine ran the "Committee to Save the World" cover, featuring Bob Rubin, Larry Summers, and Alan Greenspan. To this day, people talk about that cover.
As far as I can tell, only one of those people (Rubin) was substantially GS affiliated. Still, pretty bad.
Cant say I agree. I worked for various European and US IB's pre 08, then have for the better part of the last decade been a client of them. IMO GS's culture has always struck me as a lot of self anointed hubris and resembles attitudes found on /r/iamverysmart, which when viewed from the outside it makes one laugh. All US IB's these days are largely just commodity balance sheets. None of them have any tangible edge ov…
...and yet it was always extremely difficult to get a job there, and they paid the best. ...that's literally how you attract the best talent. ...so you, they were arrogant. Maybe some portion of that was earned?
They were talented but the talents were theft, fraud, and self-dealing, not capital allocation.
> move into retail finance Whistleblower: Wall Street Has Engaged in Widespread Manipulation of Mortgage Funds [1]. Commercial real-estate was already going to absolutely hammered. > Some of the world’s biggest banks — including Wells Fargo and Deutsche Bank — as well as other lenders have engaged in a systematic fraud that allowed them to award borrowers bigger loans than were supported by their true financials, acc…
So this was a solved problem with the Glass–Steagall Act (1933) brought in after the, you guessed it, great depression [1]. It was of course repealed (by Bill Clinton), as we'd learned our lesson thoroughly and completely. This led to 2008. And 2020. So naturally, given the broad-based success of the repeal, there's no interest in reviving it. [1] https://en.wikipedia.org/wiki/Glass–Steagall_legislation
The repeal of the Glass-Steagall Act had bi-partisan support. Following 2008, Dodd-Frank Act was passed by Democrats, opposed by Republicans, signed into law by Obama in 2010. After multiple attempts by Republicans to repeal it, they succeeded in 2017 and 2018, without bi-partisan support, both partial repeals signed into law by Trump.